Keynote address | The Hon. Catherine King MP, Minister for Infrastructure, Transport, Regional Development and Local Government

► Adrian Dwyer, Chief Executive Officer, Infrastructure Partnerships Australia

The Hon. Catherine King MP (CK): I’ll start by acknowledging the Gadigal people of the Eora Nation, the traditional custodians of the land that we’re gathering on today. I pay my respects to elders past, present and emerging, and I extend my respects to First Nations people participating in today’s event.

I do want to thank Adrian and Infrastructure Partnerships Australia, not only for the invitation today, but for the level of engagement you’ve had with me over the course of the past few years. It was actually really important as we developed our understanding of where the sector was up to and where some of the opportunities were. Relationships are incredibly important, and being able to build those at an early stage and carry those into Government is very important. I also want to acknowledge Mark Birrell AM, founding Chairman of Infrastructure Partnerships Australia, who’s here with us today, and Adrian Kloeden, Kerry Schott AO, Tony Shepherd AO, Jim Miller, Mike Mrdak AO, and a number of other people who’ve been involved in this space for a very long period of time.

Despite many of the challenges we have faced as a nation – and I don’t think you all need a reminder of those (we are still going through many of them) – infrastructure investment and development remains very strong. The delivery of infrastructure projects played an incredibly important and large role in Australia’s fiscal response to COVID-19, and to catastrophic bushfires and flooding, and it continues to do so. Our investment has rebuilt communities, created jobs and kept the economy going. Public investment and transport infrastructure alone has increased 17.5 per cent over the past two years from $20.6 billion in 2019 to $24.2 billion in 2021.

The scale of this investment has caused its own stresses for the industry. Last year, I addressed Infrastructure Partnerships Australia’s Queensland symposium as shadow minister, and then I posed a number of questions, identified a number of issues and outlined where we would go as a government. I spoke about how we had to work far more collaboratively with the states and territories, and the process to take some of the politics out of infrastructure spending. I spoke about how we had to get inland rail to a place where its benefits better accord with our entire national freight task. And I considered how we can invest to get the most out of our regions. I spoke about how we needed to invest in the projects that make our cities more productive and livable, how we plan and deliver smart infrastructure, and how we ensure our investments help tackle the challenges of climate change while contributing to growing the skills of Australian workers. It’s been a pretty busy few months.

We have been in government for just over 100 days, but we’ve done a fair bit in that time. The most topical challenge to industry at the moment is skills shortages. Our closed international borders reduced migration opportunities, and intermittent restrictions across state borders compounded resources and workforce shortages. But it isn’t COVID-19 alone that contributed to those. In our view, it has actually been a lack of strategic focus on actually developing those skills in this country that’s been a missed opportunity. These challenges are being faced across the economy, and they’ve been a key focus of the early days of our Government.

You would’ve seen what happened in Canberra at the Jobs and Skills Summit, with our Government bringing together unions, workers, business, industry, and the not-for-profit sector to chart a new path forward when it comes to jobs and skills. We do want secure, well-paid jobs across the economy. And we want to work with unions and industries to actually secure them. It’s in our interests to do so. The announcements around fee-free TAFE and the shorter-term measures of increased skilled migration are examples of this. It’s a pact between sectors. As a Government, we are keen to understand how we can work together to mitigate the key risk factors impacting market capacity, and work with states and territories to deliver our significant infrastructure co-investment. We’re engaging with industry and state, territory, and local governments in response to these challenges, including how to build and sustain a skilled and diverse workforce. I’m acutely aware of an untapped workforce that our construction and infrastructure sectors could lean on: women.

Women currently make up less than 12.7 per cent of construction occupations and less than two per cent of related trade jobs. It’s always going to be hard to overcome skills shortages with statistics like that; we’ve all been trying. We all know that there are insufficient pathways for women into the industry, and a lack of strategies to actually help attract and retain women. I know many of you are working on these with plans to address that shortfall. I’m keen to work with you to actually bring those together.

I’ve heard your voices through the Jobs and Skills roundtables, and the Summit itself, and I would encourage you to participate in the employment white paper process being run under Treasurer Jim Chalmers. One of the key outcomes of the Jobs and Skills Summit is the Government’s decision to establish a National Construction Forum. The forum is to consider key issues facing the building and construction industry, such as mental health, diversity and gender equality. The forum will assist government to develop policies and programs to address challenges, and to actually support the industry. As the minister responsible for delivering billions of dollars of Australian Government investment in infrastructure, I’ll participate in the forum, and I look forward to consulting closely with industry, unions, and state and territory counterparts through this mechanism. It will be an important initiative to help set the sector up for the future, and I look forward to participating in that.

