Chapter 1: Year in Review
I am very pleased to present the Department of Infrastructure and Transport's annual report for 2012–13.
The Department's infrastructure and transport responsibilities cover areas that are vitally important to all Australians. In 2012–13 the Department continued to lead major policy reforms, delivered a record Australian Government investment program, and met our responsibilities as a regulator of the safety, security and environmental aspects of transport operations.
I am particularly pleased with the Department's ability to lead and respond effectively across the diverse range of complex areas that are addressed in this report. Our strong emphasis on organisational planning, capability planning and developing innovative solutions to challenges underpinned our work and achievements in 2012–13. We will continue to invest in and develop these core strengths in the year ahead.
Our key achievements during 2012–13 are summarised below. Chapters 3 and 4 report on our delivery of infrastructure and transport programs and report on administered items against the performance indicators within the 2012–13 Portfolio Budget Statements. Chapter 5 reports on the work of Infrastructure Australia, the infrastructure planning advisory council for which the Department provides corporate services and supporting staff. Chapter 6 reports on the Department's management and accountability performance during 2012–13. The annual report also provides additional detail on our performance in its appendices and in the Department's audited financial statements.
In 2012–13 the Department continued to make significant contributions towards investment in land transport infrastructure and developing strategic investment policy. Our work included extensive planning to develop the Nation Building 2 five-year national investment program and administering more than $3.8 billion in direct and indirect grants for constructing and maintaining land transport infrastructure.
We worked closely with other Australian Government agencies, state and territory governments and the Australian Rail Track Corporation (ARTC) to administer this funding, and to implement infrastructure initiatives supported by Australian Government funding.
During 2012–13, 44 road and rail projects were completed and work began on another 40. The Department continued to manage its other key infrastructure programs, including the Roads to Recovery, Black Spot and Heavy Vehicle Safety and Productivity programs, with more than 2,000 projects completed during the financial year.
Several large transformative national investment projects were completed or substantially progressed during 2012–13. For example as of June 2013, 56 per cent of the Pacific Highway had been fully duplicated. In addition, on 7 August 2013 the fully duplicated Hume Highway was opened.
A key focus of the Department's infrastructure investment planning efforts in 2012–13 concerned extensive national investment planning and advising the Australian Government on projects and priorities for the next phase of the Nation Building Program, which will begin in July 2014–15. This was a major planning and investment analysis process for the Department.
We were also key players in improving the delivery of Australia's national investment programs, including through progressing work on infrastructure financing reform, and continuing micro-economic reforms in infrastructure through the Council of Australian Governments (COAG) Infrastructure Working Group.
The Department's work on the Moorebank Intermodal Terminal Project reflected our complementary focus on the delivery of strategic micro-economic reform projects and on improving methods of infrastructure finance and delivery. The Australian Government established the Moorebank Intermodal Company Limited in December 2012 to oversee construction of an Intermodal Terminal at Moorebank in south west Sydney. The import-export terminal is scheduled to begin operation in 2017 with a capacity to handle 1.2 million containers a year. There is provision for an interstate container terminal with capacity of a further 500,000 containers a year. The project is using an innovative financing arrangement through which the project is de-risked by the Australian Government to make it more attractive for private finance. Later, the company will be privatised to enable the Australian Government's investment to be recycled.
National Transport Investment Planning
The High Speed Rail (HSR) Study formed an important part of the Department's critical national transport investment planning in 2012–13.
The Minister for Infrastructure and Transport released the report of the second and final phase of the HSR Study in April 2013. The report built on phase one of the study and refined projected estimates of demand and construction and operational costs.
The Minister announced a comprehensive program of public consultation and debate on the future role of HSR. This program included the formation of an HSR Advisory Group to advise the Australian Government on key industry and community issues arising from the report, and establishment of a ministerial group to coordinate the next steps for HSR across jurisdictions. The Minister tasked the Department with undertaking detailed consultations with industry, local governments and community groups, which were completed in June 2013.
