Page 2877 - Week 10 - Thursday, 7 October 2021
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Budget—infrastructure
MRS JONES: My question is to the Treasurer: in February 2021 you estimated that the infrastructure investment program for 2022-23 would be $1.11 billion. In yesterday’s budget, you announced $1.56 billion for total infrastructure investment, including provisions for 2022-23. However, you acknowledged, and I quote from page 280 of the budget outlook, that the forecast for 2022-23 infrastructure investment is only $1.07 billion. This forecast represents a $45 million reduction for 2022-23 from the last budget. Why, Treasurer, is the 2022-23 program $45 million less when Canberrans need investment the most on the path to recovery?
MR BARR: You will see in table 3.7.1—the summary of the general government sector investment program, the five-year program—that a significant capital delivery provision is set aside. The government has the capital works reserve, which ensures that projects that are running ahead of schedule are able to draw upon that reserve in order to continue ahead of schedule.
Mrs Jones would do well to understand the difference between physical completion and financial completion. Often, given there can be defect periods that run for six to 12 months, the financial completion of a project will be several months—sometimes even a year—after the physical construction work is complete, because, rightly, the government will want from its successful tenderer to see the quality of the project and to ensure that any defects are addressed. That is why the fiscal program and profile can be somewhat different from the physical completion of infrastructure works. So the fiscal profile that you see in the budget will reflect that defect period and the fact that financial completion will occur many months after the physical completion of works.
MRS JONES: Minister, which projects are ahead of schedule and drawing on the finances outlined in your answer to the last question?
MR BARR: There were several that did, in fact, run ahead of schedule that were able to be budget-managed within the allocation of the individual directorate. This, of course, was pre the lockdown. An example was the Acton waterfront project, but it has now obviously been set back by the lockdown and by border closures. But pre-lockdown there were a number of projects in a number of directorates running ahead of schedule.
Mrs Jones: Which ones?
MR BARR: I do not have the list in my head, but I am aware through the budget rounds that many projects were running ahead of schedule.
MS LEE: Treasurer, why does your forecast investment program actually fall by $21 million over the four years of forward estimates?
MR BARR: This has been the same question the sixth time over, so I will give the same answer—because there is a difference between physical and financial
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