Advance Cairns State Budget Submission 2021-22

READY FOR RENEWAL TROPICAL NORTH QUEENSLAND

STATE BUDGET SUBMISSION 2021-22

PLAN FOR RECOVERY POST PANDEMIC Priorities for renewal........................... 3 Aviation and tourism........................4-5 Cairns University Hospital................6-7 Land use and agriculture..................8-9 Population and migration strategy ...................... 10-11 Food and water security.............. 12-13 Cairns University Hospital Redevelopment Project............... 14-15 Cairns marine precinct................ 16-17 Cairns ring road........................... 18-19 National Highway A1.................. 20-21 Savannah Way............................. 22-23

T

he crippling impact of COVID-19 is captured best by passenger arrivals into the Cairns airport. For the calendar year 2020 arrivals slumped 63.8% from 4.7million to 1.6million.

For the month of December international arrivals were down from 54,430 in 2019 to just 460 in 2020.

Gross Regional Product in the Cairns Regional Council area in FY20 is forecast to have slumped 4.6% to $9.2bn (source economy .id) while 12,000 jobs were lost from March to November (ABS labour force data).

This in a region heavily reliant on the tourism sector – and in particular on flight access given its remote location.

Both the Federal and State governments have recognised the severity of the challenges facing Cairns and have been strongly supportive with a suite of assistance measures so far, initially focused around business survival and more recently around stimulus and job creation.

While tourism remains a core pillar of the economy, there is consensus among regional leaders that now, more than ever, it is important that we accelerate the broadening of our economic base to aid a post COVID recovery and to mitigate the impact of future shocks.

To achieve this, we have identified a series of complementary projects that build on our tourism base and enhance economic resilience through diversification.

These relate to the marine, aviation, education, health and agriculture sectors, with projects that can be fast-tracked with the support

Nick Trompf

EXECUTIVE CHAIRMAN

of the Federal and Queensland governments.

The projects will generate hundreds of construction jobs as well as ongoing roles in traditional and advanced manufacturing, health and allied industries, engineering and design and construction. They will inject much needed confidence into the business sector, and community more broadly.

At the core of our recovery are critical infrastructure projects that will act as enablers for strong private sector investment in the years ahead.

These include: 1. Cairns Marine Precinct 2. Cairns University Hospital 3. New CBD campus for CQUniversity 4. Water security, both agricultural and urban The project and policy reform recommendations in this submission will support and contribute to the TNQ economic recovery and job creation plan.

Supported in the short-term by the extension of JobKeeper and other immediate survival measures such as payroll tax relief, electricity support, lease fee waivers and small business COVID-19 adaptation grants, the recommended initiatives will help to drive the recovery of the Cairns region.

In addition, fast tracking of capital works, the re-establishment of domestic aviation connectivity, investment in destination marketing, and the easing of interstate travel restrictions will be critical for TNQ’s recovery.

PRIORITIES FOR RENEWAL A targeted suite of policy and infrastructure recommendations within this submission will be catalytic in COVID-19 recovery for tropical north Queensland. Private enterprise is ready to invest across a host of sectors - such as marine, health, agriculture, resources, education and tourism - if governments provide the enabling infrastructure and supportive policy frameworks.

POLICY PRIORITIES

Aviation and Tourism $120m

Land Use and Agriculture New SDA framework

Cairns University Hospital (operational) $1bn+ recurrent

Population and Migration $750,000

INFRASTRUCTURE PRIORITIES

Food & Water Security $7m

Cairns University Hospital Redevelopment Project $163m+

Cairns Marine Precinct $180m+

Cairns Ring Road $437m

National Highway A1 $10m

Savannah Way (Gulf Section) $79.6m ADVANCE CAIRNS STATE BUDGET SUBMISSION

03

DESTINATION DEVELOPMENT

ADVANCE CAIRNS PRIORITIES 2021/22

AVIATION AND TOURISM COUNCIL: ALL TNQ STATE ELECTORATE: ALL TNQ FEDERAL ELECTORATE: KENNEDY, LEICHHARDT

BACKGROUND

BRIEFING NOTE SUMMARY • Cairns is one of Australia’s most aviation dependent communities, with more than three times as many passenger movements per resident (31.6) compared to a city such as Brisbane (9.7).

• During COVID-19, Cairns lost 95% of its total air capacity for the three months ending June 2020.

Globally, international airline capacity is not expected to return to preCOVID capacity until after 2023.

• 52% of TNQ’s 3 million visitors per annum come through the airport.

Aviation capacity is currently sitting at less than 55% of pre-COVID seat capacity.

• COVID-19 has had a disproportionate impact on the region with a forecast loss of $2.2 billion in 2021, impacting on more than 7,700 jobs in the visitor economy.

• A Queensland Government investment of $100 million over four years is needed to boost statewide aviation capacity. In addition, TTNQ requires $10 million over four years to boost event tourism.

04

THE ISSUE TNQ is one of the destinations most affected

by COVID-19 in Australia, with visitor spend estimated to have fallen $2 billion in 2020 and domestic and international aviation seat capacity predicted to remain at less than 50 per cent of pre-COVID levels for at least the next two years. This would impact more than 7700 jobs in the region from the visitor economy.

TNQ stretches from Cardwell to the Torres Strait and west to the Northern Territory border and receives nearly three million domestic and international visitors annually. This equated to an estimated $3.5 billion in annual visitor spend in the year ended March 2020. Two-thirds of the region’s visitor nights are domestic travellers, and one-third international.

While international borders are currently closed, when they do reopen the reintroduction of international aviation capacity to Australia is likely to be slow. Cairns airport must therefore seek to maximise opportunities to recover domestic airline capacity and take advantage of travel ‘bubbles’ to markets such as New Zealand, Singapore or Japan as and when they become available.

With limited international flights returning to Cairns in the coming 12-18 months, capturing as much domestic capacity as possible is crucial to support and re-energise the tourism sector and the local economy. The Cairns community welcomed the support of Governments in providing direct support to the airlines (Federal) and the airports (State) to support the reintroduction of domestic services to Cairns and across the region.

ADVANCE CAIRNS STATE BUDGET SUBMISSION

Air connectivity is key to the economic development of the Cairns region. It opens up new visitor markets, enables the export of agricultural produce and promotes growth in the education sector. A daily international wide-body flight to Cairns is potentially a $200 million a year export business, with $100 million of international visitor spend, $50-$150 million of agricultural produce sales, and the potential to deliver more than 650 new jobs widely dispersed across the region.

Cairns Airport is the nation’s seventh busiest in terms of combined international and domestic passenger movements. It has historically handled around 130,000 aircraft and over 5.2 million passenger movements per year. The airport is widely recognised as one of the most significant economic drivers in the Tropical North Queensland (TNQ) region and its facilities are critical pieces of economic infrastructure.

As the COVID-19 uncertainty and international border closures continue, further assistance is needed. The key international and domestic aviation gateways of Queensland (Cairns, Sunshine Coast, Brisbane and Gold Coast) joined forces to present an opportunity to government to review the current approach to aviation attraction funding structures and programs. A COVID recovery paper presented in March 2020 recommends a statewide investment in a new Aviation Capacity Expansion (ACE) program of $100 million over four years and continued Federal Government support for freight and international services under the International Freight Assistance Mechanism (IFAM).

The route stimulus funding from government resulted in a return of nearly 70% of pre-COVID domestic seat capacity in December, when all state borders were briefly open for leisure travel (although that has since fallen and continues to do so). Packages such as the Alliance Airlines subsidy for the Sunshine Coast generated 931 seat sales, while the Virgin Australia seat subsidy in NovemberDecember generated 2422.

At a time of continued uncertainty around international services, funding provided

by IFAM to support freight operations from Cairns has been critical to the local economy and livelihoods of those in the supply chain.

Services to Hong Kong, Singapore and Tokyo have benefited from IFAM and have allowed the local freight industry to consider a diversified market approach that the previous capacity provided by passenger aircraft had not.

For example, SilkAir Cairns-Singapore has used the narrow body Boeing 737 aircraft with little scope for freight. During COVID19, when international passenger services into Cairns have all but ceased, the IFAM-supported wide body Airbus A350 passenger aircraft (operating as a freighter) allowed commodities such as seafood to be carried into Singapore and beyond on the vast Singapore Airlines network. Continued and expanded support from IFAM may aid in the transition back to passenger services as it facilitates a proven cargo demand profile which complements a steady return of global visitors to the region.

For many years the true potential for local land and sea produce has not been realised due to the limited international air capacity from Cairns. Backtracking to Brisbane is not a viable option for many producers, however what IFAM has achieved has been the raising of awareness, and the commitment to introduce dedicated freight services from our region and we believe this is just the start of how both the passenger and freight components of our economy can thrive in a post COVID world.

Ongoing investment in destination marketing for Cairns and Great Barrier Reef will

• •

•

•

•

be vital to the region’s recovery once borders reopen. An investment of at least $10 million per annum should be supported for the region, through the cooperation of Tourism Australia, Tourism and Events Queensland and Tourism Tropical North Queensland with funding from the Cairns Airport and Cairns Regional Council along with industry.

