5 July 2013

Light Rail aims to make money

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Just in case you haven’t already been bored completely to death by hearing about light rail, here’s some more talk about it.

The ACT Government’s Capital Metro light rail project delivers a benefit cost outcome similar to, or better than, other light rail projects that are going ahead around Australia, Minister for the Environment and Sustainable Development, Simon Corbell said today.

“According to Infrastructure Australia’s own costings methodology, the benefit cost ratio for Capital Metro at our medium growth scenario was 2.34; this is similar to, or better than, the benefit cost ratio for other light rail projects going ahead in QLD and NSW,” Mr Corbell said.

“The Gold Coast light rail project, for example, has a benefit cost ratio of 1.63, and Sydney’s InnerWest light rail project between Lilyfield and Dulwich Hill is understood to have a benefit cost ratio of 1.0.

“Benefit cost ratio is a key indicator of a project’s viability. A ratio greater than 1 demonstrates that economically, for every dollar spent there is a positive economic return.

“A ratio of 2.34 shows that for every dollar spent, there is a return of just over two dollars.

“It’s also important to note that the Infrastructure Australia report, that Opposition Transport spokesman Alistair Coe keeps referring to, has not ruled out light rail, rather it has named a ‘Canberra Transit Corridor’ as an early stage infrastructure priority (page 100).

“Transforming and integrating the city’s public transport system is a big investment that will deliver benefits to Canberrans, and to the economy, for decades to come,” Mr Corbell said.

Cool, profit, yes, whatever! Just build the thing already.

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davo101 said :

dungfungus said :

What was the BCR for the Futsal Slab?

LOL, I’d never heard of the Futsal Slab–plus ça change. Maybe sometime later in the year we should get them to fly the Skywhale from the Futsal Slab? As to the BCR, I don’t know what the ACT rules are but in NSW you only have to do formal economic appraisals on capital projects over a million dollars, so in this case I doubt they did one.

Oh, the synergy of the Skywhale using the Futsal Slab as its home base.
It’s a smorgasbord of follies; no need for a BCR here.

dungfungus said :

What was the BCR for the Futsal Slab?

LOL, I’d never heard of the Futsal Slab–plus ça change. Maybe sometime later in the year we should get them to fly the Skywhale from the Futsal Slab? As to the BCR, I don’t know what the ACT rules are but in NSW you only have to do formal economic appraisals on capital projects over a million dollars, so in this case I doubt they did one.

davo101 said :

Gungahlin Al said :

Well seeing as you appear to have missed it, yes – the benefit:cost ratio of 2.34:1. As determined by PriceWaterhouseCoopers.

Well it would appear that Mr Corbell suffers from the same problem as Mr Coe; both being unable to finish a quote from documents they claim support their arguments. Yes the tram option has a BCR of 2.34 but the rapid bus option has a BCR of 4.78! No wonder the IA report talks about the bus option given that it has a BCR more than twice as high as the tram option.

damien haas said :

Where is the cost benefit analysis for Majura Parkway?

Here with a BCR of 3.32.

What was the BCR for the Futsal Slab?

Gungahlin Al said :

Well seeing as you appear to have missed it, yes – the benefit:cost ratio of 2.34:1. As determined by PriceWaterhouseCoopers.

Well it would appear that Mr Corbell suffers from the same problem as Mr Coe; both being unable to finish a quote from documents they claim support their arguments. Yes the tram option has a BCR of 2.34 but the rapid bus option has a BCR of 4.78! No wonder the IA report talks about the bus option given that it has a BCR more than twice as high as the tram option.

damien haas said :

Where is the cost benefit analysis for Majura Parkway?

Here with a BCR of 3.32.

PantsMan said :

I suspect that it will be 150% over budget (time and money) on construction and subsidised by 90%, leading to more money being spent to improve patronage/services by closing carparks and roads.

We may never know.

I suspect that it will be 150% over budget (time and money) on construction and subsidised by 90%, leading to more money being spent to improve patronage/services by closing carparks and roads.

“The cost of the electricity transmission system and maintenance are really high”

Only if the trams are powered by electricty.

“Self-driving buses would cut the cost of public transport massively. About half of ACTION’s costs are staff”.

Good luck in convincing the TWU this would be a good idea.

