Dr Phil Laird argues that Australia should consider implementing some of New Zealand’s rail incentives. Read more
THE IMPORTANCE OF KEEPING INFRASTRUCTURE JOBS
It’s an age-old economic principle. When people earn, they spend; when they do this, funds are further distributed, enabling even more spending. Infrastructure is one of the biggest employers in Australia, so the more we invest in keeping people in these jobs, the better the economy performs as a whole. With COVID-19’s economic fallout, it has never been more critical to ramp up impetus across our beloved industry.
For the most part, infrastructure jobs have been more secure than in other industries, with sectors such as construction deemed an ‘essential service’. But what other security is out there? For workers restricted by current pandemic measures, there is a big appetite to get people back into the workplace. According to surveys conducted throughout the construction industry, civil contractors are prepared to make significant investments in employment if government infrastructure projects are fast tracked. So capacity is there – especially for tier 2 and 3 companies with significant ability to create these employment opportunities. But what else do we need to consider?
While we’ve all been following recent government stimulus packages aimed at boosting infrastructure growth, the trick now is where to spend to achieve maximum benefit.
SPEND WISELY AND WITH PRUDENCE
Instead of ‘clustering’ projects in a small area, it may be more beneficial to spread the projects into rural and regional areas. The communities in these areas would benefit greatly from infrastructure investment by creating employment, as well as opportunities for training. Ultimately this translates to community spending filtering down to local businesses. This sentiment is echoing throughout our industry.
Treasury Secretary, Steven Kennedy, told a Senate hearing in October 2019, that spending big on large infrastructure projects is not the way to stimulate the economy. This point of view may have some merit, insofar as large-scale projects take significant time to plan to get the business cases and budget right. Spending more on smaller projects to match demand would make more sense – particularly when planning through to shovelling can be done within a much shorter timeline. This would allow for the main focus on larger projects to remain on planning, scoping and budgeting accurately.
Having said that, larger projects must not be abandoned in favour of the smaller ones. The smaller ones would merely provide shorter term relief in economic downturn, whereas the larger projects would stimulate the economy in the longer run. Mr Kennedy appears to reject the idea of extra spending except “in an emergency”. That was before COVID-19 became what it is now – an emergency.
WHY IS THE COVID-19 CRISIS DIFFERENT AND HOW MIGHT IT INFLUENCE HOW INFRASTRUCTURE IS DELIVERED GOING FORWARD?
What COVID-19 has taught us so far, is that we are very adaptable. With a significant number of people getting used to working from home (and many coping well with this scenario), people may start to consider whether travelling to an office is really needed. They may think; why bother if they can achieve the same amount of work (and more) from the comfort of their own environment? This may be considered a radical approach and certainly is not without its own pitfalls, but still could be a consideration. This new dynamic also raises a number of questions around the allocation of industry resources in general.
Are train lines into the city from all around the metropolitan areas really going to be used for current or planned increased capacity? Should the spending on these planned projects be channelled to developments where digital connectivity can be vastly improved (let us face it, the NBN still struggles somewhat)? Should we invest more in renewable energy sources instead? Should there be a larger focus on innovation perhaps, and what does this look like? Maybe if local rail network spending gets pushed back to a lower priority, intercity or fast rail could get more funding to compete with domestic air travel. Or now there could be less spent on transport and more on other forms of infrastructure. These are all alternative options if funds for planned transport projects get redistributed.
But what about the flow on? Although these proposed infrastructure opportunities may lack similarly skilled resources as for civil road & rail construction projects, they could open up training and upskilling for people to work in these industries. This will promote increased capacity of tertiary educational institutions – again more infrastructure spending, creating more jobs.
WHO PAYS FOR ALL THIS?
While we can promote and encourage big spending on infrastructure to stimulate the economy in times of crisis, people will rightly ask where the funding for these planned projects will come from?
Both federal and state governments have already spent significant amounts of money on cash stimulus packages including JobKeeper allowances. This may well be unplanned and we, in the general public, may not really know whether funds earmarked for other areas of the economy, including infrastructure spending, have been redirected to pay for the various cash stimulus packages introduced. They may have come from some form of contingency fund in the government coffers. We certainly do not know. However, if funds from other projects were redirected, including planned infrastructure investments, and those projects required ‘new’ funding, all levels of government may have to rethink where the capital would come from to pay for these projects. Let us face it, short term cash stimulus only goes so far – what happens if that runs out or gets wound back early?
One of the major contributors to reinvestment in infrastructure could be the sale of assets, as NSW did when they sold the state’s electricity assets. This provided a major boost to infrastructure spending and could be done again. Alternatives to this could be increased borrowing, higher taxes (GST), print more money, etc. All these have their own pros and pitfalls and identifying the healthy balance would be the key to getting this right. No option will be perfect, but some may be more perfect than others.
In any case, in our current environment loaded with uncertainty, some surety remains. As a historically vital player, infrastructure continues to play a pivotal role in boosting our country’s economy during economic downturn. The key is not only to spend wisely, fairly and equally, but to embrace the potential redistribution of funds across fresh opportunities arising out of this novel landscape.
Not since World War II has Australia’s social and economic way of life been put under such pressure. Businesses are struggling or closing, thousands have already lost their jobs, governments are shutting down all non-essential activities, and millions are working from home.
Australia’s Reserve Bank has slashed interest rates to record lows and governments are spending tens of billions to help stabilise the economy.
