FEDS SINK PORT HOPES

Government won’t fund channel widening despite Labor pledge

THE FEDERAL Government has indicated it will not fund the Port of Townsville upgrade despite acknowledging it’s a crucial infrastructure project for North Queensland.

The $ 193 million channel capacity upgrade has already received a $ 75 million commitment from the State Government in addition to $ 43 million from the port.

The Turnbull Government had been asked to match the state’s $ 75 million funding commitment but Urban Infrastructure and Cities Minister Paul Fletcher said the project was a “good candidate” for a concessional loan from the Northern Australia Infrastructure Facility ( NAIF) instead.

“That’s certainly what we have proposed,” Mr Fletcher said.

“I met with the chief executive of NAIF just in the last week or two to check on their interest in relation to financing the channel capacity upgrade ( and) they’re certainly interested in it.”

The upgrade was a key infrastructure commitment in the Townsville City Deal as it would enable larger ships to use the North Queensland port instead of travelling to Brisbane.

Mr Fletcher was in Townsville yesterday to discuss the City Deal’s progress with stakeholders, including port representatives, who have repeatedly requested funding rather than a loan. He said it was “understandable” the port preferred funding.

Mr Fletcher defended NAIF’s record of delivering projects despite the fact it has not funded anything in Queensland since it began three years ago.

Port of Townsville chief executive Ranee Crosby said there had been “constructive discussions” with the Federal Government but she had not been presented with loan terms that made NAIF an “attractive option”.

“NAIF is a loan scheme, which must be repaid in full, and with interest,” she said.

Ms Crosby said the cost of widening the channel had “quadrupled overnight” due to legislative bans on placing capital dredge material at sea.

“It is for this reason that grant funding, not a loan, is sought to pay for this additional cost to North Queensland,” she said.

Queensland Transport and Main Roads Minister Mark Bailey said the State Government was concerned the upgrade was being put “on the backburner”.

Herbert MP Cathy O’Toole said Townsville “deserved” the funding commitment, which was why the Federal Opposition promised to deliver the $ 75 million if elected.