The visitor economy, made up of holiday, visiting friends and relatives, business events, major events and education visitors, contributes over 17 per cent of our Gross Regional Product (GRP), supporting one in five jobs directly and indirectly.

The impact of global travel restrictions from COVID-19 has seen the visitor economy come to a virtual standstill since March. As the industry emerges it is clear that the key to the recovery of the visitor economy, and the wider regional economy, is aviation-led.

In addition to marketing support, industry needs to reconnect with the global travel trade following the decimation of travel wholesale and retail partners for our region globally. The Export Market Development Grant (EMDG) has provided the incentive for Australian businesses to establish trade links that drive the $30B international tourism sector in Australia.

Proposed changes to the ‘rules’ associated with the EMDG will reduce both the number of eligible businesses and the $ amount each receives. The opposite is needed: Government should be ‘resetting’ the eight-year limit on EMDG eligibility for existing operators, maintaining the current eligibility threshold level and increasing the level of support to kick-start Australia’s trade-driven COVID recovery.

To preserve and grow food and other exports, the Federal Government should extend its IFAM program to December 31, 2021.

To maximise domestic travel while international borders are closed, the Federal Government should continue to support air services to regional communities such as Cairns.

The Attracting Aviation Investment Fund and Connecting With Asia Fund should be replaced with a $100M Aviation Capacity Expansion program over four years.

Tourism Australia and Tourism Events QLD should provide the TNQ region with at least $10M in destination marketing funds per annum split 50:50.

The ‘rules’ associated with the EMDG should be reset for existing operators who have already received support for eight years, and thresholds for eligibility be retained until the impacts on global travel are better known. The level of support for individual businesses should

ESTIMATED PROJECT COST $110M

NEXT STEPS •

•

•

•

20212022

The Attracting Aviation Investment Fund (AAIF) and Connecting With Asia Fund (CWA) were due to expire at the end of FY20. To replace the AAIF and support both domestic and international route retention longer term, the development of an Aviation Capacity Expansion (ACE) program has been proposed by Queensland airports and tourism regions.

The Federal Government’s International Freight Assistance Mechanism (IFAM) needs to be extended to encourage diversification of markets in Asia and beyond for regional hubs such as Cairns.

A new fund should be established to drive aviation capacity, supported by increased destination marketing.

Enabling the Australian travel and tourism sector to reconnect face-to-face with international wholesalers and retailers (once COVID restrictions ease) is pivotal to recovery.

20222023

20232024

20242025

Recommended State Investment

$30m

$30m

$30m

$30m

Recommended Federal Investment

$5m

$5m

$5m

$5m

increase.

PATHWAY TO PROSPERITY

REGIONAL PLANNING

ADVANCE CAIRNS PRIORITIES 2021/22

CAIRNS UNIVERSITY HOSPITAL COUNCIL: ALL TNQ STATE ELECTORATE: ALL TNQ FEDERAL ELECTORATE: KENNEDY, LEICHHARDT

BRIEFING NOTE SUMMARY

• In 2020, the Queensland Government announced an operating budget of over $1 billion for the Cairns and Hinterland Hospital and Health Service.

• Cairns and Hinterland HHS has a vision for Cairns Hospital to transition to Cairns University Hospital by 2025.

• University hospital status will facilitate expanded services, reducing the need to travel outside the region for medical treatment, and supporting workforce attraction and retention • The CHHHS master planning process has identified over $500 million in infrastructure needs over the next 20 years.

THE ISSUE Expanded clinical services and a qualified and comprehensive workforce at Cairns Hospital are critical for meeting the health needs of Tropical North Queensland’s (TNQ’s) growing population. Over the past five years, the Cairns and Hinterland Hospital and Health Service (CHHHS) has addressed this need with an expansion of clinical services at Cairns Hospital, including: • locally based urology services; • a new adolescent ward; • 24-hour availability of the cardiac catheter laboratory and built a second cardiac catheter laboratory; • an expanded intensive care unit; • in-reach into nursing homes and increased geriatric support in the Emergency Department; • expanded cardiac outreach service; • a dedicated stroke service; • increased cancer care, renal dialysis and endoscopy services; and • increased telehealth services to provide care closer to home.

In 2020, the State Government announced an operating budget for CHHHS of over $1 billion1.

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ADVANCE CAIRNS STATE BUDGET SUBMISSION

Additionally, work has commenced on the new $70 million Mental Health Unit and $67.9 million has been committed to expand the Cairns Hospital Emergency Department, build a preadmission clinic, a third endoscopy procedure room and hybrid surgical theatre and to provide critical upgrades at Cairns Hospital.

In the coming years, CHHHS is aiming to obtain university status to enhance the clinical services of its health facilities with expanded education and research. The agenda will be to provide excellence in health care, maximising the range of specialty services provided. This will reduce the need to travel outside the region for medical treatment.

Following these investments, the Cairns Hospital will be delivering its highest level of care to date. However, to cater for growing demand and address the critical health challenges facing TNQ, there remains an urgent need to recruit Cairns-based clinicians to provide specialist services currently being delivered elsewhere.

The CHHHS completed a master planning process in 2019, identifying infrastructure needs worth over $500 million over the next 20 years.

• To attract, retain and educate the workforce required, JCU’s College of Medicine and Dentistry requires an extra 50 Commonwealth Supported Places, 30 International places and an allocation of scholarships through the Destination Australia scholarships program.

1 State of Queensland (Cairns and Hinterland Hospital and Health Service) Annual Report 2019–20.

2 https://www.myhospitals.gov.au/hospital/310000214/cairns-hospital/emergency-department

BACKGROUND In 2019-2020 there were 71 690 presentations to the Cairns Hospital emergency department, a 24% increase over the preceding five years2.

Throughout 2019 the emergency department faced unprecedented pressure, averaging 211 patients per day, a 4% increase on the previous year. Also 30% of emergency patients were tourists or people who live outside Cairns in rural and remote areas including Cape York and Torres Strait. Throughout 2020, the hospital managed the impacts of the global COVID-19 pandemic as well as normal health service delivery. From August 2020, there was a return of increased pressure on the emergency department with an average of 218-224 patients a day, despite tourists numbers being dramatically reduced due to COVID-19 travel restrictions.

The Cairns Hospital supports an estimated resident population of 259 230 and regularly provides acute medical services for residents of the Cape and Torres region (population of 27 643). Combined with estimated population growth of 1.79% per annum, and an ageing population, it is estimated that by 2026 an additional 32,000 people will reside in the catchment area with close to one in five residents being over 65. The Cairns Hospital also provides medical services for the three million tourists that visit the region annually.

Demand for CHHHS services will therefore continue to increase, requiring continued investment in specialised training for the local health workforce, with current planning predicting an extra 80 inpatient beds are needed by 2022 and 223 extra beds by 2037. When combined with the expansion of university medical training facilities in the region, particularly by James Cook University

NEXT STEPS (JCU), there is growing momentum to upgrade Cairns Hospital to Cairns University Hospital. For example: • Based within JCU’s Division of Tropical Health and Medicine, JCU proposes to establish a Tropical Global Health Centre to produce research-enabled clinicians with extensive clinical training in population health and global public policy. The Centre will leverage investment in the Cairns University Hospital to provide students with globally relevant training and deliver a medical workforce specifically prepared to handle regional health challenges.

Although initially focused on the medical workforce, the program will subsequently expand to include nursing, dentistry, pharmacy, allied health and veterinary health professionals.

• The CHHHS Strategic Plan includes a priority to build a Cairns Health and Innovation Centre (CHIC) in Cairns that will provide state of the art research and education infrastructure for the region.

Once constructed, through partnerships with educators, scientists, medical practitioners and technology firms, the CHIC will ensure skilled health workers are attracted to, and remain in the region, building clinical capability to improve patient outcomes in the region.

Cairns Hospital was the first regional digital hospital in Australia, which demonstrates its ability to manage the operational change required to progress to progress to increased and more complex service delivery and become a university hospital.

OUR RECOMMENDATION • Additional infrastructure and operational funding will be sought following the business case process to facilitate the transition of Cairns Hospital to Cairns University Hospital.

• That to support the training of a regional medical workforce, the Federal Government allocates an additional 50 Commonwealth Supported Places and 30 International places recurrent, together with an allocation of Destination Australia scholarships to JCU’s School of Medicine and Dentistry.

ESTIMATED ADDITIONAL RECURRENT FUNDING

To

Recommended Federal Investment (CSP)

transition

Cairns

an expansion of selected specialty services is required over coming years potentially including endoscopy and other medical and surgical specialties.

This will also include new expanded clinical and professorial roles. This will be delivered through strong partnerships, the right infrastructure and expanded provision of safe and sustainable clinical services for TNQ. The State Government has funded the development of a Preliminary Business Case to support the transition to Cairns University Hospital including the CHIC as well as optimising the current Cairns Hospital footprint. This will identify options for a detailed business case and

identify

preliminary

funding

requirements.

