Federal Infrastructure Funding Fallout

Much has been said in the media and elsewhere about the shortfall in the Federal Budget infrastructure allocations for NSW transport projects, but it is worthwhile examining its dimensions in more detail.

Just how much (or little) will NSW receive? There are a few ways to look at this – relative to the allocations to other states, relative to population (or some other measure of demand) and relative to the total value of the project proposals lodged by the State Government.

In summary, NSW will receive $2.1 billion for two “shovel-ready” road projects and preliminary works for a single public transport project. By far the largest portion goes to the Hunter Expressway between the F3 and Branxston, which receives $1.5 billion. The Pacific Highway Kempsey Bypass has been allocated $618 million and the proposed Western Metro will receive only $91 million for “pre-construction work”.

Even with the substantial roads allocation, NSW is underweight compared to the other states, receiving only 25% of the total transport allocation (see graph 1). Victoria is the clear winner with 38% of the funding.

totaltransgraph

Take out the roads allocation and the picture is even more stark. Of the five states to receive public transport funding, NSW has the lowest allocation at just 2%, whilst Victoria receives a whopping 71% of the total public transport budget vote (graph 2). Whilst public transport related projects receive nearly 55% of the national transport infrastructure allocation, in NSW the proportion is only 4.6%.

pubtransgraph

On a per-head basis (using 2008 population figures), NSW receives just under $13 per resident, whilst the average across the five States to receive public transport funding is $225.80. Victoria will receive $611.39 per head (graph 3).

perheadgraph

The most interesting comparison is with the total projects submitted for consideration by Infrastructure Australia. Now, it is unlikely that any State Government would have expected a Federal contribution to every project on its wish list, nor would they have expected any projects that did attract Federal support to be funded in full. It is also hard to get an exact figure for the total allocations sought by each State given the “blue sky” nature of some of the figures supplied, but however you look at it NSW has done extremely poorly.

Just 1% of the total value of NSW public transport project proposals submitted to Infrastructure Australia has been funded, compared with around 19% in South Australia, 43% in Victoria and 90% in Western Australia.

Queensland received only 2% of the total value of its public transport wish list, but that state’s figure was inflated by the $14 billion estimated cost of the Brisbane metro proposals. Queensland’s allocation of $385 million was actually four tines the amount NSW received and will enable the construction of the Gold Coast Light Rail project to commence.

What does this tell us? First, that the Feds appear to have been interested in funding only genuinely “shovel-ready” projects that meet all the IA criteria, at least in this round. The successful projects also address major transport needs as part of a coherent transport strategy and, significantly, there has been an emphasis on extending and improving rail services in outer suburban areas. In my next post I will examine some of the individual public transport projects that were funded and the conclusions that can be drawn from these allocations.

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