The railroad out of recovery: Catherine King’s vision for rail

Shadow Minister for Infrastructure, Transport & Regional Development Catherine King sets out how rail transport could lead Australia out of a COVID-19 recession.

In July 2019, prior to the arrival of COVID-19, governor of the Reserve Bank, Philip Lowe called on governments around the country to invest more in infrastructure. Cutting the official cash rate to a then-record 1 per cent, Lowe said that more spending on infrastructure was needed.

“This spending adds to demand in the economy and – provided the right projects are selected – it also adds to the country’s productive capacity. It is appropriate to be thinking about further investments in this area, especially with interest rates at a record low, the economy having spare capacity and some of our existing infrastructure struggling to cope with ongoing population growth,” he told the Darwin business community.

Much has changed since that speech, but in some ways, Lowe’s words could be read, word for word, again, with added emphasis, as the cash rate is now 0.25 per cent and spare capacity in the form of unemployment has only risen.

To hear how the federal government and opposition are responding to this call for an infrastructure-led recovery, earlier in 2020, Rail Express spoke to Deputy Prime Minister and Minister for Infrastructure, Transport and Regional Development Michael McCormack and his shadow, Catherine King. The below interview with King has been condensed and edited for clarity and length. To read Rail Express‘s interview with Michael McCormack, follow this link.

THE ROUTE AHEAD FOR INLAND RAIL
It’s a project that all major parties support, however Inland Rail has been a headache for the government and the Australian Rail Track Corporation (ARTC) since objections have been raised to the route over floodplains in northern NSW and Queensland. With the rail industry looking for certainty over the project, governments are hoping to increase the project’s momentum.

Rail Express (REX): Labor has brought up some concerns with Inland Rail in the past, particularly around the section over the Condamine River floodplain in Queensland, how confident are you in the delivery of this project, particularly that section in Queensland?

Catherine King: Labor supports Inland Rail and in fact we put the first billion dollars into the project to actually get it started. I’m surprised the government has taken the notion of Inland Rail very literally with it not having any connection to the Port of Brisbane or the Port of Melbourne. They are important, difficult, and challenging issues to sort out but you can’t just build Inland Rail with no connectivity to either port. These projects are complex and we know that you’re never going to please everybody and there are issues around having to procure land, having to dissect across farmland, but one of the things that I’ve learnt as being a long time local MP and also having portfolios like this before is that you have to get the consultation right and when you’ve got such a big community expressing significant concern about the sort of hydrology work that has been done by the government and a lack of transparency about how the decision was made, you’ve got a problem.

REX: How would Labor look to extend Inland Rail or make those connections to other freight networks around Australia?

King: If we were fortunate enough to be in government in 2022, we don’t know what plans would be in place but what I would like to see is the start of a discussion about it. At the moment all we know about it is there’s going to be significantly increased trucks going through Acacia Ridge but no plan or discussion about what some of the alternatives are. The government needs to start that work now because without those connections Inland Rail doesn’t make as much sense as it should.

Catherine King
Shadow Minister for Infrastructure, Transport & Regional Development Catherine King.

A LEVEL PLAYING FIELD FOR FREIGHT
Without freight rail continuing to operate throughout the COVID-19 pandemic, Australia’s supermarkets shelves would be empty and commodities would be sitting at farms and mines, never making it to market. To ensure that this critical link in the logistics chain continued to operate, governments stepped in, allowing freight to cross otherwise closed borders. In May, the ARTC provided some financial relief for rail freight operators by extending payment terms for current access charges and deferring a consumer price index increase that was scheduled for July. Rail freight operators are still concerned however, with more empty containers being transported by sea, and a lack of competitive neutrality with road freight.

REX: Would you want to go back and have a look at competitive pricing neutrality between rail and road, and access charges?

King: That wasn’t part of our policy at the last election but we’ve just seen an extraordinary effort in terms of all our freight and logistics companies, whether it has been rail through to what’s happened in the trucking industry.

I think there’s a much stronger appreciation about the role that our freight and logistics companies play and we support the government’s pausing of some of those fees and charges in order to make sure that we get through this crisis. As a nation, what’s the most efficient way of delivering our freight? It’s important to ensure that we don’t pick one over another that we make sure that there is a reasonably level playing field for both but what we want to focus on is ensuring that we have the most efficient system that we possibly can whether it is road, whether it is rail, or whether it’s via shipping and our ports.

THE FASTER OR HIGH-SPEED RAIL DILEMMA
In a speech delivered to shadow cabinet in May, Anthony Albanese reaffirmed Labor’s commitment to building a high-speed rail link between Melbourne and Brisbane, via Sydney and Canberra. As a nation-building project it would certainly be iconic, but could COVID-19 actually turn Australia’s long held dream of high-speed rail into reality?

