The Capital Metro project will receive an injection of around $60 million in Commonwealth funding under an agreement Federal Treasurer Joe Hockey and I announced today.
ACT Government is working to stimulate the Territory economy through prudent infrastructure investment, which will create new jobs through the light rail project and housing renewal. Our goal here is better transport and better public housing. I’m pleased to say today’s announcement will lead to a greater level of social inclusion and equality, and drive economic growth.
The Commonwealth will make a contribution to this investment under its Asset Recycling Initiative. Under this scheme the Territory is eligible for a 15 percent bonus from the Commonwealth Government when the ACT sells surplus assets to pay for new infrastructure. The sale of surplus assets together with the support from the Federal Government will see an estimated investment of up to $450 million (including around $60 million from the Commonwealth) in the Capital Metro project.
Asset recycling, used prudently, can raise the money necessary to acquire new public infrastructure for the city. This agreement makes a significant down payment on the Capital Metro project.
On asset recycling, our approach is different from other States and Territories because our circumstances are different. Our agreement with the Commonwealth spells out the type of assets that will be sold. We don’t have ports to sell, our electricity networks, retail and distribution are already partially privatised and we have low electricity prices compared with NSW.
The ACT will earn a bonus of $15.8 million alone from last year’s sale of ACTTAB to TabCorp for $105.5 million.
As the Territory’s renewal of public housing progresses and outdated accommodation is replaced roof-for-roof, surplus land will be sold under the scheme and attract further bonuses. Similarly other government buildings are scheduled to be replaced and when these become surplus they can also be sold and attract bonuses, which will be reinvested in light rail.
The combined future proceeds from selling these surplus assets over the next four years is estimated to be around $287 million – subject to individual sale prices – earning a bonus of $43 million under today’s agreement.
As I said in the Assembly yesterday, as part of our urban renewal program, we are embarking on the largest renewal of public housing in the history of self government, replacing old and tired public housing that has reached the end of its useful life with a large investment in the quality modern accommodation our tenants deserve. The ACT Government, through Housing ACT, will continue to work with current tenants in the properties identified in the asset sales schedule to ensure we are meeting their needs in future properties and throughout the relocation process. This renewal project will create an enormous economic stimulus to the Territory and will create jobs during construction.
Capital Metro is a vital project for Canberra’s economic future. It will deliver a billion dollars in benefits to our city and create 3,500 jobs in the construction phase alone so it is great to have the Commonwealth on board.
Procurement is underway and construction work on Capital Metro is due to begin next year, delivering on an ACT Labor 2012 election commitment.
- Statement ends -
Section: Andrew Barr, MLA | Media Releases