Tony Abbott's announcement that a Coalition government will fund new freeways in Australia's major cities but not public transport has no logical justification and will hold cities back

The Coalition’s decision to abolish federal funding for urban rail projects will have an enormous impact on Australian cities if an Abbott government is installed in Canberra on 14 September.

Last week Mr Abbott said the Commonwealth government has a long history of funding roads, but

We have no history of funding urban rail and I think it is important that we stick to our knitting. And the commonwealth’s knitting when it comes to funding infrastructure is roads.

This policy would effectively demolish plans for a swag of urban rail proposals around the country that’re premised on the Federal government providing the lion’s share of capital funding.

The top two major projects on Infrastructure Australia’s “ready to proceed” urban priority list are Brisbane Cross River Rail and Melbourne Metro Stage One.

The next stage of Brisbane’s Eastern Busway is also on the priority list. Infrastructure Australia’s says it will be marked ready to go once “a small number of outstanding issues” are addressed.

Other projects on the list but not as advanced include Sydney’s NW rail link, capacity improvements to the Sydney commuter network, Melbourne’s Dandenong rail line, Gold Coast light rail, and electrification of the Melton rail line.

Brisbane’s Courier Mail headlined its report on Mr Abbott’s announcement: Opposition leader Tony Abbott backtracks on 2010 election promise taking Brisbane cross river rail off list. The West Australian followed suit: State rail projects in danger of unravelling.

Mr Abbott’s claim that the Commonwealth has no history of funding urban rail projects doesn’t stand up to scrutiny.

As Daniel Bowen points out, the Commonwealth is helping fund Qld’s Moreton Bay Rail Link, Victoria’s Regional Rail Link, Perth City rail Link, and Adelaide’s rail electrification project. Moreover, he says if you go back a few years:

Melbourne’s Cranbourne line was upgraded and electrified in the 90s with money from the Commonwealth’s Building Better Cities scheme. Commonwealth funding was also used for the “4D” double-deck development train.

The Leader of the Opposition’s policy pronouncement is however consistent with the reluctance conservative governments have historically shown toward treating urban affairs as a distinct policy area. The conservative view is it doesn’t have national implications.

The trouble in this case, though, is Mr Abbott has already promised to fund transport infrastructure projects in some Australian major cities. It’s just that all his undertakings relate to roads.

He’s promised to contribute $1.5 billion to the proposed East-West Link in Melbourne and another $1.5 billion to Sydney’s WestConnex motorway on condition it links to the CBD.

The Coalition’s election manifesto, Our plan: real solutions for all Australians, also says a Liberal government would contribute $1 billion toward Brisbane’s Gateway Motorway upgrade and provide (as yet unspecified) funding for Perth’s airport Gateway road project.

What’s not in the document though is any parallel commitment to improve urban public transport. Indeed, urban public transport isn’t mentioned at all, even in passing.

That’s despite the fact demand for public transport has grown strongly in most of Australia’s capital cities over the last ten years.

For example, patronage on Melbourne’s rail network increased 70% over the last ten years and by 40% over the last five.

The underlying drivers of this growth aren’t mere temporary blips. Mr Abbott is ignoring structural changes in demographics; in the composition of the economy; and in the relative price of travel by different modes.

Failure to fund key public transport projects is an efficiency issue as much as anything else. It will limit the economic capacity of Australia’s major cities.

There are other problems inherent in Mr Abbott’s evident inclination to involve himself in urban policy but only via freeways. Consider, for example, the proposed $9 billion Melbourne Metro rail tunnel.

It’s a key issue because the Prime Minister promised last week to contribute Commonwealth funding to build it (the amount is unspecified, but would need to be in the order of 75% plus).

But if it isn’t funded by a Coalition government, the Victorian government says other expansions of the metropolitan rail network couldn’t proceed i.e. popular proposals for new rail lines to the airport, Doncaster and Rowville.

Mr Abbott’s promise to provide $1.5 billion for Melbourne’s East-West Link freeway presents another problem.

Although they’d have largely different functions, the Melbourne Metro and the East-West Link road are competing for scarce State and Commonwealth funding.

The Victorian government says the ratio of benefits to costs for Melbourne Metro is 1.30 i.e. it’s positive. As noted, Infrastructure Australia has classified it in its top ‘Ready to Proceed’ category.

However the East-West Link road proposal isn’t fully developed yet. It’s only classified by Infrastructure Australia at the ‘Real Potential’ stage, the second of four categories.

Proposals included at Early Stage and Real Potential are at the initial stages of development and range from those that seek to address a problem of national significance that is still being investigated before solutions are proposed, to those that explore a range of potential solutions.

There isn’t a final business case for the East-West Link yet. Moreover, as I’ve discussed recently, the best evidence available suggests the benefit-cost ratio for East-West Link is only around 0.50 i.e. the benefits are only half the costs!

The Coalition’s aversion to funding public transport in cities isn’t a mere stumble by the Leader of the Opposition or some transitory political convenience. As the Coalition’s election statement shows, it runs much deeper. It’s ideological.

Most observers think it’s a foregone conclusion that the Coalition will be in government after 14 September, very likely with a strapping majority that will give them at least two terms in office.

Unless the States can encourage Mr Abbott to back-pedal, our big cities could become much less attractive to residents and businesses.

It’s therefore important to understand what thinking underlies the Coalition’s position and where urban transport goes from here. That’s an important question I’ll come back to.