When we’re talking about challenges facing the sector and the economy across every facet of our lives, we can’t ignore climate change. I know that has been central to many of the discussions you are having today, including the contribution particularly that infrastructure can and should make towards achieving net zero. One of the surprises to me in coming to government was to find that there was no dedicated unit within my portfolio specifically tasked to look at how the infrastructure and transport sectors could contribute to the net zero target. That’s despite those sectors being some of our largest sources of emissions, as well as some of the greatest opportunities to transition to net zero. A dedicated unit has now been established within the department, reporting directly to new Secretary Jim Betts, to look at ways to help infrastructure and transport, and innovate the ways you are working to achieve net zero.

This is one of the issues in which industry has moved far ahead of where government has been over recent years. Many of you are well down the path of determining how you can cut your emissions and are actively achieving those goals. We want to do this because not only is climate change a threat to our way of life, especially to already stretched supply chains, but because it’s a great opportunity for jobs across our sectors. By tackling climate change, we can create a new generation of clean, green, sustainable and well-paid jobs. Tackling emissions in building resilience won’t be easy, but it does need to be done. At the heart of tackling climate change and making decisions about where the Commonwealth invests money is the way we do make decisions. It’s incredibly important, and it’s why I have asked Nicole Lockwood and Mike Mrdak AO to undertake a review of Infrastructure Australia. I’m happy to take some questions about that. Government investment needs to support the vision we have for Australia and deliver better outcomes for our people. With this in mind, I have been sitting down with my state and territory counterparts to identify those projects that are transformational within each jurisdiction, and looking to ensure the current investment pipeline is actually sustainable and meets those goals. I want to see and ensure that we have a coherent, transparent pipeline of infrastructure investment from the Commonwealth. In New South Wales, the Commonwealth is currently investing $18.9 billion in 43 different transport infrastructure projects over the next decade. In our partnership with New South Wales and local governments, we are also funding $1.7 billion of smaller projects, from bridge renewals to Roads to Recovery, to Black Spot programs. Being very clear about what that Commonwealth investment is seeking to deliver, ensuring the pipeline is fit for that purpose, and ensuring it is sustainable in the current capacity environments is a key task for me.

To guide future investments, we’ve already commenced work to revitalise and restore Infrastructure Australia as the expert adviser to the Commonwealth on nationally significant infrastructure priorities. That is what it was set up to do, and I think many of you, as you talked to the reviewers, will have been talking about how it may have changed a little over time. Seven weeks ago, as you know, I asked Nicole and Mike to look at Infrastructure Australia, and I couldn’t think of two better people to actually do that. I thank them very much for the work and the anticipation of their recommendations to me. I know many of you have already engaged with them, and I do want to thank you for that.

It is very important to me that we do restore and change the role Infrastructure Australia has, and make sure it actually does provide the Commonwealth with the advice we need to make those investments. Ensuring a coherent, targeted, strategic and transparent pipeline of Australian Government investment in infrastructure is critical. It means focusing on building things like Metronet and Western Sydney Airport, and also sealing those important freight routes in remote and regional Australia, particularly in the Northern Territory. It means getting Inland Rail right to deliver for our regional communities, and contributing to the national freight task. It means starting work, as I did, on high-speed rail. I’m eager to get on with delivering our election commitments in partnership with the states and territories, including investing in the Suburban Rail Loop in Melbourne, upgrading key road corridors in Tasmania, and removing level crossings in Adelaide and Brisbane. I also want to thank you for the work you have done throughout COVID-19. I look forward to working with many of you individually and collectively through Infrastructure Partnerships Australia in the months and years ahead. I’m delighted to be here with you and am very happy to take any of your questions. Thanks for having me.

Adrian Dwyer (AD): Thank you very much, Minister King. You very kindly agreed to take questions. I’ll kick off by asking you to expand a bit on your reflections from the Jobs and Skills Summit.