Master planning by CHHHS has also identified the need for over $500 million in infrastructure during the next 20 years. In addition, to support the

training

and

recruitment

of

Cairns-based clinicians, JCU requires an additional 50 Commonwealth Supported Places (CSP) and 30 international places recurrent for the JCU Bachelor of Medicine, Bachelor of Surgery (MBBS) program. This will allow JCU to offer years 1-6 of the MBBS in Cairns and Mackay. The additional places will be distributed across the regional centres of Cairns (30), Mackay (10) and Townsville (40).

20212022

Recommended State Investment

successfully

Hospital to Cairns University Hospital,

20222023

-

TBC* -

2023- 20242024 2025 TBC*

TBC*

$26.7m+ $26.7m+ $26.7m+

*To be informed by business case to finalise requirements + Recurrent funding

PATHWAY TO PROSPERITY

INDUSTRY DEVELOPMENT

ADVANCE CAIRNS PRIORITIES 2021/22

LAND USE AND AGRICULTURE

THE ISSUE A CSIRO and James Cook University (JCU) report into land tenure issues in northern Australia identified key actions required to ensure land tenure arrangements facilitate rather than hinder investment in the region.

The report identified that the majority of land in northern Australia is crown-owned (75.4%), two-thirds of which is pastoral leasehold. Another 18.5% is Indigenous land and privately-owned land accounts for 6.1%.

However,Indigenous land interests cover an estimated 94% of northern Australia and there are limited arrangements to support traditional owners in leading development opportunities within these various tenures.

In the State of Queensland, an estimated 65% of land is leasehold, with term leases for grazing and agriculture the principal arrangement.

High value agriculture is permitted by the Native Title Act (1993) on term leases subject to notices, which does not require an Indigenous Land Use Agreement (ILUA) or consent.

In 1996 the Native Title Act confirmed existing freehold and perpetual leases extinguished native title, however it is the State’s view this can only be achieved if native

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ADVANCE CAIRNS STATE BUDGET SUBMISSION

title is extinguished either by agreement (ILUA) or order of the Court.

Many pastoral tenures therefore have quite restrictive requirements that need careful negotiation for development. Native title issues in particular are sensitive as the land holder cannot achieve more secure tenure unless native title is surrendered or extinguished.

Many others are impacted by the Queensland Vegetation Management Act (1999), which was amended in 2018 to ban broad-scale clearing of remnant vegetation for agriculture.

The reduced certainty regarding land use is impacting both agricultural and environmental management investment as many leaseholder and financial institutions require a more secure form of tenure to underpin the huge capital investment required for high value agriculture.

Combined with land tenure uncertainty, to improve agricultural investment in Tropical North Queensland (TNQ) an opportunity exists to streamline development approvals.

COUNCIL: ALL TNQ STATE ELECTORATE: ALL TNQ FEDERAL ELECTORATE: KENNEDY, LEICHHARDT

BRIEFING NOTE SUMMARY • To reduce the uncertainty facing investors in agricultural development, improved strategic land use planning and mechanisms for tenure resolution are required.

To facilitate this process, it is proposed that Strategic Agricultural Development Areas be prioritised and established.

• This approach would be complimented by the creation of an Office of the Coordinator General in far northern Queensland.

The Office is required to coordinate more effective strategic regional land use planning and major development approvals, supported by increased State investment to process subsidiary tenure resolution efforts.

BACKGROUND Productive agricultural land is an irreplaceable asset for current and future generations and must be effectively identified, managed and preserved through improved land use planning and project assessment frameworks.

While land ownership in Australia is governed by common and statutory laws, in the context of northern Queensland a lack of strategic planning and land tenure complexities have frustrated new investment.

In a recent CRCNA report Facilitating Quality Agricultural Development in Northern Queensland, it has been recommended that to achieve investment and sustainable agricultural outcomes, significant effort is needed to address issues that arise from: • A lack of clearly articulated agricultural development priorities across northern Queensland; • Poor frameworks for integrated, collaborative planning at the catchment or sub-regional scale between governments, the private sector and the community to progress agricultural development; • Fragmented and sometimes conflicting policy and process settings in project assessment and approvals that are unable to resolve tensions (and opportunities) concerning development, the environment and Indigenous interests in northern Queensland landscapes; and • A limited focus on raising the capacity of agricultural development interests to develop and prosecute investment-ready proposals that can easily achieve their regulatory obligations.

Without resolution, further investment in agricultural development will continue to be hampered by inefficiencies, conflict and uncertainty.

In Tropical North Queensland, efforts to reduce barriers to agricultural investment could be pursued in several different ways: 1. All levels of government working together with industry, investors and community interests to set targets for, and to prioritise agricultural development in northern Queensland; 2. Streamlining development approvals and regulations at the federal, state and local level through a single point-ofcontact permanently based in the region; 3. Making administrative and legislative improvements to land tenure legislation to reduce barriers to investment, taking into consideration the requirements of the Queensland Vegetation Management Act (1999); and 4. Taking action to improve the effectiveness of land and resource planning to reduce conflict between potential investors and land holders.

NEXT STEPS Just as there are State Development Areas (SDAs) to promote economic development in Queensland, to reduce the uncertainty facing investors in agricultural development, it is proposed that a framework for prioritised Strategic Agricultural Development Areas be developed across TNQ. Similar in nature to a State Development Area, this would mean that in areas suitable for agricultural production, a single authority would coordinate decisions regarding: • Land use planning and approvals; • Vegetation management planning and approvals; • Native title negotiations; • Environmental impact studies and approvals; • Water allocations; and • Trunk infrastructure requirements.

The process would be managed through the creation of an Office of the Coordinator General in far northern Queensland, which would be tasked with coordinating strategic regional land use plans and major development approvals, supported by associated tenure resolution efforts.

CSIRO and James Cook University, Land Tenure in northern Australia: Opportunities and challenges for investment, June 2013 https://profile.id.com.au/fnqroc/population Department of the Prime Minister and Cabinet, Planning for Australia’s Future Population, March 2019 Dale, Allan Patrick & Marshall, Amber (2020) Facilitating Quality Agricultural Development in Northern Queensland: New Policy Directions. Cooperative Research Centre for Developing Northern Australia (CRCNA), Australia.

OUR RECOMMENDATION •

•

That the State Government reduce uncertainty regarding land use and land tenure issues by establishing a framework for Strategic Agricultural Development Areas in Queensland.

That the State Government establish an Office of the Coordinator General in far northern Queensland based in Cairns to effectively coordinate strategic regional land use planning and major development approvals, supported by associated tenure resolution efforts.

PATHWAY TO PROSPERITY

REGIONAL PLANNING

ADVANCE CAIRNS PRIORITIES 2021/22

POPULATION AND MIGRATION STRATEGY COUNCIL: ALL TNQ STATE ELECTORATE: ALL TNQ FEDERAL ELECTORATE: KENNEDY, LEICHHARDT

THE ISSUE In 2018 Australia’s population reached 25 million people, two decades earlier than predicted, which has put unprecedented pressure on metropolitan capitals. Significant population growth in capital cities has created a settlement imbalance, leading to sizable infrastructure investment in cities and an infrastructure deficit in the regions.

While population growth has been centred on capital cities, Australian residents are showing they want to live in regional areas with more than 400,000 people choosing to relocate from the city to the regions in the five years to 2016. COVID-19 has accelerated this trend, with net migration to regional areas 5% higher in 20201. Migration away from capital cities has predominantly occurred in the 30-39 year and 60–69 year age groups, leading to unexpected increased demand for regional school enrolments and health care services, and demonstrating the important role of population policy planning for regional locations.

To encourage the trend of regional migration to continue and ensure that relocation is a real

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ADVANCE CAIRNS STATE BUDGET SUBMISSION

and viable alternative to capital cities, there is a need to rebalance national infrastructure spending away from urban fringe locations such as the Gold Coast to regional city locations such as Cairns. Infrastructure investment will improve the accessibility and liveability of regional cities and in the case of Cairns, deliver on the Federal Government’s northern Australia agenda for economic growth.

Population growth should not be a side effect of other policies as it leads to unplanned urban growth and insufficient infrastructure, and this has been the experience to date in northern Queensland. The Cairns Region Population and Migration Strategy will therefore provide a strategic approach to population that demonstrates the needs of the region, leading to proactive plans that drive catalytic projects such as roads, health services and water infrastructure plus a supportive policy framework. The strategy will inform forward planning for government at all levels, delivering on the objectives of the Commonwealth’s Centre for Population.

BRIEFING NOTE SUMMARY • A Population and Migration Strategy will provide the framework to attract people to Tropical North Queensland and encourage people to stay long-term.

• COVID-19 has accelerated remote working, leading to greater migration to regional Australia • Australian residents are showing they want to live in regional areas. Policy that supports population migration to the regions can aid in balancing Australia’s population growth trends, which are currently centred around metropolitan areas.

• Development of a Cairns Region Population and Migration Strategy requires shared State and Federal Government investment of approximately $1.5 million and supports the objectives of the Commonwealth’s Centre for Population.

NEXT STEPS

BACKGROUND In December 2018, population became a standing agenda item for the then Council of Australian Governments (COAG), placing it firmly on the national policy agenda. In delivering a new approach to population planning, the State Treasurers and the Australian Local Government Association have been tasked with developing a national framework through a bottom-up approach to population policy development.

