Sunday, July 27, 2014

Abbott and infrastructure. Nation building, one elephant at a time

We're on the road to Utopia. Unfortunately.

The team from Frontline and The Hollowmen is at it again.

This time their angle is “nation building – one white elephant at a time.”

Entitled Utopia their new program is “a satire about the difficult process of taking grand, uncosted, inadequately planned and fundamentally flawed schemes - and passing them off as nation building”.

But it’s not the sort of thing you would see in real life is it? Certainly not repeatedly, deliberately, at the hands of the Coalition.

Here’s the ABC publicity blurb: “Set inside the offices of the Nation Building Authority, a newly-created government organisation responsible for overseeing major infrastructure projects, Utopia explores that moment when bureaucracy and grand dreams collide.  It’s a tribute to those political leaders who have somehow managed to take a long-term vision and use it for short-term gain.”

It couldn’t be happening right now, when we are forever being told the budget is tight...

Tony Abbott has his heart set on becoming Australia’s Infrastructure Prime Minister. Whatever the state of the budget he is determined to spend massive sums building the “Roads of the 21st Century,” NorthConnex, WestConnex and the East West Link and so on.

The one saving grace in the election campaign was his promise that all Commonwealth infrastructure spending worth more than $100 million would “subject to analysis by Infrastructure Australia to test cost-effectiveness”. It was reassuring, until he ditched it.

Two weeks ago Labor tried to force the Coalition to make good its promise moving in the Senate that the reward payments made to states that privatise assets and use the funds for new projects be subject to Infrastructure Australia cost benefit analysis.

It rejected the proposal of hand.

Cost benefit analysis by the Commonwealth on top of whatever the states did was “red tape with no additional benefit”. It would “stand in the way of the government building a stronger more prosperous economy,” minister Mathias Cormann told the Senate.

On climate change the Coalition’s detractors accuse it of being anti-science. On roads they could accuse it of being anti-numbers.

And of providing material for Utopia.

That’s how Infrastructure Australia itself sees it. It has titled its latest report on road spending: “Spend more, waste more”. On the cover is a roulette wheel...

“Australia has a true gambler’s addiction to roads, the money spent is not a rational investment,” it writes in the draft that was leaked to Fairfax Media. “Unlike almost every other agency imaginable."

“Highway funding for example is not predicated on any nationally accepted standard related to the current quality of that highway, to a safety rating or to traffic flow levels.”

“No one community has any ability of knowing whether ‘their’ highway upgrade is more deserving than that of another. Under these arrangements, political success in roads is likely to be reduced increasingly to simply outspending one’s political rivals - regardless of how inefficient or ineffective these spending patterns might be.

“This problem is probably insoluble in the absence of measuring roads against national standards.”

It’s an approach endorsed by the Coalition in opposition then eschewed in government. The $3.5 billion to be spent on highways leading to a yet-to-be-built second Sydney airport is the standout example of a project that wouldn’t pass muster if it had to be graded alongside other more immediately worthwhile contenders.

Conceding that its assessment is “challenging” Infrastructure Australia says Australian politicians routinely prioritise roads over rail.

“Australia is the 12th largest economy in the world, and one of the most dependent on freight efficiency given the wide dispersal of its economy across big distances. Most casual observers would presume that for a freight task of such magnitude a core intercontinental heavy rail freight sector would be the dominant freight mode – as is the case in Europe, Canada, the United States and Russia,” it says.

Yet “road agencies continue to plan and undertake regular expensive upgrades of the highways that are the direct competitors of major commercial rail projects. It would be hard to imagine a way in which commercial rail could be further disadvantaged.”

In the cities Infrastructure Australia says inflated estimates of road congestion are routinely used to direct money away from public transport and into roads.  It has asked the government for more realistic forecasts but hasn’t got them.

It says we need better. Utopia isn’t enough.

Utopia premieres Wednesday August 13 at 8.30pm on ABC TV.

In The Age and Sydney Morning Herald

Related Posts

. A cost-benefit analysis for the Snowy Mountains Scheme?

. What passes as cost-benefit analysis of the NBN

. "Some people hate the bus. Not me, I can't get enough"