The federal government should bring in a type of 30/20 rule for all super funds to fund essential infrastructure. The concession was abolished whilst Keating was treasurer.

Mike's Argument is rational and logical. Its ideas have basically been achieved very effectively in Singapore! 
Unfortunately sensible logic has never fazed City Hall or the Government for that matter. Bad Luck NSW!

Dear Mr. Baird, 
 
I think anything that can potentially assist in repair and renewal of infrastructure in NSW should be looked at in an objective and non-political light. NSW is, to all extents and purposes, a basket-case despite reported growth in employment. Infrastructure relating to the environment, health, education and transport -- perhaps the four most critical ingredients in creating a healthy and community-minded State -- have been left high and dry by this, and the previous, State Labor government. However, now is not the time for recriminations; it is the time for action and for serving the people of NSW with the virtues of honour, trust and respect. 
 
The people will decide the fate of this NSW State Labor government at the next election although this is much too far away considering the irresponsibility of many of its ministers, carrying essential portfolios, e.g. health 
 
Let's work together to get this State off its back and at least upright. 
 
Yours sincerely 
 
James Clancy

Hello Mike, 
 
While the idea is not new, it would be nice to see it applied to NSW. 
There is a lot of logic in it. 
It does work in some other places & there is no reason as to why not here ! 
Keep well, 
Albert.

GFC was triggered by peak oil 
 
Please visit my website 
 
http://www.crudeoilpeak.com 
 
the #1 monitoring site of the global crude oil peak 
 
OECD oil demand dropped by 6 mb/d since Jan 2006. Half of that has been taken up by China and Non-OECD and half is matched by a decline in oil production. 
 
IF EVER THERE WERE TO BE AN OECD RECOVERY TO 2005 LEVELS THIS WOULD MEAN AN INCREASE IN OIL DEMAND BY 6 MB/D, WHICH WOULD OVERWHELM THE GLOBAL OIL SUPPLY SYSTEM 
 
The GFC will never go away: Debt can only be paid back in a growing economy but an oil dependent economy cannot grow if oil production does not grow UNLESS we follow an immediate strategy of AWAY FROM OIL. 
 
But this is NOT done: new Hunter Freeway, Pacific & Hume highway upgrades etc. 
 
Regards 
Matt Mushalik (MIEAust, CPEng) 
Epping 2121  
ASPO Sydney

Thanks for the opportunity to comment: 
 
The creation of a tax effective investment vehicle for Super and general funds to support more Govt Spending will produce more Govt debt and divert the money from investment in business growth when it is needed. 
I think the biggest problem will be to find a way of reducing Govt debt. Lord knows what that real debt is now in NSW and will be for the federal Government in the near future.  
My concern is the comming massive new taxes for the environment programme. These are likely to exceed the impact of the GST. The next concern is the coming growth in inflation which will result from Govt spending and new taxes.  
In terms of investment vehicles I'm still hurting from buying Telstra shares as a result of Govt encouragement. 
No new ideas from Government please until the old ones are fixed and earlier Telstra share offers honoured. 
Regards 
 
Wayne Moynham.

