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PM comes up short on infrastructure funding for state's north

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The government’s Advisory Group for Northern Australia sought billions of dollars for infrastructure upgrades. It was not in the budget.

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Water, Resources and Northern Australia Minister Warren Pitt established the advisory group in March 2020 to help develop a new five-year plan to support the tropical north.

The advisory group, which included former Coalition minister Ian Macfarlane, contributed to the plan and then went on to make recommendations for funding in the 2021-22 budget.

While the plan has yet to be released in full, the recommendations were not implemented in the budget handed down by Treasurer Josh Frydenberg. In some areas deemed a priority, the government fell well short of what the advisory group had recommended.

In documents sent to Frydenberg and Pitt in January, and only now made public by the government, the advisory group sought a much higher level of funding than the Coalition has since allocated.

The advisory group recommended a series of four-year funding commitments: $2 billion for a Northern Australia Economic Corridor Building Fund, $400 million for a Growing Jobs in Northern Australia Fund, $400 million to improve digital connectivity, $50 million to address the skills gap and $8 million to fund business cases.

“The Advisory Group, while focussed on responding to its brief to provide advice on driving the economy in Northern Australia, also recognises and wishes to stress the importance of social infrastructure as an important enabler to economic growth,” the documents state.

Yet in the budget, the last before an election, the government only detailed $189.6 million in funding over five years to support its plan for northern Australia, including a $111.9 million Northern Australia Development Fund and $68.5 million (over two years) to improve digital connectivity. The remaining $9.3 million will be used to pilot a Regions of Growth approach.

The government has also sought to address a separate, pre-existing issue in the disaster-prone north by establishing a $10 billion reinsurance pool to benefit an estimated 500,000 residential, strata and business insurance customers.

The advisory group – which Pitt expected to play a “key role in giving high-level advice” through a “diversity of expertise and experience on economic development” – was disbanded in March as scheduled.

InQueensland sought comments on the budget announcements from its former chair, Glenys Schuntner, who could only comment in her capacity as the CEO of Regional Development Australia Townsville and North West Queensland.

“There are some very important components to the budget announcements for Northern Australia that will make a significant impact on the development of the north,” Schuntner said in a statement.

Schuntner welcomed the government’s intervention in the insurance market, and said she looked forward to seeing the details of the Northern Australia Development Fund.

“Our hope is that after the initial five years of the program that it will have achieved good outcomes and be continued as a key policy and program to develop the pipeline of projects in the north well into the future,” she said.

Schuntner also described the digital connectivity funding in the budget – not even a quarter of the amount recommended by the advisory group – as “a good step forward”.

“We know more investment will be required to ensure all major highways and communities are connected for communications in natural disasters, safety, business, education, telehealth and everyday life so we hope for an on-going commitment beyond two years,” she said.

Previous criticism of the government’s Northern Australia Infrastructure Facility prompted changes intended to see more projects funded over a longer period of time.

Prime Minister Scott Morrison recently toured regional Queensland to promote the budget, prompting speculation he will call an election later this year. The budget included hundreds of millions of dollars in funding set aside for initiatives that have yet to be detailed.

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