2023 update

Earlier content

 Somehow, this project has morphed into a mega project with no sense of being staged to deliver early benefits addressing the real problem, not occasional holiday congestion. Alex W.

“The majority of Australians would like to see freight hauled by real trains, not road trains. Countless studies and reports – many commissioned by government agencies – have highlighted the growing negative impact of allowing too many trucks on roads. More trucks mean increased severity of road accidents, heightened pressure on already overstretched maintenance budgets and a rise in vehicle emissions.”

(Dean Dalla Valle, CEO Pacific National,Rail Express, 15/3/19)

NSW on a slow track to fast trains: promised regional rail upgrades are long overdue (Source, June 2021)

Opportunity Cost Completely Ignored     

This road tunnel / duplication proposal is supposed to save 10 minutes of travel time and cost billions of dollars. The NSW Gov't is spending a lot of time and money investigating it (the technicalities, not the cost)

A minimal realignment of the rail line between Lithgow and Blayney is estimated to reduce travel time by about 25 minutes. Why isn't the NSW government investigating this??
Source: SPEEDING UP NSW MAIN WEST TRANSIT TIMES by Max Michell and Philip Laird Freelance Rail Operations Analyst / University of Wollongong, 2019.

Current transport policy  in NSW focusses on providing for anticipated demand (especially for roads).
There is almost no emphasis on demand management  (except in inner-city contexts).

This is the core of the problem in planning land transport.

A long stretch of land about 5m wide created for use  by 

• private cars can carry about 2000 people an hour; 

• buses, can carry about 2500 people an hour; and 

• heavy rail can carry about 20,000+ people an hour.

Or in the case of the latter freight equal to between about 50 to 100 trucks (depending of various factors).

We have decided to focus most of our attention on the first mentioned: we have decided to opt for the more expensive, less productive mode.

That is the main reason we have congestion on our roads. We have made that choice. 

The idea of a dual road carriageway from Lithgow to Katoomba has been on the cards for a long time.

Planning for it has not. It is (as of late July 2020) still underway, even though a decision has already been made to build it. The final construction cost is not known, the state government will only commit to $2.5 billion. The other costs are not known. There is a lot of guesswork going on.

What is wrong with this idea?

1. Spending 4.5, or 5 or more likely 8 billion dollars to duplicate the highway between Katoomba and Lithgow won't deliver a 100km/h fast and safer road to Penrith

2. Why not? Because there is already (at certain times) congestion on the highway between Katoomba and Penrith, I.e. the 22 traffic lights (several more planned), 6 school zones, 16 different speed zones, and hundreds of side streets and driveways along 50km of the GWH between Explorers Tree at Katoomba and the M4 near Lapstone.

3. The GWH between Katoomba and Penrith is essentially a local road.

You cannot build your way out of road congestion: you can only move it from one place to another, or worse still add to it.

This is a classic case of 

The Sunk-Cost Fallacy

which is our our tendency to throw good money after bad. Because we have already spent money on something that only encourages us to keep doing it. Sometimes it is better to do something different or the opposite. (Definition)

The more we spend on something, the less  willing we are to change.

Isn't making a decision to build a road without knowing all the costs and benefits a roundabout way of doing things? What if there are other ways?

Where is the research?

Shouldn't all the options be costed first, then a decision made?

What about consultation? Shouldn't all the stakeholders be asked first?

What should be done?

• Complete the planning for the dual carriageway between Lithgow and Katoomba

• ONLY the tunnel option should be considered:  any above ground option which would result in the destruction of the centre of Blackheath, or the bush to the west, or to Medlow Bath is not acceptable from a moral point of view (especially when there are cheaper more effective solutions: see Congestion page

• Extensively scope the option of improved rail services for both freight and people between the west and the Sydney basin (all 3 routes - see below)

All the costs and benefits must be carefully calculated, discussed and debated.
Only then should a decision be made, and that choice must be "mode agnostic".
We should not be trying to "pick winners and losers".

The Nationals say they are committed to rail: "Deputy Premier John Barilaro reiterated the state government’s commitment to a major rail spending programme as part of its A$55bn transport investment programme over the next five years." 

