Wasteful infrastructure spending epitomised: Melbourne’s proposed airport rail link

I have a piece in the Herald Sun today which addresses wasteful infrastructure spending with the focus on the proposed airport link which the Victorian government is threatening to justify commercially in next week’s budget. That should be a neat piece of sorcery! Here it is

Mr Napthine has committed to building an airport to city centre rail link.  While opposition to this has featured pollution and fly-overs, the key issue is the costs and the benefits.   These are to be revealed by The Treasurer, Michael O’Brien in next Tuesday’s budget. 

Meanwhile, the Premier is in Canberra today where, aside from promoting a tax on one-trip bottles, he is seeking support for infrastructure funding especially on transport facilities. 

The focus on infrastructure spending by governments is a welcome change from the policy approach five years ago.  During the 2008 global financial crisis Australian politicians and their advisers were calling for massive budget deficits to stimulate demand. 

Mr Rudd was elected as a John Howard fiscal conservative with a younger “compassionate” face.  But he soon rebadged himself as a conventional Labor spendthrift who would tame the financial tornado by increasing spending at a rate that would bring blushes to the faces of previous vote-buying politicians. 

So we had the cash hand-outs, new school halls, home insulation plans and other measures.  The Commonwealth budget went from John Howard’s $20 billion surplus to a $55 billion deficit.  And we never saw the self-sustaining recovery that the spending was supposed to trigger. 

Unlike hand-outs to individuals, government infrastructure spending can lift productivity, thereby offering a prospect of genuine economic growth.  Unfortunately however, government infrastructure spending often ends up in creating unproductive white elephants.  We see this with the National Broadband Network on which $15 billion has been wasted to date and little can be expected from the remaining $45 billion of planned spending. 

So we should pay particular attention to scrutinising a proposal like the airport rail link that the government has described as a “landmark” and “fantastic”. 

The airport link’s cost is yet to be revealed but is likely to be some $2 billion. In arguing for it, Mr Napthine says rail is becoming more competitive than road even over short distances and it is necessary because we need additional capacity. 

Rail however is finding it increasingly difficult to compete with road.  That’s largely because virtually all cities are becoming less concentrated both in terms of homes and work places.  Fifty years ago half of all Melbourne’s journey to work travel was to the city centre.  Today it is only 12 per cent.  Fixed track rail is inherently inflexible compared to road.  It is far inferior in door-to-door service and the gradually more diffuse nature of travel patterns places it at an inevitable disadvantage.     

This increasingly dispersed trip pattern also disadvantages airport rail links. Brisbane illustrates this.   Compared with Melbourne, it has less effective road network connections to the airport and its rail link is half the distance required by the Melbourne link.  Even so, rail carries only 5 per cent of the airport’s traffic at a ticket cost of $16. For Melbourne the SkyBus at $18 would be cheaper and faster.  And the Tullamarine Freeway’s capacity can be readily expanded, as illustrated by the government’s announced $850 million 30 per cent capacity upgrade.

Michael O’Brien is among the more capable Victorian ministers.  But he has as awesome task to explain how the Tulla rail link can make economic sense. 

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46 Responses to Wasteful infrastructure spending epitomised: Melbourne’s proposed airport rail link

  1. Rabz

    If I had a choice, I would never catch a taxi in Melbourne again in my life. The cab drivers are universally of an extremely poor standard. Their driving is atrocious and invariably dangerous. In the last four years alone on my quarterly work trips to Melbourne, I have been a taxi passenger in two separate accidents in the CBD.

    Not good enough.

  2. stackja

    I travel by bus and train and occasionally by taxi in Sydney. Assumption of private car by most seems unrealistic.

  3. Bruce of Newcastle

    I have to back Napthine on this. It’ll cost, but the Sydney airport rail link is just wonderful, and I never regret the surcharge. I now don’t go from Newcastle airport, which is nearly a hour away by taxi, I just train it, change at Central and am at the airport with no hassles and no issues. Not much difference in time either.

    I will admit a personal hangup about taxis, having been burgled while away on a trip because I made the mistake of replying to taxi driver what I was doing. Spotter.

  4. Bear Necessities

    One of the reasons Brisbane rail link only carries 5% is the availability of relatively cheap long term parking at Brisbane Domestic. In 2013 I paid less than $100 for my car to be parked in long term parking for a week. The convenience of getting in your car and being home in approx. 30 minutes more than made up for any extra costs compared to public transport.

  5. The Skybus works fine.
    It is fast, efficient, and runs hundreds of times a day (or seems to anyway).

    The Skybus probably costs, realistically, about 1 percent of the total cost of installing and running a train line.

