NSW Government tries to hide light rail white elephant

By Leith van Onselen

This site has gone to great effort exposing the pitfalls of the ACT Light Rail Project.

Late last year, secret NSW Government documents were released revealing that the Parramatta Light Rail Project – the centrepiece of the Government’s plans to cement Parramatta as Sydney’s second central business district, as well as facilitate the building thousands of apartments around Sydney Olympic Park – had experienced a massive cost blowout “to more than $3.5 billion – $2.5 billion above what has been budgeted” and the benefits are unlikely to meet the costs.

This was followed soon after by a damning NSW Auditor-General assessment, which found that the Government’s controversial $2.1 billion CBD and eastern suburbs light rail project had also blown-out by over $500 million due to an incomplete business case.

Today, The Australian has reported that the NSW Civil & Administrative Tribunal has directed the State Government to release documents relating to the CBD and eastern suburbs light rail project, but that the Government has indicated that it will appeal the ruling before a full panel of the tribunal:

The NSW government is pulling out all stops to halt the release of documents that could prove Premier Gladys Berejiklian misled the public over her controversial CBD light rail project and reveal further cost blowouts in the $2.1 billion development.

Labor upper house leader Adam Searle has won a case in the NSW Civil and Administrative Tribunal for the release of documents in connection with the project…

But the government is appealing to a full panel of the NCAT…

Ms Berejiklian was found by the Auditor-General in November last year — two months before she became premier — to have misled the public when she was transport minister in 2014 over the cause of a $500 million blowout in the light rail project just before the last state election. However, she has steadfastly denied doing so knowingly.

In a press release dated October 2014, Ms Berejiklian said the project’s cost was increasing ­because of a “huge win” — a 50 per cent increase in capacity…

But Auditor-General Margaret Crawford’s report… found that “94 per cent of the $549m ­increase was due to incorrect estimates in the business case”…

Mr Searle said yesterday: “The government has fought tooth and nail to keep these documents ­secret — to protect the Premier from having to take responsibility for her actions on the light rail project when she was transport minister. If she has nothing to hide, why won’t her government hand over the information?”

With the Australian Government running a high immigration program, and Sydney’s population projected to balloon by 87,000 people per year (1.74 million in total) over the next 20 years – equivalent to 4.5 Canberra’s – the state government will need to invest heavily in infrastructure or risk crippling congestion, as well as lower urban amenity and living standards.

The problem is that these projects are unlikely to provide net benefits for taxpayers and instead represent a subsidy to high-rise property developers located along the line.

The other problem is that large cities like Sydney and Melbourne have reached such a size that they are exhibiting diseconomies of scale, which occurs when the cost of providing an extra unit of infrastructure increases as the city grows.

Basically, because Sydney and Melbourne are already built-up, there is little room to retro-fit new infrastructure without expensive additions like land buy-backs, tunnelling, or hideous disruptions to existing infrastructure.

Hence, running a population ponzi economy becomes increasingly costly for existing residents. The huge infrastructure costs also forces unpopular asset sales, increased debt borrowings and austerity.

The most obvious solution is to significantly dial back immigration and forestall the need for the costly new infrastructure projects in the first place.

Another is to implement a broad-based land tax so the taxpayer effectively picks-up some of the value uplift (if any) bestowed to high-rise developers located along the rail line.

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Unconventional Economist


  1. > Basically, because Sydney and Melbourne are already built-up, there is little room to retro-fit new infrastructure without expensive additions like land buy-backs, tunnelling, or hideous disruptions to existing infrastructure.

    Yes and no. It’s our standards.

    Kuala Lumpur, a metropolis of 7m has no qualms about sticking a pole in the middle of a foot path to support a new train line or road while the road underneath is still operating.

    They just don’t care. Add the insanely low wages they offer the predominantly Indian migrant construction workers and you get a completely different result to here.

    I kinda like our standards. Being in a high-rise stair well which had the ceiling slowly get closer and closer until I was ducking under it was probably one of the most claustrophobic experiences of my life.

    But you gotta say, if we dropped all our standards, the dis-economies of scale will vanish.

    • Dubai has an elevated railway and do not get their knickers in a knot over it. So do Bangkok and Riyadh.

      The Dubai train stations are even air conditioned due to platform doors! Dubai even has air conditioned bus stops!

      Sadly, the monorail in Sydney was taken down instead of being expanded.

      There was also a tram overpass on Flinders Street Station that was torn down along with railway stations in Port Melbourne and St Kilda.

