BRUMBY AND KOSKY DISCUSS REGIONAL RAIL NETWORK INVESTMENTS

Thursday, 31 July 2008
Summary: Victorian Premier John Brumby and Public Transport Minister Lynne Kosky discuss investments in the regional rail network, difficult economic times, the consolidation of Don KRC and job losses, the closure of the Dartmoor sawmill and job losses, population growth, George Seitz, the review of Australia’s automotive industry.
JOHN BRUMBY:    As you know, since we’ve been in government, we’ve put a huge investment into country rail in Victoria.  We’ve reopened rail lines to Ararat and Bairnsdale.  We’ve invested nearly a billion dollars on the regional fast rail to Geelong, Bendigo, Ballarat, Latrobe Valley.  We’ve put something like $600 million, with the Australian Rail Track Corporation, into improving the country freight rail lines.  We’ve invested significantly in new rolling stock for the regional system, and the consequence of that, of course, is that we’ve seen massive growth in patronage across the country rail network.  We’ve also cut fares by 20 per cent, and the consequence of that is we’ve got a service now which is modern, it’s equipped for the 21st Century, and people are using it in droves. 

Last year, we came here and ordered an additional eight trains to meet additional capacity; that built on 14, I think, which we’d committed to in November 2006; that’s 22 extras.  And, today, I’m delighted to announce a further 28 carriages for the V/Line system; that’s nine train sets, nine by three, plus one additional carriage.  To put this in perspective, it’ll mean that if you look at the orders which are presently in the system, plus the 28 extra carriages today, 50 in total, and all of this will enable a 50 per cent increase in patronage, carrying passengers across the system. 

And I just want to make the point that the difference in the system today, compared with what it was a decade ago: a decade ago this was a 100-year-old system, under-supported, under-invested, under-maintained, slow services, poor rolling stock, and this system has been transformed under our Government.  We’ve invested in new infrastructure, we’ve invested in new stock, we’ve cut fares, and today’s announcement is a further significant investment in improving travel for people from the regional areas in Victoria. 

And I might ask Lynne to say a few words, as well. 

LYNNE KOSKY:    Thanks, John.  This is a $236 million package; it’s a major investment that we’re making in, continuing to make in, our regional rail services.  We’ve just got the most recent patronage figures back from V/Line patronage across the regional rail system, and we’re now, over the last two years, looking at a 63 per cent patronage increase across regional rail.  That’s just extraordinary, and when you put that into passenger trip numbers, that’s 11 million passenger trips that we’re now seeing each year across our regional rail service.  And when you consider that it was only in 2006 that the regional fast rail was complete, this is just extraordinary growth.  Regional Victorians have absolutely embraced regional rail services, and the figures speak for themselves. 

So, this announcement today of the 28 extra carriages is not only about dealing with the growth that we now have, but it’s also about anticipated growth in the future; we’re making sure that we’re ahead of the game, and of course these 28 carriages announced today come on top of the 22 carriages we’ve already announced, and they’ll start to roll out one per month in the coming weeks.  So it’s very exciting news for regional rail, and it’s fantastic news for our rail system right across Victoria.

BRUMBY:    And perhaps, too, if I could just add, as Lynne said, $236 million, so it’s a big, big contract, [inaudible] to a quarter of a billion dollars.  Great news for Bombardier, as well, in Dandenong, so Bombardier is making these.  And at a time when the world economy is slowing down, as you know, to get this extra investment, these extra jobs at Bombardier in Dandenong, I know they’re extraordinarily excited by this. 

So, better services for country Victorians.  As Lynne has said, we’ve seen just extraordinary growth in the system, and I think it shows that if you build up regional areas, if you provide quality rolling stock, as we’re doing, with great trains, great services, I think there’s 401 additional services that are on the line now since we’ve been in government – it’s just a huge increase.  So, 401 services, state-of-the-art rolling stock, another 28 carriages announced today, we’re aiming at meeting existing demand, but also building for the future right through to 2012.

REPORTER:    What about [inaudible] Shepparton, Wodonga?

KOSKY:    Well, these carriages will be utilised where we’ve really had the patronage growth, so Ballarat, Bendigo, Geelong, also Seymour, Traralgon.  So they’ll be utilised where we’ve actually got the increased patronage growth, where at the moment some people are standing during peak-hour services, so this will actually provide the benefit for them, and obviously it frees up some capacity for the rest of the service.  But we’re really responding to the demand we’re seeing at the moment and will continue to see over the coming years.