  6. Rabz

    the Sydney airport rail link is just wonderful

    It is, to use a horrible term, a “no brainer”. The return train fare to the CBD is about $28, and the trip from the domestic terminal to the CBD takes about 15 minutes.

    Compare that to a taxi trip, where you face a cue for a cab (an imponderable time) and then the cab trip itself, which is at the mercy of Sydney’s appalling traffic conditions – if you’re trying to get from the airport to the CBD by cab in morning peak traffic, it would take probably three times as long as the train. Then there’s the cab fare, which would be at least three times (probably four) as expensive as the train ticket.

  7. Notafan

    If Melbourne was a major tourist destination and we had a high density population in the inner city a city airport link might make sense but it’s too late for that. Of course the Fitzroy Brunswick luvvies want it, just make then pay $50 a trip. Can’t they just build a branch line to the nearest existing train line?
    Tuktuks would be cheaper and there are lots of unemployables in the northern suburbs looking for work.

    Didn’t he just increase stamp duty by the way. Apparently we spent all our money on desalination and myki.

  8. Eyrie

    Of course the idiot governments are trying to stamp out ride sharing apps which might obviate the need for a rail link.

  9. LVS

    Skybus works much better than the Brisbane airport rail. Skybus is very regular and around the clock, the Brisbane airport rail only goes to 10 pm (it use to stop at 8 pm) and typically only every half hour. Parking at Brisbane airport is almost cost competitive with public transport, even for a single traveller, 4 or 5 days of parking can generally be booked for $80, public transport if taken from the Brisbane suburbs is about $50 for a round trip.

  10. James B

    Public transport is so bad that the only way it can even work slightly is when governments massively discourage car use combined with massively subsidising public transport.

    I would say to simply abandon all public transport. Privatise everything related to it, let it fund itself. Then double or triple road funding.

  11. Ripper

    I like the Brisbane rail link, You can get off the plane , walk 200metres and can train to Nambour , Ipswich or the GoldCoast and all points in between.

    When catching a plane you can train in the opposite direction with no worries about getting stuck in traffic.
    They would get more patrons if it was a bit cheaper though .

  12. JohnA

    No Rabz, I’m with Notafan on this one.

    The economics works for a single passenger only.

    Once you start talking about families, groups or business associates the taxi or hire car, cheap long-term parking (ala Bear Necessities report) or the helpful friend ferrying them beats the lot.

    It is simply too late for a totally new rail link to Tulla, and now that the “freeway” upgrade has been announced, there is even less pure market justification for it.

  13. Ant

    Oh, Alan, when raising the issue spectacularly stupid government initiated white elephants in a Victorian context, please try and keep it local.

    There is no need to cite the NBN in such cases.

    We have a perfectly perfect local example of that all too prevelant beast right here – all created by the usual suspects, in this case a spectacularly stupid and deceitful Labor government.

    We call it the Desal Plant.

    Such a pity these creatures are not endangered, but rather multiplying like rabbits on Viagra.

  14. Andrew

    I would imagine the time that the Airport rail link would be faster than trying to drive out to the Airport from the city centre, especially in peak hour, which is the equivalent comparison here.

  15. why are you city folk so addicted to trains and buses.

    I grew up in country town free of such dangerous mind altering drugs.

    I took a commuter train for the first time as a adult. Not very exciting.

  16. Notafan

    Dedicated Skybustaxi lane on the Tullamarine freeway much cheaper and quicker.
    What are the projected passenger volumes?
    That car ride app might see some interesting things
    I’m eastern suburbs, there is no way I would add in a a multiple train trip especially when so many international flights seem to leave late at night and arrive pre 6am
    We family pick up drop off or taxi for business.

  17. H B Bear

    Skybus in Melbourne works fine from Spencer Street station for the people who don’t use private transport. If you want to talk about an airport rail link white elephant have a look at the Perth proposal that Barnett announced as a panicked response to Sneaker’s un-funded Labor promises at the last election.

    Remind you of anyone?

  18. Fred

    The problem with Melbourne’s Airport is that it is on the edge of the city and all rail lines go to the city. To get the train to the airport, you will first have to get a train to the city.

    I live in the north east of Melbourne. I can drive or get driven to the airport in 35 mins. It takes me 48 minutes to get to the city on a train. Another train to the airport would take a minimum of 30 minutes. Add in waiting time and the walk to the station, it would take me a good 2 hours to get a train to the airport.

    I imagine that would be the same for many people in Melbourne. This rail line will only benefit tourists and inner city dwellers.

  19. H B Bear

    Michael O’Brien is among the more capable Victorian ministers. But he has as awesome task to explain how the Tulla rail link can make economic sense.

