The decision to abandon the Inland Rail project when it was already well advanced in construction has shocked many and raises very big questions.
Transport planning assumptions that have underpinned planning decisions for years at state, federal and local government level are coming undone as the Inland Rail decision prompts closer scrutiny of transport planning at all levels.
In this New England Times investigation by RK Crosby, we look at how bad numbers, assumptions and guesses, and misrepresentations of old documents, have led to plans at all levels of government being not worth the paper they are printed on.
NSW draft transport plans crumble into dust
At the state level, the NSW Government’s draft Strategic Regional Integrated Transport Plan (SRITP) for the New England North West has come under criticism over the questionable assumptions underpinning the document. As the figures and rationale throughout the document are poked and prodded, the NSW Government’s assessment of rail infrastructure and capacity in the region has crumbled to dust.
The withdrawal of Inland Rail, mentioned 56 times and presented as the answer to all freight challenges, obviously requires a significant rewrite the plan. But the document asserts that both the federal and state government are “not planning to progress reinstatement”, and that “re-establishing the line for modern freight trains and passenger services is considered unlikely to be feasible”.
Asked what was the grounds for determining that reactivating the line is “unlikely to be feasible”, Transport for NSW referred to the 2006 North South Rail Corridor Study as having “comprehensively examined the route”, and an Armidale Regional Council commissioned “feasibility study”.
However, the 2006 North South Rail Corridor Study by Ernst & Young did not assess the feasibility of reopening the existing Main North line in its current form or for local use purposes. Instead, that report examined potential inland freight corridors suitable for double-stacked container operations as part of early Inland Rail planning.
The study did comprehensively examine the Main North Line route, with a specific line item for a rebuild of the Armidale to Stanthorpe corridor, including a number of major realignments designed to reduce gradients for modern freight operations. That rebuild was estimated at $265 million, or about $1.07 million per kilometre, a relatively small component within the study’s broader estimated $8.2 billion cost for the “central inland” route option. In today’s money, that would be $443 million, or $1.79m per kilometre to reactivate the line North of Armidale through to Queensland.
The study ultimately favoured the far western corridor via Narrabri and Moree because it was assessed as cheaper and faster for bulk freight movement than the central route through Dubbo and Armidale or coastal alternatives. It did not, at any point, suggest that the Main North Line would not be feasible for freight or passenger services.
For two decades, however, the report has regularly been cited by politicians and public servants as justification for claims that reopening the Main North line was not feasible.
Trains North President Matthew Tierney said the report had been mischaracterised for a long time.
“The thing about [the Ernst & Young] report is that it did not condemn our line,” he said.
Tierney recounted past meetings where officials had admitted to him directly they were referring to this report when they were talking about feasibility of the line. He also said the report always underquoted the likely cost of what is now Inland Rail on the far west route.
“The original cost estimate for Inland Rail of $3.5 billion in the 2006 study for the federal government was never believable.”
Feasibility based on Rail Train campaign material
Transport for NSW also pointed to a report commissioned by Armidale Regional Council into reopening the Armidale to Tenterfield section of the line, still available on Council’s website.
“Armidale Council engaged AEC Group to conduct a feasibility study into reopening the Armidale to Tenterfield portion of the line. The study found the project was not viable,” staff wrote in an email.
This 2018 document, clearly stated in the introduction as being commissioned to support the New England Rail Trail development, is not a feasibility study. The document describes itself as a “discussion paper” and a “letter”, and clearly states that the information is “preliminary and prima facie” and significantly greater analysis would be required to determine feasibility.
The brief document adopted an assumed reopening figure of approximately $2.5 million per kilometre in it’s back-of-an-envelope style calculations. It is not clear why the consultants did not use the specific figure given for the Armidale to Stanthorpe section, given it was available in the same report that they refer to as costing the entire Melbourne to Brisbane corridor at $8.2b, other than the fact that, had they done so, the reactivated rail line would have been – by their calculations – not just feasible, but profitable.
The discussion paper also conflicted with an earlier – and much more substantial – 2004 report, commonly referred to as the Charlston Study, which was also a “preliminary” study that recommended reopening the line to Glen Innes alongside development of an intermodal freight hub for around $20 million, equivalent to about $35.5 million in today’s money. Then Northern Tablelands MP Richard Torbay publicly supported the proposal at the time.
Mr Tierney said the line should now be reassessed in light of the federal government’s decision to halt Inland Rail north of Parkes.
