Canberra Times: Newly-released cabinet documents reveal what the Howard government knew when it canned the high speed rail project. Picture: Shutterstock
When the Howard government finally decided to terminate the Sydney-Canberra high speed rail project tender in December of 2000, the projected benefits to taxpayers were just a fraction of figures the government had spoken about publicly.
The ACT government wanted to keep the project going, but the NSW government was in favour of terminating if the Commonwealth wasn’t going to bankroll the 50 per cent public-contribution towards the $4.8 billion cost of the endeavour.
The benefits of the Speedrail project, who were at that stage the last remaining of four original bidders, were estimated to total no more than $819 million. More than $270 million of that was simply deferring the construction costs of Sydney’s second airport.
While the consortium, headed by Leighton Holdings and GEC Alsthom, was considered by a project evaluation committee as capable of successfully building and operating a Sydney-Canberra VHST project, the financial viability was dependent on unique tax and competition concessions, “which are likely to be unacceptable to governments”.
Newly released cabinet documents reveal that Treasury and the Bureau of Transport Economics argued the Speedrail bid’s ability to meet the no net cost to taxpayers test was possible but dependent on contentious decisions like deferring a second Sydney airport.
The Commonwealth’s project control group argued awarding the tender to Speedrail would expose the government to litigation and Senate inquiries since it clearly was not going to successfully meet the NNC test, and NSW had already signalled that probity issues were the Commonwealth’s alone to manage
“Were governments considering proceeding with the project they could expect that any NNC assessment would be criticised by previously terminated consortia and be scrutinised in legal challenges,” the PCG wrote in its brief to cabinet.
However, the PCG was convinced that the Sydney-Canberra process, while unsuccessful, had demonstrated that the technical and logistic aspects of a VHST service were viable. It proposed, and then-transport minister John Anderson brought to cabinet, a pitch for a $20 million scoping study for a route connecting Brisbane, Sydney, Canberra and Melbourne.