Comic_and_Gamer_Nerd1:21 pm 08 Jul 13

When did I ever say you cannot have a opinion? I said its not your money anymore and therefore the only say you have about how a tiny bit of it may get spent is election time.

Comic_and_Gamer_Nerd said :

It’s incredibly lol that some self entitled assholes think that their taxed pay still somehow belongs to them.

How Canberran. Betrays an incredible sense of naiivety about how things get paid for.

Government doesn’t have any money. The only money Government has is the money that actual productive taxpayers give it. So yes, thank you, since I give them plenty, I continue to assert the right to an opinion about how effectively it is getting spent.

As many have pointed out over the years, there are varying categories of spend – spending your own money on yourself is the best way to ensure value for it. On the other hand, Government spends other people’s money on other people – socially necessary but a recipe for poor control and wastefulness. I fear this project is heading down that route from Day 1.

dungfungus said :

wildturkeycanoe said :

As far as i can see, light rail or “trams” for what they really are, are just like buses except they are restricted to follow tracks. Why not just make a corridor exclusively for buses to travel along and you’d not have to install half the expensive infrastructure but achieve the same result? Why have a vehicle capable of carrying 150 people only filling up to say 30% capacity and stopping every 100m, when individual carriages designed for particular stops would take the customers faster to their destination? Like off-road cycleways, take the buses off our roads and you’d have a win-win for buses and cars as well.

Trams have less rolling resistance than buses and don’t have to have tyres replaced at great expense every 2 years. They cost a lot less to operate than buses and have a life up to 3 times as long. They are safer as well. I could go on.
I understood “cycleways” in Canberra were shared with pedestrians. Are there actually “exclusive” cycleways now and if so, where are they?

Trams are inflexible and cost more overall to run than buses. The cost of the electricity transmission system and maintenance are really high.

The Victorian government had an internal report on the cost of their trams written about 5-10 years ago. I have friends who had read it. The conclusion was that the most cost effective way to provide public transport on streets in Melbourne would have been to dismantle the system. Providing access for the disabled was posited as being a reason that could be used to cut back on trams. However it was realised that it would have been political suicide. Instead super-stops were brought in.

Canberra is very spread out. The farebox recovery ratio on ACTION buses is about 20%. A tram is unlikely to be better and could well be worse. The most promising thing for Canberra’s transport is that over the next 10-15 years self-driving vehicles are likely to appear. Self-driving buses would cut the cost of public transport massively. About half of ACTION’s costs are staff. Ultimately cars that can take multiple people to work and park out of major areas are likely to change Canberra’s transport substantially.

For ACTION budget figures have a look at p113 of the ACT budget:

http://www.treasury.act.gov.au/budget/budget_2011/files/paper4/06action.pdf

thebrownstreak69 said :

dungfungus said :

wildturkeycanoe said :

As far as i can see, light rail or “trams” for what they really are, are just like buses except they are restricted to follow tracks. Why not just make a corridor exclusively for buses to travel along and you’d not have to install half the expensive infrastructure but achieve the same result? Why have a vehicle capable of carrying 150 people only filling up to say 30% capacity and stopping every 100m, when individual carriages designed for particular stops would take the customers faster to their destination? Like off-road cycleways, take the buses off our roads and you’d have a win-win for buses and cars as well.

Trams have less rolling resistance than buses and don’t have to have tyres replaced at great expense every 2 years. They cost a lot less to operate than buses and have a life up to 3 times as long. They are safer as well. I could go on.
I understood “cycleways” in Canberra were shared with pedestrians. Are there actually “exclusive” cycleways now and if so, where are they?

They also cost a shedload more to buy, and need much more expensive infrastructure to run on.

There are lighter, self propelled trams now available that don’t need catenaries, transformers and roads to be torn up to relocate services. These are very appropriate for Canberra unlike the heavy Euro Tram network that has just been built on the Gold Coast.

dungfungus said :

goggles13 said :

its 40 years too late to build light rail in this city, time for the ACT Govt to stop wasting my money on this project. there is simply not enough people living in the ACT to justify the service, and I cannot see the population growing much in the future either.

unlike building a shopping centre which may have a wide catchment area, it is unlikely that many people would have a need to travel from Gungahlin to the City just for the sake of it.

oh and I won’t mention the fact that there is no obvious plans to build the light rail on the southside, so how would I benefit from it?

