Crown Towers, Melbourne

It is a great honour to be asked to address you today. I want to discuss issues that are close to your heart, and to mine: the creation of private and public infrastructure which is used for civic or commercial purposes.

In a matter of days Australia celebrates the centenary of our nation's federation - 100 years since six young colonies took the visionary and bold decision to create a nation. One nation for one continent, created by a vote not a war.

In 2001 we will all reflect on the achievement of idealistic Australians who were united by a nation-building ambition, people like Barton, Deakin and Parkes who thought big and secured lasting benefits for us all. They established national institutions and assets that keep delivering economic and social prosperity.

My contentions in this area are threefold:

1. the time has come to assert the role of the Commonwealth Government in fostering and partnering the development of civic and commercial assets, because the days of largely State regulated asset creation have run up against the law of diminishing returns;
2. we need to harness the enthusiasm that Australians now have for the development of new and nationally significant assets - this will help us secure their delivery by balancing out the often destructive influence of parochial or ill-informed interests; and
3. there are immediate practical examples of infrastructure projects that will get moving in Australia and particularly Victoria if we embark down this path.

Let me start with the first contention: that the days when we could rely on the State's to deliver or attract all infrastructure are gone. In the past the States did do it all: roads, freeways, electricity, gas, water, sewerage, ports, industrial estates, commercial and residential precincts, etc.. They did it well too, but in this century great new assets of national significance will be provided, or NOT provided, due to the role of the another tier of government - the Commonwealth.

This is well illustrated by looking at the most significant national asset which Australia should add to its stock of inventory: a high-speed train down the eastern seaboard. This valuable project can never be delivered by a single State, or even a group of States and Territories. The Commonwealth Government will determine the destiny of this and other major developments through its powerful influence over taxation laws, environmental controls, heritage laws, international agreements and more.

We certainly found this with the pace-setting City Link project. That $2b. urban asset threw up a number of challenges for us, but none as decisive as Federal taxation rulings!

And for the brilliant idea of a high-speed train to be turned into an Australian reality there must be Commonwealth leadership.

But the bureaucratic systems for providing such leadership are dated. There is no Federal Minister for Infrastructure, let alone a powerful Federal Department to service such a Minister. Despite there having been a sea change in the way capital works are delivered in this country, particularly over the last 10-15 years, the Canberra bureaucracy still reflects an historic view that the States are monopolies when it comes to delivering large-scale projects.

True, the Commonwealth does have years of good experience in overseeing major mining developments and delivering huge defence projects. It also has a Transport Department that funds national roads, but Australia in the year 2001 will deserve more leadership and co-ordination than that.

With the same nation-building zeal of Australia's founding fathers, let's argue for the development of a Federal/State alliance on infrastructure, with the Commonwealth signaling its proper leadership role through the creation of a Federal Department of Infrastructure. The States will be instant beneficiaries - because projects that cross geographic borders or which need Federal approval or financial support would be expedited under this fresh partnership - but the State's will first need to put aside petty rivalries that could stand in the way of such co-operation.

I am personally convinced that this enhanced and more direct role for the Commonwealth will ensure the delivery of major projects that would otherwise languish or fail.

With a project like High Speed Rail this is certainly the case. This much discussed project has gone nowhere because it has never been simultaneously embraced by all of the partners essential for its success: the Commonwealth Government, the N.S.W., A.C.T. and Victorian Governments and, of course, the private sector. To date the project has been a victim of the bidding and assessment environment created by the N.S.W. and A.C.T. Governments in the mid-1990's, with myopic and uninspiring guidelines that were mistakenly embraced by the Keating Government. The Howard Government finds it has inherited a process that lacks nation-building objectives and seeks only to fulfill the regional needs of a modest Sydney-Canberra link.

We quite literally need to get this project 'back on the tracks'. The current bid for a Sydney-Canberra rail link ought to be brought to an end. It should be succeeded by a Federal/State alliance, led by a Federal Minister and under the overall co-ordination of a new Federal Department or agency. Victoria would then be formally added to the list of partners, and national objectives set to:

• link Sydney, Canberra and Melbourne via the world's best rail service, providing a travel time between the nation's two great commercial centres of just 3 hours; and
• progressively extend this link to both Brisbane and Adelaide, thus delivering a fast rail service within easy reach of 80% of all Australians.

As an aside, I predict that a project delivered in this manner would also reduce the need for costly extensions of many existing inter-state highways and national airports (and obviate the need for the $2b. Badgery's Creek airport!).

This Federal/State alliance can achieve more than delivering a high speed train though, with two road projects deserving to be high on the list for attention: the Scoresby Freeway and the linking of the Hume Freeway to the Metropolitan Ring Road. These are nationally significant projects and they help illustrate the second contention I mentioned at the start of my speech - that we need to harness the current enthusiasm of Australians for national projects and, in the process, overcome the selfish or parochial objections that undermine such projects.