    Actually in Victoriastan the last question anyone will ask is, “Does it make economic sense?” That is why Labor is odds on to be re-elected one term after building a $6.5bn desalination plant that hasn’t produced a single litre of water and has added $100s to every Victorian’s water bill for the next 20 years.

    They deserve the governments they get.

  20. Rabz

    OK – I’ve said my piece above, but I can’t see how any thorough CBA could possibly justify the rail link being constructed. Presumably there would be cheaper alternative options, some of which have been raised above.

  21. Rabz

    building a $6.5bn desalination plant that hasn’t produced a single litre of water and has added $100s to every Victorian’s water bill for the next 20 years

    You couldn’t make up these kinds of examples of the unrelenting idiocy of politicians. Unbelievable.

  22. Diogenes

    Wouldn’t it be easier to just extend the tram light rail from Essendon along the edge of teh freeway (IIRC correctly it ends next to freeway about 5km short)..
    Meanwhile to the north, Newcastle wants to remove a perfectly good heavy rail & replace it with light rail for 120million.

  23. Anonandon

    Driverless cars will make the public transport system redundant within 15 years or less.

  24. Paul

    “Driverless cars will make the public transport system redundant within 15 years or less.”

    Rudderless cars are here now if Rabz’s taxi experiences are anything to go by.

  25. .

    Anonandon
    #1288972, posted on May 2, 2014 at 1:54 pm
    Driverless cars will make the public transport system redundant within 15 years or less.

    Let’s see how the Taxi lobby spins that…”DANGEROUS, OUT OF CONTROL, DRIVERLESS “CARS”!”

  26. MemoryVault

    ”DANGEROUS, OUT OF CONTROL, DRIVERLESS “CARS”!”

    Isn’t that pretty-much the definition of a taxi these days?

  27. Empire Strikes Back

    Let’s see how the Taxi lobby spins that…

    The licence holders will just fine with it.

  28. Kaboom

    Memory Vault:

    Well, I suppose we will all enjoy the advent of Johnny Cabs then…

  29. Bruce of Newcastle

    Meanwhile to the north, Newcastle wants to remove a perfectly good heavy rail & replace it with light rail for 120million.

    No Newcastle doesn’t want that. Macquarie Street wants it. They’ve been trying to twist our arm to remove the heavy rail for decades.

    They do have a point. I’ve been in Newcastle for 23 years and I’ve taken the train to Civic exactly once in all that time. There’s nothing there but some restaurants and a whole suburb of inner city metrosexuals.

    I may be unfair, but IMO the city centre has gone ‘way downhill since Bob Hudson.

  30. NeoSeoul

    I lived in Sydney for 13 years.

    Coming back to Melbourne recently, I’ve had to use the Skybus a couple of times and it rocks!

    Its efficient, runs every 10 or 12minutes and is cheap.

    Hello?? Does the govt know how good it is already??

  31. H B Bear

    The licence holders will just fine with it.

    I’m sure the licence holders would be happy to have no human driven cabs either and just collect the capital gains on their monopoly regulated asset. Particularly all of those at Macquarie Bank.

  32. srr

    It’s just one small part of a much bigger plan.

    Victoria – a State of Cities -

    http://www.theage.com.au/victoria/regional-cities-set-to-rise-and-thrive-20121124-2a0gb.html

    Even now, commuting by train to Melbourne from regional cities is a better and more affordable option for many, particularly those who want to raise a family in their own spacious home, without forfeiting city amenities.

  33. srr

    Train to work in Melbourne, need to suddenly fly out to an interstate or O/S meeting, train to airport.

    It makes sense for a smaller area state of global mover and shakers.

    And before the greenies freak out, remember that American State of cities (and that great city, New York), New York, still has a lot of glorious countryside to. ;) :)

  34. johanna

    Bruce, thanks for the “Newcastle Song” link. Haven’t heard it in decades, but still funny. Whatever happened to Bob Hudson? I know he worked on JJJ for a while, but he seems to have disappeared since.

    Can any Melburnians clarify whether the proposed rail line links with the rest of the network? If it’s a dead end, that is a huge minus. The Sydney and Brisbane ones have the virtue of allowing passengers to take a short walk from one platform to another to get where they are going.

    If you are going to the CBD, catching the train from Sydney airport is much better than getting a cab – cheaper and faster, except in those rare times when the traffic is not heavy. Best of all, there is one very 10 minutes.

    And I must agree with Rabz about Melbourne taxi drivers. For a start, they should be required to have a shower and use deodorant before starting a shift. Several times, I have had to wind down both windows in the back to stop from gagging. And like cabbies everywhere, they are always keen to discover if you are a local, i.e. have the faintest idea of where you are going and how to get there.

