Labor will pay for transport delays
It's hard to keep track of the many inquiries and consultants commissioned over the years to examine whether Canberra should build a light-rail network. The ACT government certainly seems to forget them; it keeps requesting new reports. Yet it's simple to summarise these studies' findings: every one of them has highlighted the long-term benefits - social, environmental and economic - of building such a network. Several of the reports have leaned in favour of an alternative - a transitional network of high-speed busways - but even these studies have argued that such a system should be converted, at a later date, into permanent light-rail fixtures.
The latest study, a concept design report on linking Gungahlin and Civic, has reached the same conclusion. ''[Bus rapid transit] is a cost-effective option, whilst [light-rail transit] generates the best overall outcome for Canberra.'' Nonetheless, some Canberrans will baulk at the price. The report suggests a modest light-rail system that links Gungahlin, Dickson and Civic could cost up to $860 million. It's an unusual claim, given that one of the many past reports, written by consultancy firm Kellog Brown Root in 2005, estimated that a Gungahlin-Civic link would cost between $86 million and $185 million. Even allowing for inflation, the significant difference raises questions about how the latest study costed its options.
Yet focusing solely on the costs of building an effective, high-volume, public transport system misses the point, because the purpose of such an investment is to mitigate future costs. Five years ago, the federal Bureau of Infrastructure, Transport and Regional Economics estimated that the avoidable productivity losses caused by traffic congestion in Canberra amounted to $110 million in 2005. It also said these losses would climb to $200 million a year by 2020. Canberra may well be a city built on the assumption that everyone travels by car, but we need to realise that this carries with it a heavy financial burden. Roads are costly to build and maintain, yet they do nothing to lessen congestion: they make it worse.
Environment Minister Simon Corbell pointed out yesterday that ''doing nothing on this corridor is not an option''. The problem, however, is that he and his colleagues have said that for a decade now. The opportunity costs of Labor's inaction will only grow. If the government fails, once again, to take decisive action before the election, we will happily remind Canberrans of this dereliction when they consider who deserves their vote.
Prudence, not pain
The International Monetary Fund has again rummaged through the entrails of global markets to produce its World Economic Outlook. To an extent, the latest outlook is pleasing news for Australia. The fund predicts that, over the coming two years, we will remain Asia's strongest developed economy, with an annual growth rate of 3 to 3.5 per cent a year. Indeed, both our growth and our comparative lack of sovereign debt remain the envy of the Western world. There's also good news for our largest trading partner, China, whose economy is expected to slow rather than slump. This should be enough to drag the rest of the world into a gradual recovery from its present woes.
Yet, as much the signs bode well, the fund points out that these improvements are extremely fragile. The euro area's recession is tipped to continue this year, while the strength of those other giants, the United States and Japan, remains anaemic. One more crisis in Europe could be enough to topple the house of cards that is the global economy.
It is wise to be prudent in uncertain times like this; our governments and businesses should never assume that their current revenue levels will improve, and should budget accordingly. Yet as Treasurer Wayne Swan prepares to deliver - apparently against the odds - a surplus budget next month, the outlook reminds us to ask: why? Decisions taken in Athens and Beijing may well have as much effect on the Gillard government's bottom line in 2012-13 as the efforts of cabinet's expenditure review committee to cut spending. This is no excuse for failing to scrutinise policies and programs; the government should always search for inefficiencies among its operations. Yet, as the fund says, ''Austerity alone cannot treat the economic malaise in the major advanced economies.'' It may be our economy would benefit far more from strategic public investments - like, say, transport infrastructure that improves our long-term productivity - than from a threadbare federal budget that produces a slim surplus. In these matters, Mr Swan should allow the national interest, not polls, to guide him.