At a cost of $960m. the Scoresby freeway would provide a seamless 33-kilometre link from Ringwood to Frankston. It is a vitally needed piece of infrastructure, but it too is not progressing. Whilst the last State Liberal Government publicly committed itself to the project in 1999 after completing an E.E.S., the Bracks Government at first opposed its construction, then delayed the project for a year and now refuses to submit a formal bid to the Commonwealth for joint funding. This exasperating experience reinforces my belief that more public understanding of the value and benefits of such projects of national importance will make it harder for governments to act against the public interest, as the current State Government has done here.

The same goes for the equally necessary national road link between the Hume Freeway and the Ring Road. This essential $280m.connection, through open paddocks in Craigieburn, is in danger of being scuttled due to the illogical and time-wasting opposition of the Darebin Council. We need bigger thinking than this!

On a more positive note, I was delighted to see the announcement last week that the Federal Government will jointly fund a brilliant $57m. development project in country Victoria, involving the complete rejuvenation of the Rural City of Wodonga by removing the rail easement that bisects the city. This is one of Australia's most inspiring regional renewal opportunities. By adding to funds offered by the Kennett Government in 1998, we will witness a perfect example of a Federal/State alliance in action.

So far in this address I have canvassed infrastructure projects that utilise Commonwealth funding. I now want to catalogue a range of major projects - all still of national significance - whose destiny rests with the State Government alone.

These infrastructure options are being held back because of a lack of will.

Urban projects that could and should be commenced immediately include a multi-million dollar public hospital in Knox (a tertiary health facility that would service this growth corridor) and the $15m. marina and safe harbour project near Frankston (which would provide the first major, new infrastructure on Port Phillip Bay for recreational boating since the St Kilda marina in the 1970's).

Rural projects that should be supported include the standardisation of key rail lines in western Victoria. And a project that enjoys passionate support from the rural community, albeit in Melbourne, is the well-researched plan to upgrade and extend the use of the Royal Showgrounds.

A regional project that should be funded by the State is the proposed Technology Park at Deakin University. Like the Technology Port that we launched for Docklands, the Geelong Park proposal offers measurable benefits for innovation and skills development.

Capital City projects that deserve facilitation include the next stage of the highly successful Melbourne Exhibition Centre, adding a 5,000 seat congress hall (which will help us win the large conferences that currently can not be accommodated in Victoria). And, in the same precinct, it's time the ugly King Street overpass was demolished, thus beautifying both Flinders Street and the north bank of the Yarra River.

Amidst all these project ideas, where - you might ask - are the State Government's much promised 'Private Public Partnerships'? Not one has commenced. Indeed, the only Public Private Partnerships in the news have been the ones that were stopped, like our Austin Hospital project.

This lamentable outcome is only outdone by the fact that the Bracks Government has not announced a single Major Project of its own - it just cuts the ribbons on ours!

The absence of nominated projects is at the heart of public concerns. As a noted Financial Review commentator summarised recently: "much of the success of the Kennett regime was its ability to launch and complete big investment projects, such as City Link and Docklands Stadium. Such projects not only invigorated the Victorian construction industry and provided thousands of jobs, they infected businesses and consumers with optimism. (But today) ... business company owners complain that too little is being done to make projects happen".

As I have highlighted in this address, there is a public passion for, and interest in, large-scale projects. There is also no shortage of ideas.

By failing to actually start the construction of any new pieces of infrastructure the Government is denying Victoria the assets which generate employment, commercial growth and sustainable development.

Continuing with projects it inherited from us - like the freeway upgrade to Geelong, the great BIO 21 technology project at Melbourne University, the County Court project and the many developments at Docklands - is welcome, but we all have to ensure the list grows.

Over the coming years there must be more projects put into the pipeline. Given that the State Government's own economic projections predict falling levels of economic growth and job creation, and a sad return to net inter-State migration, we can hardly afford to rest on our laurels.

In conclusion, I ask that we learn some lessons from the recent past.

First, great projects - like City Link - have faced considerable engineering challenges, but have overcome these and proven to be a winner. This project, and the financial and social benefits it has created, gives us room for confidence in privately delivered civic assets.

Second, other great projects - like the new Museum - have faced criticism for their design and location, but have also prevailed and been overwhelmingly embraced. I well remember the critics who savaged the winning design that arose out of the international architectural competition, and others who publicly asserted the construction process would kill the surrounding 100-year-old trees. None of this occurred. Indeed, the public has fallen in love with the building and the critics now number amongst its greatest supporters!

The lesson from all of this: think big, have faith in our great engineers, architects and builders, and recognise the enduring benefits of nation-leading infrastructure.

There IS room for optimism about the future - but the job is still ahead of us.

Thankyou.

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