The phase two report, together with the results of consultation, will inform the Australian Government's consideration of the next steps for HSR in Australia.
The Department continued to play an important part in making Australia's cities more productive, sustainable and liveable. The annual state of Australian cities reports help significantly to gauge progress towards these goals. The third report was released in December 2012.
The Department provided additional funding of $9.0 million under the Strengthening Aviation Security Initiative to help airports purchase security screening equipment.
Body scanner screening started on 3 December 2012 at international departure and transit screening points at Australia's eight international gateway airports. To support implementation of body scanners, the Aviation Transport Security Act 2004 and the Aviation Transport Security Regulations 2005 were amended. These amendments contained important measures to ensure, among other things, that a person's privacy is maintained if selected for a body scan.
The Department coordinated the Australian Government response to the Inspector of Transport Security's Offshore Oil and Gas Resources Sector Security Inquiry, which made recommendations to further strengthen security of the offshore oil and gas sector. On 14 May 2013, the Australian Government response was tabled in the Parliament by the Minister for Infrastructure and Transport and the Department is coordinating implementation of the response with other government agencies, industry participants and stakeholders.
National Transport Regulation
Implementation of the national transport regulation reforms was a key achievement in 2012–13. Work included the agreement to national regulations, the passage of national laws in various state and territory parliaments, appointment of the chief executive officer of the National Heavy Vehicle Regulator and the non-executive directors of the National Rail Safety Regulator, and commencement of the National Rail Safety Regulator andNational Heavy Vehicle Regulator from January 2013. The National Heavy Vehicle Regulator will regulate road access permit arrangements and heavy vehicle safety from late 2013. In addition, the Australian Maritime Safety Authority (AMSA) became the national maritime safety regulator on 1 July 2013.
The Department continued to be highly active in implementing the Australian Government's maritime and shipping reforms during 2012–13.
After about three years of planning, public and whole-of-government consultation, extensive drafting, and with the commitment and cooperation of all stakeholders, the re-written Navigation Act 1912, now the Navigation Act 2012, received Royal Assent on 13 September 2012. The Act replaces the century old Navigation Act 1912 with a contemporary legislative framework for maritime regulation. The Act reflects changes in the maritime sector and is the primary legislative means for the Australian Government to regulate international ship and seafarer safety, shipping aspects of protecting the marine environment and the actions of seafarers in Australian waters. It also gives effect to the relevant international conventions to which Australia is a signatory. The Navigation Act 2012 commenced on 1 July 2013.
The Coastal Trading (Revitalising Australian Shipping) Act 2012 commenced on 1 July 2012, and its revised approach to licensing coastal trade was a significant part of the Australian Government's maritime and shipping industry reforms.
The Stronger Shipping for a Stronger Economy reform package was completed with the Australian Government's acceptance of the Maritime Workforce Development Strategy in May 2013. This strategy was developed by the Maritime Workforce Development Forum and set out strategic recommendations to address the skills issues facing the Australian maritime industry.
The Department played a significant role in improving Australia's road safety across several national and international areas in 2012–13.
The Department continued its leadership of an international working group developing a global vehicle regulation on side impacts with narrow objects, such as poles. The regulation will significantly improve vehicle crashworthiness and safety in side impacts. In May 2013 the Department presented a draft regulation to the United Nations expert group on passive vehicle safety, which recommended its adoption by the United Nations World Forum for Harmonization of Vehicle Regulations at its next meeting in November 2013.
The Department continued to facilitate the Seatbelts on regional school buses program, which helps fund regional school bus operators to fit seatbelts in their vehicles.
Following consultations in 2012–13, draft Regulation Impact Statements to mandate electronic stability control for light commercial vehicles, brake assist systems for light commercial and passenger vehicles, and anti-lock braking systems for heavy vehicles will be presented to the Australian Government for consideration in 2013–14.