REPORTER:    So will we see extra trains running, or longer trains?

KOSKY:    Well, these carriages actually provide for longer trains.  So if we look at, say, Geelong, with the extra carriages, it will allow for eight car seats, when we, during the peak period, when they’re really needed.  But it allows for those combinations of seats; it allows V/Line to be much more flexible in the provision of services, where at the moment they’re just a little bit tired, where we’re seeing great patronage during those peak periods, particularly, so this allows for that flexibility.

REPORTER:    Services weren’t run frequent and reliable enough for you both to catch the train this morning.  [Inaudible]

BRUMBY:    Oh, well, we did…last time, Gareth.  But we’ve got Parliament sitting at the moment, and I’ve got some international visitors who‘ve been in my diary for a long time – they’re coming at quarter past 12 – so it just wasn’t possible to do that.

REPORTER:    Premier, have you read at all the comment…the ‘tough times’ comment?  Has that sent out the right signal to potential investors?

BRUMBY:    Well, no, what I’ve said, and I’ve been very consistent, is that…we are facing tougher, a tougher global economic environment than we have for many, many years, and that’s true, and I would have thought that’s self-evident.  And I’ve also said that we’re well equipped and in a good position to work through that, and some other places around the world [inaudible] we are in Victoria and I believe we are in Australia. 

But you only have to look at the circumstances in the US, what’s occurring in Europe, to understand that the times are more challenging and they are more difficult, and they’ve been exacerbated, of course, by three percentage points of interest rate rises.  So I think it’s absolutely correct to say we’re facing tougher challenges, and the point of that, of course, if you’re facing tougher challenges, you need to take decisive action, as a government. 

And I believe that we’re doing that, as a government, so whether it’s reducing taxes, as we did in the budget, whether it’s embarking on the biggest capital works program in the state’s history, whether it’s investing in transport projects, like the Monash-West Gate, like the order today, which will create new jobs, whether it’s the Convention Centre, whether it’s the Rectangular Stadium, whether it’s close to $5 billion worth of water projects, $600 million worth of rail freight projects, these are projects which provide a very strong economic foundation for the state.  So I believe that we’re better positioned, we’re better insulated, and these initiatives, decisions we’ve taken as a government will see us through a more difficult international environment.

REPORTER:    What can be done for the Don workers who’ve lost their jobs?

BRUMBY:    Well, we’ve seen, obviously, some new job announcements in Melbourne recently: John Holland, obviously, the aircraft maintenance, 60 jobs there; new flights into Melbourne, new jobs in the aviation industry.  There’ll also be significant new jobs at Castlemaine, and I suspect millions of dollars, potentially, perhaps even tens of millions of dollars, of investment in Castlemaine as a result of the consolidation of Don.

But, I repeat, they’re more difficult times; you’re seeing a number of companies now consolidate operations.  And the best thing we can do as a state is make sure we’ve got the fundamentals right: we’re reducing business costs, reducing payroll tax, reducing land tax, reducing WorkCover premiums, and investing in the biggest capital works program in the state’s history, and I believe those things will give us a strong economic foundation, going forward.

REPORTER:    The mill at Dartmoor’s also closing down and jobs will soon to go there.  [Inaudible]

BRUMBY:    Well, I was advised of the Carter Holt Harvey decision on Monday, and…that’s a global decision that they’ve made, and obviously I’d hope that the company would reconsider its position in relation to that.  They’re moving some of those jobs to another mill, but the Dartmoor facility, as I understand it, was a perfectly good facility, so I’m concerned about the decision the company’s made.  At the end of the day, it’s a decision for them, but obviously if they were able to reconsider that decision, it would be a great outcome.

REPORTER:    Has Victoria reached its maximum population growth rate?

BRUMBY:    Well, we’re at 1.6 per cent, we’re growing faster than the national average, and I think at a time when we’ve got obvious growth pressures, as we’ve got particularly in our transport system, that’s about the limits we’d want. 