Back in 2010 the then Opposition Leader urged the Labor to get freight on to rail. At the time he said

• "The State Government has to end the excuses and start responding to community concerns about increasing truck movements across this state

• "We are determined to ensure that we get as much freight back onto rail as possible,"

What is government policy with regard to project planning?

This is an extract from the Transport for NSW Cost-Benefit Analysis Guide , which recommends how planning decisions like this should be made:

5.3.2 Specify the project options

As a general guide, there should be a minimum of three alternatives to the base case considered for major investments (≥$10 million) at the strategic business case stage, and two to three alternatives at the final business case stage. For smaller projects, at least two alternatives, preferably more, should be considered. It is recommended that a range of alternatives are represented in terms of technology, mode, demand, or timing. Only technically and economically feasible options should be considered in the analysis. 

For major projects, a long list of potential options should be developed in the strategic business case. 

poor specification of project options will compromise the analysis and distort the investment decision being made.

 A CBA should consider a range of realistic options." 

and from Section 6 on Optimism bias

"A common cognitive bias for project proponents is optimism bias which unintentionally advantages a preferred option over credible alternatives. The most appropriate way of addressing this issue, particularly for projects that have not been undertaken before, is to ensure that the cost and benefit assumptions and data used are reasonable by comparing them with actual data from similar, recently completed projects.

Ways to avoid cognitive bias when developing transport initiatives include: thinking in terms of outcomes, exploring a wide range of option early in development, and avoiding the preferring of an option without the necessary evidence."   (emphases added) 

At the  federal level a 2020 report by the Productivity Commission recommended that "There are significant opportunities for COAG (to improve] infrastructure provision and management by :...ensuring that investment decisions on major freight corridors are based on transparent cost-benefit analysis, which includes consideration of intermodal options"   (National Transport Regulatory Reform - Inquiry Report no. 94)
 

Failing the newspaper and pub test: TfNSW acting against its own advice.

more from Transport for NSW Cost-Benefit Analysis Guide section 6 

"When doing or reviewing a CBA would you be willing to defend your decision, to family, friends or media if it appeared in a local paper? This includes: the choice of preferred option; cost and benefits of the preferred option compared to alternatives; the process used to make the decision; and the cost of developing the CBA, the business case and making the decision".

In the case  of the GWH the government has not followed its own advice.

 It has NOT considered

• alternative technologies

• alternative modes

• a long list of potential options

• explored a wide range of options early in development

There is a danger that the "decision" already made will lead to poor outcomes.

Why is it being fast tracked?

In the 2018  TfNSW document called  "Regional NSW Services and Infrastructure Plan" the  'Great Dividing Range long term solution corridor preservation' was for scheduled for investigation by 2028 and for delivery 20+ years away, and the "Electrification of intercity to Bathurst" was supposed to be investigated in the next 10-20 years. (see pp 272-3).

Why the turnaround? What has changed in two years?  

10,000 people in the Orange Area want a better rail service to Sydney
Petition in 2019

Congestion and Reliability Review: Full Report Austroads 2015 p.99

"Benefit-cost analysis is particularly important for large infrastructure projects because their total capital commitment, benefits and risks are all significant and are typically only marginally above the acceptable benefit-cost threshold of 1. Indeed, there are likely to be a large number of small projects with higher benefit-cost ratios that could be completed instead, for the same cost as a larger project."

Missing evidence base for big calls on infrastructure costs us all. "When the case for big transport projects is made without due analysis, we risk building the wrong projects. The result is we waste billions of dollars and rob ourselves of the infrastructure our booming cities need to be more liveable. Given how fast our big cities are growing, we simply can’t afford to make decisions based on limited or misleading information. Yet this keeps happening."

"It would be better to spend the $40billion on 80 projects worth $500 million than two mega-projects" (Terry Rawnsley, SGE Economics and Planning. Source: SMH 24 Aug2020)

Grattan and SGS also question big projects (SMH, 9 September20, page 6)

“The Grattan Institute’s transport and cities program director Marion Terrill said two changes out of the coronavirus recession could affect the usage of planned infrastructure projects for years if not decades….. ‘‘We know that these big road projects for instance were based upon big increases in population, but that’s not going to happen,’’ she said. ‘‘All of these big projects should be halted, with their business cases reviewed to make sure they stack up."

SGS Economics principal and partner Terry Rawnsley said governments had to look at the relative economic benefit of projects.

