Deciding infrastructure priorities…8th BITRE Transport Colloquium, “Australian Transport: Building Capacity and Competitiveness”Canberra 18 June 2008

Prof E W (Bill) RussellDeputy Director,Australasian Centre for the Governance and Management of Urban Transport,(GAMUT) University of Melbourne

The Scene…

Consensus on the need for accelerated infrastructure investment

$93 billion shortfall according to IPA Plus $14 billion needed in local government New Minister for Infrastructure New body “Infrastructure Australia” Thematic reviews by Ministers under NTP $20bn Funding in Building Australia Fund “The return of the Commonwealth to the cities” and

Major Cities Unit States’ PPP based infrastructure programs squeezed by

rising risk premiums

So how do we now choose?“There’s small choice in rotten apples” - Shakespeare

Technical assessment?Political bargaining by marginal seats?A numbers game?Freight routes or urban corridors?Sydney or the bush?An orderly market or a bazaar?A Mandarinate or an open process?

Process Challenges“Opinions are formed in a process of open discussion” – Hannah Arendt

Good GovernanceTransparencyConsistencyAccountabilityThe Analytical Comparison of AlternativesParticipation

Outcome Challenges“Results are what you expect, and consequences are what you get” – Ladies Home Journal

Good Economic ManagementNational FocusRising above modal or territorial loyaltySustainability andContribution to economic growth and

productivity

Weaknesses of the Old Model“Secrecy is the badge of fraud” – Judge Sir John Chadwick

Not TransparentAggregation of state wish listsLittle funding of rail, or port access and

no funding of ports, urban issues or public transport

Scope for political cherry pickingAppraisal criteria uncertainSustainability void

Outcomes of Old Model

BottlenecksCongestionPublic transport stagnation/poor

greenhouse adaptationKiller highway sectionsModal bias leading to over emphasis on

creating freeway road spaceCritical freight links missing (sometimes

not even planned)

Bottlenecks

Up to 30 ships waiting at Dalrymple Bay – 25-30 days wait

Long delays at Port of Newcastle and in Hunter coal chain infrastructure

Decline in Australia’s share of international coal trade from 25 to 20%

Impact on company profitsSignificant demurrage costs

Bottleneck Quicklist

Dalrymple BayPort of NewcastleHunter Valley Coal ChainRail/road links to Port BotanyDitto Port of Melb, Webb Dock Interstate rail Syd-Bris; Syd-AlburyRail route in Adelaide HillsMoving grain harvest

Congestion

Question: Since one train can replace a 5km line of cars, wouldn’t investment in additional trains reduce congestion and provide extra capacity for road freight to flow?

(10 new trains = 50 km of freeway lane)

Killer Highways – Pacific Highway Hexham to Qld Border 2007:-

911 Crashes149 Heavy Vehicle crashesAv Cost Heavy Vehicle Crash - $200KTotal Cost HV Crashes 2008 - $29.8MCumulative fatalities 7236% of fatality accidents involved heavy

trucksAnnual road trauma cost, Australia, $17bn

Postponing Infrastructure Australia investment in public transport “to the distant future”? Difficulties are acknowledged:

Lack of Commonwealth experience NSW management problems Vic privatisation confuses public/private interests Qld municipal involvement

But PT is critical urban infrastructure PT met and unmet demand booming due to oil price PT development a key path to < transport sustainability PT a key “social inclusion” issue Some states need massive investments Significant congestion benefit from PT investment

Some ideas as to process…

Project generation shouldn’t be a monopoly A consistent technical appraisal process A shopping list from Infrastructure Australia

based on strategic objectives Parliamentary scrutiny of large and/or

contentious projects High level endorsement of the preferred

program Post implementation review of what is done

Project Generation“Lack of an agenda is the greatest power” - Guardini

State road agencies have set the agenda of project generation in the past

Infrastructure investment houses have played a role

Both these should continue but add…States should seek urban policy, public

transport and regional policy inputsLocal government inputs via COALG & IAPrivate sector provider & peak group inputsCommunity group inputs

Technical Appraisal“What interested me was not news, but appraisal” – John Gunther

Projects generated would then be appraised via

ATC National Guidelines for Transport System management

A sustainability testA consistent application of the framework

across the projects generatedA website transparently listing proposals

and summary technical assessments

How Infrastructure Australia can add value

Through its infrastructure audit, establishing base data

Through its representative composition, allowing priorities to be argued

Through establishing clear strategic objectives, placing proposals in a national context

By better packaging decision options for ATC, COAG and Cabinet.

Parliamentary Scrutiny

Should apply to large projects (eg $100M+)

Should apply where significant public and private interests are intertwined

National and state processes should be complementary

Can provide a basis for better governance through consultation with community and business

Post Implementation Review“Evaluation is the most valuable of all we treasure” - Nietzsche

Major projects should be reviewed after completion

Results should be available in a transparent lessons learned data base.

Conclusion

New process for accelerated infrastructure provision to be welcomed

Combination of IA audit, thematic review and COAG oversight is excellent

Exclusion of public transport should be reconsidered

Parliamentary scrutiny needed of large projects & those where public/private interests intertwine

Post implementation review and lessons learned data base desirable