And in the interviews that I did over the last week, I made it clear that I thought that was about as fast as we’d want to grow.  It’s a very different environment to the one we saw in the 90s, we were…the challenge then was to stop the exodus – we were losing 40,000 people a year, as they were fleeing Victoria.  We’ve not got the opposite challenge, which is huge numbers of people wanting to come and live in our state.  But I think at 1.6 per cent, that’s about the right maximum figure for out state.  We’re not saying stop growth, but we’re saying that’s probably a rapid enough rate of growth.

REPORTER:    How do you cap [inaudible]?

BRUMBY:    Well, we’ve been very strong in the market, particularly in relation to migration and particularly in relation to attracting people to the state, and so we’ve invested heavily in some of those programs, and we probably won’t be as forceful in those programs in the future, as we would have been in the past.

REPORTER:    Should George Seitz been using Parliament to attack ALP [inaudible]?

BRUMBY:    Oh, well, they’re matters for George.  It’s not…I don’t think…it’s not for premiers of the day to say what individual Members of Parliament can or can’t raise in Parliament; that’s the nature of Parliament, the nature of parliamentary privilege. 

But, as I said yesterday, if anybody’s got concerns about local councils, whether it’s a Member of Parliament or whether it’s anybody else, if they’ve got concerns, they should raise them with the Department of Planning and Community Development and the Office of Local Government, which is located within that Department.

REPORTER:    [Inaudible] when you talk about debt-funded projects, is that aimed at the rail tunnel in Eddington?

BRUMBY:    No, there’s nothing…new in what I said today about that; it’s what I indicated in a speech to…SEITA and a couple of others recently that, when you look at the Eddington report and, more broadly, what we’ll do with Eddington, there are a number of ways in which we will undertake those projects.  And one of them is through the normal capital works programs of the Government.  Secondly, it’s through commonwealth funding.  Thirdly, it may be through tolls and, fourthly, it could utilise debt, and we haven’t made decisions about any of those matters yet, but we’re going through a process; Lynne and I and Tim Pallas had the second of the caucus consultations yesterday, so we’re getting a whole range of views. 

In many ways, I think, you could say that this decision itself to provide more rolling stock here is, in many ways, the first decision which has come out of our consideration of Eddington.  And that is that if you look at not just what Rod has recommended, but look at the broader transport needs of our state, this is clearly an area where we’re seeing huge growth, and we need to ensure that we can fully meet the strong demand in the future – 2010, 2011, 2012 – and that’s what we’re doing.  So, what we’re seeing out of that process is not just projects in Melbourne; we’re gonna see a range of projects right across the state.

REPORTER:    In regards to population growth, when does the Government say enough is enough--

BRUMBY:    Oh, well…
   
REPORTER:    --we’ve reached out limit?

BRUMBY:    I was asked my views about that by the Herald Sun last week.

REPORTER:    Premier, the car components review that’s been done for the Federal Government, how important,  critical is the federal response to Victoria’s industry?

BRUMBY:    Well, I think it’s crucial.  So, I think, if you look at the motor vehicle industry in Victoria, the manufacturing associated with it, you’re talking about tens of thousands of jobs, directly and indirectly, hundreds of thousands of jobs, in fact.  And, so, getting this right is crucial for our state, so that’s a matter that’s being considered.

But I think the steps we’ve taken in recent years, securing Ford’s investment and, of course, the Ford Focus manufacture which commence next year, was a big decision, a very positive one, and one that wouldn’t have happened without…our support.  The Holden program, a very positive program and geared to, in part, towards export.  And Toyota, getting the Hybrid Camry commitment, these are the big decisions which we needed to lock in for the state. 

And I think if the Federal Government now make the right decision, particularly in relation to ASIS, particularly in relation to support for the industry and support for the components element of it, I think I’ll be very happy with that.  But we do want to see strong support, we do need to see strong support for our industry, and hopefully that’s what the Federal Government will decide.

REPORTER:    If we’re facing tougher economic times, should we then be expecting more businesses to close and more job losses?  Is this just the start, these two?

BRUMBY:    Oh, no.  What I've said is that our fundamentals are right, and I think the government positioning is right, and that is cutting business costs and investing in a huge program of capital works, and that’s what we’re doing.  And…there are always changes in global economic conditions, and Victoria and Australia are a small part of the world economy, so the best thing we can do is get our fundamentals right, and that’s what we’re doing.