10 May 2015
Peter Martin and Richard Willingham
Tuesday’s budget will include an offer to end the impasse over the East West Link that has seen $1.5 billion left in limbo.
The Age has learned that the offer is one of the few big infrastructure commitments in a budget whose three big themes will be families, taxation and jobs.
Last week Prime Minister Tony Abbott signalled that he may consider re-directing $1.5 billion slated for the western section of the East West Link to a new proposed Western Distributor to be built be Transurban.
The jobs package has not yet been announced.
On infrastructure, the budget will include $100 million to improve northern Australia roads that are critical to the beef industry and an offer on East West Link.
The Abbott government has already paid Victoria $1.5 billion for the East West Link, with another $1.5 billion promised for the western section.
Despite the East West Link being scrapped by the Labor state government, Prime Minister Tony Abbott has insisted $3 billion for the road remains on the table. Mr Abbott said in April that the money would remain in a “locked box”, remaining adamant the road should still be built as a congestion-busting project for Melbourne.
“My pledge for the people of Melbourne, and Victoria, is that the $3 billion of Commonwealth dollars pledged to East West Link will remain in a locked box for the first Victorian government that is prepared to build this absolutely necessary piece of infrastructure,” Mr Abbott said.
State Labor has been keen to highlight there are other projects that the money could be spent on, although it acknowledges Mr Abbott is highly unlikely to allow Commonwealth money to be used for the $9-$11 billion Melbourne Metro rail project.
Last Thursday, Mr Abbott gave the strongest indication to date that $1.5 billion slated for the western part of the dumped road could be redirected to the Western Distributor.
The $5.5 billion road and tunnel project would link the city with the western suburbs with a tunnel and expansion of the West Gate Freeway.
Mr Abbott acknowledged on Melbourne radio that Transurban’s proposal was not “dissimilar” from the western part of the East West Link.
“If they want to build the western part of East West Link, obviously we put $1.5 billion up towards that,” Mr Abbott told radio station 3AW.
Transurban believes the project could be funded through a combination of toll revenue and Commonwealth contributions.
The Abbott government also last week hosed down speculation that Treasurer Joe Hockey was preparing to demand Victorian hand back $1.5 billion already paid to the state for the East West Link.
While some Liberals are keen to exploit Labor’s controversial decision to rip up the road contract, strategists also warn about the dangers of short-changing Victoria on infrastructure with several Liberal seats highly vulnerable at the next election.
Last week’s state budget papers highlighted that in the five years from 2013-14 Victoria’s expected share of federal infrastructure funding was 20 per cent, even though Victorians make up 25 per cent of the national population.
“If the Commonwealth withdraws infrastructure funding previously allocated to the State for the East West Link, Victoria’s share will drop to 13 per cent in that period,” the budget says.
Courtesy of The Age
10 May 2015