The Grattan Institute’s Transport and Cities Program Director, Marion Terrill, has lashed the Dan Andrews Victorian Government’s botched West Gate Tunnel Project. She also suggests that Victoria is the national leader in infrastructure waste and mismanegement:
- “The West Gate Tunnel project has blown out by a further $3.3 billion, and we taxpayers are being asked to help pick up the tab for what’s become a $10 billion project – so far”.
- “The West Gate Tunnel started out as a $5.5 billion project, when the new Andrews government in April 2016 signed an in-principle agreement with Transurban… It was a market-led proposal – Transurban put the plan to the government, not the other way around”.
- “Soon, the expected cost increased to $6.7 billion, and the benefit-to-cost ratio fell from a skinny 1.1 to a line-ball 1.0”. Now it is negative.
- “From the start, the West Gate Tunnel has been questionable. In agreeing to a market-led proposal, the government bypassed competition”.
- “Market-led proposals are particularly prevalent in Victoria, where a sixth of the value of contracts on projects worth more than a billion dollars has been awarded through market-led proposals”.
- “Accepting such proposals for toll roads “generally leads to higher costs to taxpayers, drivers, or both”, according to Rod Sims, Chairman of the Australian Competition and Consumer Commission. A World Bank review of market-led proposals in Australia and 14 other countries found that “allowing a proponent to develop the project creates significant challenges in ensuring competition and … value for money”, and often leads to “poorly structured deals”.
- “The West Gate Tunnel saga is a cautionary tale”.
Marion Terrill’s arguments about Victoria’s infrastructure project management is spot on. But Grattan, which is a rabid supporter of mass immigration and a ‘Big Australia’, also needs to recognise that such projects are inevitable if our cities continue to take in tens-of-thousands of new migrants every year, resulting in our cities roughly doubling in size in only 50 years:
