Taxpayers shafted again with Sydney Metro $4B over budget

JUST how much housing will NSW INC approve? Currently the Metro is running every 4 minutes, and they can crank that up to 2 minutes!

Which will allow for a massive increase in housing density

REZONING a 2 Km radius circle around each station for high rise … say 20, 30 storeys, and lotsa medium-density beyond that so the Metro will run at full capacity … sardine-like …

FROM the ‘suggestion box’ a Metro up the Northern Beaches and Eastern suburbs down to Maroubra just what Harry wants … complete with massive rezonings

BECAUSE the northern beaches are a wasted recreational resource, and need loads more VIBRANCY!

WHY do you reckon Jean Toplace has lined himself up with Ralan?

Artist impressions of the new Skyview residential development by Toplace.

Photo: Toplace vision for Castle Hill; Daily Telegraph

Transport Minister Andrew Constance, left, and Premier Gladys Berejiklian inspect one of the station sites last year.

Transport Minister Andrew Constance, left, and Premier Gladys Berejiklian inspect one of the station sites last year. CREDIT:JAMES BRICKWOOD

Taxpayers shafted again with Sydney Metro $4b over budget

By Leith van Onselen in Australian budget

February 5, 2020 | 11 comments

I have noted repeatedly that one of the key reasons why Australia’s high population growth (immigration) is lowering the living standards of existing residents is because of the strain that it places on infrastructure, which inevitably leads to more congestion on roads, public transport, as well as more expensive housing.

Basic math (and common-sense) suggests that if you double the nation’s population, you need to at least double the stock of infrastructure to ensure that living standards are not eroded (other things equal).

In practice, however, the solution is not that simple. In already built-up cities like Sydney and Melbourne, which are also the major magnets for migrants, the cost of retrofitting new infrastructure to accommodate greater population densities is prohibitively expensive because of the need for land buy-backs, tunnelling, as well as disruptions to existing infrastructure.

The latest example of these escalating costs comes from Sydney’s Metro train line through the city to the south-west, which was originally predicted to cost between $11.5 and $12.5 billion but may now blow out to $16.8 billion:

INFOGRAPHIC: The Metro City and Southwest will add 18 extra stops to the network. (Supplied: NSW Government)

In Question Time today, the Opposition sought to clarify if the project had blown out from between $11.5-$12.5 billion to $16.8 billion — a price jump the Government did not deny.

“Do major projects have challenges? Of course they do,” Premier Gladys Berejiklian said.

“When it comes to a major infrastructure project, we always keep the community advised every step of the way”…

Treasurer Dominic Perrottet also would not be drawn on whether the project would be millions more than planned.

“Whether it’s the North West Metro [or] the South West Metro … these projects aren’t being built for the sake of it, [they] will make a huge difference to people’s lives, so they can get home to their families faster.

“We’ve seen that in north-west Sydney, we’ll soon see that in south-west Sydney”…

Any major blow-out in its cost of the Metro will have serious ramifications for the NSW Government’s ambitious $93 billion infrastructure program.

This latest cost blowout follows the bungled Sydney Light Rail Project which, after lengthy delays, was delivered way over budget and received widespread condemnation from transport experts and the Auditor-General.

If the New South Wales Government cannot deliver these projects on Budget, what hope is there that the other $80 billion of projects will be delivered?

Prepare for billions of dollars of cost blowouts as Sydney tries in vain to keep pace with the population ponzi.

Leith Van Onselen

Leith van Onselen is Chief Economist at the MB Fund and MB Super. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.

There was a power outage on the Sydney Metro this morning

Photo: the Metro City and Southwest lines scheduled to be completed by 2024 . AAP