The Abbott government has a poor record on infrastructure. The “infrastructure Prime Minister” has presided over a marked deterioration in infrastructure investment levels since he was elected, and his main policy effort on the issue has consisted of trying to attack the Victorian Labor government for abandoning the expensive and dubious East West Link project, which would have cost billions of dollars to generate benefits of just 45 cents for every dollar invested.
Now the government is looking to throw more money at another commercially unviable infrastructure project — a rail link for the mooted Carmichael coal mine to move coal to the Abbot Point port terminal on the Queensland coast, to be provided by the Commonwealth and Queensland Labor governments. The nearly 400-kilometre rail link will cost more than $2 billion, according to initial estimates.
The Carmichael coal mine is simply unviable at existing coal prices. There are coal mines in Queensland and NSW with existing transport links that have been shuttered by their owners or put up for sale because they can’t make money at current prices. Coal mine companies are reporting massive losses and facing share price collapses quite separate from current sharemarket turmoil.
The Commonwealth government, which is blinded by its bizarre obsession with coal, and the Queensland government, which seems willing to do anything to avoid the charge of not supporting Queensland jobs, appear bent on pumping as much taxpayer money into the project as is required to restore a semblance of viability.
It will be interesting to see what Infrastructure Australia — which hasn’t listed the rail link on its Priority Projects list — and the Australian National Audit Office think of such profligacy. This project is more boondoggle than infrastructure.
Since the project is being funded by govt, it would be instructive to know who the contractors for the rail project are, and how much they have contributed to the liberal party. That’s where the truth is.
It’s like the guy who wheeled out one brick every day in a brand new wheelbarrow from the hardware store where he worked. It wasn’t about the brick.
And does it really cost FIVE MILLION DOLLARS PER KILOMETRE to build a railway line?
So Tony Abbott is willing to spend $2 billion on rail to transport coal, but not to transport people, that’s a State responsibility. Oďd too that he’s happy to create an unbelivable 10000 coal jobs but wouldn’t spend $500 million to save 350000+ jobs in motor industry. If this action doesn’t prove he’s off the rails, nothing will.
Not sure about “cost more than $2 billion, according to initial estimates given that such guestimate usually double, at least.
Look at the latest NBN shock-horror cost, and that is for the crap copper.
How can it be possible that this project is still being considered.
Apart from government, who is going to fund it, as most of the banks seem to recognise it as unviable.
And finally, why is a Liberal govt looking at subsidising what should be a private sector business decision.
The world has gone mad.