Industry backs $4.7bn infrastructure package


Industry groups back multi-billion infrastructure package, saying it will boost freight efficiency and accelerate much-needed upgrades

Industry groups have thrown their support behind the Rudd Government’s multi-billion infrastructure package, saying it will boost freight efficiency and fast-track much-needed upgrades.

The Australian Trucking Association (ATA) says the $4.7 billion package to be spent on roads, rail and small business assistance will build a better transport network and reduce running costs.

"The trucking industry carries 75 per cent of Australia’s domestic freight, so helping us reduce our costs will deliver results across the whole economy," ATA Chairman Trevor Martyn says.

Prime Minister Kevin Rudd last week announced $711 of the package will be spent on roads over two years to accelerate 14 major projects.

"These projects include the Woomargama and Tarcutta bypasses on the Hume Highway, which will now be completed by late 2011," Martyn says.

"Once these bypasses are finished, the highway through Holbrook will be the only two-lane section left between Melbourne and Sydney. It is due to be finished by 2012."

The Australian Automobile Association (AAA) says the $711 million road investment will go towards four projects in NSW, four in Victoria, three in Queensland, and one-off projects in South Australia, Western Australia and Tasmania.

As well as stimulating the economy, AAA Executive Director Mike Harris says the funds will bring forward projects essential to reducing road fatalities.

The peak motoring body has also welcomed the extra $60 million for road maintenance under the Black Spots program, which will now jump from $50 million to $110 million this financial year.

The Australian Rail Track Corporation (ARTC) will also receive $1.2 billion, with a large amount of the funding to be spent on increasing the capacity of the Hunter Valley coal lines.

The ATA says the inclusion of an investment allowance in the package will also help companies wanting to buy new vehicles and equipment.

"From today until June 30, 2009 businesses will receive an additional tax deduction equal to 10 percent of the cost of the qualifying assets that they purchase. It applies to tangible depreciating assets that cost more than $10,000, including prime movers and trailers," Martyn says.

But Martyn says many small trucking companies will not benefit from the 20 per cent cut in the December 2008 pay as you go (PAYG) instalment because of their earning capacity.

"The PAYG instalment reduction will apply to small businesses with a turnover of less than $2 million a year, which is the equivalent of a trucking business with six or seven trucks. There are about 30,000 of these operators," he says.

In congratulating the Government’s announcement, Martyn also reiterated calls for state governments to grant greater access for higher productivity vehicles.
He says this will have the biggest effect on reducing running costs, but the industry is being restricted in achieving this because companies do not want to use the Intelligent Access Program (IAP).

Operators wanting to use Higher Mass Limits (HML) in Queensland and NSW need to use IAP, which monitors truck movements to ensure they do not stray onto roads or bridges incapable of supporting heavy vehicles.

The ATA does not support the requirement, saying many trucking companies already spend money on their own tracking systems.

You can also follow our updates by joining our LinkedIn group or liking us on Facebook