REX: High-speed rail proposals obviously have a long history in Australia. Why did Labor feel like now is the right time to return to the project?

King: Well I think we’ve never left the project to some extent. We’ve been pushing high-speed rail as a visionary rail infrastructure project for the nation for a long period of time, and obviously when we had the opportunity to hold the government benches started to progress the business case for that.

REX: Labor took the policy of a billion dollars for land acquisitions along the corridor to the last election. Is that something the party is still committed to at a federal level?

King: Well obviously we’re reviewing all of our policies at the moment, we’re two years out from the next federal election and we’ll have a bit to say in the lead up to the next election in terms of our transport policies including rail. Obviously money is going to be pretty tight this time around for both sides of politics, given the COVID-19 crisis, but we’ve laid a marker down pretty clearly that we think high-speed rail is an important long-term economic opportunity for our nation and shouldn’t be one that’s lost.

REX: There’s also a number of proposals for faster rail. How would Labour see a program of high-speed rail interacting with the current businesses cases focused on faster rail on similar corridors to those the high-speed rail line would follow?

King: Faster rail can be anything from substantial corridor improvements, improvements in rail technology, through to more expensive projects of duplication and looking at improving some of the regional rail networks. It doesn’t have to be either or but what you have to do is be serious about it. There’s lots of potential for regional rail improvements and we should be looking at that all the time.

REX: One of the stumbling blocks for high- speed rail has been that price tag but there are alternative funding methods such as value capture that are used to get projects like these off the ground. Would you be looking at these as a way to fund a high-speed rail project?

King: One of the things that coronavirus crisis has shown us is that we’ve lacked any large scale, iconic infrastructure transport project and Anthony in his vision speech wanted to particularly go back and highlight high-speed rail because of a couple of things. One is the investment potential that it has, but also the nation building potential that it has, in terms of developing a much stronger sense of regional and decentralised towns from Melbourne from Sydney, all the way up to Brisbane.

REX: Another element of Anthony Albanese’s speech was calling for the local manufacturing of rollingstock. Albanese nominated successes in Queensland, WA, and Victoria. How would Labour seek to expand this to other states and for builds to continue happening in those states that already have a manufacturing capability?

King: My hometown of Ballarat is a railway town. We still have our railway workshops here, many of the X’Trapolis trains are built here as well, and they’re really important skilled manufacturing jobs for our region. Part of the problem for many of those manufacturers has been that the procurement is really patchy. Each state and territory government does that separately, they may procure three trains here, they may do 50, and the manufacturers in my own constituency tell me it’s that long term pipeline of projects that keeps those railway workshop doors open.

COVID-19 has taught us that our manufacturing does have enormous capability, but it does need support. One of the things we announced in the 2019 election campaign was that we felt there was a need to have a national rail procurement strategy to actually start to look at how you can smooth out some of those lags that occur in rollingstock procurement so that we can continue to still have those terrific railway workshops here. We’ve got a great history of it, and we don’t want to see railway manufacturing go the way of the car industry. You need a plan to support it, to keep it here and to keep local jobs here.

REX: Would you support or encourage quotes or targets for locally manufactured rollingstock like there are in Victoria?

King: As a Victorian I’m very attracted to the plan that the Victorian government has in relation to local procurement. Federally we are subject to trade law as well so we always have to be conscious about that but I am a big fan. Many people have decided that we should be manufacturing more things that we are capable of manufacturing in this country and I’m a big fan of local content and local procurement.

The railroad out of recovery: Michael McCormack’s vision for rail

Deputy Prime Minister and Minister for Infrastructure, Transport and Regional Development Michael McCormack sets out how rail transport could lead Australia out of a COVID-19 recession.

In July 2019, prior to the arrival of COVID-19, governor of the Reserve Bank, Philip Lowe called on governments around the country to invest more in infrastructure. Cutting the official cash rate to a then-record 1 per cent, Lowe said that more spending on infrastructure was needed.

“This spending adds to demand in the economy and – provided the right projects are selected – it also adds to the country’s productive capacity. It is appropriate to be thinking about further investments in this area, especially with interest rates at a record low, the economy having spare capacity and some of our existing infrastructure struggling to cope with ongoing population growth,” he told the Darwin business community.

Much has changed since that speech, but in some ways, Lowe’s words could be read, word for word, again, with added emphasis, as the cash rate is now 0.25 per cent and spare capacity in the form of unemployment has only risen.

To hear how the federal government and opposition are responding to this call for an infrastructure-led recovery, earlier in 2020, Rail Express spoke to Deputy Prime Minister and Minister for Infrastructure, Transport and Regional Development Michael McCormack and his shadow, Catherine King. The below interview with McCormack has been condensed and edited for clarity and length. To read Rail Express‘s interview with Catherine King, follow this link.

