The Commonwealth of Australia is a federal parliamentary, constitutional monarchy comprised of six states and two territories. The federal government is composed of executive, judiciary, and legislative branches. It includes a governor-general representing the monarch, a multi-party Senate elected by citizens of the six Australian states, and a multi-party House of Representatives elected from single-member districts. Australia is a common law country.
The Australian Government (also referred to as the Commonwealth) provides funding for rail transit projects and establishes framework legislation and regulations that determine infrastructure priorities for how lower levels of government and the private sector can invest in infrastructure. Except for the national rail network, which includes interstate rail, the Hunter Valley Coal Supply Chain, and a number of intermodal terminals under development, the national government does not own, nor does it build, roads and passenger rail infrastructure.
Infrastructure Australia (IA) is a government-owned, independent statutory body established in 2008 to guide the national government on choosing infrastructure projects that provide the highest returns on investment and serve a national purpose. With consideration of IA’s advice, the Commonwealth determines which projects to fund in its annual budget.
State and territory governments are organized with the same structure as the federal government, with each state government (except Queensland and the two territories) composed of a bicameral parliament, an executive branch led by a governor and a premier, and a supreme court. There is one level of local government within each state.
State and territorial governments are the primary planners, funders, and owners of transportation capital projects. Each state has a Department of Transport that plans, delivers, and constructs parts of major projects. All major metropolitan areas in Australia are largely contained within their respective state boundaries, helping to coordinate urban rail projects that span municipal boundaries. This includes the Australian Capital Territory, which contains Canberra. Similar to other federated countries, there is little national statutory influence over capital construction.
States and territories receive approximately 45 percent of their revenues through transfers from the federal government. State and territory government tax revenues that directly support transit include vehicle registration, licensing fees, and public transportation fares. In addition, parking levies in Sydney, Melbourne, and Perth are used to fund public transit investments.
States and territories have established infrastructure advisory entities with varying degrees of independence. Some of these bodies, like Infrastructure New South Wales, play a strong role in infrastructure decision-making. Others are structured as independent infrastructure think tanks, like Infrastructure Victoria.
Local governments indirectly influence public transit construction and service delivery through investments in local roads, transit stops, and bicycle/pedestrian infrastructure. Local governments advocate to the state and federal government for funding and list priority projects in long-range transportation strategy documents.
Transit agencies are owned and operated by state and territory governments. These agencies build transportation infrastructure and manage transit services. Transit service operation is either contracted out to government-owned organizations (e.g., NSW Trains, Sydney Metro), or to private companies (e.g., Transdev, Keolis Downer, Transit Systems, MTR). In two cases, Transport for Brisbane and the light rail system in Queensland (G:Link), local government is the primary owner and actor in public transport planning, operations, and funding.
Some states have recently made significant changes to their transit agencies and regional transportation governance. Queensland’s agency, Building Queensland, was absorbed into the Queensland Treasury in 2020. Following the November 2018 election in Victoria, the Department of Economic Development, Jobs, Transport and Resources that was formed in 2015 was split into two separate departments, one of which is the Department of Transport. With that change, VicRoads and Public Transport Victoria, both previously independent entities, were incorporated into the Department of Transport.
Private sector involvement in the construction and delivery of transit service is common in Australia through P3s and contract outsourcing (i.e. franchising).vii All new rail transit lines brought into operation over the past two decades have a private operator, either through a long-term operating and maintenance concession or a design-build-operate-maintain P3. For example, in a $3.7 billion P3, Transport for New South Wales selected the consortium Northwest Rapid Transit to design, construct, finance, operate, and maintain the Sydney Metro Northwest, including railway, systems, stations, and rolling stock. From that consortium, Metro Trains Sydney was formed to operate and maintain the service for 15 years.