Anxiety is gripping the nation, with panic buying of food and household items by nervous consumers.
Now is the time for Team Australia to kick in.
What many Australians may not realise is the army of essential freight and logistic workers toiling day and night to help keep our economy ticking over. They are making sure necessities and raw materials find their way to supermarkets, retail stores, petrol stations, warehouses, steel and flour mills, and manufacturing plants.
As Australia’s largest rail freight company, Pacific National is proud to be doing our part, hauling the nation’s goods and commodities 24 hours a day, 365 days of the year along railways linking key supply chains across our vast continent.
Without goods trains, domestic and imported products like food, clothing, medical and pharmaceutical supplies, cleaning products, fuel, household products, chemicals, electronics, steel, and machinery and parts cannot be efficiently transported to depots and warehouses between cities and regional towns.
A double-stacked 1,800-metre interstate goods train can haul more than 330 shipping containers, thereby helping to free-up hundreds of truck drivers each week to focus on delivering goods and products the remaining ‘last mile’ from warehouses to stores where consumers need shelves restocked.
To put this in perspective, a single shipping container can hold approximately 25,000 toilet paper rolls, 55,000 food cans or 1,500 cases of beer.
Without freight trains, bulk exports like grain, meat, fresh and dry produce, cotton and coal cannot be efficiently hauled to ports, the gateways to global markets.
Paddock to port, pit to port, or manufacturing plant to port – essential rail freight services stretch across state borders, servicing finely-tuned supply chains.
Our company has been providing essential rail freight services since 1855. Back then we were called New South Wales Government Railways.
Today, our 600 locomotives are crewed and serviced by 2,500 men and women right across the nation. Each day and night they clock onto their shifts after practicing strict hygiene and social distancing procedures. Rail freight has the added benefit of operating within railway corridors and depots prohibited to the public.
The health and safety of our train crews are paramount, and I’m immensely proud of their efforts and dedication.
Unless ill or otherwise required by law, these crews continue to run essential freight train services around the clock. Without them, critical supply chains across state borders will break. Largely out of sight, each day they help underpin the productivity and wealth of our nation.
We thank federal and state governments for working closely with our sector during this challenging time. They moved quickly to protect the nation’s supply chains.
So next time you see a big blue and yellow Pacific National locomotive, take comfort knowing there is an army of freight and logistic workers doing their bit for Team Australia.
Dean Dalla Valle
Pacific National CEO
Cities are expanding upwards and downwards, as well as outwards. With urban density also increasing, moving people efficiently around the city, often using ageing infrastructure, is quite a challenge, Andrea Connor and Donald McNeill write.
Cities worldwide face the problems and possibilities of “volume”: the stacking and moving of people and things within booming central business districts. We see this especially around mass public transport hubs.
As cities grow, they also become more vertical. They are expanding underground through rail corridors and above ground into the tall buildings that shape city skylines. Cities are deep as well as wide.
The urban geographer Stephen Graham describes cities as both “vertically stacked” and “vertically sprawled”, laced together by vertical and horizontal transport systems.
People flow in large cities is not only about how people move horizontally on rail and road networks into and out of city centres. It also includes vertical transport systems. These are the elevators, escalators and moving sidewalks that commuters use every day to get from the underground to the surface street level.
Major transport hubs are where many vertical and horizontal transport systems converge. It’s here that people flows are most dense.
But many large cities face the twin challenges of ageing infrastructure and increased volumes of people flowing through transport hubs. Problems of congestion, overcrowding, delays and even lockouts are becoming more common.
Governments are increasingly looking for ways to squeeze more capacity out of existing infrastructure networks.
Can we increase capacity by changing behaviour?
For the last three years, Transport for London (TfL) has been running standing-only escalator trials. The aim is to see if changing commuter behaviour might increase “throughput” of people and reduce delays.
London has some of the deepest underground stations in the world. This means the Tube system is heavily reliant on vertical transport such as escalators. But a long-standing convention means people only stand on the right side and allow others to walk up on the left.
In a trial at Holborn Station, one of London’s deepest at 23 metres, commuters were asked to stand on both sides during morning rush hour.
The results of the trials showed that changing commuter behaviour could improve throughput by increasing capacity by as much as 30% at peak times. But this works only in Tube stations with very tall escalators. At stations with escalators less than 18 metres high, like Canary Wharf, the trials found the opposite – standing would only increase congestion across the network.
By standing only, 30% more people could fit on an escalator in the trial at Holborn Station.
The difference is down to human behaviour. People are simply less willing to walk up very tall escalators. This means a standing-only policy across the network won’t improve people flow uniformly and could even make congestion worse.
Is people movement data a solution?
With the introduction of ticketless transport cards it’s now possible to gather more data about people flow through busy transport hubs as we tap on and off.
Tracking commuters’ in-station journeys through their Wi-Fi enabled devices, such as smart phones, can also offer a detailed picture of movement between platforms, congestion and delays.
Transport for London has already conducted its first Wi-Fi tracking trial in the London Underground.
Issues of privacy loom large in harvesting mobile data from individual devices. Still, there’s enormous potential to use this data to resolve issues of overcrowding and inform commuters about delays and congestion en route.
Governments are also increasingly turning to consultancy firms that specialise in simulation modelling of people flow. That’s everything from check-in queues and processing at terminals, to route tracking and passenger flow on escalators.