In support of this objective, a national population and planning framework was released by the Federal Government in March 2019 and in October 2019, a new Centre for Population was launched to be based inside of Treasury. The Centre is the primary location for all population related matters and works closely with the states and territories, academics and think tanks in order to share data, research, ideas and expertise on population.

Far North Queensland is the largest region in northern Australia by population (279,948 people), and whilst it has an established

track record of population growth averaging 1.1% per annum, this is 55% lower than the Queensland State average of 1.7%. The population growth rate of the Cairns region has been in steady decline since 2010 and at 0.9% in 2019, is well below the long term average of 2.6% 2.

To achieve the region’s economic potential and to help fill current employment gaps, in May 2019 a Far North Queensland Designated Area Migration Agreement (DAMA) was declared for the region. This is now in need of a variation to increase the geographical footprint and ease various occupation and industrial restrictions. There is also a need to identify emerging and growing industries and the associated skill gaps they will bring, enabling the region to develop workforce projections and to plan for the targeted recruitment of skilled migrants. This will also inform social infrastructure needs and investment requirements for catalytic assets.

1 Bernard, A et. al. 2020, ‘Anticipating the impact of COVID-19 on internal migration’,Centre for Population Research Paper, The Australian Government, Canberra.

2 Carr, R. 2020, ‘Cairns Watch’, Herron Todd White Cairns Socio-economic research

Policy that supports population migration to the regions can be part of the solution to balancing Australia’s population growth away from metropolitan areas, relieving pressure on capital cities while supporting economic development in northern Australia.

A Cairns Region Population and Migration Strategy is needed to provide the framework for the infrastructure, services and facilities required to attract, retain and support a skilled and growing resident population in TNQ. The strategy will inform policy development regarding infrastructure, liveability, social cohesion and workforce planning, delivering the change required for economic development, and aiding in the creation of a Masterbrand that overcomes perceptions of poor infrastructure, services and amenity in the region.

Led by James Cook University’s Cairns Institute, the population and migration strategy will: • Identify causes and consequences of population change; • Establish medium term goals for population size and growth; • Examine distribution trends and opportunities to modify them; and • Identify possible levers to achieve the changes required.

The result will be a framework for more sustainable, affordable and efficient growth, enabling the region to influence population trends rather than respond to them. The strategy will also provide input to the State population plan, complement Federal population initiatives around attracting new migrants to regional cities, and inform the Queensland Government’s delivery of the National Partnership on the Skilling Australians Fund.

OUR RECOMMENDATION •

•

That in 2020-2021 the Queensland and Federal Governments support the development of the Cairns Region Population and Migration Strategy through shared investment of approximately $1.5 million (based on 50:50 contributions).

That to accelerate economic growth in TNQ, the Federal Government approve the current Deed of Variation presented by Cairns Chamber of Commerce to address the current caps and restrictions placed on the Far North Queensland Designated Area Migration Agreement and commit to renewing the agreement when it expires in 2024.

ESTIMATED PROJECT COST $1.5M

2021- 2022

Recommended State Investment

$0.75m

Recommended Federal Investment

$0.75m

PATHWAY TO PROSPERITY

ENABLING INFRASTRUCTURE

ADVANCE CAIRNS PRIORITIES 2021/22

FOOD AND WATER SECURITY COUNCIL: CAIRNS, MAREEBA, ETHERIDGE, COOK, TABLELANDS STATE ELECTORATE: CAIRNS, BARRON RIVER, HILL, TRAEGER FEDERAL ELECTORATE: KENNEDY, LEICHHARDT

THE ISSUE Tropical North Queensland (TNQ) has seen sustained population growth during the past 30 years underpinned by expansion of industries including agriculture, tourism, fisheries, education, health and retail. Throughout 2020, agriculture has been a continuing success story for the region and vitally important in driving post-COVID-19 economic recovery. At the forefront of agricultural growth has been the Atherton Tablelands, driven by the Mareeba Dimbulah Water Supply Scheme (MDWSS) with rapid expansion in high value crops such as avocados, bananas, berries and sugarcane.

Water is now 100% allocated and 80% used, with purchase prices rising more than three-fold since 2011, peaking at $4000ML. To address high prices and supply issues on the Tablelands, short and long term action is urgently needed. Sunwater is undertaking muchneeded improvements in the MDWSS to provide efficiencies in the short term but the scheme will also need supplementing with extra supply through the proposed North Johnstone River Diversion Scheme. In the long term it is expected Nullinga Dam will also be given further consideration, with land for the proposed site being set aside.

In addition, agriculture in areas such as the Lakeland district near Cooktown and surrounding the Gilbert River in Etheridge Shire have potential to expand rapidly with through value crops such as bananas, grains, cotton and watermelons. Water security has been a concern for a number of years and is now limiting supply in both regions.

Agricultural exports are vital to Tropical North Queensland (TNQ) with the industry sector output currently valued at $2.7 billion, constrained mainly by factors such as irrigation and access to market. A landmark supply chain study entitled Export 2030 – Fresh Food Fast was released in June 2020 which highlighted the potential to double high value food exports through Cairns airport within a decade.

Urban demand also continues to increase with Cairns’ population growth averaging 1.1% per 12

ADVANCE CAIRNS STATE BUDGET SUBMISSION

Cairns’ population growth averaging 1.1% per

BRIEFING NOTE SUMMARY • The ability to supply increased demand for fresh Australian food from North Queensland is at risk due to a lack of long term water implementation strategy • To cater for growing demand for water, four significant water supply and infrastructure projects are considered essential enablers for the region:, North Johnstone River Diversion Scheme, Lakeland Irrigation Area Project, Gilbert River Irrigation Scheme and Cairns Water Security – Stage 1 project.

• All four projects require bilateral commitment and shared investment to facilitate environmental approvals and progress to construction stage.

• A $7million investment is required to progress a North Johnstone River Diversion Scheme business case with completion of the business case by June 2022, to enable and inform a rewrite of the water resource plans for both the Barron and Wet Tropics catchments.

annum. Combined with an estimated three million tourists visiting TNQ annually, to ensure the growing needs of the region can be met, an effective and multi-faceted water supply strategy is required. In Cairns itself, modelling by the Cairns Regional Council shows that demand for water will outstrip supply within the next five years. As a result, the Cairns Water Security – Stage 1 project is an essential piece of infrastructure to secure urban water supply for Cairns well into the future.

In summary, four significant water supply and infrastructure projects are considered essential enablers for water security and growth in the region: • North Johnstone River Diversion Scheme • Lakeland Irrigation Area Project • Gilbert River Irrigation Scheme • Cairns Water Security -Stage 1 project

Building Queensland, Detailed Business Case: Nullinga Dam and Mareeba Dimbulah Water Supply Scheme Improvements Project, June 2019 North Queensland Market and Agricultural Supply Chain Study, May 2019 Department of Agriculture and Fisheries, Tablelands Agricultural Profile: Mareeba, 2016 Water Exchange: Mareeba-Dimbulah irrigation water prices, permanent trade – medium priority, accessed July 2019 https://economy.id.com.au/cairns/population https://economy.id.com.au/fnqroc/value-add-byindustry

BACKGROUND Water and Food security have become priority national policy issues on the back of record drought periods in Australia. In 2020, the Federal Government committed a further $2 billion to the National Water Infrastructure Fund to build resilience in regions and help grow the agriculture sector. A National Water Grid Authority has also been established to develop investment frameworks. In strengthening the role of northern Australia as a food bowl, substantial feasibility work has progressed in the past three years to explore new agricultural development opportunities. With many of these studies now coming to a close, there are clear priorities for progressing environmental impact and construction activities and a coordinated approach to development is required.

North Johnstone River Diversion Scheme: Sunwater completed a preliminary feasibility study in early 2020 with favourable findings and the Queensland Department of Resources has since been undertaking detailed hydrological modelling. The diversion scheme is considered a viable option to stimulate the economy, delivering up to 50,000ML. A $7 million investment is sought for a full business case, to be completed by June 2022 to enable and inform the rewrite of the Water Resource Plans for both the Barron River and Wet Tropics in subsequent years.

Lakeland Irrigation Area Project: Regional Development Australia Tropical North, through the National Water Infrastructure Development Fund (NWIDF), funded a preliminary business case that investigated new water storage options to expand the Lakeland irrigation area.

When constructed, the proposed dam will store

200,000ML and irrigate 8,000ha of arable land.

Federal Government funding of $10 million to further develop the business case has seen work advance materially with site identification, test drilling and cultural heritage, environmental and social stakeholder engagement. The project will require bilateral Government support to facilitate and coordinate the development approval processes for the dam.

Gilbert River Irrigation Scheme: Etheridge Shire Council proposes to manage water from the Gilbert Catchment general reserve and facilitate construction of an irrigation scheme along the Gilbert River, distributing water to an estimated 30,000ha of irrigable land. A detailed business case funded by the State Government’s Maturing the Infrastructure Pipeline Program has been completed and Etheridge Shire Council is in the process of developing a forward plan to progress the project. Preliminary modelling suggested the scheme is economically feasible, and that the area is suited to a range of irrigated crops including grains, pulses and cotton.

