Article: Stopping all stations: Baillieu's borrowed transport plan

[ozbob]

From the National Times click here!

Stopping all stations: Baillieu's borrowed transport plan

Stopping all stations: Baillieu's borrowed transport plan
November 17, 2011

Opinion

Rocketing across China at 300 kilometres an hour by rail, Ted Baillieu recently did some quick mental calculations to see whether a high-speed train for Australia was viable.

Baillieu, who seems adroit when it comes to such thought experiments, concluded that likely patronage and the high construction costs would make it difficult to leverage the necessary private sector investment.

Baillieu stresses that major projects have often suffered from poor planning and project management, resulting in delays and cost blow-outs.

He is adamant his government will not be corralled into blindly rushing ahead with expensive projects just for the sake of having something to announce. So far, it hasn't.

After being stung by criticism in July for failing to submit a list of major projects to Infrastructure Australia, which makes recommendations to the federal government about funding priorities, the state government will today release its major projects wish-list.

The submission, which comes as the government nears its first anniversary, draws on the previous Labor government's (mostly unfunded) $38 billion transport blueprint, which in turn relied heavily on the 2008 options paper delivered by infrastructure adviser Sir Rod Eddington.

In other words, the latest submission has been a long time in the making. Unlike past proposals, there are no glossy maps showing potential routes, no timelines showing when various projects might be completed, and no estimates of potential costs.

The lack of flashiness, according to the government, is deliberate. The idea is to first develop a plan, then find a way of funding it, and then managing the project itself.

''It would be no leadership to set out a timetable you can't keep, it would be mis-leadership and I don't intend to embark on that,'' Baillieu told The Age. ''So it is step-by-step, plan, fund the planning, step-by-step, take the project through.''

There are two key elements to the plan.

First, an 18-kilometre inner urban road connecting the Eastern Freeway and the Western Ring Road, with intermediate links to the Tullamarine Freeway, the Port of Melbourne and Geelong Road. Second, a metro rail tunnel connecting the northern and south-eastern lines, with five new stations along the way.

The problem - which is not unique to Victoria - is finding the cash. As Baillieu notes, which ever way you dress it up, the money has to come from somewhere. The question is, what is the most efficient way of paying?

The options are resorting to debt, running down the budget surplus or selling assets to finance the project.

In the case of the east-west link, financing could be a profound challenge. When Infrastructure Australia last reported on its priorities in July, it delivered a blunt warning that it was ''very unlikely'' to support state government proposals for new freeways unless they were tolled.

Infrastructure Australia national co-ordinator Michael Deegan said state governments needed to realise that ''someone has to pay for major projects'', either by taking on debt, selling assets or using tollways or some other user-pays system.

''The old days of there being a magic pudding in Canberra are no longer,'' Deegan said.

Infrastructure Australia has also been cautious on the merits of the east-west road tunnel itself, saying it should be considered only if there was joint funding from the Victorian government and a focus on container traffic from the Port of Melbourne.

The thinking is that the link would only be viable if it is a tollway with various access points into the city to induce the necessary traffic.

As Labor found out, the politics of this are horrible. As a rough rule of thumb, every $1 billion of investment needs to generate about $100 million a year to get the private sector interested. That means a lot of extra cars in and around the city.

The government's second proposal, for Melbourne Metro, which was also first proposed in Eddington's 2008 study, would be more likely to be viable.

According to Baillieu, the new five-station link would move an extra 25,000 passengers an hour, with 140,000 passengers travelling each morning. Infrastructure Australia, which identified the project as ''ready to proceed'', concluded that every $1 spent on construction would generate an economic return of $1.30.

The ultimate challenge will be delivering in the not-too-distant future as Melbourne's population continues to swell.

Read more: http://www.theage.com.au/opinion/politics/stopping-all-stations-baillieus-borrowed-transport-plan-20111116-1nj5b.html

[Stillwater]

There are two aspects of this story of relevance to Queensland.

The first relates to these words:

"The latest submission(Victoria's submission to IA) has been a long time in the making. Unlike past proposals, there are no glossy maps showing potential routes, no timelines showing when various projects might be completed, and no estimates of potential costs.  The lack of flashiness, according to the government, is deliberate. The idea is to first develop a plan, then find a way of funding it, and then managing the project itself.

''It would be no leadership to set out a timetable you can't keep, it would be mis-leadership and I don't intend to embark on that,'' Baillieu told The Age."

So, what has Queensland got?  The glossy Connecting SEQ 2031 document, all sharp as a new suit; maps, videos, drive-through simulations, unrealistic timelines without establishing funding for projects and guesses of costs in today's dollars in circumstances where the projects will cost twice, three times the estimate when they are finally built in 2031.

What does Premier Baillieu call that?  He calls it 'mis-leadership and no leadership.'

First develop a plan, he says, then find ways of funding the projects.  Our government leadership team displays its 'mis-leadership' by touting a $125 billion commitment to a plan for fixing SEQ's transport woes and states that no other jurisdiction has such a plan.

It is interesting to contrast a Victorian government that is under no illusion and is taking a sensible approach to planning and a Queensland government that dangerously believes its own rhetoric about a grand scheme that requires billions, yet ignores the revenue side, or a new tax to provide the funds.  It blithely points to the pretty pictures and ignores the funding, which means what's depicted in the pictures won't come about in the timelines envisaged.

The second aspect of this story relates to the Melbourne Metro.  The Age's story goes:

"The government's second proposal, for Melbourne Metro, which was also first proposed in Eddington's 2008 study, would be more likely to be viable.  According to Baillieu, the new five-station link would move an extra 25,000 passengers an hour, with 140,000 passengers travelling each morning. Infrastructure Australia, which identified the project as ''ready to proceed'', concluded that every $1 spent on construction would generate an economic return of $1.30."

Brisbane's Cross River Rail project will generate an economic return of around $1.10 for every $1 spent on its construction.  That's $1.30 for Melbourne Metro, versus $1.10 for Brisbane's CRR.
The number of people who are "touched and moved" by the Melbourne project is greater than Brisbane's.

So, put yourself in the shoes of someone voting on whether to direct IA money to Melbourne or Brisbane.  Melbourne gives more bang for buck and it benefits a larger number of Australians.

[dwb]

''It would be no leadership to set out a timetable you can't keep, it would be mis-leadership and I don't intend to embark on that,'' Baillieu told The Age."

So, what has Queensland got?  The glossy Connecting SEQ 2031 document, all sharp as a new suit; maps, videos, drive-through simulations, unrealistic timelines without establishing funding for projects and guesses of costs in today's dollars in circumstances where the projects will cost twice, three times the estimate when they are finally built in 2031.

What does Premier Baillieu call that?  He calls it 'mis-leadership and no leadership.'

I disagree.

This is a typical LNP/Liberal/Lib-Nat approach. Hide everything in secret. Don't plan for anything holisitically. Grab for something at the last minute.

[Jonas Jade]

Also don't forget that the projects that Baillieu is applying for originated in a "glossy" Labor plan very similar to SEQ 2031, he's just playing down that link.

Edit: Also, the project has been altered to be North Melbourne - South Yarra, not staged Domain - Caulfield as was the original route.