Article: Time for Victoria to get moving on our vital projects

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Time for Victoria to get moving on our vital projects

Time for Victoria to get moving on our vital projects

    Alan Howe
    From: Herald Sun
    April 22, 2013 12:00AM

VICTORIA must get moving.

It needs urgently to tick off vital transport projects, keep labor costs competitive, particularly in construction, and radically revamp primary and secondary education.

These are the key findings of a group of prominent Victorian business leaders who this morning unveil Agenda Victoria - a comprehensive analysis of the issues and opportunities facing our state published exclusively in today's Herald Sun.

A joint venture between the Bank of Melbourne and the Herald Sun, Agenda Victoria brought together leading CEOs, public servants and educators to analyse the Victorian economy.

They looked at what would be needed to drive our state's growth over the next decade with its compelling challenges of a strong dollar, regulatory hurdles, runaway costs, rapid technological change, population shifts, and the rise of China.

Agenda Victoria finds a state in mostly good shape and with a range of advantages that we need to exploit and improve on.

We have a world-class tertiary education system, a leading edge in medical research and financial services, an enviable and valuable events roster - and the smallest mainland state is the country's major food exporter. Our capital is the world's most liveable city.

But Agenda Victoria warns against complacency; the time to invest in our future is now.

Included on Victoria's to-do list is:

THE Melbourne Metro rail system;

THE East-West road connection;

AN airport rail link;

INCREASING school class sizes, and better pay for fewer, more skilled teachers;

THE deep-water port at Hastings;

AN expansion of the Melbourne Convention and Exhibition Centre;

MORE direct flights to Asia;

COVERING the rail lines between the MCG and Melbourne Park;

KEEPING Melbourne the national capital of super funds management;

SECURING a fairer share of federal tax revenues;

SLASHING red tape for business; and

NEGOTIATING with unions to lower the cost of construction.

For the Agenda Victoria committee - and Herald Sun readers - investing big to improve infrastructure, particularly transport, is the top priority. More than 77 per cent of Herald Sun readers thought it was the most pressing issue if Victoria were to "strengthen its position as a great place to work and do business over the next 10 years".

Right now, in this area, Agenda Victoria finds us failing.

Steering committee member Elizabeth Proust, a former secretary of the Department of Premier and Cabinet and CEO of the City of Melbourne, talks of transport "black holes".

Our rail network "is probably serving Melbourne population boundaries up to about the 1950s".

She would like to see bipartisan support for the major transport upgrades.

Agenda Victoria believes these to be the Melbourne Metro, the 9km rail tunnel under the city linking the Sunbury and Dandenong lines; the East-West Link, a road and tunnel connection from the Eastern Freeway to the Tullamarine Freeway and beyond; a train line to Melbourne airport; and the development of Port Hastings as a major container facility to keep us as Australia's freight and logistics capital.

Agenda Victoria gives none a priority. It believes all must be done.

Annette Kimmitt, the managing partner of Ernst & Young, insists there is a "real appetite to get things done," and believes we should look at all financing options - user-pays, public-private partnership, and funding from the increasingly wealthy superannuation sector.

Public-private partnerships are working well and include the Peninsula Link freeway connection and the new Bendigo Hospital.

The construction industry, though, is battling and lost 4000 jobs last year as building work fell almost 5 per cent and, according to developers, margins diminished.

Sam Beck, the managing director of the Beck Property Group, blames the costs of construction, and an inflexible planning system.

"It's getting to the point now where it's almost too expensive to build," he says.

"It's not much good having workers being paid so much that they don't get work."

Last year, the Baillieu government sought to crack down on the Construction, Forestry, Mining, and Energy Union and weaken its grip on the industry to help trim building costs.

Claiming the CFMEU was undermining the economy, Mr Baillieu said construction companies striking sweetheart deals with it would not get government work.

Signalling the Coalition means business, one of the biggest builders, Lend Lease, has been banned for four years.

But perhaps the most contentious challenge in Agenda Victoria is its call for class sizes in schools to become bigger.

Smaller class sizes have been the Holy Grail of education unions and many parents for decades - and numbers have never been lower.

Right now the average class size in Victoria is 21.6 and the Victorian Education Union says that the recent settlement of its rancorous dispute with the State Government will see that come down further.

But Agenda Victoria finds that while our universities and research institutes are "global leaders", increases in funding and a focus on smaller class sizes "have not led to measurable improvements" at the primary and secondary levels.

Our education results are being overtaken by other countries.

Dr John Daley, CEO of the Grattan Institute, sat on the committee that investigated the education sector whose services to foreign students is Victoria's biggest export earner - at almost $5 billion in 2011.

While the education unions see smaller class sizes as delivering better education, Dr Daley believes they are an impediment.

He says Australia has effectively decided to pay teachers less but to have more of them.

"In retrospect that was wrong," he says.

There may be a very small impact as a result of reducing class sizes, but ... it doesn't pay its way.

"You are far better off paying for better teachers."

He would rather fewer, more skilled and better-paid teachers in front of bigger classes.

Also, the quality of teachers has to improve.

"If you reduce class sizes and, by definition, you need more teachers, it is likely that the last teacher you hire is going to be a little bit worse than the average," says Dr Daley.

"As you reduce average class sizes you'd expect that what that will do is reduce average teaching quality."

He says that in Shanghai, Hong Kong and Singapore - where class sizes were "way higher" than Victoria - schools are consistently outperforming ours.

And he believes the key to their success is coaching teachers and plenty of peer-to-peer feedback.

In Shanghai, a peer or department head sits at the back of every teacher's class for two hours a week praising good teaching and addressing shortcomings, while keeping an eye on students as well, so that youngsters in danger of becoming disengaged are identified and assisted.

Dr Daley believes that when it comes to improving Victoria's prospects, education comes first.

"Nothing else comes close," he said.