THE ROUTE AHEAD FOR INLAND RAIL
It’s a project that all major parties support, however Inland Rail has been a headache for the government and the Australian Rail Track Corporation (ARTC) since objections have been raised to the route over floodplains in northern NSW and Queensland. With the rail industry looking for certainty over the project, governments are hoping to increase the project’s momentum.

Rail Express (REX): In June this year there was another review announced about the project, this time looking at the so-called forestry route. Can you provide industry with some certainty about the project, particularly that critical stage between the NSW-Queensland border and Gowrie?

Michael McCormack: It’s important that regional Australia understands that by the mid-2020s when this project is completed that it is going to bring the benefits that have been talked about since the 1890s. There’s been independent analysis, there’s been hydrological reports, there’s been everything you would expect to be in a project of this size, scale, and scope. With the Condamine Plain, I appreciate that some local people have some issues with the selected route and so to certainly make sure that we’ve got the right route we’re looking at that forestry route. We’ll put the ruler over it, we’ll have independent analysis of it, we’ll have a hydrological study of it, just to make sure that the right route is eventually selected.

REX: Currently, we have forestry route review and then we have the independent panel who are reviewing the hydrological modelling on the original route, what happens if the conclusions out of both come into conflict?

McCormack: Of course we need to take on board the expert advice, to make sure that the full benefits are passed on, making sure that we can get goods from paddock to port within 24 hours. When you talk to people as I have in the Toowoomba area, and you take Jill Allwright, she’s got a cereal producing factory there, she moved to Toowoomba eight years ago. She set up her company and she’s really looking forward to Inland Rail because freight is over 20 per cent of her operating costs.

REX: I imagine businesses up and down the line such as Allwright’s would appreciate a connection to the ports of Melbourne and Brisbane as well?

McCormack: Well they will, and they’re already benefiting and during COVID-19 when so many industries have been shut down and so many jobs have been lost it’s heartening and rewarding to see that along the Parkes to Narromine section work has just continued and that’s employing thousands of people directly and indirectly.

REX: But in terms of the direct connection between Acacia Ridge and the Port of Brisbane for double stacked trains which is such a significant aspect of what makes Inland Rail competitive, how are you going to ensure that a rail connection is built, if not when the line is opened, soon afterwards?

McCormack: We’re working through those issues with state government as well as local governments. The NSW government for instance has put a special activation precinct around the Bowman area at north Wagga Wagga and invested heavily into that, and so there is buy in there for state governments, there is buy in there for local governments and of course private entities as well. We will continue to work with and negotiate with and embrace all the activity involved with Inland Rail and it’s been a collaborative project.

A LEVEL PLAYING FIELD FOR FREIGHT
Without freight rail continuing to operate throughout the COVID-19 pandemic, Australia’s supermarkets shelves would be empty and commodities would be sitting at farms and mines, never making it to market. To ensure that this critical link in the logistics chain continued to operate, governments stepped in, allowing freight to cross otherwise closed borders. In May, the ARTC provided some financial relief for rail freight operators by extending payment terms for current access charges and deferring a consumer price index increase that was scheduled for July. Rail freight operators are still concerned however, with more empty containers being transported by sea, and a lack of competitive neutrality with road freight.

REX: Freight rail has rightly been recognised for the critical role it has played during the COVID-19 pandemic, how are you going to ensure the competitiveness of rail freight continues after the crisis?

McCormack: Some of the real heroes in COVID 19 have been train drivers and intermodal workers, who have delivered. We’ve got this national freight and supply chain strategy since August 2019 when states and territories agreed with the federal government to sign up to the 20 year plan and we’ve got a five year national action plan. We’re tackling the growing and changing freight task and Inland Rail is going to dovetail into that.

REX: One of the concerns of the rail freight industry has been about a lack of a level playing field between rail freight and road transport. One positive thing that we saw come out of the crisis was that the ARTC extended the payment terms for current access charges and suspended CPI-tied increases to the fees.

McCormack: We need everybody to be a player in this regard and yes there have been pressures on rail, I understand that, but that’s why Inland Rail is so important. That’s why the Victorian rail revival and other projects that we’re doing, both transpoting people and transporting freight, are just so crucial and that’s why we are investing so heavily. I am talking to ministers of all political persuasions to get the right outcomes. Is crucial that we get all the right investment in track, the right investment by states in rollingstock, and we bring about benefits for all.

REX: But for those particular fees, for the road transport industry, CPI increases heavy vehicle road user charges have been suspended for about half a decade, while it just happened now for rail. Is there a possibility to extend that to create a more competitive rail freight environment?

