A MASSIVE $22 billion will be spent on Australia's economic and social infrastructure over a decade as the Government seeks to position the country for economic recovery.
The Government has tapped its Building Australia Fund, its hospitals and universities funds, and burrowed into other budget sources, including a special account set up after the Telstra privatisation, to pay for the new capital works investments.
Melbourne wins one big public transport development in the first batch of projects — a $3.2 billion regional rail link from west Werribee to the city, which will be funded over six years.
As well, preliminary work will begin on a new metropolitan rail tunnel from Dynon Road, west of the city, to St Kilda Road. Work on the east-west rail tunnel is expected to be under way in 2012 and completed by 2018.
Mr Swan used the infrastructure package to sweeten a budget that hits families, pensioners and high-income earners as the Government attempts to plot a path back to surplus in 2015-16.
He told journalists the infrastructure spending was about "nation-building for recovery", investing in projects that would boost capacity and add to productivity as the country moved from economic downturn back to economic growth.
He described the proposed investments as the "building blocks of the future".
The big infrastructure spending is a win for Infrastructure Minister Anthony Albanese, who pushed for the program to be included in the budget rather than being deferred until later in the year.
More than $9 billion will fund investments in public hospitals and education infrastructure and also energy projects, including "clean" coal and solar commercial-scale demonstration projects.
More than $8 billion is allocated to upgrading rail lines, public transport links, major highways in NSW and Queensland and ports in Western Australia and Darwin.
The investments include inner-city rail or metro links in Perth, Sydney and Brisbane — public transport networks that have previously been solely funded by state governments.
The $22 billion also includes Canberra's previously flagged financial contribution to the proposed high-speed national broadband network.
The long timeframes and lead times mean some projects, such as work on a section of Queensland's Bruce Highway, will be under way quickly, while other projects will show only preparatory work for some years.
The mix of funding, including the raid on the Telstra special account, also means spending can be financed without borrowing, and with only a minimal impact on the budget bottom line.
The budget also shows that the Government will not only be a passive investor, but take an equity or ownership position in three of its projects — like it has chosen to do with the broadband network proposal.
Budget papers reveal the Government has set aside $365 million in 2009-10 to take an equity stake in the Gold Coast light rail project, a 13-kilometre light rail system that will run from Griffith University through Southport to Broadbeach.
The Government may also end up taking a direct stake in two of its proposed port projects — the Oakajee Port in Geraldton, and the Darwin port upgrade — if the proposed developments get approval from its policy adviser, Infrastructure Australia.
