Transport infrastructure to see $120B pipeline: Budget 2022-23

The Australian Federal Government’s latest Budget commits more than $120 billion to transport infrastructure works over the next decade, including rest area developments and freight network changes, as well as fuel and alternative energy updates.

In the October 2022-23 Budget, the Australian Government is delivering on $9.6 billion of election commitments for vital infrastructure projects across Australia.

Commitments funded in the Budget include:

  • $300 million for the Western Sydney Roads Package and $500 million for the High Speed Rail Authority.
  • $2.2 billion for the Suburban Rail Link in Victoria
  • $586.4 million of additional funding for a major upgrade of the Bruce Highway to widen a 13-kilometre stretch through Brisbane’s outer northern suburbs.
  • $1.5 billion for upgrading important freight highways, sealing the Tanami, and upgrading Central Arnhem Road, as well as the Dukes, Stuart and Augusta highways in SA.
  • $540 million to upgrade Tasmania’s important road corridors, including the Bass Highway, the Tasman Highway and the East and West Tamar Highways.
  • $125 million funding to help build an electric bus network for Perth.

A further $250 million has been committed for the Local Roads and Community Infrastructure program, enabling every local council across Australia to deliver priority projects to quickly stimulate local economies.

Heavy vehicle rest areas

Through the October 2022-23 Budget, the Australian Government is committing an additional $80 million to improve safety outcomes for the trucking industry by building and upgrading heavy vehicle rest areas to ensure drivers have the facilities they need to rest, recuperate and return safely home.

The Australian Government will work closely with industry via a Steering Committee which will include long-distance truck drivers, industry representatives and technical experts.

The Steering Committee will share strategic advice, set priorities for heavy vehicle rest area projects and assess heavy vehicle rest area projects against these set priorities.

This commitment will be delivered through the Heavy Vehicle Safety and Productivity Program (HVSPP).

Applications for the funding stream will be accepted year-round, and are expected to open to state, territory and local governments from mid-2023.

Fuel update

The Heavy Vehicle Road User Charge rate is set to increase from 26.4 cents per litre to 27.2 cents per litre of diesel fuel. This will, according to the Treasury, decrease expenditure on the Fuel Tax Credit by $215.7 million over four years from 2022–23.

Outside of the infrastructure and transport-related investments, there will also be provision for safeguarding farmers and primary producers from biosecurity threats as well as improving disaster resilience and preparedness.

Here is a deeper dive into the infrastructure investment program by state and territory:

Australian Capital Territory

The Australian Government is investing over $90 million for vital land transport infrastructure projects in the ACT in the October 2022-23 Budget to improve safety and reduce travel times.

This includes committing funding to progress the Canberra Light Rail Stage 2A project, as part of a strategy to ease congestion and improve access.

This Budget follows a repositioning of the Infrastructure Investment Program to respond to market capacity constraints, creating a more sustainable infrastructure pipeline while continuing to support priorities for the ACT.

This Budget will also begin to action the Powering Australia Plan with more than $800 million invested in cutting electric car taxes, building a national electric vehicle charging network and hydrogen refuelling stations on highways.

New South Wales

The Australian Government is investing almost $1.4 billion for vital land transport infrastructure projects in NSW to improve safety and reduce travel times.

Key projects include a planning study for a Nowra Bypass, the Epping Bridge upgrade, and planning and early works for Sydney’s North West Growth Corridor. These projects form part of the Government’s strategy to ease congestion, better connect regions, improve access and safety of the state’s roads as well as tackle the national freight challenge.

The Blue Mountains Roads Upgrades project has been allocated $12.5 million which will help to improve community access and contribute to safety and efficiency for road users in the area. The project is expected to commence in early 2023 and be completed by early 2026.

Meanwhile, $17.4 million has been committed for safety upgrades to a dangerous section of Brindabella Road from Brindabella Valley to the ACT border.

A commitment of $40 million for Central Coast Road Upgrades will help to improve safety for all road users, reduce congestions and improve network reliability. The project is expected to commence in early 2023
and is expected to be completed by early 2026.