McCormack: We do want a more competitive rail freight industry and that’s why we are investing so heavily in it. At the end of the day, businesses and private individuals if they want to get something transported from one side of the country to the other or indeed from one town to the next, they’ll always make decisions based on cost. We want every stakeholder in the country to be competitive, whether it’s air, rail, road, or indeed whether it’s our sea lanes and our maritime freight, has a part to play in this.

Michael McCormack
Deputy Prime Minister and Minister for Infrastructure, Transport and Regional Development Michael McCormack.

AN INFRASTRUCTURE LED RECOVERY?
Infrastructure will undoubtedly play a role in getting Australia back to work after the COVID-19 recession, but what form that infrastructure will take is still up in the air. While some jurisdictions are looking for zero emissions mobility and rail to play a larger role, funding announced so far has brought forward a number of smaller roads projects around Australia, to ensure that planning times are reduced. While the age of the megaproject is not over yet, what shape those projects take could be very different in the future.

REX: What projects are you looking at in terms of bringing forward work or funding and is there a change in preference in terms of wanting to do smaller projects that can get started straight away?

McCormack: Well I can almost say watch this space because it was of course really genuinely pleasing to be working with the states and request that they bring forward some of the projects that we’ve asked them to. I wrote to them late last year and I sent another letter to them early this year when COVID-19 really started to take hold on all aspects of the economy.

REX: There’s two projects, for example, that are sitting with you right now awaiting federal approval; the Murray Darling Basin Rail Project and Melbourne Airport Rail. Is there any indication that you can move forward on either of those?

McCormack: I’ve actually messaged Victorian Minister for Transport Infrastructure Jacinta Allan about that and other infrastructure projects. There’s a lot happening in Victoria, a lot happening with Commonwealth money of course, and we want to make sure that whether it’s Murray Basin Rail or Melbourne Airport Rail, it’s something that’s been talked about for years and years and we’re delivering.

REX: In particular with the Melbourne Airport Rail Link, your colleague Treasurer Josh Frydenburg has suggested that super funds should bring forward more investment in infrastructure and this is one project where a consortium of super funds said they want to build a tunnel from Sunshine to Southern Cross station. Are you leaning towards a tunnel or an above ground option?

McCormack: Let’s continue to talk about that. There are some announcements that are soon to be made, whether it’s Melbourne, whether it’s our capital cities or whether it is our most rural and remote and outback towns. There’s plans being drawn up whether it’s tunnels for rail, tunnels for the Coffs Harbour bypass or whether it’s just getting that long awaited bitumen on roads in outback dusty Queensland cattle tracks.

THE FASTER OR HIGH-SPEED RAIL DILEMMA
In a speech delivered to shadow cabinet in May, Anthony Albanese reaffirmed Labor’s commitment to building a high-speed rail link between Melbourne and Brisbane, via Sydney and Canberra. As a nation-building project it would certainly be iconic, but could COVID-19 actually turn Australia’s long held dream of high-speed rail into reality?

REX: The leader of the opposition brought up high-speed rail but you have suggested you wanted to focus on faster rail. Could you give us an indication about your thinking about why you’d like to focus on faster rail rather than high-speed rail?

McCormack: I can remember holding a community conference in my home town of Wagga Wagga when I first was elected back in 2010. The late Brian Nye headed up the Australasian Railway Association (ARA) back then and I invited him to speak. I was amazed at how many people turned up but even back then, the cost of high-speed rail a link between Sydney and Melbourne via Canberra, it had a price tag then on it of $114 billion. That figure has just escalated and while there have been moves to protect and preserve the corridor so that we can ultimately do something along these lines you have to have the willingness, the capacity, and also the commuter interest to do it.

Australia is a big country and we don’t have the population that some of those countries which have invested heavily in high-speed rail do. In Australia we’re investing in the infrastructure fits the bill for what we’re doing right now.

High-speed rail, I’d like to see it in my lifetime, but we’re a big country and we’re very densely populated in our capital cities. There are opportunities of course for this type of investment but given the fact that it’s going to be very difficult to with COVID-19 to actually find that sort of investment anywhere in the world at the moment, there are other priorities at hand.

ACT

ACT Transport Strategy outlines continued investment in rail

The ACT government has released its strategy to move Canberra as the city grows to 580,000 people by 2040.

The ACT Transport Strategy 2020 updated the city’s transport vision and further outlines a shift towards public transport, walking, and cycling as the future of mobility in Canberra.

ACT Transport Minister Chris Steel said that investment would follow this vision.

“To ensure Canberra remains one of the world’s most liveable cities we will continue to heavily invest in transport with light rail, high frequency rapid bus services, and improvements to key active travel links as well as maintaining our quality road network,” he said.

The Strategy also responds to changing transport patterns that have been seen since the arrival of COVID-19. With an uptake of walking and cycling, the strategy proposes using these changes as a way to drive more permanent behaviour changes.

“We want to harness the opportunity of the pandemic to permanently grow the number of people walking and riding in the community beyond COVID-19,” said Steel.

“An ACT Transport Recovery Plan will help facilitate a return to public transport, when the time is right, so that we can efficiently and sustainably move people around our growing city.”

In setting out the vision for Canberra’s transport network in 2045, the strategy proposes a number of key central links, along the city’s north-south and east-west spines. These would be complimented by orbital links. While the strategy does not explicitly state that these will be light rail lines, the central links largely follow the proposed light rail corridors, including future stages.

The Strategy also indicates a potential high-speed rail alignment, coming from the north of the ACT to the city centre or the Canberra airport. The Strategy states that the ACT government has begun corridor preservation for a future high-speed rail service.

“The ACT government continues to work closely with the NSW government to explore these opportunities with initial investigations into possible improvements to the Canberra Sydney service already underway,” the Strategy notes.

Chinese high speed train. Photo: Bombardier

Albanese puts high speed rail at the centre of COVID-19 recovery

Anthony Albanese will argue for high-speed rail to be a central part of the rebuilding of Australia’s economy following coronavirus (COVID-19), according to reports.

In a speech to be delivered to the shadow cabinet on May 11, Albanese will say that a high-speed rail project along with decentralisation should be pursued by the federal government as a way to recover and create a more resilient nation.

In a draft of the speech, Albanese is expected to combine a commitment to high-speed rail with local train manufacturing.

“We must invest in nation-building infrastructure including iconic projects like high-speed rail and we should be building trains here,” Albanese is expected to say.

“Government procurement policy in rail manufacturing has produced superior outcomes to imports and created regional jobs in Queensland, Victoria and Western Australia.”

In 2019, Labor took a $1 billion land acquisition policy for high-speed rail to the federal election, however the Coalition has not pursued high speed rail during its time in office.

The speech by the federal opposition comes after Treasurer Josh Frydenberg outlined his plans for post-COVID-19 recovery. In a speech to the National Press Club on May 5, Frydenberg said that the government would maintain its $100 billion ten year infrastructure pipeline, but did not nominate particular projects. Frydenberg did, however, note that the current pandemic should not lead to protectionist policies.

In April, shadow transport spokeswoman Catherine King had nominated high speed rail as a “economic game changer” and indicated federal Labor’s continuing support for a high speed rail network linking population centres down the Eastern seaboard. King also noted that investment in high-speed rail would encourage economic growth in regional communities.

At the time, federal Minister for Infrastructure, Transport and Regional Development Michael McCormack said that the government’s focus is building the Inland Rail project and pursuing faster rail projects.

Air France pushed to cut flights where high speed rail operates

Air France must limit domestic flights between cities connected by rail in less than 2 and a half hours, said French Finance Minister Bruno Le Maire.

The decision is part of the French government’s €7 billion ($11.8bn) bailout package for Air France and is the furthest governments have gone yet to encourage the shift from air travel to rail.

Air France can still fly customers on these shorter domestic routes if they are connecting to an international flight, however with major flight hubs such as Charles De Gaulle already having high-speed rail access, there may be even more incentive to choose rail over air.

Le Maire’s decision to make state aid conditional on limiting domestic flights is part of the government’s push to make the airline more environmentally friendly. In addition to cutting short-haul routes, the airline will have to reduce CO2 emissions by passenger and kilometre by 50 per cent of 2005 levels by 2030.

“This new and drastic condition will lead us to review mobility on French territory,” said Le Maire to French reporters. “As soon as there is a rail alternative to domestic flights with a duration of less than 2:30, these domestic flights will have to be drastically reduced and limited simply to transfers to a hub.”

Once implemented, domestic flights between Pairs and cities such as Rennes, Nantes, Bordeaux, and Lyon would be cut and train patronage increase.

“The plane should no longer be a means of making transport in 1 hour or 1 hour 15 minutes which could be done at a lower cost of CO2 by train in 2 hours or 2 hours and 30 minutes,” said Le Maire.

French state-owned railway company SNCF, which operates the TGV service, has also been in talks with the French government about a bailout, with losses reportedly reaching €2bn ($3.37bn).

Labor pushes for high speed rail investment

High speed rail could once again be on the table, with federal Labor transport spokeswoman Catherine King describing the project’s potential as an “economic game changer” for Australia after the coronavirus (COVID-19) pandemic.