He said social housing, which the federal government has been reluctant to support as it believes it is a state responsibility, would provide a substantial economic boost because it was spread across the country and required small scale contractors. ‘‘If you’re going to spend $50 billion, is it better to have two projects worth $25 billion each or a thousand worth $50 million each?’’ he said."

In December 2018 a Parliamentary Inquiry [2] found that for future large scale infrastructure projects, the government should:

• hold public planning inquiries

• prepare a detailed options analysis

• ensure that this analysis is independently peer reviewed in accordance with the requirements of the Infrastructure Investor Assurance Framework

• publish both the analysis and a summary of the peer review prior to the commencement of construction of that project.

Why hasn't this happened?
Is planning so much improved now that we don't need oversight? 

Social Licence to Operate

(What follows is from TfNSW's own documents: Enhancing transport project implementation and community acceptance through ‘social licence to operate’)

" This is especially the case for communities that are heavily impacted through construction and/or operation, but directly gain little benefit, for example, the asset is servicing an upstream community or deliverable significantly removed from the main area of impact.

 According to the Australian Government Department of Industry, Innovation and Science, social licence to operate must be constantly renewed through active, broad-based community engagement for the entire lifespan of the project."

QUESTION: Does TfNSW have a social licence to operate in this case? Who gains? Who loses? Why weren't the community engaged before March 2019?

More detailed information and research

What are the 3 routes between the West and Sydney basin

1. Northern: to Newcastle via Sandy Hollow

2. Central: to Sydney via the Blue Mountains

3. Southern: to Port Kembla (or Sydney) via Demondrille by rail or M31/48 by road

1. Issues with the Port of Newcastle

Most of the freight for export from the Central West / Orana should be going to Newcastle. See map at bottom of the page, as it has been identified as the most suitable port (NSW Container and Port Policy March 2018 p.24)

A container port is being built at Newcastle (which will be a good thing when they wind up the coal export terminal).

 There is a catch. 

When the port of Newcastle was privatised several years ago it was conditional on a cap being put on the number of containers that could be shipped from it. Anything over a certain limit would be charged. So shippers will have to send their containers to Port Botany, probably by road. This will create more congestion. 

The ACCC has taken the government to court for anti-competitive behaviour and the decision is pending. [3]
June 2021 Update
Port Botany, Illawarra to gain ‘monopoly’ on transporting containers for 50 years
Federal Court finds against ACCC (SMH, 30June 2021, page 9)

The NSW government should drop its opposition to a Newcastle container terminal. The Nationals support the dropping of the restrictions.[1]

“In comments apparently designed to up the ante on the debate, Port of Newcastle chief executive Craig Carmody lashed out at the restrictions on the port, saying Australia was "an island nation that knows bugger-all about ships and ports". Feb 2020[2]

The government has already completed a feasibility study to reopen the Maryvale to Gulgong Corridor, which is the missing direct link between the Orana region and Newcastle. But it doesn't appear to have been published?  There was another one 40 years ago. But nothing happened as a result of it.

Excerpt from that report

"Within the context of the benefit-cost methodology adopted in this evaluation it is clear that the construction of both segments of the Sandy Hollow to Maryvale railway is economically warranted."

[1] http://mhdsupplychain.com.au/2019/07/05/container-terminal-a-step-closer-for-newcastle/

[2] https://www.newcastleherald.com.au/story/6645963/port-says-newcastle-container-restrictions-must-go-in-face-of-coal-downturn/

[3] https://www.dailyliberal.com.au/story/5827877/exporters-could-use-newcastle-option-if-accc-action-is-successful/

The Government is Creating Unnecessary Congestion through its policies

The NSW government will be creating  congestion by making freight forwarders ship their containers through past the port of Newcastle, down the M1, through Sydney to Port Botany.

This could be changed at the stroke of a pen.

Would the freight forwarders support this? Yes!
Dubbo exporters could use Newcastle Port option if ACCC action is successful

[1] https://www.transport.nsw.gov.au/projects/project-delivery-requirements/evaluation-and-assurance/transport-for-nsw-cost-benefit/key

[2] New South Wales. Parliament. Legislative Council. Public Accountability Committee. "The impact of the WestConnex Project"