While residents of Sydney and Melbourne are suffering from crush-loaded roads, trains, schools, hospitals, and prisons, as well as hideously expensive housing, toll road company Transurban yesterday reported a massive lift in profits as Australia’s mass immigration ‘Big Australia’ policy continues to feed it customers. From The AFR:
The tollroad company is benefiting from higher revenues in its road development and tolling businesses, with its shares rising 4¢ in morning trading on Monday to $11.39 after solid interim results.
Net profits for the six months to June rose 280 per cent from $88 million a year earlier…
Transurban makes its highest profit margins in Melbourne, where margins run at 88.5 per cent, and Sydney, where margins run at 81.2 per cent.
Group toll revenues rose 9.6 per cent to $1.13 billion, while construction revenues jumped 69 per cent to $462 million.
Toll revenue increases were driven by both traffic growth and higher toll fares…
This folks is Australia’s population ponzi economy in action. It’s a model of growth where corporate Australia privatises the gains from mass immigration and socialises the costs on everyone else.
Former treasury secretary turned NAB chairman, Ken Henry, explained this model in a speech last year:
Research NAB carried out earlier in the year showed that among our customers there’s not wholesale support for a larger Australia. For many, the prospect of a higher Australian population means more stress in the ability to buy a house, to live where you want to live, to get to work with a reasonable commute time. And many in the community are also concerned about our ability, as a nation, to maintain norms of Australian social and economic inclusion, and to continue to provide access to high quality services in areas such as healthcare and education.
These concerns are playing out against a backdrop of rapid technological advancement that’s seeing the digitalisation and automation of many aspects of our lives, including in the workplace – and with it, growing concerns about job security.
But what is the business perspective? The same NAB research showed that most of our business customers would strongly prefer a larger population, which supports better business growth.
With Australia’s two biggest states desperately trying to build infrastructure to keep pace with the population ponzi, private companies like Transurban are facing further strong profit growth, paid for by ordinary motorists like you and me.
For example, the Victorian Government’s $6.7 billion West Gate Tunnel Project will see Transurban contribute $4.4 billion towards the cost, but in exchange motorists will have to pay additional tolls on CityLink until 2045 estimated at $15 billion. It’s a sweet deal for Transurban, but a dud deal for Melbourne motorists.
In a similar vein, Sydney’s $17 billion WestConnex project will see existing free public roads like the state-owned M4 (that have already been paid off) being tolled to help fund the project, raising costs for residents.
Clearly, private businesses like toll road operators, retailers, banks and property developers get to enjoy the easy growth in revenue and profits that come from an ever expanding customer base, whereas households suffer from the increased competition and reduced bargaining power at work, rising housing costs, rising infrastructure costs, and longer and more expensive commutes.