In comments reported in the Sydney Morning Herald, King said that building a high-speed rail network along the eastern seaboard would be able to cut travel times.

“High-speed rail has the potential to revolutionise interstate travel, allowing travel between capital cities in as little as three hours,” King told the Herald.

With regional areas also reeling from the impact of the bushfires earlier in 2020 and late 2019, King noted that the project has the potential to inject economic activity into regional economies, as Inland Rail is currently doing.

“If the government is interested in creating jobs and boosting regional economies, it should seriously consider investing in high-speed rail now,” said King.

Federal Minister for Infrastructure, Transport and Regional Development, Michael McCormack, told the Herald that the government was not looking into high speed rail at this time.

“While I have long been an advocate for high-speed rail in Australia, given the significant costs outlined in the reports conducted between 2010 and 2013, my focus is currently on delivering the inland rail and faster rail proposals which the federal government has committed to,” said McCormack.

In 2019, Labor took to the election a $1 billion promise to set aside land for an East Coast high speed rail corridor.

Between 2010 and 2013 the Australian government looked into the possibility of a 1,748km route from Brisbane to Melbourne via Sydney and Canberra. With a speed of 350km/hr this would make the travel times between Sydney and Melbourne and Sydney and Brisbane below three hours, the threshold for passengers to swap from air to train travel according to the Australasian Railway Association.

The route alignment mapped out in 2013 also included regional stops such as in Wagga Wagga, Albury Wodonga, Shepparton, Newcastle, Coffs Harbour, and Grafton. The cost of linking Sydney and Melbourne with high speed rail would be roughly $50bn and the total cost would be $114bn in 2012 dollars, however with a positive return on investment.

Notice to proceed issued for HS2

The UK government has issued a ‘notice to proceed’ for companies to begin work on High Speed 2 (HS2).

The decision ensures that construction will go ahead on the controversial project, and confirms that work will progress while the country grapples with the coronavirus (COVID-19) and associated lockdown measures.

The ‘notice to proceed’ is the formal approval for the construction of stage one of the project, from London to the West Midlands. This stage project is split into four work packages awarded to four separate joint ventures. Awarded in 2017, the joint ventures are:

  • SCS Railways (Skanska Construction UK Ltd, Costain Ltd, STRABAG AG);
  • Align JV (Bouygues Travaux Publics SAS, a subsidiary of Bouygues Construction, Sir Robert McAlpine and VolkerFitzpatrick, a subsidiary of VolkerWessels UK);
  • EKBF JV (Eiffage Genie Civil SA, Kier Infrastructure and Overseas Ltd, BAM Nuttall, Ferrovial Agroman); and
  • BBV JV (Balfour Beatty Group Ltd, VINCI Construction Grands Projets, VINCI Construction UK Ltd, VINCI Construction Terrassement).

HS2 Minister, Andrew Stephenson, said that the decision is an assurance to the rail industry.

“Following the decision earlier this year to proceed with the project, this next step provides thousands of construction workers and businesses across the country with certainty at a time when they need it, and means that work can truly begin on delivering this transformational project.”

HS2 Ltd, the public company overseeing HS2, estimates that 400,000 supply chain contracts will be created in phase one of HS2.

“In these difficult times, today’s announcement represents both an immediate boost to the construction industry – and the many millions of UK jobs that the industry supports – and an important investment in Britain’s future: levelling up the country, improving our transport network and changing the way we travel to help bring down carbon emissions and improve air quality for the next generation,” said Mark Thurston, CEO of HS2 Ltd.

The UK government has also published the full business case for the project.

Increased appetite for air to rail switch

If concerns around climate change were not enough, modelling by Swiss bank UBS is showing that more people will be looking to switch from air to train travel in Europe following the coronavirus (COVID-19) pandemic.

The report, released by UBS Evidence Lab, highlights that a number of air routes within the EU are at risk of losing passengers to rail. Those most at risk include routes from Berlin to Frankfurt and Munich, London to Paris and Edinburgh, and Madrid to Barcelona.

While most of the routes most affected are relatively short, the report notes that travellers are having an increasingly higher tolerance to longer rail journeys, which could be taken faster by plane in the same corridor.

“Data from a UBS Evidence Lab survey of 1,000 people in four European countries and China suggests leisure travellers would tolerate 5-6 hours on a train, and EU business travellers up to four hours vs the general consensus of 2-3 hours.”

The report notes that service and frequency are drivers for demand for longer train journeys, and that competition among operators can often encourage improvements in these areas.

The report links the growing appetite for rail to current concerns about COVID-19, as well as wider demands for net-zero carbon by 2050.

“The Covid-19 outbreak is showing industrialised countries not only what clean air means and how to cope without travelling, but also how a cleaner environment and healthier populations cope better with diseases.”