Using data analytics, people movement specialists identify movement patterns, count footfall and analyse commuter behaviour. In existing infrastructure, they look to achieve “efficiencies” through changes to scheduling and routing, and assessing the directional flow of commuters.
Construction and engineering companies are also beginning to employ people movement specialists during the design phase of large infrastructure projects.
Beijing’s Daxing airport, due for completion in 2020, will be the largest transport hub in China. It’s also the first major infrastructure project to use crowd simulation and analysis software during the design process to test anticipated volume against capacity.
The advice of people movement specialists can have significant impacts on physical infrastructure. This involves aspects such as the width of platforms, number and placement of gates, and the layout and positioning of vertical transport, such as escalators.
Movement analytics is becoming big business
People movement analytics is becoming big business, especially where financialisation of public assets is increasing. This means infrastructure is being developed through complex public-private partnership models. As a result, transport hubs are now also commercial spaces for retail, leisure and business activities.
Commuters are no longer only in transit when they make their way through these spaces. They are potential consumers as they move through the retail concourse in many of these developments.
In an era of “digital disruption”, which is particularly affecting the retail sector, information about commuter mobility has potential commercial value. The application of data analytics to people flow and its use by the people movement industry to achieve “efficiencies” needs careful scrutiny to ensure benefits beyond commercial gain.
At the same time, mobility data may well help our increasingly vertical cities to keep flowing up, down and across.
Andrea Connor is a Postdoctoral Research Fellow, Institute for Culture and Society, Western Sydney University, and Donald McNeill is Professor of Urban and Cultural Geography, Western Sydney University. This article was originally published on The Conversation. Read the original article here.
ANALYSIS: Regional areas are expanding, and yet not enough attention is being paid to improving rail access to capital cities. This affects the liveability of the areas, Melanie Davern, Carl Higgs, Claire Boulange, Jonathan Arundel, Lucy Gunn, and Rebecca Roberts write.
Our research on the liveability of regional cities in Victoria has identified an important element: liveability in these areas requires fast, reliable and frequent rail connections to capital cities.
Previous research has established that we need better models of early transport delivery in growth areas of Melbourne. Public transport, in particular, is an essential ingredient for a liveable community. Less attention has been paid to transport in regional areas, particularly regional areas with growing populations.
People living in regional areas still need access to capital cities. The reasons include employment, education, medical services, shopping, arts, culture and visits to family and friends.
Regional Victorians who lack access to reliable rail services remain deprived of non-car travel options. This forces them to drive and that adds to traffic congestion in our capital cities. Car dependency is costly for health and wealth.
Regional rail is important both to meet the needs arising from predicted population increases across regional areas and to manage the rapid population growth and sprawl of our capital cities. Australia’s population is predicted to increase by 45 million by 2100 and our cities are already expanding rapidly. We need to start thinking about where these extra people are going to live.
At present, most people (more than 80%) in Australia live in capital cities. However, as populations grow, more people will start moving to regional areas. This means we need to pay more attention to the liveability of regional Australia as well as capital cities.
Wherever they live, people need transport to get to employment, education, shops and services, and to socialise with friends, family and community members. Furthermore, our research has found that having close access to a range of these things is associated with better health and well-being. Good access to frequent, reliable and fast transport is not a luxury. It is a critical factor influencing liveability and is described as a social determinant of health – one of the conditions (where we live, learn, work and play) that influence our health.
Liveable places promote health and well-being among the people who live there. However, they also require transport options, including public transport such as trains, buses, trams as well as walking and cycling. In regional areas expansive distances make it hard to get by without a private vehicle.
A good example of this is Mitchell Shire. It begins at the northern edge of metropolitan Melbourne and extends to the regional town of Seymour in northeastern Victoria.
The population is booming in this non-metropolitan shire. The small town of Beveridge is expecting to accommodate at least 150,000 people in new urban development over the next 30 years. To put that into context, the town had a population of just over 2,300 people in 2016.
To understand the current regional rail services (and liveability) for areas like Beveridge we produced the summary map below.
Developers’ signs in the Beveridge area are advertising “40 minutes to the city” along the Hume Highway. Perhaps they are including a helicopter in their house and land packages. Based on current regional rail options, residents must drive to their nearest station 10-15 minutes away, wait for a train – services depart at intervals of 34-105 minutes – and then travel up to an hour to the city during peak hour.
Alternatively, these developments might be encouraging car use as the main means of transport. In that case, Google Maps suggests peak-hour travel from Beveridge to the Melbourne central business district takes between one and two hours on a weekday. Again, as well as being associated with poor health outcomes, long commutes by car will increase traffic congestion along the route and in the city.
Regional rail services are highly uneven
The map above also suggests that some areas of regional Victoria are doing better than others in terms of regional rail connections to Melbourne.
Consider the examples of Bendigo and Shepparton in central and north-eastern Victoria. Shepparton is a large regional centre, with an economy established in health services and agriculture. Its population is projected to grow to 315,000 people by 2046.
Shepparton Council planning is guided by a liveability framework, a 30-year plan and has recently completed a liveability assessment. However, Shepparton’s economic and social development is restricted by only four train services to Melbourne per day compared to Bendigo’s 27 services.
Similarly, Geelong has a projected population increase of 56% to 445,000 people by 2046. However, duplication and electrification of the overcrowded line remains an unfunded long-term project.
Car dependency, transport planning and urban design are critical social determinants of health that also need to be considered in creating liveable, well-connected communities in regional areas. We need to act now if we are to learn from the liveability lessons of our capital cities and avoid repeating the mistakes.
Melanie Davern is Senior Research Fellow, Healthy Liveable Cities Group, Centre for Urban Research, RMIT University. Carl Higgs is Research Officer, Centre for Urban Research, RMIT University. Claire Boulange is Postdoctoral Research Fellow, Centre for Urban Research, RMIT University. Jonathan Arundel is Senior Research Fellow, Healthy Liveable Cities Group, Centre for Urban Research, RMIT University. Lucy Gunn is Research Fellow, Centre for Urban Research, RMIT University. Rebecca Roberts is GIS Analyst, Centre for Urban Studies, RMIT University. This article was originally published on The Conversation. Read the original article here.
It might not be effective now, but the development of self-driving vehicles could be a game changer for public transport services, John Disney writes.
The idea of free public transport has clear appeal. Cities in France and Germany are already considering such proposals, to reduce traffic and air pollution. And in the UK, Labour party leader Jeremy Corbyn declared that he would introduce free bus travel for under-25s, to complement the passes already available to senior citizens.
But the evidence suggests that offering free public transport causes headaches for local authorities – and may not be an effective way of getting commuters to stop driving cars. Tallinn, capital of Estonia, introduced free public transport for residents in 2013. But a 2014 survey showed that most of the people who switched to public transport had previously walked or cycled, rather than driven. A further survey in 2017 showed that patronage had increased by only 20% over four years.
In the April 2018 edition of German trade publication Stadtverkehr, Naumann claims that the only cost effective way to get car drivers to switch to public transport is to couple reasonably priced transit with severe traffic restraints. For example, in the English city of Sheffield, attractive bus fares and timetables used to keep cars out of the city centre. From the 1970s, until the service was deregulated in 1986, there was simply no need for residents to drive into Sheffield.
Finding the funds
The biggest drawback to free public transport schemes is the lack of funds from fares to cover maintenance and upgrades. In Tallinn, for example, the city’s inadequate tram system will eventually require capital for a complete renewal – or face closure. Hasselt, a Belgian town with a population of 70,000, offered free bus travel for 16 years until 2013, but eventually scrapped it when costs became unsustainable.
Paris, meanwhile, has already banned the most polluting vehicles and offered free public transport for a few days each year when pollution has reached dangerous levels due to atmospheric conditions. But according to Haydock, writing in the June 2018 edition of Today’s Railways EU, traffic is rarely reduced more than 10% on these days, and the long term shift to other forms of transport is minimal.
In the UK, free bus travel for senior citizens has hastened the demise of many rural and intercity services. Many local authorities have diverted support away from rural, evening and weekend services, to the concessionary fares budget. During interviews with BBC Radio 4, younger people – who rely on buses to get to work or go out on the evenings and weekends – complained that services had been axed to offer senior citizens free travel during daytime on weekdays.
But irrespective of your age, health or prosperity, there is no point in having a free bus pass if there are no buses to use it on. As bus services are further deregulated in the UK, there will continue to be pointless oversupply on some corridors, while other areas struggle to see more than a few buses per week – if any at all.
The development of autonomous electric minibuses could be a game changer, especially if a manufacturer is prepared to lease them on favourable terms. Local authorities could pilot a scheme whereby the bus is “hailed” by smart phone 15 to 30 minutes before departure. Indeed, tests for autonomous on-demand services are already underway in cities across the US, UK and Europe.
Once the expensive and restrictive labour element is removed from the operating costs, there is no reason why such services could not be offered free of charge to all users. In the urban core – within a 10km radius of a city centre – these services could run 24/7. Further afield, in the suburbs, a daily service from 6am until midnight would probably be sufficient to compete with the private car.
Autonomous minibuses could automatically connect with city buses and trains, which would continue to be staffed and paid for by fares. The minibuses would provide a “last mile” service, taking people within easy walking distance of their destination. In urban areas, all residential and business premises would be within 200m of a minibus stop, extending to 500m in suburban areas and 1km in rural areas.
At off peak times, the minibuses could replace some conventional bus services to avoid the inefficiencies created when a 70 passenger bus is used to transport only ten people on an evening or Sunday service.
To prevent abuse of the minibuses, passengers would scan their phones on boarding to confirm the booking. If they didn’t, a penalty could be collected automatically from their phone. CCTV could identify any disruptive passengers and refuse further bookings. Meanwhile, taxis would continue to prosper from those people willing to pay for a personal door-to-door service.
Public transit systems, as we know them today, would struggle to deliver a sustainable free service. But there’s a real possibility that the autonomous vehicles of tomorrow could do just that.
ANALYSIS: TfL’s money troubles worsen, as passenger numbers fall for the first time in two decades, Nicole Badstuber writes.
For the first time since 2008, the number of people using the world-famous London Underground – locally known as “the tube” – has fallen. After over two decades of long-term growth, passenger numbers are down 2%, from 1.38 billion in the financial year 2016-17, to 1.35 billion in 2017-18. Bus use also peaked in 2014, and has been falling steadily each year. Simply put, fewer people in London are using public transport – and this means fewer ticket sales. This has created a funding gap that puts plans for improvements and upgrades in serious jeopardy.
Since the national government cut its £700m a year grant, London’s transport agency, Transport for London (TfL), has been banking on ticket sales to fund the capital’s transport system. But this year, TfL has had to revise its income from tickets sales down by £240m.
This spells trouble for the agency, which plans for ticket sales to generate up to £6.2 billion, or 62%, of the £10.2 billion budget for 2022-23 – a step increase from today’s £4.6 billion, or 45% of this year’s budget. Since London Mayor Sadiq Khan is committed to freezing single fares, additional growth will need to come from more passengers.
This is, in some ways, a reasonable expectation: population and employment – the key drivers of transport demand – are still growing in London. TfL points towards economic factors, including the uncertainty of Brexit, to explain the downturn in demand for public transport. But this year’s lower passenger numbers point instead towards lifestyle changes, which are affecting when and how people choose to travel.
London’s missing passengers
Travel surveys show that the average Londoner made only 2.2 trips (across all transport modes) a day in 2016-17, down 20% from 2006-7. So despite population growth, transport demand has not risen as much as expected. This decline is mirrored across England: between 2002 and 2016 a 9% drop in trips across all modes was recorded.
Passenger numbers on London Underground. Author created using data from London DataStore.
Flexible and remote working practices are contributing to this trend: instead of commuting to work five days, the new normal for Londoners is now four. Over the past decade, commuting trips have dropped by 14.2%.
At the same time, the cost of travel has been increasing. While single fares on the bus and the tube cost approximately the same in real terms between 2000 and 2012, they have increased 5% and 3% respectively since then. The cost of season tickets is up even more; 8% on the bus and 6% on the London Underground in real terms since 2012.
Greater transport costs mean less disposable income, which explains why Londoners are making fewer leisure and shopping trips, instead opting to stay home and shop online. Meanwhile, London’s changing mix of traffic suggests that personal trips are being substituted with deliveries. This shifts the burden from the public transport network to the road network. Across London, light goods vans are making up a growing proportion of traffic: accounting for 14% of traffic in 2016, up from 10% in 1993 and 11% in 2000.
Trouble for TfL
To avoid a major shortfall, TfL will need look at new ways to fund transport. One solution might be to reform London’s congestion charge. Currently, the congestion charge covers less than 1.5% of the city, applies only between 7am and 6pm, consists of a simple, daily flat rate, and exempts private hire vehicles – your Uber drivers and minicabs.
Over the past four years, there has been a 75% increase in the number of registered private hire vehicles. On Friday and Saturday nights, 18,000 cars flood the streets of Central London. With New York City set to introduce a surcharge for taxis and private hire vehicles (US$2.50 and US$2.75 respectively), London might also want to follow suit.
A more comprehensive road pricing strategy would be an effective tool to manage traffic and generate funds for the transport system. A reformed congestion charge alongside good public transport, cycling infrastructure and public space could encourage Londoners to shift away from their cars toward travelling by public transport, walking and cycling.
TfL predicts that most of it’s revenue growth – £3.2 billion over the next five years – will come from the new Elizabeth Line, which is set to start running in December 2018. By 2022-23, TfL expects passenger numbers on the Elizabeth Line to increase by 200m to 269m, and tickets sales to earn £913m. Over the same period, passenger numbers on the London Underground and bus network are forecast to rise by just 5% and 3% respectively.
The income from the Elizabeth Line is crucial to TfL balancing its books. As outgoing deputy mayor for transport, Val Shawcross, warned, delays to the Elizabeth Line opening on time are TfL’s greatest revenue risk. So as engineering challenges threaten to push back the opening date, TfL’s money worries look set to worsen.
The funding conundrum
TfL is also seeking to earn from developments on some of the 300 acres of land it owns in the city. By 2022-23, the property partnerships agreed between TfL and thirteen large property development companies in 2016 are set to generate £3.4 billion of income to reinvest into London’s transport system. London Mayor Sadiq Khan is pushing for further sites to be unlocked, to generate more funds and meet his manifesto commitment to build more affordable homes for Londoners.
Khan’s manifesto pledge to freeze single fare tickets throughout his term is estimated to cost £640m. Arguably, reneging on that promise could return £640m to TfL’s purse. TfL points to national rail services where fares are higher and the reduction in passenger numbers has been greater, and argue that the fare freeze blunted the drop in passenger numbers.
If TfL fails to find new ways to fund its network, more cuts to upgrade and capital programmes are only a matter of time. The agency has already cut its funding for streets, cycling and public spaces in London’s boroughs, and suspended its roads renewal programme and underground capacity upgrades. TfL’s reliance on ticket sales to fund the capital’s transport system makes it very vulnerable to unexpected changes in demand. To ensure London continues to have a world-class transport system, both Khan and TfL must urgently find new sources of funding.
COMMENT: High-speed rail for Australia has been on the drawing boards since the mid-1980s but has come to nothing. Three states are developing medium-speed rail with federal funding, but NSW is missing out, Philip Laird writes.
More than half a century has passed since high-speed rail (HSR) effectively began operating, in Japan in 1964, and it has been mooted for Australia since 1984. I estimate that the cost of all HSR studies by the private and public sectors in Australia exceeds $125 million, in today’s dollars. But the federal government is now less interested in high-speed rail (now defined as electric trains operating on steel rails at maximum speeds of above 250km per hour), and instead favours “faster rail” or medium-speed rail.
The 2017 federal budget provided $20 billion over the next 10 years for rail, with more allocated in the 2018 budget. It is now time for Australia to commit to medium-speed rail (trains operating on new or existing tracks at speeds of between 160km and 250km/h).
Indeed, three states have made progress in developing trains at 160km/h, with Victoria leading the way. New South Wales has failed to keep up with these states.
What happened to high-speed rail in Australia?
The first high-speed rail system dates back to 1964 when the Tokaido Shinkansen started operating between Tokyo and Osaka. At first, it took four hours to travel 515 kilometres; now some trains take two-and-a-half hours. Japan’s system has an impeccable safety record and the network extends for over 3,000km.
France was next in 1981 with its TGV trains. In 1984, high-speed rail was first proposed for Australia. This was the CSIRO’s Very Fast Train proposal to link Sydney, Canberra and Melbourne using TGV trains.
At all levels, government was not supportive. The private sector, after a series of studies, found it was viable and could work with different taxation arrangements. This was not forthcoming and work stopped in 1991.
A more modest proposal, called Speedrail, to connect Sydney and Canberra was proposed in the mid-1990s. With some federal government encouragement, it was studied, with detailed design. It was costed at about $4.5 billion, with finance arranged for some $3.5 billion. The Howard government would not fund the balance and commissioned yet another HSR study.
More studies have followed. One study in 2013 put a price tag of $23 billion on a Sydney-Canberra line involving much tunnelling in Sydney. This was part of a 1,750km high-speed rail corridor linking Brisbane, Sydney, Canberra and Melbourne. The total estimated cost was A$114 billion.
Despite many studies recommending the need to identify and protect a corridor for a future high-speed rail network, government has failed to reserve any land corridors (with the exception of part of a future Melbourne outer metropolitan ring road).
What about the alternatives?
Many countries do not have high-speed rail, but have medium-speed rail (MSR) instead. These countries include Sweden, Switzerland, the United States and Canada.
Three Australian states have trains operating at 160km/h. These are Queensland, starting in 1998 with its Electric Tilt Train service between Brisbane and Rockhampton, Victoria, with its Regional Fast Rail project using V/Locity diesel multiple units, and Western Australia, with the Prospector train.
Victoria’s service originated in 1999 when the then Labor opposition promised a new deal for regional Victoria, which included new trains and upgraded tracks on four lines to Bendigo, Ballarat, Geelong and Gippsland. The ALP won government that year. By 2006 the track upgrades were delivered along with new trains made in Victoria.
People liked the faster trains. Patronage went up by more than 15% in each of the first three years of operation. More trains were ordered and further major track upgrades followed.
Victoria was assisted by $3 billion in federal funding for a Regional Rail Link program. This was to provide new intercity tracks in Melbourne so suburban trains did not slow down regional trains.
Due to good ongoing planning attracting more federal funding,
further track upgrades are under way. The 2017 Victorian Infrastructure Plan outlines priorities and funding for projects over the next five years, with longer-term policy directions.
So what’s going on in NSW?
Questions are now being asked as to why Victoria and WA are doing do well with federal funding for passenger rail at the expense of NSW.
The rail situation in Australia’s most populated state is not good for its regions. By far the most NSW government attention and funding has gone into the Greater Sydney region.
Between the 2011 and the 2016 Censuses, Greater Sydney’s population (including Gosford) grew some 10% from 4.39 to 4.82 million. Rail patronage on the Sydney and intercity network had even stronger growth of some 15% from 2011 to 2016.
Sydney continues to have serious road traffic problems, which are unlikely to be solved by WestConnex Stages 1 and 2 that are now under construction. The proposed Stage 3 received over 7,000 objections, including a sensible alternative proposal by the City of Sydney, but the NSW government has approved Stage 3 and even more motorways. This is despite overseas experience for cities the size of Sydney pointing to the best solution being a much-improved rail system with road congestion pricing.
Regional NSW is also growing in population, albeit not as quickly as Sydney. In spring 2017, Transport for NSW released a draft regional servicea and infrastructure plan not for the next five years, but out to 2056. However, these plans were very vague as to what may be delivered in the next five or even ten years.
The plans also omitted earlier Infrastructure NSW goals for Sydney-Gosford and Sydney-Wollongong trains to take one hours (instead of one-and-a-half) and Sydney-Newcastle trains to take two hours. In addition, there are calls for more and faster trains linking to each of Goulburn/Canberra and the Central West of NSW.
Clearly, NSW is facing major transport challenges to overcome rail infrastructure backlogs and meet the needs of a growing population.
The state government is getting new intercity electric trains and has committed to buying new regional trains. But it’s yet to commit to track upgrades to help the new trains go faster than the present slow ones.
The NSW ALP opposition is also yet to present detailed policies of how it would meet the transport challenges in Sydney and in regional NSW.
The people of NSW must hope the state budget due June 19 and the opposition leader’s reply will address these issues.
COMMENT: Analysis of the business cases for three of the biggest projects deemed “high priority” by Infrastructure Australia raises questions about the process, Glen Searle and Crystal Legacy write.
Infrastructure Australia’s latest infrastructure priority list has been criticised for being “too Sydney-centric” and for giving Melbourne’s East West Link, cancelled in 2014, “high priority” status. The cancelled Roe 8 project in Perth was removed from the list.
So how does a project get onto Infrastructure Australia’s list? This requires submission of a full business case, which then needs to be “positively assessed” to be given priority status.