    I note that Reg Kermode, the father of the Cabcharge extortion racket, has just died. Along with Wran’s passing, it signals the passing of a generation of crooks.

  35. Anne

    Mr Moran, why hasn’t this article been posted to the Catallaxy Twitter feed?

  36. Notafan

    The Tulla run can bottleneck at the end of the freeway, could be fixed with a dedicated skybus/taxi lane. They could even put a tunnel under the existing entry exit point to the freeway. Extending the Essendon tram along the freeway also makes more sense. If he wants to subsidise Skybus to run every ten minutes it still wouldn’t cost two billion dollars. Its not an investment if you never make a profit, it won’t even cover operating costss unless they charge a ludicrous amount per trip.
    Napthine wants the big project for the election because it will create a few very highly paid jobs for the usual suspects and people have been conned into thinking this kind of project is good for Victoria.
    They would be better spending the money getting rid of a few more level crossing bottlenecks, Blackburn for example and extending a few more of the existing train and tram networks. Inner Melbourne has already got more than it’s fair share of public transport.

  37. Diogenes

    Bruce,
    Newcastle Council has been trying to get rid of the extension from Civic since it was opened in 1858. It was annoyed when Queens Wharf was closed as a coal shipping facility (in favour of Bullock Is then Pt Waratah) and then converted to a general goods yard. Its attitude is very obvious that in all the the interpretive signage around the park between the station & Nobbys there is only 1 spot where the fact that a yard was there at all is in the old carriage shed (now a big picnic shed). There is a bit near the old Workshops where they talk about the old AA Coy staithes & lines through Hamilton.

    More frustrating is that there were already trams running down Hunter St from Newcastle to Wallsend, West Wallsend, Merewether and lots more lines.

    The excuse they are using is it will “revitalise” the CBD – & “reconnect the city with its harbour – which is total BS as the waterfront has been built up (Crown Hotel) & they want to put the monster tower on the old David Jones building.

    There is irony n that Hunter mayors have been discussing opening the old South Maitland Railways Cessnock line (1 coal train a day) as a commuter line, and I have heard whispers that ideas around rebuilding the old J&A Brown line to Minmi have been floated to support the new estates going in there & increasing the frequency of the service to Maitland & up to Singleton and Scone. Won’t work well if line is truncated at Wickham. Persnally I would like to see the line to Belmont & the old Gully line to Charlestown restored as well :-)

  38. johanna

    Wow, Novocastria minima. :)

    I like Newcastle, a lot, though. It is situated in a very beautiful landscape, and also has some of the best industrial art (such as the old steelworks) that I have ever seen. And I’m not being ironic :) when I say that.

    Stayed at the long-gone Star Hotel once. It made Rabz’ birthday party look like a Sunday school picnic. Which it most certainly wasn’t.

  39. Diogenes

    Sorry about the dissertation , but I am a rail fan & my “thing” is the old now long gone coal lines in the Hunter :-) :-)

  40. James B

    Public transport is disgusting. Rip it all out of the ground.

  41. Johno

    We see this with the National Broadband Network on which $15 billion has been wasted to date and little can be expected from the remaining $45 billion of planned spending.

    Does anyone know how much revenue Abbott expects to take with his deceit tax?

    Is it anything like $45 billion?

    Could Abbott save more money by scrapping Turnbull’s NBN, than imposing a great big new tax?

  42. Andrew

    Lucky the Peoples Republic of Vic doesn’t have a Labor govt. Otherwise they would be doing a study tour of the best airport trains in the world, turning green with envy at Shanghai’s, and deciding to replicate the Maglev to Pudong.

  43. Paul

    Coming back to Melbourne recently, I’ve had to use the Skybus a couple of times and it rocks!

    seconded.

  44. The Skybus works fine. It is fast, efficient, and runs hundreds of times a day (or seems to anyway).

    Both of the last times I have taken it, at approximately the same time of the day, delays were announced due to accidents on the Tullamarine Freeway. I nearly missed my flight on both occasions, despite allowing plenty of buffer time, nearly screwing up my entire day at the destination both times. I’m sure there’s a hell of a lot of people who’d take a train if it were there.

    IIRC there is already track out to that neck of the woods (Sunbury). A slight diversion or a branch line should not cost $2bn.

  45. Seza

    The Maglev in Shanghai is wonderful, but doesn’t even go into the city. Trying to get a taxi driver to take you to the station to catch it out to the airport can be a trial, too. But travelling at 430km/h does make the journey interesting.

  46. Andrew

    I specifically booked a hotel near Maglev terminus and was horrified that it stopped running well before by late flight from HKG. Never have ridden one yet, and now they’ve cut back the to
    speed to reduce CO2s (no doubt receiving some CERs for the scam).

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