While the report authors note that some low-carbon investments may be diverted to support the transport and travel industries, countries will continue to push towards net zero by 2050, while consumers will continue to look for travel options that take the least time. Increased funding to meet these twin demands will grow the market for European high-speed rail and associated supplies of rollingstock, signalling, controls, and brakes.

Source : UBS Evidence Lab

Renfe signs $9bn deal for Texas high speed rail

The first high-speed train in the United States is a step closer to completion, with Spanish state-owned railway company Renfe signing a US$6 billion ($9.2bn) deal with private equity rail operator Central Texas.

The contract covers the delivery of a high speed rail connection between the Texan cities of Houston and Dallas/Fort Worth.

The link would target an average speed of 257km/h, to complete the journey between the two cities in under 90 minutes.

Italian construction company Salini Impregilo will build the infrastructure, with a timeline of six years until completion. Renfe will maintain and operate the trains from 2026 until the end of the current contract in 2042.

According to a statement from Renfe, the project is the world’s first 100 per cent privately delivered high-speed rail project, being unsupported by public funds from either the Texas state government or US federal government. There is the potential that Central Texas could extend the line to Austin and San Antonio in the future.

Other fast rail lines in the US include Amtrak’s Acela Express, which can reach speeds of 240km/h, and the publicly funded company also operates the Silver Star, Northeast Regional, Keystone Service, Vermonter, and MARC Penn Line express trains, which reach speeds of over 200km/h.

Other high speed rail projects under consideration in the US include the California High Speed Rail Project, which would connect San Francisco with Los Angeles via the Central Valley. The project is currently in the planning stage.

According to Renfe and Central Texas, the economic benefits of the line could be up to US$36bn ($55bn) over 25 years, with 10,000 jobs per year during construction and 1,500 permanent jobs once the line is open.

Australia’s faster rail future

Faster rail forms part of the federal government’s strategy to deal with population growth and congestion. The National Faster Rail Agency’s acting CEO Malcolm Southwell discusses his agency’s work at AusRAIL Plus 2019.

Australia’s major cities are a key driver of the nation’s economic success and support the majority of the population in employment and economic growth. They are also growing, exponentially.

“Our population is expected to reach 33 million people by 2040, and most of those 6.6 new Australians will settle in our major capital cities,” acting CEO of the National Faster Rail Agency (NFRA), Malcolm Southwell, said at the AusRAIL Plus 2019 event held in Sydney.

“Around 64 per cent of us live in cities and we’re one of the most urbanised nations in the world. As such, we have issues with congestion, housing supply and affordability.”

Congestion costs are also expected to rise. According to Infrastructure Australia’s estimates, road and public transport congestion in the major cities will cost almost $40 billion by 2031, more than doubling from around $19bn in 2016.

Over 80 per cent of the estimated $21bn increase will occur in Greater Sydney, Greater Melbourne and south east Queensland.

A faster rail solution will go some way to alleviating population pressure in the cities. In comparison to other countries around the world, Australia has a relatively large land mass but low population density. While Australia has 3.2 persons per square kilometre, the US has 36. The UK has 275 persons per square kilometre, and Japan has 347.

“We’re not just about building fast rail in the hopes that it works, we’re taking an evidence-based approach,” Southwell said.

“Professor Andrew McNaughton of the UK, who is working with the NSW government on their faster rail plans, has publicly noted that reducing transit times to one hour or less is a particular sweet spot for improved access to higher paying jobs in capital city CBDs and increased economic development in regional centres.”

The Faster Rail Plan, which the NFRA is tasked with delivering, intends to better align future population growth by linking major cities and growing regional cities in order to take pressure off the cities and strengthen economic ties with regional areas.

With the December 2019 appointment of Barry Broe as inaugural chief executive officer of the NFRA, the agency is expected to ramp up its operations this year.

Southwell was acting CEO from the agency’s creation in July 2019 until January 2020. He spoke at AusRAIL to update the rail industry on the NFRA’s work to date and what to expect in the future.

So far, eight faster rail corridors have been identified, including: Sydney to Newcastle, Sydney to Wollongong, Sydney to Parkes (via Bathurst and Orange), Melbourne to Greater Shepparton, Melbourne to Albury-Wodonga, Melbourne to Taralgon, Brisbane to the Gold Coast, and Brisbane to the Sunshine Coast.

The NFRA will work in partnership with state and territory governments and private industry to develop the rail infrastructure necessary to accommodate a faster rail solution between major cities and key regional centres. It will develop proposals, examine routes and begin the process of corridor planning, acquisition and protection.

“We’ve started a conversation with states on the east coast about interoperability and standards of faster rail projects to avoid a repeat of issues around passenger services between jurisdictions,” Southwell said.

