As Scott Morrison announced $8.4 billion is to be spent on an inland freight rail linking Brisbane to Melbourne, Barnaby Joyce went purple with excitement.

But is it a boon or a boondoggle?

The proponent’s stated benefit-cost ratio (BCR) is 1.1.  When wider economic benefits (WEBs) are included, the stated BCR rises marginally, but is still 1.1 when rounded.

Infrastructure Australia has identified a number of risks which could impact on the economic viability of the project. Factors such as a decrease in demand for Australia’s coal exports, weak oil prices, reduced demand for interstate freight, and upgrades to the Newell Highway, could adversely impact the economic case for Inland Rail.

The budget papers concede that, given the marginal nature of the BCR, an increase in project cost could have a significant impact on the final BCR.

“Project costs will not be finalised until procurements, alignment and reference designs are completed. The project is sensitive to increases in project cost and lower revenues from users, and these risks could decrease the returns on the Government’s investment in the project.”

The budget also included funding for a Regional Road Freight Corridor in NSW—New England Highway: $30.3 million, Princes Highway: $52.5 million, Mitchell Highway: $5.6 million, Newell Highway: $78.8 million.  As stated by IA, these road upgrades lessen the projected benefit from inland rail.

The budget states that the inland rail project “will support 16,000 direct and indirect fulltime equivalent jobs at the peak of construction” and 600 jobs when operational.  But have they considered the number of jobs that will be lost in the road freight industry?  Or even those employed in road construction and maintenance as 7.5% of the total benefit comes from “Reduced lifecycle costs for infrastructure owners and operators on the road network as a result of lower freight volumes, with reduced maintenance costs and capital investments able to be deferred.”

All parties seem to be supporting this investment but I suspect that has more to do with not being the one to upset the regional voters than through any actual comparison of the value with alternatives.

High speed rail has a similar BCR but has the advantage of facilitating decentralisation which would help with housing affordability, urban congestion, the high volume of air traffic between Melbourne and Sydney, and regional revitalisation.  It would also, with less private traffic, free up existing rail lines and highways for freight.

This is definitely a win for the National Party but perhaps Barnaby had a more personal reason for his glee.

According to a map published on May 1, there will be a new section of rail built between Narromine and Narrabri.

“Approximately 307km of new track.  This new track will reduce the overall journey time and complete one of the missing links between Melbourne, Adelaide, Perth and Brisbane.”

Serendipitously, this line will go through a little place called Gwabegar where Barnaby Joyce happens to own  two neighbouring properties totalling 2400 acres.

When he bought them, the locals were bemused.  A successful farmer and exporter from a nearby area said of the Joyce’s purchase, ”This is scalded country. It could not support the number of animals that would be needed to make a return on investment.  It is a strange buy, put it that way.”

Perhaps not so strange now.

Here is the proposed route map from the Infrastructure Australia website.

Is it just coincidence that Joyce happened to buy land on the proposed route a few weeks before it was announced? Or is this another example of COALITION CORRUPTION?

We need a Federal anti-corruption commission, and we need it now.

Senator Derryn Hinch has written to the Australian Federal Police seeking an investigation into news leaking about the $6.2 billion bank levy, which wiped $14 billion off bank shares ahead of the budget.

Sky News speculated on Monday night that the government was formulating a plan to levy the big four banks and on Tuesday ahead of the budget media lock-up, The Australian Financial Review published an online story just after noon confirming the move. The speculation sparked a $14 billion sell-off in bank stocks.

"This appears to be a classic case of criminal insider trading, possibly involving a federal government employee, or even a politician.
I would like to know who the short-sellers are and did they have links at Parliament House?" Senator Hinch asked.

The Australian Securities and Investment Commissions has made inquiries about the leak and launched a preliminary investigation into whether any suspicious trading occurred on Tuesday, based on speculation ahead of the release of Tuesday night's budget.

The banks claim they were not consulted over the shock measure and on Wednesday, Treasurer Scott Morrison claimed any suggestion of insider trading was "ridiculous".

"There are rumours and speculation that appear in the press before every budget. The banks were advised of that announcement as we went into the budget speech, and that was the process that was followed," Mr Morrison told ABC radio.

"Media speculate on all things in the budget. There was unconfirmed speculation on all of those things. They often get it wrong."

aquascoot wrote on May 12^th, 2017 at 7:34am:

So you condone corruption. I'm not surprised, really.

aquascoot wrote on May 12^th, 2017 at 8:36am:


Yep condones corruption