CK: I think the fact that it happened in and of itself was actually really telling. I think there was a real sense of this actually being how you have to work as Government. This is what governing is about. It’s about understanding the different and contested positions that exist on a range of issues. Obviously the focus was jobs, but really it was about skills and the way in which we actually train more people. We have the opportunity to make sure we’ve actually got the workforce that’s needed today and into the future. That’s really what governing is about. It’s actually trying to bring people together, looking at those contested positions, and trying to come up with a pathway forward. To the Treasurer’s credit and the Prime Minister’s credit, in particular, they weren’t seeking a consensus statement out of this, because that’s not realistic. We know there are people who are never going to change views about particular things. What we’re trying to do is find a pathway that we can actually move forward together on.

So, those 36 outcomes that came out of the Summit are concrete things, such as an increase to permanent migration for next year to 195,000. We’ve been talking about the pathways to permanent residency to actually get more people living in this country, extracting commitments around fee-free TAFE, training more Australian workers here and setting that up for the next decade, and some of the industrial relations issues, which are still going to be contested as we work our way through. I think that this is what Government should look like. Even if things are hard, we should talk about that. They’re hard, but we should try to make a pathway forward. I don’t really want to be overly political at this forum, but that’s something that’s been missing from our Federal discourse for a while now. To me, that was the real outstanding part of the Jobs and Skills Summit – actually seeing what government should look like.

AD: Thank you. There has been a lot of talk about the review of Infrastructure Australia. That’s ongoing, but what do you want from that review? What do you want it to give you?

CK: I don’t want to be predictive with both Nicole and Mike in the room, but I’ve had early conversations with them. For me as an incoming federal infrastructure minister, there are big questions. I look at the billions of dollars of investment we are making. As I said, I didn’t know we were spending $18.9 billion in New South Wales on 43 different projects. There’s a couple of websites you can look at, but how is that pipeline worked out? How is it contributing to our national freight task? How is it making our roads safer? How is it actually providing regional communities opportunities for better connectivity? I don’t get a sense about what that strategic direction is when I look at that investment. When I have questions about the problems of resilience on our freight network, how do I actually help communities in transition as an infrastructure minister? I’ve got a narrow scope. There’s energy, energy and water infrastructure, and other pieces. What are the investments I should be making? I don’t get that information from the reports of Infrastructure Australia today.

A couple of things have happened. The first is that when it was set up, the state bodies weren’t in existence. So, it had to cover some of the state jurisdictions, as well. I’ve got a view, it’s the Commonwealth’s body, it’s the Commonwealth’s infrastructure that’s really got to advise me, in partnership with the states and territories. It really is about that Commonwealth investment. There might be opportunities for other sectors, but it’s really about where those big billions of dollars from the Commonwealth go. The other is attempting to find some relevance. It broadened itself out to the extent that there’s not a local council in the country that does not come to me saying that their project is on the Infrastructure Australia priority list and is therefore going to get money. So, there’s been this massive expectation created that because it’s on the priority list – which is almost 170 projects long – Infrastructure Australia is able to, A, be a funds holder and Infrastructure Australia is going to fund it, and, B, if they don’t, then the Commonwealth’s just going to give them money. That’s a terrible thing for local councils to be thinking because it’s beyond the means of most levels of government – local, federal or state – to fund all of those 170 projects. Are they the projects we should be concentrating on? I really want to see it lifted up to those of larger scale. Two or three big-scale strategic investments that are transformational need to be made in each state and territory so that governments can invest in them.

There has to be a separate pathway, and probably not through Infrastructure Australia, whether it’s our Regional Development Australia networks or something like that, for those local government, social and regional projects. I think there needs to be a different pathway for those. Then, in terms of other infrastructure, whether it’s water or telecommunications, it’s about finding another pathway through Infrastructure Australia for those. That’s sort of how I see it, but I shall await advice and not pre-empt and see if it occurs. You may be telling me something different. The reason I’ve asked for it is, as infrastructure minister, I need advice. I get it from my department. I get it from other bodies, but I really need Infrastructure Australia to be able to say for the next budget, for the next decade, this is where you need to be investing Commonwealth money in nation-building projects.

AD: But we’d all agree, it’s a hell of a swimming pool in Geelong. Jim Miller?