The effective exchange of views and information on road safety is an important part of the National Road Safety Strategy 2011–2020. The Department organised a National Road Safety Forum in August 2012 which successfully engaged stakeholders in discussing several road safety matters identified in the strategy. All transport ministers later agreed to hold annual national forums. The first was held in July 2013.
In 2012–13, the Department finalised most of the 134 initiatives detailed in the Australian Government's Aviation White Paper. We undertook further work following the Joint Study on Aviation Capacity for the Sydney Region completed in 2012.
The Department finalised amendments to regulations under the Airports Act 1996 following amendments to that Act in 2011. We also engaged in planning coordination forums and community aviation consultation groups at Australian Government owned airports around Australia.
During 2012–13 the Department successfully negotiated enhanced international air service agreements with key and growing markets such as the United Arab Emirates, Thailand and Vietnam.
Strategic Policy and Research
The Department continued its role in 2012–13 as a key advisor to the Australian Government by helping to shape the strategic policy agenda through its research and analysis and contribution to whole-of-government policy development. The Department provided a variety of material on issues relating to Australia's infrastructure and transport systems, including the work conducted by the Bureau of Infrastructure, Transport and Regional Economics (the Bureau) which ranges from cities to the regions, as well as statistics across all major modes of transport. The Bureau published 79 reports, as well as contributing to specific studies.
The Department's advice on intergenerational infrastructure, including phase two of the High Speed Rail Study and further analysis on Sydney's future aviation requirements, have ensured a balanced debate on future options is facilitated by evidence. These pursuits were undertaken with an emphasis on quality analysis to inform the Australian Government, states and territories in developing a sound information base for future planning decisions, leading to better outcomes for all Australians.
Departmental Evaluation Strategy
In 2012–13 the Department continued to implement its five year departmental Evaluation Strategy which aims to build evaluation capability and use in policy, program and regulatory teams to capitalise on the opportunities that evaluation processes and thinking provide to constantly improve the Department's performance. Two key priority evaluations were undertaken in 2012–13:
- keys2drive, and
- Strengthening Aviation and Security Initiative.
Three training programs were held to develop staff skills in managing and conducting evaluations.
Regulatory Practitioners' Forum
To continue to be an effective and leading regulatory agency, the Department established a Regulatory Practitioners' Forum to coordinate activities to strengthen the Department's performance in regulatory functions. The role of the forum is to continually improve the Department's capability as a regulator, support best-practice regulation activities and performance, and advise on broader regulatory-related issues. The forum will guide a structured program of reviews of the Department's major regulatory activities to assess the efficiency and effectiveness of the Department's existing regulatory regimes in achieving the Australian Government's desired outcomes.
Over the coming decades, as Australia's population and economy grow and new opportunities and challenges emerge, the growth in demand for infrastructure and access to transport systems across all modes in Australia will intensify. So too will the challenges to increase energy efficiency, manage increased urbanisation and ensure Australia's infrastructure and transport systems attract the investment needed for a fully functioning, efficient and productive economy.
The Department will play an important role in providing the Australian Government with policy advice to assist it to respond to these new, emerging and critical infrastructure and transport issues affecting our stakeholders and the nation. In addressing such challenges the Department will build on our policy development and delivery, and further strengthen our engagement and partnership with stakeholders and the users of our services.
The growth in demand for infrastructure is already placing pressures on the financing of Australia's infrastructure needs, and these pressures are likely to continue. The Department is committed to developing and sponsoring financially prudent approaches to help ensure that infrastructure needs are addressed through financially sustainable means. We will continue to be active in a range of forums, including the joint industry-government Infrastructure Finance Working Group to resolve infrastructure financing issues.
The Department achieved significant successes across the range of its responsibilities in 2012–13, and this success reflects well on the professionalism and commitment of the Department's employees.
I wish to thank all employees for their contributions during 2012–13, and I look forward to the year ahead.