ACT News


Canberra's $780m light rail line gets final go ahead, business case to be released

The tram line from Gungahlin to the city has been given the green light, with a private consortium to be appointed to build, own and operate for at least 20 years, Capital Metro Minister Simon Corbell said on Monday, estimating the construction cost at close to $800 million.

Neither Mr Corbell nor Chief Minister Katy Gallagher would put a figure on the annual cost to ratepayers of the tram line, saying that would depend on negotiations with the light rail companies.

The construction cost, estimated at a nominal $610 million plus $173 million contingency, will be paid by the consortium, with an annual fee paid by the government over the life of the project, about 20 years.

Expressions of interest will be called on October 31, when consortiums will be asked to detail their experience, financial capacity, and how they propose to deliver on "customer experience, urban design, community and value".  

Construction is set to start by mid 2016 and the tram will begin operations in 2019.

The government has been unclear about the cost of the tram projects for months.


Asked about a suggested $800 million-plus price tag in June, Ms Gallagher said cabinet's tolerance was for an inflation-adjusted $614 million. Asked just last week about an estimate from the Liberals' transport spokesman Alistair Coe of $805 million, Mr Corbell said the figure was  "well and truly over and above what we're anticipating".

The decision to release an estimate this week, and to release the final business case next month, signals a determination to put an end to damaging speculation about the affordability of the project.

This week's estimate was "prudent, conservative and responsible", Mr Corbell said.  

It included a large contingency partly because of the uncertainty about the cost of moving underground pipes and wires, a cost that would be borne by the private partner, he said.

Mr Corbell confirmed the government would release the full business case on October 31, pending advice in the meantime on whether any parts should be withheld to ensure the government got the best deal it could in negotiations with the private partner.

He said updated estimates of patronage and travel times for the 12-kilometre route would be included in the document, which could also include the cost benefit analysis.

Mr Corbell said only that the project showed a positive economic benefit, and "a very strong return for the Canberra community".

The large turnout to an industry briefing at the Convention Centre on Monday, with light rail investors flying in from overseas as well as other parts of the county and overseas, "should give great confidence to Canberrans that there is real and strong industry interest for this project", he said.

He welcomed the group with a stirring video titled "confident, bold, ready", which portrayed Canberra as a vibrant city of progressive thinkers, creative people, and a city with a hipster edge, complete with tattooed barista.

The tram project recognised that fossil fuels could not drive transport indefinitely, that land was finite, that the city's population was growing, and that the way we lived now was not sustainable.

The tram was not simply about moving people around Canberra, but would fundamentally change how the city grew and how Canberrans lived, he said.

Greens minister Shane Rattenbury welcomed the confirmation of a key commitment in his governance agreement with Ms Gallagher after the 2012 election.

"For decades, ACT governments have largely failed to see the opportunities that would come from building a quality and permanent public transport network," Mr Rattenbury said.

Investigations of underground pipes and wires continue along the route, and last month the government lodged an application to rezone seven sites to allow for new intersections, substations, a depot and road widening. 

Liberal leader Jeremy Hanson introduced a note of uncertainty over the project, warning companies that the Liberals would scrap it if they won government in 2016.

"What I'd say to any company that is considering getting involved in light rail is they need to consider that if the people of the ACT at the 2016 election reject this government then they have rejected light rail and we will not be in a position where we're going to proceed with an infrastructure project that has been rejected by this community," he said.

He called on the government not to lock the project in by signing contracts before the election.

"If this is a government that is simply going to try and sign contracts to lock this community in before the next election then that is a bastard act of politics. It is unfair on the people of Canberra for this government to impose $800 million of their money on a project that Canberrans don't need and simply can't afford."


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