Upgrades to Coulsons Creek Road between Merriwa and Willow Tree will receive $38.6 million in addition to $9.66 million from the NSW Government. Coulsons Creek Road has been significantly damaged due to heavy rainfall and subsequent land slips and remains closed to all traffic. This urgently needed upgrade will reconstruct the road, improve safety for all road users, and bolster the road’s resilience. The project is expected to commence in mid 2025 and is expected to be completed by mid 2027.

The state has a long list of other infrastructure road works which are a part of the Budget spend.

Northern Territory
The Australian Government is investing $550 million to deliver its election commitments for vital land transport infrastructure projects in the Northern Territory to improve safety and reduce travel times.

This includes sealing and upgrading the Tanami Road and the Central Arnhem Road, and the delivery of the NT Strategic Roads Package as part of a strategy to better connect regions, improve access and road safety.

A commitment of $740 million to the upgrade the Northern Territory section of the Tanami Road and the Central Arnhem Road also includes $350 million of additional funding.

Sealing the Tanami and Central Arnhem Roads will improve safety, travel times and freight efficiency, connectivity, flood immunity, safety, and social and economic development for the region. Project timeframes will be determined in
consultation with the Northern Territory Government.

The Australian Government has committed $332 million for the NT Strategic Roads Package, which includes $200 million of additional funding to the existing commitment of $132 million to seal the Mereenie Loop. This package will include upgrades across the Territory to help provide remote communities reliable year-round connections to the services and opportunities that they need. Project timeframes will be determined in consultation with the Northern Territory Government.

Queensland

An investment of $2.1 billion for vital land transport infrastructure projects in Queensland is expected to improve safety and reduce travel times. This includes committing to key road corridor upgrades and providing planning money for future projects in Queensland as part of the Government’s strategy to ease congestion, better connect regions, improve the access and safety of the state’s roads as well as best prepare industry for the national freight challenge.

A Budget allocation of $586.4 million aims to upgrade 12.9 kilometres of the Bruce Highway from six lanes to eight lanes at between Anzac Avenue and Uhlmann Road. The Bruce Highway Upgrade (Anzac Avenue to Uhlmann Road)
will help to improve road safety for all road users, reduce congestion and improve connectivity between people with jobs and services, and goods with markets. The project will commence construction following the completion of the
business case and is expected to be completed by mid 2024.

An allocation of $210 million will be used to widen lanes, install additional guardrails and reinforce roadsides to prevent landslides on the Kennedy Highway between Smithfield and Kuranda.

Meanwhile, $200 million will see the build and upgrade of new passing and dual lanes, new overtaking lanes on the Gavial-Gracemere link, and other improvements on the Bruce Highway, between Gladstone and Rockhampton. The delivery schedule will be determined in consultation with the Queensland Government.

Additional works have been announced including the widening of Bruce highway in Brisbane, Cavendish road level crossing in Coorparoo, Boundary road level crossing in Cooper Plains, $22.5 million Loganlea road upgrade, an acceleration of the Bribie Island road upgrade with $20 million from the Budget and $10.4 million from the Queensland Government as well as Ipswich Motorway upgrade planning and more.

South Australia

The Australian Government is investing $660 million to deliver its election commitments for vital land transport infrastructure projects in South Australia, to improve safety and reduce travel times.

This includes committing to the Southern Expressway and Majors Road Interchange and Nationwide Freight Highway Upgrade Program (SA) for $400 million.

The Australian Government has committed $200 million for the upgrade of Marion Road from Anzac Highway to Cross Road, in Adelaide. This is in addition to $200 million from the South Australian Government.

The Marion Road – Anzac Highway to Cross Road project will help to improve freight productivity and access to freight corridors. The project will commence in late 2023 and is expected to be completed by mid-2026.

The Australian Government has also committed $60 million for the construction of new on/off ramps for the Southern Expressway at Majors Road, Adelaide, in addition to $60 million from the South Australian Government.

The Southern Expressway and Majors Road Interchange will help to increase efficiency and ease congestion. The delivery schedule will be determined in consultation with the South Australian Government.

Tasmania

A Budget allocation of $570 million will include upgrading the Mornington Roundabout and safety improvements for the Bass and Tasman highways.