Jim Miller (JM): Jim Miller from Infrastructure Victoria. Well done; you’ve hit the ground running and it’s great to hear. So fantastic. Following up on Infrastructure Australia and, more broadly, the Federal Government, you mentioned the investment the Federal Government is already making and that’s very significant; but the needs – be it with the Infrastructure Australia

priority list or just more generally – keep growing because of all the things that we know. Where it’s a little bit different now is the fiscal constraints the Treasurer is talking about, and so forth. So, you are going to be right in the middle of those discussions as the first budget comes through, and with subsequent budgets. Obviously it’s early days and there is a lot to do, but I am just interested in how you’re thinking about that over and above the work that Infrastructure Australia will hopefully be doing.

CK: Well, there are a few things happening at the moment. One is about assessing the quality of the spend and making sure that what we’re actually spending money on is actually delivering on the Government’s outcomes. So, running an eye over that is important. The capacity constraints that are in the sector at the moment are real. I think the absolute reality is that the timelines and budgets on all of the projects are going to blow out and we’re already seeing states trying to get on top of that. You’ve seen it in Western Australia and New South Wales; they have been trying to smooth that pipeline of investment out so that we can actually deliver it. The Commonwealth is not digging up the soil; we’re relying on states, territories and local government to do that. If we don’t do something about the underspends that occur each and every year, that will just continue. I don’t want to see that. That’s wasted money. It’s money that should be going out. It should be being delivered, and if it can’t be delivered, then we need to make sure it’s delivered in a way that is coherent. We’re not looking to cut. The previous Government made a whole range of commitments, so we are looking to try to deliver on those and obviously we’ll look at the time frames for those. What I’ve got to do is look at future investment, and then look a bit further at the Commonwealth’s strategic investment in infrastructure, as opposed to down in some of the weeds in terms of the elections and electoral cycles. That’s part of my job, but it is certainly a challenge.

Treasurer Chalmers talks about the trillion dollars of debt. When you look at what the Commonwealth has to spend money on, it’s demand-driven debt like Medicare and the NDIS, age pensions, our social security budget, and overall defence spending. The thing that is growing the quickest is government payment on debt. That’s the largest government expenditure – or the quickest-growing government expenditure – at the moment. It’s costing all of you, as taxpayers, as much as it costs to fund the age pension at the moment, so we’ve got to get that debt down. Looking at the realistic delivery and capacity constraints is one of the ways we’re intending to do that.

AD: One final question: there’s a lot of talk today about net zero. You spoke in Parliament about the carbon base case idea, what do you think the Commonwealth’s role is in driving the outcome?

CK: So, at the last infrastructure and transport ministers’ meeting, there was an absolute desire, particularly from infrastructure ministers. We tend to focus a lot on the transport side as it’s a very complex regulatory environment, particularly around heavy vehicles. So, we are trying to think about how we can lift the infrastructure side back onto the agenda and we’ll be discussing that at the end of this month. There was a commitment to start talking about how you count embedded carbon in infrastructure projects and how we get some more consistency across the country on that. There’s been a lot of work done already, so that’s really important.

I think, looking at the role of infrastructure in net zero, I was really delighted to look under one of the city deals. Launceston has moved the University of Tasmania and combined all its sites in Launceston, and has really built some extraordinary buildings with very low-carbon footprints. That’s allowed them to actually fund their entire move of the Hobart Campus into Hobart on green bonds. They’ve raised $300 million in literally two days and will use that to fund infrastructure by building these really incredible buildings. I’m very interested in how we do that. I’m interested in how that might work in relation to high-speed rail and high-speed rail financing, as well. So, I think there’s lots to do, and I’m really delighted that infrastructure ministers across the country all want to focus on this issue, and they’re all talking about it.

AD: Brilliant. A great note to finish on. Please join me in thanking the minister. Thank you very much.

The Hon. Catherine King MP was first elected in 2001 to represent the electorate of Ballarat in the Australian Parliament. Following the 2022 Election, King was sworn in as the Minister for Infrastructure, Transport, Regional Development and Local Government.

King held a similar portfolio in the previous term of opposition, while also serving for six years as Labor’s Shadow Minister for Health and Medicare. King previously served as Minister for Regional Australia, Local Government and Territories; Minister for Regional Services, Local Communities and Territories; Minister for Road Safety; and before that as Parliamentary Secretary for Transport and Parliamentary Secretary for Health.

King holds bachelor degrees in social work and law, and a Master in Public Policy. Prior to entering Parliament, King was a senior manager at KPMG’s consulting practice.