Minister wanted to dump light rail – The Australian

ANDREW CLENNELL THE AUSTRALIAN 12:00AM October 19, 2017

Soon after he became NSW Transport Minister, Andrew Constance asked bureaucrats what it would cost to dump Premier Gladys Berejiklian’s controversial $2.1 billion CBD light rail project and whether abandoning it was possible.

Bureaucrats told him and his senior staff the contract signed by then transport minister Ms Berejiklian was watertight and cancelling it would create “sovereign risk” and be too expensive, The Australian has learnt. Since then Mr Constance has had to make several announcements about the light rail line and praised it.

After the 2015 Coalition election win, Mr Constance was moved by former premier Mike Baird from Treasury to Transport, with Ms Berejiklian made treasurer, ahead of her becoming Premier less than two years later.

According to an account of one early meeting, Transport for NSW secretary Tim Reardon and other senior bureaucrats told Mr Constance there was “sovereign risk” in any attempt to dump the line. “The words he (Mr Reardon) used were ‘the Spanish have tied us up in knots on the contract’,” a source in the meeting said.

“The contract was signed in such a rush, every alteration we want to make is costing us five times as much as it should have.

“There was a view (in Mr Constance’s office) at the time that this was a dog of a project.”

At another meeting, bureaucrats again told Mr Constance and his senior staff the project could not be cancelled.

The Australian has learnt two big Australian infrastructure construction companies will not bid for work for the Parramatta light rail project, which the government reannounced yesterday, partly because of dramas associated with the CBD light rail. Lend Lease and John Holland have decided not to bid for the design and construct part of the plan.

A combination of difficulties the Spanish contractors Acciona have had removing and replacing utilities in the CBD and the way the Parramatta deal has been structured has put them off, sources at the companies confirmed.

Yesterday Mr Constance did not deny his 2015 wish to cancel the CBD light rail project.

“Any new minister receives a full brief of current projects, what stage they’re up to and makes an assessment of whether projects provide good outcomes and should proceed,” he said in a statement yesterday. “Sydney light rail proceeded because it will provide a great outcome for Sydney. We do not comment on internal meetings.”

Mr Constance and Ms Berejiklian announced a preferred route for stage two of the $3.5 billion Parramatta light rail yesterday, from Rydalmere north of the Parramatta River to Olympic Park. A first stage, from Westmead to Carlingford, is due to be completed in 2023.

Yesterday the opposition questioned how the project would be funded, given the state budget allocated only $1bn to the project.

The Australian revealed yesterday the government was pulling out all stops to block the release of documents on the CBD light rail project, which the opposition thinks may show Ms Berejiklian misled the public when she said a $500 million blowout was for improvements. The Auditor-General found 94 per cent of the rise was “was due to incorrect estimates in the business case”.

Asked why the government would not release the documents, Mr Constance told parliament yesterday the matter was being handled “at arm’s length” by the department and there were “commercial sensitivities”.

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