Cairns Water Security – Stage 1 project: With forecasts indicating supply to the Cairns urban region due to be at capacity in the next five years, the Cairns Water Security – Stage 1 project is a critical piece of infrastructure for the city. The project has been identified by the Cairns Regional Council’s Water Security Advisory Group (WSAG) as a key priority to meet the short to medium term water security needs of the Cairns community. The project is estimated to cost about $215 million and is scheduled in the council’s capital works program to be completed by June 2026.

NEXT STEPS Development of the four proposed water infrastructure projects would meet a range of state and national policy objectives: • Expand northern Australia’s agricultural productive capacity – this is nationally significant given the impact of drought on food and water security in southern Australia; • Increase northern Australia’s contribution to GDP through an increase in agricultural production; • Diversify northern Australia’s economic capabilities to facilitate investment and reduce reliance on tourism; and • Strengthen Australia’s international competitiveness through proximity to Asia.

OUR RECOMMENDATION • That the Queensland Government apply to the National Water Infrastructure Development Fund (NWIDF) in 2021-2022 for $7 million to progress a full business case for the North Johnstone River diversion scheme • That the Queensland Government works with the Federal Government to facilitate and coordinate the development approval processes for the Lakeland Irrigation Area Project • That the Federal Government provides $8m for an environmental impact study for the Gilbert River Irrigation Scheme • That in 2021-2022 the Federal Government commits funding towards the Cairns Water Security -Stage 1 project as per the Town and City Water Security High Priority Infrastructure Initiative identified by Infrastructure Australia.

ESTIMATED PROJECT COST $230M Recommended Federal Investment

20212022

20222023

20212022

20212022

North Johnstone business case

Gilbert River Cairns Water Cairns Water Irrigation Security - Stage Security - Stage 1 project SchemeEIS 1 project

$7m

$8m

$3m

$20m

20232024 Cairns Water Security - Stage 1 project

$60m

PATHWAY TO PROSPERITY

ENABLING INFRASTRUCTURE

ADVANCE CAIRNS PRIORITIES 2021/22

CAIRNS UNIVERSITY HOSPITAL REDEVELOPMENT PROJECT COUNCIL: ALL TNQ STATE ELECTORATE: ALL TNQ FEDERAL ELECTORATE: KENNEDY, LEICHHARDT

THE ISSUE Clinical research, education and expanded health services are critical to meeting the health needs of Tropical North Queensland’s growing population. Establishing a Cairns Health and Innovation Centre (CHIC) and an expansion of services at Cairns Hospital will be a key element in the transition of Cairns Hospital to university status, allowing the hospital to deliver world-class, highquality care to address the critical health challenges facing TNQ. It will also enable the hospital to address its current challenges related to hospital capacity, site resilience, workforce attraction and retention, and bringing care closer to home for our community.

The proposed CHIC is intended to be adjacent to and support the Cairns Hospital in the areas of research, development and training, transforming the sector to a high-tech, research-driven collaborative enterprise between the Cairns and Hinterland Hospital and Health Service (CHHHS), James Cook University (JCU), TAFE, scientists, and private medical and technology firms.

The CHIC will enable some services to be relocated from the main hospital, freeing up critical assets for clinical services. Some of the hospital’s critical services on the ground floor may also be shifted to other parts of the Cairns Hospital to address short-term service continuity risks.

The proposed CHIC will enable CHHHS to address known research gaps, such as: • Aboriginal and Torres Strait Islander health; • Tropical health and medicine; • Healthcare data linkages and health service models of care; and • Equity of access to healthcare for patients with rheumatic heart disease, sexually transmitted infections, renal disease, diabetes and blood borne viruses.

14

ADVANCE CAIRNS STATE BUDGET SUBMISSION

In addition to clinical research, the CHIC will provide opportunities for innovative delivery of health workforce education programs, plus ongoing clinical advancement in nursing, medical and allied health services for its patients and its workforce. It will also enable and rapidly expand virtual health care models.

The CHIC will house a clinical education facility and a virtual care facility to support the delivery of telehealth patient services. A core element of the precinct will be JCU’s CTEC, a research-driven medical facility that has received a $60m Federal Government commitment including a contribution towards acquiring land for the joint facility.

The State Government has committed funding for Phase 1 of the project, including $1.5million for a preliminary business case and $15million for land acquisition. Further capital is now sought for CHHHS to progress Phase 1 of the Cairns University Hospital Redevelopment Project, comprising: • Optimising the fit-out of Cairns Hospital to facilitate an extra 80 beds • Designing and constructing the CHIC in partnership with JCU • $3.5m to progress a detailed business case for Phase 1 of the project.

BRIEFING NOTE SUMMARY • Cairns Hospital will be at capacity across all bed types by 2022.

• CHHHS is seeking to progress Phase 1 of its Cairns University Hospital Redevelopment Project – comprising an additional 80 beds and establishing the Cairns Health and Innovation Centre (CHIC).

• The new CHIC is proposed to be built in partnership with JCU’s Cairns Tropical Enterprise Centre (CTEC), on land adjacent to the Cairns Hospital.

• JCU has received a Federal Government commitment of $60m towards CTEC (including land acquisition contribution).

• Phase 1 is now progressing, with State Government committing $1.5m for the preliminary business case and $15m for land acquisition.

Further funding will be sought following the business case process.

BACKGROUND The Cairns Hospital supports an estimated resident population of 259,230 and regularly provides acute medical services for residents of the Cape and Torres region (population of 27,643). Combined with estimated population growth of 1.1% per annum, and an ageing population, it is estimated that by 2026 an additional 32,000 people will reside in the catchment area with close to one in five residents over 65.

In 2019-2020 there were 71 690 presentations to the Cairns Hospital emergency department. Throughout 2020, the hospital managed the impacts of the global COVID-19 pandemic as well as normal health service delivery. From August 2020, there was a return of increased pressure on the emergency department with an average of 218-224 patients a day, despite tourist numbers being dramatically reduced due to COVID-19 travel restrictions.

The Cairns and Hinterland Hospital and Health Service Strategic Infrastructure Master Plan outlines the critical need for investment in health facilities in Cairns to address current and predicted health needs.

NEXT STEPS There are significant short-term capacity constraints and resilience risks at Cairns Hospital. The plan outlines a number of strategic options to address these issues – including optimising existing assets.

Cairns Hospital will be at capacity across all bed types by 2022 (c. 70 beds short) – even accounting for improvements to care models. By 2036/37, this gap will have widened to 200+ beds.

This is constraining the hospital’s ability to deliver new and improved services and innovate to meet community needs.

The proposal for a CHIC to service this population has broad partner support and seeks to build on successive government investments. CHHHS, supported by the Northern Queensland Primary Healthcare Network, JCU, CQUniversity, TAFE and and Advance Cairns, is seeking to improve the ability of Cairns to build its own medical, nursing and allied health workforce and translate research into practice to improve health outcomes in our community.

PHASE 1 (2020-2025) “Optimise”

To deliver on the vision for the CHIC, CHHHS is required to construct a dedicated new facility adjacent to Cairns Hospital. With JCU having secured $60 million in Federal funding as a contribution to the construction of the new facility, a further $115+million is now sought from the State Government to progress the CHIC to design and construction phase as well as fit out an additional 80 beds in Cairns Hospital.

Through expanding the Cairns Hospital precinct to accommodate medical research and specialised workforce training, the CHIC will support the transition of Cairns Hospital to University status. A core element of the precinct will be James Cook University’s CTEC, a research-driven medical facility. CTEC will also support the delivery of JCU’s proposed Tropical Global Health Centre, which will allow expansion of the JCU Bachelor of Medicine, Bachelor of Surgery (MBBS) program to offer Years 1-6 in Cairns (and Mackay).

PHASE 2 (2020-2035+)

“Innovate”

“Transform”

Optimise the use of existing Cairns Hospital

Establish the Cairns Health and Innovation Precinct (CHIP)

New, transformed Cairns Hospital

» Relocate some services offsite (e.g. outpatients) to free up capacity for acute services

» Construction of new Precinct in partnership with James Cook University on land adjacent to Cairns Hospital.

» Invest in an expanded hospital footprint to meet projected services demand:

» Refurbish the Emergency Department, improve theatre utilisation

» Relocate services off the main Cairns Hospital site – freeing up critical assets for clinical services

» Accommodate short-term growth within the existing facility (NB. Short-term capacity only)

» Deliver new, innovative care models – virtual health, ambulatory care, clinical trials

OUR RECOMMENDATION • That in 2021, the State Government fast tracks the purchase of the land for the CHIC, as well as the preliminary business case for Phase 1 of the Cairns University Hospital Redevelopment Project.

• That the State Government commits the full funding required to Queensland Health to implementPhase 1 (based on the business case), comprising an additional 80 beds at Cairns Hospital and the construction of the CHIC. • That the State Government provides $3.5 million for the completion of the Phase 1 detailed business case.