But our research, yet to be published, has found these business cases leave out highly significant costs. This article looks at three prominent projects – the WestConnex and East West Link motorways in Sydney and Melbourne respectively, and Cross River Rail in Brisbane – to illustrate how business cases submitted to Infrastructure Australia do not follow its requirements in key respects. This casts serious doubt on the business cases used to justify major motorway projects, as well as on how priority projects are selected.
What do business cases assess?
Ensuring business cases are completed before investment decisions are finalised is critical to “good planning”. Part of Infrastructure Australia’s remit is to head off concerns that projects are committed to before business cases are fully evaluated. This can help minimise “optimism bias” and ensure investments deliver community benefit.
But we must also examine what the business case is actually showing us. The main part of each business case is the cost-benefit analysis. This compares the money value of project benefits and project costs. Economically viable projects should have a benefit-to-cost ratio above 1:1.
Infrastructure Australia requires project business cases to consider non-monetised benefits and costs, including community impacts. These benefits and costs are required to be quantified in some other way, or at least described. The basis used to estimate “external costs” must also be provided.
The cost-benefit methodology requires any significant positive or negative impacts on third parties – externalities – to be included. Examples include air quality, carbon emissions, noise, biodiversity and climate adaptation.
Social impacts to be covered include equity or the distribution of benefits (which Infrastructure Australia says need to be identified since cost-benefit analysis does not explicitly take these into account), and affected local communities and other individuals/groups. The non-monetised benefit and cost categories listed as relevant are: social impacts, cultural impacts, visual amenity/landscape, biodiversity and heritage impacts.
In support of monetary estimates, proponents must “describe and provide supporting material that demonstrates how land use, population and employment projections are modelled”.
The guidelines stress that the supporting conditions for expected land use impacts will be in place – for instance, necessary infrastructure investment where densification is assumed. Factors that can hinder the realisation of such benefits (such as local opposition to increasing density) must also be included.
This process would seem to produce a rational prioritisation of national infrastructure projects. The problem is that the business cases submitted to Infrastructure Australia do not follow its requirements.
High-priority projects with problematic business cases
To illustrate this, we analysed the business cases of three projects designated as “high priority” for Commonwealth funding:
- East West Link, to which the Commonwealth allocated A$1.5 billion before the new Victorian government cancelled the project
- WestConnex, which has been allocated A$3.5 billion
- Cross River Rail, which is yet to receive funding.
A key problem in these business cases is that significant project cost items have not been monetised. These include costs relating to environmental effects such as noise and visual amenity and to other impacts on businesses, households and property values.
For example, none of the three cases includes a valuation of the costs of lost business and disruption to household travel and amenity during construction. (This is a big issue with Sydney’s southeast light rail project.)
There is also no costing of the loss of property values along motorways, especially around exhaust emission vents. The East West Link and Cross River Rail business cases make some allowance for this by including the value of general changes in amenity from noise, urban landscape and visual amenity. None of these are costed in the WestConnex case.
Another significant omission relates to the costing of land use impacts. The WestConnex and East West Link business cases both forecast more, and longer, road trips across the network as a result of the projects.
The WestConnex scheme will increase vehicle kilometres by 600,000 per day and make outer suburbs more accessible relative to the inner city. The potential extra costs from greater sprawl are high, estimated at A$4.99 billion for Sydney over 25 years from 2011 if greenfield housing was 50% of new dwellings rather than 30%.
The opposite is the case for Cross River Rail. Increased higher-density development around rail stations would produce infrastructure savings, but the business case does not give these a value.
Furthermore, the valuation of changes in transport mode resulting from each project is inconsistent.
The Cross River Rail business case includes savings resulting from motorists switching from road to rail after the line is built.
The WestConnex project will have the reverse effect, with 45,000 public transport trips per day being switched to the motorway. But the business case does not put a value on the costs of this. These include bus and train revenue losses, or reduced service frequency and increased waiting time to reduce losses.
Debatable ‘wider economic benefits’
The most contentious business case component is wider economic benefits. These are productivity improvements arising from increased central city job density as a result of the projects improving access.
These benefits needed to be included to lift the East West Link benefit-cost ratio above one. But this is only achieved through sleight of hand – public transport improvements into central Melbourne are included as part of the full project cost. As the public transport component of the business case had low costs compared to its benefits, including these wider economic benefits was enough to push the overall ratio above 1.
Similar benefits are part of the WestConnex cost-benefit analysis. However, these benefits are to be achieved from extra car trips to the centre. This takes no account of the disincentives of road congestion and lack of parking.
Current central Sydney planning controls allow a maximum of one new parking space per 75 square metres of floor area for not-so-tall offices – or one space for about five new workers – and even fewer spaces relative to floor area for higher buildings. This means most increased job density will not come from people driving to work.
By contrast, the wider economic benefits of the Cross River Rail resulting from increased job density in central Brisbane are not valued for inclusion in the cost-benefit analysis.
Rethinking the business case
Our work points to several real concerns:
- a lack of consistency in what is included in business cases
- questions about how cases can be reasonably compared across projects
- discretionary inclusion or exclusion of critical items that bias results in favour of projects.
We need more holistic and integrated analysis of projects. This will take into account not only the “nation-building” aspects – the jobs and growth projects might inspire – but also the disrupting and displacing effects they produce across transport modes, land uses and people’s experiences of the city.
