Infrastructure minister Darren Chester has reinforced the government’s Inland Rail plan, despite a private sector group suggesting the project could blow out by up to $6 billion above forecast costs.
National Trunk Rail director Jon Grayson told Fairfax after the Budget that the government’s plan – which has approval from Infrastructure Australia – could cost as much as $16 billion, despite the current business case forecasting a cost of between $9.9 billion and $10.7 billion.
The Turnbull Government aims to deliver Inland Rail – an inland connection between Brisbane and Melbourne – via an $8.4 million equity investment into the Australian Rail Track Corporation, as well as a PPP for the most complex section of new track – a tunnel through the Toowoomba Range.
The 1700-kilometre Inland Rail route would only need new track to be built along 40% of its length, with the rest of the route created by upgrading existing track.
Grayson reportedly believes this method could result in a major blowout in costs, pushing it well above the $12 billion to $13 billion price tag NTR has placed on its alternative plan.
NTR wants to build an all-new, 1595-kilometre rail line between the two major cities, which would rely on no existing infrastructure and – NTR says – would deliver a better end-product.
“We don’t believe [the Government’s proposal] can be built for $10.7 billion,” Grayson was quoted in the AFR on May 12.
“We think it will be significantly more than that.”
Grayson reportedly believes the plan to upgrade vast amounts of existing track presents significant construction risks, while a 100%-new rail plan would create a shorter, flatter, more reliable piece of infrastructure.
Nonetheless, the Turnbull Government appears to be committed to its existing plan, with Minister Chester visiting regional NSW on May 12 to promote Inland Rail to the local community.
“This project has been through an exhaustive process. It’s been talked about for decades, it’s had the tick of approval by Infrastructure Australia, it has a positive cost-benefit ratio. It’s the type of project that will make a difference in people’s lives,” Chester told the media gathering.
“It is a long-term investment that our kids and our grandkids will thank us for.
“Admittedly, it takes several decades to maximise the benefits but governments have to think long term.”