Subjects: Northern Australia Infrastructure Facility; GST; NT gas moratorium
ADAM STEER:
Matt Canavan is the Minister for Resources and Northern Australia. Senator, good morning.
MINISTER CANAVAN:
Morning, how are you?
ADAM STEER:
Umm, why not? Why haven’t we seen any projects approved in the Territory yet?
MINISTER CANAVAN:
Well it’s not correct to say there haven’t been projects in the Northern Territory from the Northern Australia Agenda. Over the past year, we’ve funded $200 million worth of roads in the Northern Territory. And that’s 30 percent of the funding we have committed to roads in the North. That’s well above…
ADAM STEER:
But how much of the $5 billion available for concessional loans has been approved for the Northern Territory?
MINISTER CANAVAN:
Well I should say, no loans have been approved yet from the Northern Australia Infrastructure Facility, for Queensland, Western Australia or the Northern Territory. It’s been running for nine months. It’s got five projects close to financial close, and another dozen that are progressing well and in advanced stages. They are dealing with very large projects, and they’re large projects involving the private sector. They will take time to resolve. That’s why we announced road funding last year, some work on water as well in the Northern Territory, and some work upgrading remote airstrips in the Northern Territory. This is a staged process to develop the North, and we’ve got to get the infrastructure spending right on large projects. So, it is coming. I’m working with the Northern Territory Government, I’d love to have more proposals from the Northern Territory Government to the NAIF but we’ve got to work with what we get through the door. There are some advanced projects…
ADAM STEER:
Are you to blame Senator? Are you the reason why none of the applicants – because there has been applications from the Territory, none of them have been approved?
MINISTER CANAVAN:
As I say, the timing of these things have to work with the commercial financiers as well. So, those people that I’ve worked with across Australia are generally happy with how they’ve engaged in the NAIF. The NAIF is an independent body that we’ve established. It’s very similar to the Clean Energy Finance Corporation. We set up on very similar governance arrangements. Now the Clean Energy Finance Corporation, it was about 11 months after it was established that its first loan was issued. And they were much smaller, much smaller transactions. So the NAIF has been running for nine months and it’s got a number that are at advanced stages. And I expect in the coming months we’ll see projects approved.
ADAM STEER:
The accusations keep coming in about the preference that’s being given to your electorate and home state. What do you say to that?
MINISTER CANAVAN:
Well that’s just patently not true. At the moment, as I say, the Northern Territory has received more of our roads funding in proportion to their population. They’ve received about an equal share, but they’ve got a lower proportion of the population in Northern Australia of course. We moved the Office of Northern Australia to Darwin because we recognise the importance of that city…
ADAM STEER:
I’m confused that the Federal Government is committed to develop Northern Australia, yet at the same time giving us a massive cut in our budget because of the GST share?
MINISTER CANAVAN:
Well as I’m sure you’ve had expressed in your program by the Treasurer and others, the arrangements about the GST are completely determined independently. Some years you’ll go up, some years you’ll go down depending on economic growth, population growth, changes in other states and territories. I think overall, it’s a system that we should support, because it helps smaller jurisdictions like the Northern Territory, who are the largest beneficiaries from it over time. Now there will be changes from time to time, as happens with tax revenue generally. All governments face write-downs from time to time. It’s been a particularly difficult decade for the Federal Government with mining revenues being down and income growth being stagnant. The response that responsible governments make to those issues though, is to get on with the job of growing the economy, investing in infrastructure. That’s what we’re doing through our Developing the North Agenda, and I’m very happy to work with the Territory Government on that.
ADAM STEER:
So you do recognise Senator the importance of getting this investment to the Northern Territory flowing ASAP, in light of the huge GST cuts we’re about to face?