      So rather than expand transport infrastructure, this nation actually tears it down while the population explodes.

      As for cheap labourers, the trouble is AUS gives them PR visas. Singapore has maids and the maids will never be given a Singapore passport. The other issue is, unemployed Aussies are demonised and given a pitiful amount of money. So why would Aussies tolerate 3rd world laborers coming in to build infrastructure here when Aussies are trying to work as laborers? If AUS had UBI or at least removed the job search requirements of Newstart, we could indeed have cheap labourers here.

    • Building a underground Metro in Zurich costs half the money it costs in Australia, and they pay higher wages, have higher building standards and care more about disruptions – what they don’t have as much as we do is corruption.

      A worker on Sydney light rail gets paid $50 per hour but his work is costing project $250 per hour because there are 4 middle-men subcontractors all making 50% profit on his wage. Same for equipment, land etc.

      • see also: the Mt Gotthard tunnel expansion. Same length as the WestConnex fiasco, half the cost. And I can’t believe that tunnelling under the alps is so much easier than cutting sandstone a couple of meters underground.

        It would also help if we didn’t build four lane highways and then a few years later decide that we should rip it all up and expand it to six lanes.

      • @Doctor x
        Yep I had a mate working on light rail for a few months $50 an hour plus penalties on night shift.
        He said it took a team of 35 8 hours to move a tree one night. Crazy stuff. I didn’t want to hear anymore stories.
        It was always going to be a white elephant. How many trees cut down – 200 plus – I wonder who the contractor was that pocketed the big money for that gig??? National disgrace.

    • This light rail, like most NSW government public transport projects, was never anything other than a property development scheme. The capacity of the line when completed will be less than carried by the buses it is replacing, but sites along the route will be sold off to developers to build high rise apartments at a nice premium.

    • Even if they dropped the standards it comes back to the key point you make which is that we are already ‘built up’. They will never keep up or have any chance of putting in place enough infrastructure to support the growing population nightmare. Politicians at all levels are well and truly stuffing this country up.

  2. Zacly the same for the gold cost. Commonwealth games , motor car racing events, tax payers money being wasted on incomplete business cases. or hoaxes more likely.(southpark Monorail style)

    • HadronCollision

      I still can’t come to grips with why the LR doesn’t extend to the fricking airport!!!!

      • Airport , dont mention the airport
        HAlf the joint wants the rain to wash these fire fighting chemicals from the airport out to sea asap
        the other half wants to hold a motor race.
        Currently the drizzle mob is winning, though a creek and beach are still closed.
        Whoda ever thought fire fighting foam could poison the environment???

      • They are spending $26 billion or more on WestConnex supposedly to make it easier to get to the airport, but the last leg to actually get to the airport they still haven’t figured out. There is such a transport entanglement in the area, Port Botany road and rail freight, airport traffic and passenger rail, along with huge new residential developments I suspect it is technically impossible and won’t be done until Badgery’s Creek is built and they are able to close some of it down even temporarily.

  3. The biggest white elephants are the 12 submarines. At least a railway is useful for 100 years. How long will each sub last? 30 years?

    David Leyonhjelm makes a lot of sense on immigration (but not the corporate tax rate): https://www.youtube.com/watch?v=Q1o_-jZs0PM

    “I do not think a government department can possibly know if there is a shortage of chefs or not”. “we should charge $50k for each PR visa”.

    Precisely. How could a politician possibly know about every single occupation? Even I do not know if there is a shortage of taxidermists or not. The sensible thing to do is charge $140/day for each work visa to guarantee that “skilled” immigrants are not coming here to work for less than $51k/year.

  4. Can’t wait for the inevitable cost overruns in the ACT light fail. What’s not captured in these costs is the impact to small businesses. Many of the shops in Gungahlin termination station have seen a 60% reduction in business with many not that far away from closing. Rail line construction has also greatly affected businesses in the Mitchell light industrial area. The light fail is a bloody disaster. Fck you very much Andrew Barr you dipstick.

    • Wing Nut, the small businesses probably love mass low-wage immigration…which necessitate light rail construction. Oh the irony.

    • “Fck you very much Andrew Barr you dipstick.”

      Seconded. It’s a bloody goldmine for land developers along the line, and the corrupt politicians that feed off them. For everyone else in the ACT it’s an expensive debacle. I’ll be paying for this piece of shite for years to come, while never using it.