» New Acute Services Building – ED, theatres, ICU, inpatient beds » Expanded sub-acute services – B Block » Further spaces available (A Block) for consolidation of other leases / admin / research space

ESTIMATED PROJECT COST $163.5+M* Phase 1 (Cairns Hospital 80 beds plus CHIC)

https://profile.id.com.au/cairns/populationestimate Queensland Treasury, Service Delivery Statements, Queensland Health 2019-2020 https://www.myhospitals.gov.au/ hospital/310000214/cairns-hospital/ emergency-department https://www.myhospitals.gov.au/ hospital/310000214/cairns-hospital/ admissions

2021 - 2022 Detailed business case

Land acquisition

$3.5m

$market value

2022/23 2025/26 Delivery of project

$160+m

PATHWAY TO PROSPERITY

INDUSTRY DEVELOPMENT

ADVANCE CAIRNS PRIORITIES 2021/22

CAIRNS MARINE PRECINCT COUNCIL: CAIRNS STATE ELECTORATE: CAIRNS FEDERAL ELECTORATE: LEICHHARDT

THE ISSUE The Cairns Port is a critical enabler of the Tropical North Queensland (TNQ) economy, with the region welcoming the Federal Government’s commitment to base at least four new Offshore Patrol Vessels (OPVs) in Cairns. The sustainment and maintenance of vessels in northern Australia aligns well with existing shipbuilding commitments in southern Australia, and complements Australia’s Step-Up to the Pacific foreign policy initiatives.

As one of three new Regional Maintenance Centres (RMC) for the Royal Australian Navy (RAN), the others being Darwin and Perth, Cairns provides a national naval sustainment and maintenance hub enabling the Cairns Marine Precinct (CMP) to build on its present commitments of servicing vessels from HMAS Cairns, Darwin, the United States and the Pacific Islands.

The significant Defence and Border Force contracts managed out of the precinct ensures a skilled, yearround permanent marine and engineering workforce of 4600. Cairns is also home to a large and diverse marine sector with 1603 commercial vessels across tourism, fishing and shipping, and an active cruising yacht squadron.

In 2017 the Federal Government committed $24 million to enhance and modernise the three shipyards within the Cairns Marine Precinct. This Stage 1 investment has delivered preliminary improvements to wharves, hardstands, slipways and services and has seen each of the shipyard owners invest considerably more than the original government spend. With the Navy’s tight timeline for RMC NorthEast in Cairns to be operational, an additional federal

investment of $24 million is now required for Stage 2 works in the three shipyards to provide necessary capabilities and capacity.

In 2020 the State Government committed $28 million (over two years) to provide increased wharf capacity under the auspice of Ports North plus $2 million for a detailed business case to inform a stepchange within the precinct.

Ultimately, upon completion of the business case, the State Government is projecting a further $150+ million will need to be invested by both levels of government to create the step change in overall capacity.

The investment in the individual shipyards and the overall Cairns Marine Precinct expansion project, coupled with additional capacity and skills, will ensure that Cairns complies with the RAN’s Plan Galileo which requires that Cairns be fully operational as Regional Maintenance Centre North-East by 2022.

The commitment will also give effect to marine precinct master planning objectives while providing post COVID-19 economic stimulus, creating muchneeded jobs, diversifying the regional economy and ultimately providing for a more secure Australia in line with Pacific Step-Up and Defence initiatives.

This Cairns Marine Precinct expansion project will deliver capability enhancements as identified in Table 1 (overleaf).

1 Department of State Development, Manufacturing, Infrastructure and Planning. Manufacturing Hub Delivery Model: Cairns, Townsville, Rockhampton. November 2018.

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ADVANCE CAIRNS STATE BUDGET SUBMISSION

BRIEFING NOTE SUMMARY • Australia’s Naval ship-building programs have recently been substantially boosted from 12 to 26 vessels.

• The Navy has announced it requires its planned Regional Maintenance Centre North-East in Cairns to begin operating by 2022 – the first of three new RMCs in Australia.

• The Cairns Marine Precinct (CMP) is a national defence asset that currently employs 4600 people.

• The State-recognised precinct requires further government funding commitments, aligned with policies which create jobs, build vital infrastructure, diversify the region’s economy, provide positive economic return and facilitate ongoing private investment.

•

A commitment by the State and Federal governments to work together to finalise the Cairns marine precinct business case in 2021 and deliver on its recommendations to fully develop the precinct – including a $150+ million investment to create new direct and indirect Queensland jobs, adopt new technology and build tomorrow’s workforce.

Table 1: Capability enhancements needed in Cairns marine precinct to maximise jobs and diversify regional economic growth.

INFRASTRUCTURE

SHORT TERM

LONGER TERM

Capability (vessels)

Vessels to 120m LOA homeported RAN fleets and majority of regionally based commercial vessels

Vessels 150m to 175m LOA – majority RAN fleet/maximal commercial vessel opportunities

Lift out capacity (shiplift/dock)

3500 to 5000 tonnes capacity

8000 tonnes capacity

Berth length

3 to 4 vessels at any one time; additional berth of 150 – 350m

800m to 1km of quayside, separate superyacht berth facility comprising floating pontoons

Extra yard and warehouse facilities, plus out of water capacity

3 to 4 vessels up to 120m LOA; 5 hectares of additional land + SPMT corridors; additional paint / blast workshops; ability to sub-divide land areas for a security/ship type purposes

6 – 8 hectares of additional land for vessel lay down purposes, separate landside areas for superyacht maintenance and refits (up to 3 hectares)

NEXT STEPS INFRASTRUCTURE: Investment in ‘fit for purpose’ infrastructure is key to unlocking the maritime opportunities for Cairns with completion of the Cairns Marine Precinct expansion project a critical enabler. As outlined in Table 1, this investment ultimately needs to cater for larger vessels (up to 175m), have ship-lift capacity of up to 8000 tonnes, provide up to 1km of extra wharf, see multiple large vessels simultaneously in dry dock and allow considerable extra land for maintenance activities. The long term vision will be guided by a comprehensive business case for the precinct which details demand, economic benefits, risk assessments, operating model, cost benefit, gap analysis of skills and infrastructure and funding.

WORKFORCE: To capture unmet demand and opportunities, the CMP expansion needs to be complemented by a significant step up in industry workforce skills, training and development, both within the shipyards and also within the sector support industries. The Queensland Government has a clear mission to grow Queensland’s Defence industry and to increase the number of Queenslanders working in Defence manufacturing from 6,000 to 10,000 over the next decade. To support the Cairns RMC, there is a major role for training to upskill existing workers, contextualise training for the marine sector, and to recruit and grow the workforce through stronger training pathways.

Informed by the precinct’s business case, a range of upskilling initiatives will need to be undertaken. Among those to be considered is a virtual sustainment college through the Great Barrier Reef International Maritime College. The College will develop and deliver agile micro credentials that meet future Defence sustainment demands.

BACKGROUND On 1 July 2020 the Morrison Government announced a $270 billion investment over the next 10 years to upgrade the capability and potency of the Australian Defence Force.

The 2020 Defence Strategic Update signals a key change in Australia’s defence posture as it prioritises the Indo-Pacific region.

The strategy will see continued investment in 12 Arafura Class offshore patrol vessels, and extra spending on six new Cape Class patrol boats and up to eight new vessels optimised for mine countermeasures and hydrographic survey, taking Australia’s total shipbuilding activity from 12 to 26 vessels.

The Cairns Marine Precinct is Australia’s maintenance centre for the RAN’s hydrographic vessels as well as Australian Border Force Cape Class vessels. It has serviced the Defence, Border Force and marine industries for many years and, as home to Fleet Base Pacific (HMAS Cairns), is one of the few ports in Australia that can offer the Department of Defence significant expansion opportunities in berth and land facilities.

Under the Security of Critical Infrastructure Act (2018) the Cairns port is a critical national infrastructure asset. It is the northern-most

• • •

•

naval base on the eastern seaboard and plays a key strategic role in Australia’s northern naval capability. In acknowledging this role, in 20172018 the Federal Government committed to upgrading the precinct through staged investment. There is unmet and growing demand in naval, commercial and superyacht maintenance opportunities that supports a step change in ship maintenance capacity in the CMP. There has been significant investment by State and Federal Governments in facilities in South Australia, Western Australia and the Northern Territory. The NT Government, for example, has committed $400 million towards upgrades for its planned Regional Maintenance Centre.

Without a significant step-up in infrastructure and capability at Cairns, the existing CMP based operators may not be able to compete for all future sustainment contracts, and/or maintain or grow their business.

This will result in a potential decline in market share, loss of economic opportunity and overall regional activity levels in allied industries will also sharply decline.

That the Federal Government commits $24 million for stage 2 capacity building within the three existing shipyards, in time for the Regional Maintenance Centre North-East starting operation in 2022.

That the Queensland Government support and facilitate the Federal expansion of HMAS Cairns, ensuring the Department of Defence delivers on the initial $140 million upgrade of the navy base by 2024.

That the QLD Government $2 million business case be completed by end of 2021 and the $28 million for early works to deliver in-water maintenance berths for the Cairns marine precinct expansion be finished by the end of 2022.

That the Federal and State governments commit to deliver the outcomes of the Cairns marine precinct expansion project business case with investment of $150+ million to further develop the Cairns Marine Precinct to Regional Maintenance Centre requirements.