“The old Main North Line must be looked at again, from Werris Creek to Queensland via Tamworth, Armidale and Glen Innes,” he said.
“The federal Government want to invest in existing rail freight infrastructure rather than face the huge challenges of greenfield construction.
“The Main North Line is an existing rail corridor and it’s much easier to create a high-quality railway line where the track formation is still in place, as it is on the Northern Tablelands.”
Combined with gauge conversion in Queensland and other required work, Trains North estimate that single stack freight and passenger services along what they call the “Northern Connection” from Parkes to Toowoomba could be achieved for $3b.
Inland Rail figures remain unclear
The scrutiny over NSW transport planning has become even more complicated as the figures used to justify the axing of Inland Rail north of Parkes have also come under increased questioning. Member for New England Barnaby Joyce has pulled on his accountant hat and been asking for an explanation of the $31b blow out to a total estimated cost of $45b, but in response Infrastructure Minister Catherine King has only given hyperbolic partisan – and frequently personal – attacks.
During Question Time in Federal Parliament on 12 May, Joyce directly asked King to identify the largest cost items behind the claimed blowout.
“The minister has claimed that there is a $31 billion blowout in the cost of the construction of the Inland Rail,” Mr Joyce said.
“To give confidence to the validity of this number, as it seems rather incredible, can the minister nominate the five largest cost items and the amounts associated with them that are part of the $31 billion?
“And, if you can’t nominate the five largest ones, can you nominate one and the cost item that is associated with it?”
Minister King did not provide any specific cost items in response.
Instead, she outlined the project’s history, saying the Coalition had announced the project without sufficient planning and that subsequent reviews had found significantly higher costs.
“The first thing that I was told by the Australian Rail Track Corporation, the ARTC, who all of the figures come from, was that the project would need substantially more funding to finish it, but the ARTC could not tell us how much,” Ms King said.
“They did not know how much it would cost.”
Asked again on last night’s 7.30 program, the Minister could only offer more condescending rhetoric, not an explanation of the cause of the blowout.
“If anyone’s saying that we’ve somehow made these figures up, I’m really concerned about that. I think that shows a lack of understanding about this project and a lack of understanding about how budgets work,” she said to the ABC.
The federal government have declined to provide details or a breakdown of that $45b figure to New England Times, saying it is “commercial in confidence”. The actual amount removed from the project in the federal budget is $4.4 billion.
Local government planning also affected
The cancellation of the northern section of Inland Rail has also created uncertainty for regional councils whose planning strategies had been built around the project proceeding.
Member for Barwon Roy Butler is calling for compensation for councils that spent ratepayer funds preparing for Inland Rail.
“Local councils stepped up and did the work to prepare for Inland Rail—only to be left with nothing to show for it,” Mr Butler said.
“That is simply not good enough. These communities should not be financially penalised for a project the Federal Government has failed to deliver.”
Mr Butler said councils had diverted resources away from other priorities.
“Money spent on this undelivered project is money that now can’t be spent fixing roads and providing services like community pools and childcare, as many regional councils do,” he said. “Compensation is not optional—it’s a matter of fairness.”
Councils such as Moree Plains and Narrabri had undertaken significant planning work and infrastructure preparation linked to Inland Rail expectations, and are out of pocket considerable sums if the project cannot be saved.
At the other end of the impact spectrum, Armidale Regional Council is progressing rail trail planning, allocating $1.5m for preliminary works in their current draft budget which closes to public comment on Friday. The rail trail figure is one of many drawing criticism from locals in a budget raising lots of questions due to the abundance of very round figures and as few as 24 line items that appear to be properly costed.
The support and expenses of both Armidale Regional and Glen Innes Severn councils towards the beleaguered New England Rail Trail project have been based on long-standing assumptions and assertions of Transport for NSW, and numerous politicians, that reopening the Main North line is not viable.
We now know those assumptions and assertions are based on a combination of bad numbers and assumptions, a misrepresentation of a 20 year old report, and a “discussion paper” specifically commissioned to support a rail trail project.
No feasibility study has been completed on the Main North Line being reactivated for local passenger or freight use.
While the question of who is at fault in this array of assumptions based on guesses masquerading as planning may never have a satisfactory answer, Transport for NSW at least admits there are problems with its transport plan, which it reiterates is a draft.
“As a draft document, Transport for New South Wales welcomes all comments and feedback on the plan while it is on public exhibition.”
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