Renewed call for Cross River Rail inquiry
 
 

Revelations of more CRR problems demand answers

The Australian Institute for Progress has renewed its calls for an immediate inquiry into the Cross River Rail project in the light of new revelations in today’s Courier Mail about costs involved in moving the Dutton Park station.

Executive Director Graham Young said that the institute released a report in the last week of the election which reviewed the known position of the project.

“The report revealed that the real cost was $6.9 billion, not the $5.4 billion touted by the government.

“The difference is a privatisation deal where the consortium building the tunnel pays $1.5 billion to the government which they then recover from the government over 24 years with interest and profit.

“This $1.5 billion has to be added to the $5.4 billion original cost.

“There are likely to be further blowouts because the changes necessitated by changing the station are a variation of the contract, and traditionally this is where the contractor finds all the fat in this type of project.

“In a variation there is no competitive tender, and billings tend to be cost plus a very generous margin.”

Mr Young said that passenger numbers have also been grossly overestimated, meaning that the tunnel is, at best, being built prematurely, before there is any need for it.

“The government estimated that by 2025 68,800 people would use the system, but that is 40% higher than the most optimistic current estimate of 49,140.

“This project has the potential to swallow money that desperately needs to be spent on real needs as we reboot the economy after COVID.”

Mr Young said that the new minister should:
  • Commission an independent review of CRR, ensuring the Commissioner has the necessary investigative powers to assess the overall performance of the project.
  • Ensure the investigation includes a full technical review, identifies major risks, as well as confirms the total direct, indirect, and associated capital costs for the project and the whole–of life and operating costs for the project.
  • Ensure the investigation also identifies and recommends ways to better integrate the planning and delivery of other associated infrastructure projects such as inland rail and inner city freight corridors, Brisbane Metro and major urban redevelopment projects such as Queens Wharf Brisbane and the proposed Eagle Street redevelopment.
  • Ensure the investigation also considers whether current governance arrangements are best suited to the evolving nature of the project as well as mechanisms to ensure ongoing reviews of the project.
Mr Young noted the recommendations were similar to those made by the Grattan Institute in their recently released review of transport infrastructure.

To download the AIP report by Professor Phil Charles and Phil Sayeg, click here.

For further information contact Graham Young 0411 104 801 or graham.young@aip.asn.au

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