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Can Gungahlin tram be sold on its benefits for the entire territory?

The ACT government is struggling to get its message across about the overarching goal of the Civic to Gungahlin light rail project. Clearly, the project is much more than just a new piece of public transport infrastructure.

Indeed, if looked at from that perspective only, it might be judged a failure before the first tram runs as it will serve only a fraction of the population. However, it is only the beginning of what might become a cross-city network, as is the case in many European cities.

The government is clearly hoping the project will greatly increase the population along the route of the track. This densification will come about as more apartment blocks are built along Northbourne Avenue and Flemington Road. Land values for this concrete valley will go up and the government will reap the bounty of increased tax revenue.

Capital Metro has previously pointed to studies showing commuters will walk longer distances to a tram than to a bus. The obvious attraction is the stability of the steel tracks. A commuter doesn't need to know the timetable; just getting to the tracks is sufficient. A tram will arrive, eventually.

However, that scenario is still some way off. For now, the Labor Party is battling negative perceptions of the tram, in the lead-up to the ACT election due towards the end of the year. Therefore, the report from Auditor-General Maxine Cooper is not welcome news for Chief Minister Andrew Barr. While the government calculated a cost-benefit ration for the project of 1.2 – meaning $1.20 of benefits for every $1 spent – Dr Cooper found almost 60 per cent of the "benefits" were wider economic and land benefits whose inclusion was debatable.

The government changed the figures significantly in late 2014 before the business case was released, with transport benefits cut 26 per cent, land-use benefits boosted 17 per cent and wider economic benefits boosted 17 per cent, with insufficient documentation to explain the decisions.

This confirms the tram is a key economic driver for the territory. Obviously the first section will suit only a slice of the city but hopefully will deliver benefits across the territory.

Already there are green shoots emerging, pointing to this likely positive outcome. Some northern suburbs on the tram line have already experienced a rise in value, before any track is laid. This trend is occurring because the project is attracting buyers to properties along the transport corridor and their dollars are pushing up prices. Existing homeowners in the area will be pleased to hear this news, along with the government, which can expect more revenue from stamp duty on sales and from rates on higher valuations.

The opposition has come up with an excellent bus plan as it threatens to halt the tram project if it wins power. While the opposition seems content to play mostly a low key role, the challenge for Labor is to dampen criticism based solely on transport issues and pitch a coherent message about the broader economic benefits to be generated by the tram and, hopefully, sprinkled a long way south of its Civic terminus.