MINISTER CANAVAN:
Yeah look, absolutely. But I should say, our agenda to develop the North is a long-term one too. It’s a long-term commitment. It’s the first time the Federal Government has developed a White Paper. So, the funding we have available here is not a knee jerk reaction to something. It’s about putting in place the essential infrastructure that can provide a platform for growth across Northern Australia, including the Northern Territory, for a number of years. I think through it, we’ve got to make sure we break down those boundaries between our different jurisdictions. We’ve got to think East-West here. We’ve got to think about how the North can work together across Queensland, the Northern Territory and Western Australia to sell its benefits to Asia. And Darwin is at the centrepiece of that given its proximity to those regions that are growing so strongly. Too much of our development over the first 116 years of Federation has happened North-South, particularly down the eastern seaboard including in my state. We’ve got to think East-West, so that’s why I’m very passionate about the fact we’re going to build the Outback Way, that’s a third sealed road across Australia. Only the third sealed road across our continent to be built. I think we’ve got a lot of hope that long-term that we can invest in the Tennant Creek-It Isa railway line. But that will require us to have mines prop up around Queensland to put something on the rail line, and to put more throughput through Darwin.
ADAM STEER:
And the pipeline I presume, are you going to put pressure on the Northern Territory Government to lift their moratorium on fracking, Senator?
MINISTER CANAVAN:
Well look absolutely. I know they’re working through a process right now, but I’ve always been opposed to state-wide, territory-wide moratoria on gas development. Obviously, you should look at these things on a case by case basis. There may be some areas which are too sensitive to do fracking or gas development, but I think for an area the size of the Territory to ban it across the whole jurisdiction is unwise. And there are huge opportunities in the Territory. You have an enormous resource that could be equivalent and similar to what we are seeing in the United States and see what that’s doing to their manufacturing sector. That’s what I’m passionate about. If we can develop that gas, you can make good money out of it, but you can also help spur lower energy prices in the Territory, more businesses, more manufacturing, and more jobs, more high paying jobs for Territorians.
ADAM STEER:
You’re on ABC Radio Darwin, Adam Steer with you. You’re also hearing from the Minister for Resources and Northern Australia, Senator Matt Canavan. Is the criteria too strict, Senator, for the [NAIF] fund, because each project needs to be $100 million to qualify, doesn’t it? And only half of that comes from the…
MINISTER CANAVAN:
I’ll just clarify that. What we’ve said is that we would like to make loans of more than $50 million and because we’re 50 percent or up to 50 percent of a project, that’s where you get that $100 million figure. But it’s not a mandatory criteria. When we established the NAIF, it was an indication to the market of the size of things we’re looking at, so we don’t get a flood of applications of two or three million dollars. I think at that level, there are other grant programs that the Commonwealth Government has in place to help smaller projects, like the Building Better Regions Fund. So, there are some projects I know of at the moment being considered that are below that $50 million threshold. It was not a mandatory criteria. It was just something to indicate to the market what we’re looking for.
ADAM STEER:
Chief Minister Michael Gunner says the definition of what is classed as infrastructure is too narrow. Do you agree with him?
MINISTER CANAVAN:
Well look I’m always happy to take suggestions. When we established the Northern Australia Infrastructure Facility, the legislation and the mandate went out to both Parliamentary Committees and to the State and Territory Governments. They all had a say. And some changes were made in feedback on that. So, look, the legislation itself is kind of set, but it’s very broad. The mandate we’ve given the NAIF can be changed, and I’m always open to suggestions to make it work better. But as I say there are a number of projects that are well advanced and I’m very focused on getting results and infrastructure built.
ADAM STEER:
Will you be announcing any of those projects tomorrow, Senator, when you come to the Territory?
MINISTER CANAVAN:
Well no I won’t be. It’s also the case that we’ve set up an independent body and it’s not for me to direct it to do anything in particular. It should be run on a commercial basis. We’ve got an expert board there, including Mr Barry Coulter who is on it from the Northern Territory. I know they’ve got extensive experience in infrastructure finance and development and they should be left to do their job.
ADAM STEER:
So you can’t give us any indication at this stage, what those projects are?
MINISTER CANAVAN:
No those have generally been kept in commercial in confidence. I know some others have revealed themselves, their application interest. You mentioned the Adani Carmichael mine, there’s the Seafarms project as well that’s spoken publicly about its interests. So, they are obviously in discussions with the NAIF but generally speaking, these matters are best I think dealt with in commercial in confidence, until there’s a decision. Obviously once any decision is made by Government, that will be revealed and we are accountable to the Parliament and to the public.
ADAM STEER:
Senator, good to talk to you today.
MINISTER CANAVAN:
Thanks mate have a good day.
(ENDS)
