Victoria forges ahead with $50b rail megaponzi

The Victorian government has announced that the proposed Suburban Rail Loop will start at Southland Shopping Centre. The preferred sites for six underground stations for the first leg of the loop from Cheltenham to Box Hill have also been announced, while the upcoming state budget will include $2.2 billion for early works on the first stage of the project.

When the project was first announced at the 2018 election, the cost of the entire project was estimated at around $50 billion, while Victorian Premier Daniel Andrews says it will take many decades to complete:

The full project aims to eventually link every major train line between Frankston and Werribee, via Melbourne Airport.

Next week’s budget will include $2.2 billion for early works for the first 26 kilometres of the project.

No date has been set for completion, but the money announced today will allow early works to begin in 2022…

Despite the eye-watering bill for the early works, the Government has not revealed how much the total project will cost, saying a full cost analysis is still underway.

When the project was first announced at the 2018 election, the estimates for the entire loop exceeded $50 billion.

By comparison, the 9-kilometre Metro Tunnel project is budgeted to cost $11 billion, but is facing cost blowouts…

Mr Andrews said the project would create 800 direct jobs and, at the peak of construction, the project would support 20,000 jobs…

The Grattan Institute has slammed the lack of transparency and due process surrounding the project:

The Grattan Institute’s transport and cities program director Marion Terrill said she had concerns about the Government’s lack of transparency.

“We still don’t have a business case, we still don’t know what the costs will be, we don’t know what the benefits are going to be,” Ms Terrill said.

“This is locking us into a generations’ worth of spending all on one mega project where we hope this is what is going to be needed, but in fact there a lot of things you can get for that kind of money.”

She also warned that mega projects like the Suburban Rail Loop had a greater risk of cost blow outs.

The suburban rail loop is a classic example of everything that is wrong with infrastructure provision in this country.

This project was designed purely to give the Labor Government a shock-and-awe ‘announceable’ in the run-up to the State Election, was aimed at appeasing voters’ concerns about excessive population growth, as well as giving the appearance that the Government has the situation under control.

It was never subjected for assessment by Infrastructure Australia or Infrastructure Victoria. There was no business case conducted before its announcement. And Victoria’s transport department wasn’t even told about the plan for fear that it would attempt to block the project from within government.

Now generations of Victorians will be required to foot the bill of a massive vanity project whose costs and benefits are unknown, and which could very likely turn into another infrastructure white elephant.

With the history of cost overruns across major infrastructure projects, there is little chance this project could be built for initially purported $50 billion (in today’s value). The proposed project would contain 90 kilometres of track, mostly tunnelled, as well as several underground stations and interchanges. Many properties will also need to be compulsorily acquired by the Government.

Given the 9 kilometre Metro Rail tunnel was budgeted to cost $10.9 billion, and there have already been cost blow-outs, it is more likely the suburban rail loop project – which is 10-times the length – would cost closer to $100 billion. In any event, the necessary scoping work should have been completed before the project was committed to.

Little wonder then that a wide variety of transport experts have slammed the suburban rail loop, including: the Grattan Institute; Professor John Stanley – one of the authors of Plan Melbourne; Dr Crystal Legacy – Senior Lecturer in Urban Planning at the University of Melbourne; and Des Grogan – civil and traffic engineer.

A coalition of transport groups, councils and planning academics also claimed that the money would be far better spent on the Metro 2 tunnel connecting Melbourne’s North and Western suburbs.

When added to the wasteful Westgate Tunnel, which was approved after receiving an unsolicited bid from Transurban, it is clear the Victorian Government does not believe in following due process on infrastructure projects.

The end result will be projects that fail to live up to expectations and are riddled with cost overruns, with incumbent residents paying the price through escalating user charges, taxation, and reduced amenity as they are crushed under the endless immigration deluge.