Infrastructure Coordinator backs Henry direction

10 May 2010

By opening up a necessary debate on the cost of road congestion and making observations in relation to freight, the Henry tax review has laid the groundwork for the resolution of some of Australia's most pressing future infrastructure needs.

In addition, by outlining policies to boost the nation's savings pool via superannuation and further infrastructure funding to help Australia unlock its resource wealth the Henry Review and the Australian Government's response to it will assist Australia in realising its economic potential.

“Without infrastructure investment, this nation won't grow and the future economic prosperity that's within Australia's grasp could be lost,” said national Infrastructure Coordinator, Michael Deegan following the release of Australia's Future Tax System Review.

“In addition, without addressing road congestion, Australians in the future won't be able to get around our cities, another inhibitor to economic prosperity.

“Through the Henry review these vital issues are now before the Australian nation and the Australian people.

“We all have an opportunity to set the future directions we need to take,” Mr Deegan said.

“The creation of the infrastructure fund is a clear acknowledgement of the immense size of the task of infrastructure delivery in the vital areas, of road, rail, energy, ports and water.

“Through linking economic growth with infrastructure, the scene is set for a permanent means of funding infrastructure, although the right commercial arrangements must be in place for delivery of projects to become a reality.

“Allied with effective project delivery is the focus on superannuation, which creates and builds the nation's savings pool, underpinning infrastructure creation.

“The growing savings pool is a necessary complement to the infrastructure fund in rolling out Australia's infrastructure needs”.

Henry has also made some observations in the area of road freight including the need for asset management plans and the need for road charging to ensure efficient mode choice along our major freight corridors.

The forthcoming national freight strategy by Infrastructure Australia and the National Transport Commission will look to apply some of these principles.

Mr Deegan said Dr Henry's review had increased the need for a debate on road congestion, the economic and social cost of congestion and the potential of road congestion charges to create efficiency and equality on metropolitan road usage.

“While everyone sitting in traffic snarls knows the social cost and the personal frustration, few realise how it savages our economy.

“That's why a discussion of road congestion charging is important as it can highlight how the nation can encourage efficient use of a limited resources as well as examining potential investment in alternative transport options, such as mass transit”, Mr Deegan said.

“This is a debate we must have,” Mr Deegan concluded.

Michael Deegan (02) 8114 1900