      Barr really is an arrogant, greedy and stupid bastard.

  5. After having to drive 2 days in a row to the Homebush area during peak hour from outside of Sydney, I can safely feel certain Sydney is full and beyond help. Traffic is abysmal yet developers and Governments are still pilling on more and more taller and higher density apartment buildings in already crowded areas. It’s a complete abortion now to travel anyway by car.

    Light rail is no answer to the problems, more a token gesture than a real solution.

  6. Ronin8317MEMBER

    The Parramatta Light Rail project, as it currently stands, does not go all the way to Homebush. Instead it goes to Carlingford, which is a dead end, and the other side is Westmead which is one train station away. It makes no sense at all when you look at it on a map.

    What makes a lot more sense is to extend it to Epping where it will connect with the Sydney North West Metro. That gives a direct path from Parramatta to Chatswood/Macquarie University without going through Straitfield or Central. Carlingford to Epping is only 3km away.

    • macrofishMEMBER

      Was planned to when they built the chatswood-epping line..

      Other part is they need to doable the carlo line as its only a single track

    • Yep, the end point at Carlingford is all you need to know that this light rail is not intended to integrate with the North West Metro.

      The North West Metro also stops about 2 km from Scholfields station so that transferring from the Richmond line to the Metro will be a pain in the butt.

      One possible reason is that they are panicking about what is going to happen at Chatswood station when the North West metro starts dumping thousands of people who need to get on North Shore trains to the City.

      That is likely to be a hell mouth of congestion in peak hours.

      By not building connections to the Richmond Line or to Carlingford until the build the line from Chatswood under the harbour they may be trying to limit usage. Richmond line passengers and anyone near Parramatta will continue to be forced to travel via the city to the North Shore.

      They actually have secured the land to extend the North West line past the RIchmond line. Not connecting the line to the Richmond line does not make sense as it is all above ground and just a few km.

  7. Gladys has really stuck her corrupt head out for a reward by one of the big developers after politics by further pushing Sydney into a total cluster fcuk

  8. The analysis of the Sydney Light Rail was always a joke.

    It did not consider the obvious and much smarter alternative.

    Just convert George Street to bus and taxi only during peak hours and do the same to Devonshire street.

    That way they would have only need to build a bus bridge over the eastern distributor (they are building one for the light rail) and knock over the block of flats between this new bridge and Devonshire Street.

    An express bus route all the way to UNSW for not much more than the cost of a bridge, a block of flats and lots of red paint.

    And if that proved insufficient they would have had a running start to building light rail.

    But as we know this project is all about finance mates of the LNP clocking up a massive CAPEX with a guaranteed return that the poor sucker taxpayer will pay.

    The only thing the LNP in NSW knows is packaging up income streams and flogging them off to their mates in finance for a capital sum they can use to build up a new income stream project to flog off.

    • I wouldn’t lay the blame totally at the feet of the state government. The city of sydney was pretty complicit in this – because hey, light rail is trendy and cool.

  9. who remembers the sydney monorail! i went around it a few times back in the late 90s, was pointless but fun.

    • Yep. Although we created a point. Once we got bored of our local pub on Castelreagh and Park, you could jump on the monorail to the next pub (slip inn?), then get back on to Darling Harbour for a few more schooners, then back to the starting point. Or just do a couple of loops. Hours of fun.

  10. with light rail we’ll get at least something useful we didn’t have before. How about $2b of public money to knock down and rebuild two existing stadiums (that are mostly empty) to have less capacity
    just imagine outrage if gov decided to replace an unused train line by demolishing and building one with smaller capacity but nicer seats.

    • You shouldnt think about this stuff too hard, It’ll do your mind in
      the stupidity is extraordinary.
      IF i didnt keep notes on this gold coast thingy, I’l go bonkers like the rest of em

    • Light rail will have less capacity than the buses it will replace, so its not getting something you didn’t have, unless you can explain why a light rail trip is preferable to a bus, when travel times and most other factors are equal.

      South West Metro is the most egregious example. $12 billion to tear up existing rail, which is timely, reliable and comfortable. It will be replaced with Metro rail along exactly same route, but will need new stations, will be mostly standing room only and offer very little improvement in travel time because the bottlenecks lie elsewhere. And to justify the cost they need to build massive high rise apartments around every station on the route.

  11. Don’t forget the Newcastle light rail, which goes from one end of Hunter St that no one visits to the other end of Hunter St that no one visits, replacing trains that did the exact same thing.