An investment of $540 million is set to upgrade key road corridors in Tasmania, including the Bass Highway, the Tasman Highway and the East and West Tamar Highways.

The Tasmanian Roads Package will improve safety for all road users, improve efficiency and network reliability, and improve freight productivity. The delivery schedule will be determined in consultation with the Tasmanian Government.

Meanwhile, $30 million in funding to upgrade the Mornington Roundabout in Hobart will help boost network reliability.

Victoria

With a Budget investment of $2.57 billion, Victoria is committing to projects such as the Suburban Rail Loop East and Barwon Heads Road Upgrade – Stage 2.

A series of other projects include $150 million for the Camerons Lane Interchange at Beveridge, $125 million to upgrade and duplicate Barwon Heads Road, $57 million for the Ison Road overpass, $11 million to upgrade roads in the Macedon Ranges Shire and Mitchell Shire, $10 million to develop a business case to upgrade the Western Highway between Melton and Caroline Springs in Melbourne along with other rail works and feasibility studies.

Western Australia

With an investment of $670 million, key projects include the sealing of Tanami Road which includes $434.2 million with an additional $108.6 million from the state government, resulting in a $542.8 million joint commitment.

Electric bus charging infrastructure will see $125 million. Also, there are other major rail and road projects announced as part of the Budget package.

Western Sydney

The Western Sydney Roads Package comprises an allocation of $300 million in addition to the establishment of an expert panel for Western Sydney infrastructure planning.

In total, $728.1 million is being invested in nine projects across Western Sydney this Budget to help reduce congestion, improve community access, contribute to safety and efficiency for road users and provide planning for future investment decisions.

The Albanese Labor Government’s first Budget is touted to be responsible and ‘right for the times’

The Budget is reported to substantially downgrade the outlook for many of the world’s major economies – reflecting the impact of conflict in Ukraine, a global energy crisis and inflationary pressures, and unprecedented synchronised global monetary tightening.

Real Gross Domestic Product (GDP) is forecast to grow by 3.25 per cent in 2022-23, before slowing to 1.5 per cent growth in 2023-24 – as global challenges, high inflation and rising interest rates weigh on domestic consumption.

Inflation is still forecast to peak at 7.75 per cent in the December quarter this year, but is expected to be more persistent – largely due to higher energy prices, turbocharged by conflict in Ukraine and exacerbated by the energy policies of the prior administration.

The October floods will also add further to inflation, partly offsetting lower-than-expected fuel prices relative to the Ministerial Statement in July.

Inflation is forecast to gradually ease to 3.5 per cent by 2023-24, and return to be within the Reserve Bank’s inflation target band by 2024-25.

Unemployment is forecast to be 4.5 per cent through 2023-24 and 2024-25 – below the pre-pandemic level of around five per cent.

Wages growth is expected to pick up – forecast at 3.75 per cent in 2022-23. As inflation moderates, real wages are expected to begin growing again in 2024.

This is what a ‘responsible Budget’ looks like according to Albanese: Limiting growth in spending, especially while inflation is high; returning almost all tax receipt upgrades to the Budget; focusing new spending on initiatives that grow the capacity of the economy; and new policies have been largely offset over the next two years, to avoid adding to inflation.

Almost all tax receipt upgrades have been returned to the Budget according to the Federal Government. Specifically: 99 per cent over the next two years; and 92 per cent over the forward estimates.

As a result of spending discipline: Payments will fall in real terms over the next two years. Real spending growth averages just 0.3 per cent over the forward estimates.

The underlying cash balance for 2022-23 is expected to be – $36.9 billion – an improvement of $41.1 billion compared to the Pre-election and Economic Fiscal Outlook (PEFO).

The Government said it inherited a trillion dollars of debt without an economic dividend to show for it – with gross debt as a share of GDP at its highest level in more than 70 years.

The current Budget management means gross debt-to-GDP will be 37.3 per cent in 2022-23. Gross debt will remain lower over the forward estimates compared to PEFO.

The Government’s Budget repair package delivers $28.5 billion in improvements over the next four years, including: $22 billion in savings from the Government’s Spending Audit; and $4.7 billion from making sure multinationals pay their fair share of tax in Australia and extending successful ATO tax compliance programs.

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