We have seen many versions of the "next big thing" during the first 100 days. There was Labor's education revolution. Then there was the climate change revolution. Now there's the infrastructure revolution. Hardly a day goes by without a federal minister promising that better and more infrastructure is the solution to the nation's economic ills.
Infrastructure has been enlisted in the fight against inflation, global warming and the skills shortage. In the Prime Minister's glossy brochure celebrating his three months in office, infrastructure is mentioned no less than 24 times.
Infrastructure Minister Anthony Albanese has proclaimed that "nation building" is back in style. He's committed the Rudd administration to proudly follow in the footsteps of Chifley, Whitlam, Hawke and Keating. Thankfully he didn't say the Labor government would attempt to nationalise the banks, ransack the commonwealth budget and try to cause a recession. Rather, he was invoking an altogether more positive Labor tradition that recalled Ben Chifley's Snowy Mountains project, and the urban renewal schemes of the 1970s and 1980s.
But for all of this talk about infrastructure there remains one question. What exactly are we going to build?
As yet the government has been scant on specifics. Its infrastructure strategy looks suspiciously like a slogan in search of a policy. We don't know much beyond the fact that Labor wants to "reduce bottlenecks" and "ease congestion". We do know that a new committee, Infrastructure Australia, will spend a year undertaking an audit to create an infrastructure priority list. It's unclear why such an audit would take so long given the myriad reports on the subject over the past decade.
Labor characterises Australia's infrastructure problems as the failure to build enough things. What Labor doesn't acknowledge is that the regulatory regimes governing the use of infrastructure don't encourage the efficient use of the infrastructure we already have.
And, to a large extent, any lack of investment in infrastructure is the inevitable consequence of those regulatory regimes. A fibre to the node broadband network could have been built by now if the regulatory environment were different. A recent Organisation for Economic Co-operation and Development report lists Australia as having one of the most rigid sets of telco regulations in the developed world.
Albanese has cited the examples of the coal export bottlenecks at the Port of Newcastle and Dalrymple Bay. Those bottlenecks are not the result of any absence of enthusiasm for "nation building" on the part of the previous government -- they are the result of bad regulation. A minister complaining about bad regulation stifling competitiveness doesn't provide as catchy a headline as does a minster blaming the previous government for a "failure to invest in nation building".
A closer examination of the so-called infrastructure problems cited by Albanese reveals that his examples have less to do with a failure to spend money and more to do with a reluctance by governments to confront vested interests. Water policy is controlled by Queensland and NSW -- the two states that have resolutely resisted reform. Telco policy is controlled by the Australian Competition and Consumer Commission. Schools and hospitals policy is controlled by the producers of education and health services. And transport policy is the province of state government departments that are either afraid or incapable of making decisions.
A joint federal/state working group on infrastructure met for the first time in January -- a meeting that was hailed by Albanese as a resounding success. He said everyone knew "that the time for talk is over" because the meeting was scheduled to last for three hours but finished after two. One interpretation is that the meeting concluded early because the public servants were in heated agreement. Another is that it finished before time because there was nothing much to discuss and everyone assumed it would be business as usual.
The Rudd government's first 100 days have been replete with symbolism. A new administration committed to infrastructure reform could have made no better start than to tackle the closed shop which prevents competition on air routes between Australia and the United States. But when it came to real policy, as opposed to mere symbolism, Labor blinked. Last month the federal government announced that it would maintain the ban on foreign carriers operating between Australia and the US. That's not a great start to an infrastructure revolution.
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