The Australian Greens have today launched their policy to establish the Australian Infrastructure Bank on the back of a comprehensive Senate Inquiry into infrastructure with the inquiry report also being released today.
Greens spokesperson for Finance, Senator Peter Whish-Wilson, said, “The Greens have prepared a comprehensive policy outlining a new way of national infrastructure financing. The Australian Infrastructure Bank will raise funds via bond issuances and a reformed approach to private equity. The Australian Infrastructure Bank will then grant or on-loan funds to all levels of government so they can get on with dealing with Australia’s infrastructure backlog.
“The Greens are prepared to increase the Australian Government’s investment in infrastructure by up to $75 billion over the next ten years. This will keep the consolidated government debt within a target range of 25% of GDP; and borrowing costs below 2% of GDP.
“Economists of all stripes are telling the government to stop being afraid of the D-word. Debt. Australia needs to step up and increase investment in productive infrastructure, to diversify our economy, to fight global warming and to provide for basic intergenerational equity.
“To put off this investment now means to pass on the cost of dealing with these issues to future generations. We have to stop kicking the can down the road. We do this now and we get a cheaper and fairer outcome.
“The Greens policy is built around the Australian Infrastructure Bank issuing bonds to raise billions at record low interest rates. The bank would then grant or on-loan money to councils and state governments so they make Australia more resilient and prosperous.
“We must seize this opportunity. With the Australian economy still suffering a hangover from the mining boom, now is the right time to invest.
“A key benefit of the Greens policy is that it makes funding more readily accessible at cheaper rates to local government. Councils will be able to bundle together projects, including bridges, stormwater, bike paths and energy-efficiency street lighting, and bid for project finance.
“Many councils currently have low debt levels and a maintenance backlog, but struggle to raise capital. The Australian Infrastructure Bank would make accessing finance more achievable and would allow councils to plan for, bring forward and deliver on a suite of projects.
“The Productivity Commission recently reported that smaller projects, carried out at a local level, usually deliver a greater productivity boost than mega-projects. The Greens approach would be good for the economy and good for communities.
“Facilities and transport systems in our cities, towns and suburbs are languishing. The answer isn’t more Private-Public Partnerships for gigantic toll roads. We need to be investing and right down into the communities where we can really make a difference,” he concluded.