East West Link: Labor demands investigation into funding for 'shocker of a project'
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Version 0 of 1. The federal opposition is demanding an independent investigation into the decision to allocate $3bn of commonwealth funding for Melbourne’s East West Link, after newly released documents undermined claims about the project’s economic benefits. Labor’s infrastructure spokesman, Anthony Albanese, called on the commonwealth auditor general to examine the “shocker of a project”, citing Victorian government evidence that it might have delivered just 45c of benefit for every dollar invested. The request coincided with a report by the Audit Office of NSW that identified “deficiencies” with the planning of another flagship road project, Sydney’s WestConnex. The newly elected Victorian Labor government released on Monday 9,000 pages of documents revealing the former government’s planning for East West Link. Labor was elected on a promise to dump the project, despite the federal government’s warning that its funding could not be reallocated to other transport priorities. An April 2013 submission to the Victorian cabinet’s budget committee showed the project’s benefit-to-cost ratio would be 0.45, indicating 45c of benefits for each dollar invested. This rose to 0.84 if the wider economic benefits were included. The same submission contained a warning about providing full details to the federal advisory body Infrastructure Australia: “The risk associated with this action is that the lower end range of benefit cost ratios presented in the business case may be used as a justification for not supporting the project.” A “short form” business case prepared for Infrastructure Australia in June 2013 said the first stage of the project was “clearly of high economic worth” with a benefit to cost ratio of 1.4 including wider economic benefits. This assessment of $1.40 of benefit for every dollar invested also factored in other upgrades to the traffic network that were “required to maximise the value of this significant investment for the state”, according to a paper presented to the Victorian budget committee. The first stage included the 6km toll road between the Eastern Freeway and CityLink and three other “integral” elements: the widening of CityLink, the widening of the Eastern Freeway, and other public transport upgrades. Albanese said he had written to the commonwealth auditor general “to demand that he conduct an inquiry into the farce that has become the funding by the commonwealth government of the East West Link in Victoria”. The documents suggested the former Victorian government hid information from Infrastructure Australia, he said, and raised questions about Tony Abbott’s willingness to contribute $3bn to the project with “no rigour” applied. “The Victorian government made a conscious decision not to tell Infrastructure Australia and the Abbott government made a conscious decision not to ask, so they funded this through this don’t-tell-don’t-ask policy, this dud project, whilst not funding projects that we know stacked up,” Albanese said. Abbott has repeatedly affirmed his support for East West Link. Last week the prime minister said he had tried to persuade the new Victorian premier, Daniel Andrews, to proceed with the “vital piece of the Melbourne and Victorian and national transport infrastructure”. “I’ve said to him that whatever he thinks of the current cost-benefit analysis, the cost-benefit analysis is going to constantly shift in favour of building it, given the ever increasing traffic on Flemington Road, Hoddle Street and Alexandra Parade,” Abbott said in an ABC interview last week. Albanese said the East West Link project was not the only part of government’s infrastructure agenda under a cloud. He called on the NSW premier, Mike Baird, to release the full business case for Sydney’s WestConnex, another landmark project backed by Abbott, after an audit report criticised planning processes and identified conflicts of interest. In findings published on Thursday, the Audit Office of NSW said independent assurance processes “did not meet best-practice standards”. The report said aspects “were well designed and well managed” but the implementation “created some confusion and a lack of clarity in relation to the applicable assurance processes, which in turn led to some shortcomings in the level of independent assurance provided to the government”. “These shortcomings have had practical implications,” the report said. The preliminary business case “had many deficiencies and fell well short of the standard required for such a document”, it said. And the business case ultimately put to the government “still included some deficiencies” that should have been identified. NSW agencies responsible for delivering the project told the audit office they were confident the processes for developing the business case were “robust and effective”. The agencies said they “largely accepted” the report’s recommendations. |