Glen Searle is Honorary Associate Professor in Planning, University of Queensland and, University of Sydney and Crystal Legacy is Senior Lecturer in Urban Planning, University of Melbourne. This article was originally published on The Conversation. Read the original article.
ANALYSIS: Australia does need infrastructure to spur growth and support jobs – that idea comes with a big ‘but’, Hugh Batrouney writes.
We look set for another infrastructure budget: big new projects that will, we’re told, boost growth, create jobs and tackle the pressures of our booming population. For example, the Turnbull government has already pledged up to A$5 billion for a rail link from Melbourne Airport to its CBD.
Infrastructure can play an important role, but behind the rhetoric some fundamental investment principles are missing.
Are investing in infrastructure and economic growth a sort of virtuous circle that feed each other?
Through a stronger economy, you can also invest in important infrastructure that again drives stronger growth in our economy … but also delivers the infrastructure that busts the congestion in cities, that makes rural and regional roads safer.
– Treasurer Scott Morrison
Yes, sometimes infrastructure spending and economic growth form a virtuous circle. In new suburbs and rapidly growing cities, infrastructure is needed to connect people to jobs and that in turn drives economic activity.
But we shouldn’t be fooled into thinking any spending is good spending. There are many examples where the opposite is more likely true: where poorly targeted infrastructure wastes resources and weakens economic growth.
If we want to identify the best projects, a good place to start is our biggest cities. Big cities have a productivity advantage because they match workers to jobs better and faster than smaller cities and towns. Transport infrastructure is key to this matchmaking.
But in many cases, the enormous costs of construction in big cities – acquiring land, disrupting traffic, and the physical challenge of constructing in densely developed places – often makes it hard to justify the incremental increases in accessibility that a project generates.
Instead, policies and projects targeting better use of existing infrastructure can have greater economic impacts. The trouble is, these projects usually don’t involve cutting a ribbon.
Changes to the way we set prices for the use of roads and public transport, for example, can help us get more out of the infrastructure we already have. Charging public transport users different amounts depending on the time of day they travel can reduce peak-period overcrowding on our trains. With much lower capital costs, policies like this often deliver a bigger bang for the buck than major new investments.
Are these road and rail projects the sort of infrastructure that supports growth?
Whether it’s the Tulla Rail or the M1 up in Queensland or indeed in my home city of Sydney around Western Sydney Rail from the airport and the road infrastructure that goes around that in particular, we are making important national investments in infrastructure that will support growth, bust congestion in our cities and make our transport – rural and regional roads – safer.
– Treasurer Scott Morrison
Infrastructure undeniably plays a role in supporting the economy. But not every project will add to the productivity of our economy.
On the face of it, the economics of airport rail in Melbourne look thin. Infrastructure Victoria has said upgrading airport bus services should be investigated first, because at A$50-100 million it’s a much cheaper way to tackle the same problem. It has also said that the rail line should be delivered within 15-30 years.
The perceived urgent need for airport rail in Melbourne may stem from the slow and unreliable travel to the airport over the past 18 months. This is a byproduct of the Tullamarine Freeway widening project, which is now almost complete. Responding to a short-term pressure with a multi-billion dollar investment – in the absence of a detailed business case – is a depressing example of poor policy-making.
And the Treasurer’s enthusiasm for the Western Sydney airport rail is also concerning, given that a recent state government study indicated the project wouldn’t be needed to cater for customers and workers at the airport until 2036, at the earliest. Infrastructure Australia has been clear that a rail corridor, running north-south through the airport site, needs to be preserved for a future rail line. But that is a long way from justifying billions of dollars of infrastructure that isn’t needed for nearly another 20 years.
Does Australia need infrastructure to create jobs?
Our national economic plan for jobs and growth has been getting results…A $75 billion national infrastructure investment plan that is building the runways, railways and roads Australia needs to remain competitive, and create jobs.
– Treasurer Scott Morrison
At certain points in the economic cycle, infrastructure spending can help create jobs. New projects create jobs for workers involved in planning, building and deploying each project, as well as for the suppliers of equipment and materials needed as inputs.
And in the longer term, the Treasurer is right to say that infrastructure is essential if our cities are to remain competitive.
But again, context is everything.
Infrastructure can put people to work when there is “slack” in the labour market – when there is unemployment or underemployment, in other words. But if there is little slack in the labour market, then the workers required to get a project off the ground will be drawn from other productive activities. In that case, there may be no boost to jobs or economic growth, because one activity is merely displacing another.
With national unemployment currently around 5.5%, there does appear to be some slack in the labour market right now. However, firms are now finding it more difficult to access the labour they want. And the slack doesn’t appear to be in the parts of the economy that would benefit most from new projects: as the RBA reports, the construction sector recently reached its highest share of total employment since the early 1900s.
What’s the verdict?
Eminent urban economist Ed Glaeser once said, “if you have a focus on jobs and macroeconomic effects, it leads to infrastructure in the wrong place”. Australia should focus on a project-by-project approach; that’s the only way we can be assured that investments represent the best possible use of available funds.
This means starting with some basics: the government should not commit to expensive new infrastructure projects until it has commissioned a detailed look at the economic impacts of the investments, and it has made public the results of that analysis.
That’s how infrastructure policy would be done in an ideal world. But sadly, in a pre-election budget, we can probably expect politics to triumph over policy, yet again.