An expert panel will provide advice to government on faster rail related matters including existing business cases, new potential faster rail corridors, future developments across networks and infrastructure requirements and priorities. The panel will advise on staging and delivery options.

The NSW government has appointed Professor Andrew McNaughton to lead the panel. He has more than 45 years’ experience working on rail infrastructure projects, including the UK’s High Speed project.

The first three of the overall eight faster rail business cases have now been completed, the agency confirmed in January. The business cases for Sydney to Newcastle, Melbourne to Greater Shepparton and Brisbane to the regions of Moreton Bay and the Sunshine Coast are now being reviewed by the agency. NFRA will provide advice to government on the findings and its recommendations for next steps in the coming months.

These corridors and the remaining five, which are “progressing well” according to the agency, were identified based on the intention to support growing population movements.

For example, the agency’s first priority, to deliver faster rail between Geelong and Melbourne, will have major benefits for those living along the corridor, including quicker access to work and services in both locations, as well as greater choice around housing and less congestion.

“Geelong is one of the fastest growing regions, growing at a rate of around 2.7 per annum,” Southwell said.

“Transport connectivity between Melbourne and Geelong is constrained by existing infrastructure and rail investment has not kept up with population growth. These constraints have a range of flow on effects, including hampering regional development and increasing road congestion.

The agency acknowledges, however, that better connectivity could, in some circumstances, result in regional towns becoming dormitory suburbs for larger cities.

“We’re very much aware of these concerns and as part of our work we’ll look for the opportunities where faster rail can actually work for the economy and job markets in these regional towns. We’re actively talking to regional centres about the challenges and opportunities faster rail will bring to their economy.”

Southwell is adamant that faster rail will resolve population pressures if regional centres are made attractive.

“For example, lowering operating costs for enterprises in regional towns will attract businesses to the area. Faster rail will provide these businesses will labour markets in the capital cities and provide opportunities for economic development in regional towns.

“That effect is evidenced here in Australia. In Geelong, rail was instrumental in maintaining the attractiveness of the city following the large and sudden downturn in the manufacturing sector. Research and modelling work have shown that the emergence of strong employment centres has been able to attract service jobs, and that was greatly facilitated by an increase in efficient rail services.”

Faster rail services are capable of reducing travel time in the corridor even further, from an hour to closer to half an hour, and thus enable more commuters to travel along the rail corridor.

Another challenge the agency will need to soon resolve is cost.

“Studies conducted between 2010 and 2013 on a high-speed rail between Melbourne and Canberra, Sydney and Brisbane found that it would have an estimated construction cost of around $114bn in 2012-dollar terms.

“Noting current construction market pressures and inflation impacts, this figure will increase significantly in today’s terms and could be as high as $150 to $200bn.

“Whatever the amount, this is a significant cost, and obviously needs to be considered against all the other projects making up a core share of taxpayer’s funds.”

The Australasian Rail Association says that it supports the utilisation of innovative financing and funding mechanisms such as “value capture” development opportunities along rail corridors to help fund faster rail infrastructure.

“It will be critical that the Agency, under Mr Broe’s leadership, recognises the need to invest in existing and new lines to stretch government dollars and provide a faster rail service offering that meets the needs of the Australian population,” ARA chair Danny Broad said.

“In addition to supporting the establishment of new fast rail lines as a means to decentralise Australia’s population and support regional development, the
ARA highlights that optimising our existing networks cannot be overlooked,” the ARA’s Annual Report 2019 said.

“Faster rail can be achieved through upgrades and modifications to existing rail infrastructure, such as passing loops, new signalling systems and level crossing removals.”

Meanwhile, the NSW government says it will examine a range of funding options and smart staging, as part of the Fast Rail Network Strategy, to ensure the fast rail network provides value for money.

Each funding option considered as part of the strategy will be assessed based on the estimated cost of the project in light of economic and other benefits to the community, and complementary revenue- generating opportunities.

The state government says that international experience shows that fast rail networks can be delivered in stages, with each stage delivering immediate benefits.

NSW’s short- to medium-term focus will be on upgrades and the optimisation of existing rail routes, with dedicated track improvements such as junction rearrangements, curve easing, deviations, passing loops and level crossing removals on existing routes.

Its longer-term focus will be on a dedicated and purpose-built rail line, with new lines and routes, as well as new rolling stock.

According to Southwell, the national agency is cognisant that its work will affect the future of how people live.

“This is no simple task and requires debate and dialogue from all sides of the equation. We’re still very new but through ongoing conversations with our key stakeholders, including those in regional communities, we acknowledge that consideration needs to extend well beyond just building a new rail line and a train station,” Southwell said.