Rudd Government commits to election promises, but world financial crisis expected to impact on infrastructure fund.
By Brad Gardner
The Rudd Government has committed to implementing all of its road, rail and port election commitments, but the world financial crisis is expected to hit its building funds hard.
Minister for Infrastructure and Transport Anthony Albanese’s office has rejected claims the revised Budget surplus figures released today will result in a number of cuts to vital road and rail projects.
He says all of the Government’s election promises will be delivered because they were accounted for in the Budget.
“There are no cuts, and I repeat no cuts, to road and rail funding going forward,” a spokesman for Albanese says.
Opposition spokesman on transport Warren Truss claims there is no way the Government can fund infrastructure projects without borrowing money, and has accused the Government of not delivering on its promises.
“Now it seems infrastructure spending will actually be cut. Any new projects that do receive funding will go on the bankcard,” he says.
But the spokesman has questioned the criticisms, saying when the Coalition was in government it cut road spending by $2 billion in its first eight years.
But with Treasurer Wayne Swan saying the revised figures equate to a $40 billion loss over the next four years and the need to make “tough decisions” on infrastructure investment, the Government’s Building Australia Fund may not be able to reach its $20 billion target.
There is currently $12.6 billion in the fund and the spokesman says the Government will monitor the budget and economic conditions to determine how much more will be invested from future surpluses.
“We have made a huge down payment and we reserve the right to make more investments,” the spokesman says.
“Unforseen economic circumstances mean surpluses have had to be revised.”
The fund will finance communication, transport and port infrastructure.
Infrastructure Australia is currently auditing the nation’s infrastructure and will release a priority funding list to the Government later this year.
The mid-year economic outlook released today revised the Budget surplus down from $21 billion to just over $5 billion this financial year.
Unemployment is expected to rise by five percent while GDP is expected to fall.