ESTIMATED PROJECT COST $344+M

2021

2021- 2022- 2023- 20242022 2023 2024 2025

Recommended Federal Investment

-

$24m

-

-

-

Recommended State Investment

$8m

$22m

-

-

-

-

$75m* $75m* TBA*

Recommended State and Federal Investment Recommended Defence Investment

-

$20m

$40m $40m

$40m

*Subject to business case outcomes

PATHWAY TO PROSPERITY

ENABLING INFRASTRUCTURE

ADVANCE CAIRNS PRIORITIES 2021/22

CAIRNS RING ROAD COUNCIL: CAIRNS STATE ELECTORATE: CAIRNS FEDERAL ELECTORATE: KENNEDY, LEICHHARDT

THE ISSUE Access to the Cairns airport and seaport from the north, south and west is adversely impacted by a highly inefficient road network, with all directions constrained by the need to travel directly through the Cairns CBD. There is significant traffic congestion on the Captain Cook Highway and along the Cairns Western Arterial Road, both of which lead from the northern beaches into the city, and this makes the transport of freight to, from and between the key port locations difficult.

While there is significant potential to expand export activities for the Tropical North Queensland (TNQ) region, particularly to Asian markets, connectivity between ports is a critical enabling factor in the future development of Cairns as an export and service hub.

The need to upgrade Captain Cook Highway to enhance connectivity was recognised by the Federal Government in its July 2020 release of the 2019 National Land Transport Network (NLTN) Determination Review. The review confirmed the National Highway A1 would be extended to Smithfield, with works on the first phase between James Street and Airport Avenue to begin in mid-2021. The extension of the A1 will free-up State Government funding that would previously have been required for Captain Cook Highway upgrades.

These funds should be redirected to the State-owned Western Arterial section of the Cairns Ring Road which carries 36,550 vehicles per day. Upgrading this section is essential to connecting Cairns’ freight routes with the region’s premier agriculture producing areas (Atherton Tablelands, Cape York Peninsula and Mossman), while also meeting demand for daily commuter traffic.

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ADVANCE CAIRNS STATE BUDGET SUBMISSION

BACKGROUND The Bruce Highway is part of the National Highway A1, providing the vital link between Cairns, other Queensland coastal cities and Brisbane. The National Highway A1 has been extended by the Federal Government to the intersection of Captain Cook and Kennedy Highways and Mount Milman Drive, Smithfield, north of Cairns, which will lead to a major upgrade of the Captain Cook Highway.

However, the effectiveness and safety of the road transport network in and around Cairns will continue to be adversely impacted until the State-owned Cairns Western Arterial Road is also fully duplicated from Redlynch to Smithfield as well as major intersections upgraded.

The Cairns Arterial road network has been underfunded for many years in terms of capacity upgrades, with residential and industrial land development outpacing road project investments. In January 2019, Cairns Regional Council identified a number of underfunded State-owned roads and listed them as priority infrastructure projects for the region. The Cairns Western Arterial Road is a significant component of this list as the road is heavily congested on a daily basis and when the Captain Cook Highway is flooded during wet season or natural disaster, is the only flood free access route between Cairns, the northern beaches and Kennedy Highway. In the 2020 State election, $60 million was promised to duplicate the remaining single lane section of the Cairns Western Arterial Road out to the Barron River at Kamerunga. Currently, only $35 million has been allocated in forward estimates. It is vital that the full funding be in the 2021-2022 budget papers, to allow these important upgrade works to commence.

BRIEFING NOTE SUMMARY • The Federal Government has confirmed National Highway A1 will be extended from Cairns to Smithfield, providing much better links between the CBD and the Cairns sea port, Cairns airport, the northern beaches and southern access route.

• As Stage 1 of the Cairns Ring Road, Federal investment of $287.2 million has been committed, which has been matched by State investment of $71.8 million.

• The Cairns Western Arterial Road intersects with the northern point of National Highway A1 and urgently requires State funding of $365.5 million for essential upgrades as Stage 2 of the Cairns Ring Road. The State Government has promised $60m in the lead up to the last election but only $35m was allocated in the November State Budget.

• When the Captain Cook Highway is flooded, the Western Arterial Road is the only flood free access route between Cairns, the northern beaches and Kennedy Highway.

NEXT STEPS The required infrastructure upgrades can be achieved through: • Creating Stage 1 of the Cairns Ring Road by upgrading the Captain Cook Highway which links the northernmost part of the National Highway A1 to the Cairns port and airport; • Stage 2 includes duplicating the Cairns Western Arterial Road to provide a minimum of two lanes in each direction, beginning with the section between Smithfield and the Barron River at Kamerunga; • Duplicating the Barron River Bridge at Kamerunga and the Redlynch overpass; • Upgrading three major intersections through a combination of overpass, traffic signal and slip lane projects; • Constructing the McCoombe Street connection road between Ray Jones Drive and Mulgrave Road.

It is estimated that a $365.5 million investment is required to cover the cost of the Western Arterial Road upgrades.

This will complement the combined State and Federal investment of $359 million committed for Captain Cook Highway upgrades.

Cairns Ring Road Cairns Ring Road

National Highway A1 National Highway A1 State Arterial Road State Arterial Road Recommended first stage of CWAR duplication

SMITHFIELD SMITHFIELD

Bridge duplication required

STAGE 1 STAGE 1

Cairns Airport Cairns Airport

STAGE 2 STAGE 2

CAIRNS CBD CAIRNS CBD

Cairns Seaport Cairns Seaport

OUR RECOMMENDATION • That the Federal Government commitment of $287.2 million for Captain Cook Highway upgrades be invested over three years to 2024.

• That the Queensland Government commits $437.3 million for the two stages of the Cairns Ring Road, to be invested over four years from 2022-2025.

• That the Queensland Government completes its detailed planning of the Cairns Western Arterial Road upgrade by October 2021 and Captain Cook Highway upgrade by October 2022.

ESTIMATED PROJECT COST $724.5M

20212022

2022- 2023- 20242023 2024 2025

Recommended State Investment

$20m

$100m $100m

Recommended Federal Investment

$3m

$150m $134.2m

PATHWAY TO PROSPERITY

$217.3m

ENABLING INFRASTRUCTURE

ADVANCE CAIRNS PRIORITIES 2021/22

NATIONAL HIGHWAY A1

COUNCIL: CAIRNS, MAREEBA, CASSOWARY COAST, HINCHINBROOK ,TOWNSVILLE STATE ELECTORATE: BARRON RIVER, CAIRNS, MULGRAVE, HILL, HINCHINBROOK, TOWNSVILLE FEDERAL ELECTORATE: HERBERT, KENNEDY, LEICHHARDT

THE ISSUE An integrated and efficient road transport network is critical for economic stability and growth in northern Australia. In Tropical North Queensland (TNQ), the road network underpins the economy and is vital to the resident population of 286 873, ensuring accessibility to health, education and community services.

Due to rapid population growth, TNQ’s road transport system faces increasing pressure, particularly on the road network in and out of Cairns which acts as the main distribution hub for the region. Meeting the growing demand for freight has strained existing infrastructure, impacting transport costs and service levels across the supply chain. The strain has been exacerbated by uneven population dispersion, the shared passenger transport task on TNQ roads, and resilience gaps in the road network which is frequently impacted by weather events.

Via road, the city of Cairns is serviced by four main arterial roads, two of which are critical freight routes – the Bruce Highway and the Kennedy Highway.

The Bruce Highway is part of the National Highway A1, providing the vital link between Cairns and Townsville, other Queensland coastal cities and Brisbane. The highway supports the transport of freight into and out of the region. The National Highway A1 was extended by the Federal Government in 2020 to the intersection of Captain Cook and Kennedy Highways and Mount Milman Drive, Smithfield, north of Cairns, which will lead to a major upgrade of the Captain Cook Highway, with $359 million allocated.

The Kuranda Range Road (Kennedy Highway, Cairns/Mareeba section) links Smithfield with Kuranda and is the coastal

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ADVANCE CAIRNS STATE BUDGET SUBMISSION

BRIEFING NOTE SUMMARY • TNQ’s road transport system is under pressure due to population growth, particularly on the road network around Cairns which is the main distribution hub for the region.

• The Bruce Highway is one of Australia’s highestrisk roads and in the 5 years to 2020, there were 604casualty crashes and 33 fatalities on the stretch between Cairns and Townsville.

• The Kuranda Range Road has already exceeded its capacity of 9,500 vehicle movements per day, catering for up to 10,000 daily traffic movements. In 2018-2019, the road was closed more than 130 times due to crashes.

gateway to the Atherton Tablelands, Cape York Peninsula and the Gulf Savannah. It is a critical link for commuter, commercial and visitor traffic in TNQ and a vital strategic corridor linking the Atherton Tableland, North Tropical Coast and Cape York to the Cairns Airport.

Both the Bruce Highway and Kuranda Range Road underpin the commercial viability of primary industries, producers and exporters in the region. However, both are operating at or near capacity with safety and traffic efficiency now at critical levels for action.

While unprecedented State and Federal funding has been allocated for Bruce Highway upgrades between Cairns and Townsville, to maintain and grow TNQ’s competitiveness through improved productivity a number of catalytic projects are still needed.