The first Federal urban transport funding allocation in late 2008 left New South Wales with peanuts while Victoria got $3.5 billion for Melbourne. Overall 15 projects were funded to the tune of $8.5 billion, with a further $27 b to be raised by States and investors. 
Sydney will make no progress without Federal support so what went wrong and what do we do next? 
Infrastructure Australia pointed to four areas: better analysis of each problem or challenge; better consideration of options; linking of proposals with long-term corridor and network needs; and better economic, financial and other analyses. They also said, learn from past mistakes.  
Public Private Partnerships (PPPs) is the first opportunity. Economic and financial analysis? A succession of investor groups had lost their shirts over poorly assessed road and rail projects in Sydney. Who would want to do that again? 
This can be said even more strongly for superannuation money. No one, citizens or institutions, will take up bonds without a solid risk and return analysis. 
Debt is not a dirty word. Even rating agencies will support productive projects. There is a sharing of costs across generations but inflation reduces the burden of repayment to low levels in the long term. 
A recent appraisal of the Maldon-Dombarton rail line found it had a very low direct financial return but potentially high economic benefits throughout the economy. The Rail Tram & Bus Union recently updated a Centre for International Economics study, finding that less than $6 billion on the “shovel ready” Rouse Hill, Leppington and Epping to Parramatta rail links would produce $2.2 billion a year in general economic benefits. 
We should no longer assess individual projects in isolation. Costs of expensive inner or missing links need to be spread rather than concentrated over a small population – which is penalised thus repressing demand. Investors need to be attracted but the community has to see that profits are not excessive. Forced attempts to spatially monopolise traffic through capacity manipulation are destructive and the community would be happier if the historical standard of a free alternative was maintained. 
With solid network planning we would improve community confidence in “projects”, hopefully to the point where bonds and betterment would be accepted by citizens, users and property owners. 
What happened in Melbourne was “all of the above”. Sir Rod Eddington did a review of needs and developed the best option for each, whether heavy rail, metro or freight road and so on. It was that information which produced the national grant.  
NSW does not have such a plan. Sydney’s traffic and congestion costs are increasing at two to three and more times the rate of growth in population; and the Government has not even started to look at the accessibility and other implications of an aging demographic. 
Sydney needs credible leadership. 
 
I would hate to see Govt guarantees on Superfunded bonds sitting on the State accounts as contingent liabilities, crippling the ability to move positively on.

Mike, I think your article is spot on. The current Gov. has sold infrastructure projects like roads that could have been set up as you proposed. How hard is it to run a toll way? Lots of funds out there and if the Gov can give the managed funds a fair return there will be a lot more self funded retirees as a result.

I've been talking about this idea for a year; am ready to use my own DIY superfund for the first input!

Dear Mike, 
All your good efforts and initiatives on bonds as the driver of infrastructure projects are particularly frustrating to me - since in the good-old-days before corporatisation, all the semi government institutions like Water Boards & etc could Plan, Engineer with their own staff, and initiate Major Projects like Warragamba Dam and Grahamstown Lake near Raymond Terrace, while financing them by issuing their own bonds to construct the projects with the help of both Federal and State governments when necessary. 
Not any more Mike - the party and politics in general, has imprisoned and emasculated itself from performing engineering works since the ill-fated 1989 Government Owned Corporations Act was orchestrated by the NSW Liberal Party. 
Nowadays, SWC is just a cash-cow to the state government as is the RTA AND SO FORTH. 
Doug Robertson

Hi Doug, thanks for your comments. As you know Waratah Bonds is a whole of government solution. I understand your concerns on SWC, there are many frustrations with the SWC model. If you are keen to discuss further, I'd be happy to meet in person. Cheers, Mike

Hi Mike 
 
There is potentially a sizeable source of funds from not just the diy market - I can recall when at State Super we were on the look out for something like what you have in mind for the Waratah bonds (ironically Iceland did issue such bonds not such a good omen), as you will understand an inflation proof bond of the standing of a Waratah bond is made to order for a defined benefit fund such as State Super's Pooled fund. Unfortunately, with interest rates at such low levels and an imminent rise in rates likely it is not the best time performance wise to be loading up with such fixed interest securities. It would also be interesting to see whether Treasury would be prepared to wear the cost of the inflation risk inherent with such bonds which could be quite significant going out. 
 
Good luck with your idea and am sure there is a market for such bonds if you can convince Treasury that the risk to them is worth the potential cost to the State. 
 
Regards 
 
Rod Macleod

Mike, it makes good sense to me and if it has the support of the super industry its seems to be worth a serious look. Would need to do better than invest in the cross city tunnel and the investment managers would need to be selected on the basis of Commen Sense rather than the abaility Spin. 
Cheers, Graeme