This need is supported by the 20092031 Far North Queensland Regional Plan, which recommends that the Department of Main Roads plan for and preserve transport corridors to construct bypass roads around Innisfail, Ingham, Cardwell and Tully, and plan for and construct the duplication of Kuranda Range Road.

• While the Bruce Highway has seen unprecedented State and Federal investment since 2013, many future TNQ projects are scheduled for commencement after 2023. It is essential these be brought forward to address critical congestion and safety issues.

•A strategic transport plan linking Cairns and Townsville is required, together with a significant upgrade of Kuranda Range Road.

Queensland Department of Infrastructure and Planning, Far North Queensland Infrastructure Plan 2009-2031 Australian Automobile Association, How Safe Are Our Roads? Australian Road Assessment Program (AusRAP): Risk Mapping, 2016 Australian Road Assessment Program (AusRAP), Risky Roads Project Examples include: McIntyre M (2000). Integrated Transport Study for Kuranda Range: impact assessment study.

Prepared for Department of Main Roads; Environment North (2004). Integrated Transport Study for Kuranda Range – Impact Assessment Study IAS Addendum.

Prepared for Department of Main Roads; Environment North (2006). Integrated Transport Study for Kuranda Range Further Information Report. Prepared for Department of Main Roads.

Department of Main Roads: RTI 135-05880 North Queensland Region

BACKGROUND Over the past decade, the Bruce Highway has consistently been rated one of Australia’s highest-risk roads. In 2016 the highway accounted for 17% of National casualty crashes on only 7.5% of the entire national network. On the 299 km section between Cairns and Townsville, which carries an estimated 17,250 vehicles per day, in the five years to 2020 there were 604 casualty crashes and 33 fatalities.

To address the significant safety issues, in 2013 the Federal Government introduced the $12.6 billion Bruce Highway Upgrade Program, which has led to step-change investments in north Queensland sections of the highway. Together with the State Government, to date this has delivered: $610 million for Stages 1 to 4 of Cairns Southern Access upgrades with another $225 million committed for Stage 5; $9 million committed for Innisfail bypass planning; $48 million committed to plan for the Cardwell Range deviation; and another $ 99.8million committed for Townsville Northern Access upgrades.

In contrast to the Bruce Highway, the Kuranda Range Road has been the subject of multiple impact assessment and design studies dating back to 2000 but is yet to see significant investment. The road has already exceeded its capacity of 9,500 vehicle movements per day, catering for up to 10,000 daily traffic movements. And in the 10 years to August 2018, the Cairns to Mareeba section of Kennedy Highway experienced 493 unplanned closures with total closure time of 1,111 hours and an average close time per incident of 2 hours and 15 minutes. While the need to upgrade the road was identified in the 2009-2031 Far North Queensland Infrastructure Plan, more than 10 years on this remains a critical infrastructure project but is yet to secure significant funding.

NEXT STEPS A number of significant investments have been announced that will continue to address safety and efficiency challenges on the TNQ road network. However, many of these projects are scheduled for commencement after 2023. To address the critical congestion and safety issues faced on the road transport network, it is essential that the following key projects be brought forward and commenced in 2021-2024: 1. Kuranda Range Road: Release the findings of the $1.25 million Cairns to Northern Tablelands access strategy (completed).

2. Kuranda Range Road: Business case ($20 million) to design and cost upgrades by 2022.

3. Captain Cook Highway: Complete planning for upgrade between Cairns and Smithfield

and include $359 million allocated for construction in budget forward estimates for 2022-2025.

4. Bruce Highway, Innisfail Bypass: Continue to preserve the existing bypass corridor and commence transport project planning ($9 million) with a view to completion by 2022.

5. Bruce Highway, Ingham to Cardwell Range Deviation: Continue to preserve the existing transport corridor and commence transport project planning ($48 million) with a view to completion by 2023.

6. Bruce Highway, Cairns to Townsville: Develop a strategic transport plan for the Bruce Hwy which links northern Australia’s two largest centres, Cairns and Townsville.

• That the Queensland Government releases the findings of the $1.25 million Cairns to Northern Tablelands access strategy, which was completed in late 2020 • That, following the release of the access strategy, the Queensland and Federal Governments commit $20 million (shared 50:50) to undertake, preliminary evaluation and business case for Kuranda Range Road.

• That through the Bruce Highway program, the State and Federal Governments bring forward their commitments to upgrade north Queensland sections of the National Highway A1 to 2022-2025, and commit to developing a strategic transport plan linking Cairns and Townsville.

2021-2022

ESTIMATED PROJECT COST $20M

Kuranda Range Road Business Case

$10m

Recommended State Investment Recommended Federal Investment

$10m

PATHWAY TO PROSPERITY

ENABLING INFRASTRUCTURE

ADVANCE CAIRNS PRIORITIES 2021/22

SAVANNAH WAY (GULF SECTION) COUNCIL: BURKE, CARPENTARIA, DOOMADGEE, ETHERIDGE, CROYDON STATE ELECTORATE: TRAEGER FEDERAL ELECTORATE: KENNEDY

THE ISSUE The Savannah Way traverses Northern Australia, linking Cairns in Tropical North Queensland to Broome in Western Australia’s Kimberley. The route is approximately 3700km long, crossing 15 National Parks and five World Heritage areas as it traverses across the Top End. Considered to be in the top 10 road trips of Australia, the self-drive tourism market delivers $69.8 million annually into the Gulf region, with 38% of visitors starting the journey in Cairns1.

The Gulf section of the Savannah Way takes in 888km from Forty Mile Scrub west of Mt Garnet to the Northern Territory border, with significant sections of the road already sealed.

However there are critical missing links that

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ADVANCE CAIRNS STATE BUDGET SUBMISSION

require pavement upgrades, bitumen seal, minor realignment of substandard curves, concrete causeways and four major river crossings.

As sections of the Savannah Way remain unsealed and flood prone, communities become isolated during the annual wet season which limits the economic value of this northern road link. Upgrading the Gulf section of the Savannah Way will require replacing existing substandard infrastructure.

Upgrading the Savannah Way aligns well with the Federal Government’s Northern Australia agenda, given the road is a key which links Cairns in tropical north QLD to Broome in north west WA.

BRIEFING NOTE SUMMARY • The Savannah Way stretches for 3,700 km and is considered to be one of the top 10 Great Australian Drives, linking Cairns in Tropical North Queensland to Broome in Western Australia’s Kimberley.

• Drive tourism delivers $69.8 million into the Gulf region annually, with 38% of visitors entering the Savannah Way via Cairns.

• Segments of the Queensland section of the Savannah Way are unsealed and flood prone, isolating communities during the wet season and limiting the economic value of this northern road link.

• Sealing the Queensland section of the Savannah Way is estimated to require a total investment of $39.8 million annually over 10 years, split 80:20 between the State and Federal Governments.

1 Keirle, P, (2018) Gulf Savannah Way Tourism Survey Report, Gulf Savannah Devlopment

BACKGROUND In recognising the need to seal the Gulf section of the Savannah Way, in 2019 the Federal and State Governments committed $62.5 million to road upgrades through the Roads of Strategic Importance – next priorities initiative. This will be spent across various shire councils, with a prioritised list being formulated in 2021.

The Mt Garnet to Carpentaria Shire border section is 510.5km and requires funding of $135 million to upgrade the road and floodways for reliability, current construction and safety standards for heavy vehicles, tourists and commuters who use this corridor. Burke Shire to the Northern Territory border is approximately 302km long with less than 50% of the road sealed. This section requires approximately $64 million to upgrade the road.

NEXT STEPS Upgrading the remaining Gulf sections of the Savannah Way is estimated to require investment of $39.8 million annually over 10 years (including the $62.5 million already committed). Completing the project over a 10-year period with annual investments to local councils will allow for incremental improvements on this road and ensure the retention of a local workforce. The estimated investment breakdown for each local shire is as follows: • Burke Shire to Northern Territory Border - ~$64 million • Carpentaria Shire - ~$185 million • Croydon Shire - ~$78 million

• Etheridge Shire - ~$71 million The project will extend across North West Queensland, travelling along the Gulf of Carpentaria from Forty Mile Scrub to the Northern Territory border, passing through remote towns including Croydon, Burketown and Doomadgee in Queensland and connecting to Wollogorang in the Northern Territory.

OUR RECOMMENDATION •

•

That the State and Federal Governments support the sealing and improved flood resilience of the Gulf section of the Savannah Way by providing 80:20 project funding in accordance with the Commonwealth/State roads funding model.

That allocation of funds be distributed to the controlling Local Government Authorities in equal portions over a 10-year period from 2021-2022.

ESTIMATED PROJECT COST $398M

20212022

Recommended Federal Investment

$31.84m $31.84m $31.84m $31.84m

Recommended State Investment

$7.96m

2022- 2023- 20242023 2024 2025

$7.96m

$7.96m

PATHWAY TO PROSPERITY

$7.96m

CONTACT: NICK TROMPF E: NICKTROMPF@ADVANCECAIRNS.COM PH: 07 4080 2900