For the present, you will have to content that Mr Barr has spent your southside millions on Manuka oval (or whatever its commercial name is now) and he has committed over $20 million to sponsor the winless GWS team. Didn’t appear to be many at the match over the weekend either. Trams won’t be needed at Manuka for a long time.

sounds like the ACT Govt likes investing in pointless things

thebrownstreak6910:40 am 08 Jul 13

dungfungus said :

wildturkeycanoe said :

As far as i can see, light rail or “trams” for what they really are, are just like buses except they are restricted to follow tracks. Why not just make a corridor exclusively for buses to travel along and you’d not have to install half the expensive infrastructure but achieve the same result? Why have a vehicle capable of carrying 150 people only filling up to say 30% capacity and stopping every 100m, when individual carriages designed for particular stops would take the customers faster to their destination? Like off-road cycleways, take the buses off our roads and you’d have a win-win for buses and cars as well.

Trams have less rolling resistance than buses and don’t have to have tyres replaced at great expense every 2 years. They cost a lot less to operate than buses and have a life up to 3 times as long. They are safer as well. I could go on.
I understood “cycleways” in Canberra were shared with pedestrians. Are there actually “exclusive” cycleways now and if so, where are they?

They also cost a shedload more to buy, and need much more expensive infrastructure to run on.

Comic_and_Gamer_Nerd said :

It’s incredibly lol that some self entitled assholes think that their taxed pay still somehow belongs to them.

do you mean that we as taxpayers are not allowed to express an opinion on how our money is spent, unless it happens to be when we vote every four years?

get real, we live in a democracy with free speech and I don’t like the Light Rail proposal. I’m allowed to express my opinion and say why.

goggles13 said :

its 40 years too late to build light rail in this city, time for the ACT Govt to stop wasting my money on this project. there is simply not enough people living in the ACT to justify the service, and I cannot see the population growing much in the future either.

unlike building a shopping centre which may have a wide catchment area, it is unlikely that many people would have a need to travel from Gungahlin to the City just for the sake of it.

oh and I won’t mention the fact that there is no obvious plans to build the light rail on the southside, so how would I benefit from it?

For the present, you will have to content that Mr Barr has spent your southside millions on Manuka oval (or whatever its commercial name is now) and he has committed over $20 million to sponsor the winless GWS team. Didn’t appear to be many at the match over the weekend either. Trams won’t be needed at Manuka for a long time.

wildturkeycanoe said :

As far as i can see, light rail or “trams” for what they really are, are just like buses except they are restricted to follow tracks. Why not just make a corridor exclusively for buses to travel along and you’d not have to install half the expensive infrastructure but achieve the same result? Why have a vehicle capable of carrying 150 people only filling up to say 30% capacity and stopping every 100m, when individual carriages designed for particular stops would take the customers faster to their destination? Like off-road cycleways, take the buses off our roads and you’d have a win-win for buses and cars as well.

Trams have less rolling resistance than buses and don’t have to have tyres replaced at great expense every 2 years. They cost a lot less to operate than buses and have a life up to 3 times as long. They are safer as well. I could go on.
I understood “cycleways” in Canberra were shared with pedestrians. Are there actually “exclusive” cycleways now and if so, where are they?

wildturkeycanoe8:08 am 08 Jul 13

As far as i can see, light rail or “trams” for what they really are, are just like buses except they are restricted to follow tracks. Why not just make a corridor exclusively for buses to travel along and you’d not have to install half the expensive infrastructure but achieve the same result? Why have a vehicle capable of carrying 150 people only filling up to say 30% capacity and stopping every 100m, when individual carriages designed for particular stops would take the customers faster to their destination? Like off-road cycleways, take the buses off our roads and you’d have a win-win for buses and cars as well.

Public transport patronage and the way the government develops the ACT would seem to go hand in hand. The solution to the problem of “but the light rail is useless because I won’t be able to go here or there on it” is to ensure that the city is planned so that “here or there” will be built within reach of public transport facilities.

Instead, there is an ad-hoc approach to development in which the government persists in forever expanding Canberra’s urban boundary by building over the ACT’s open space with Tuggeranong-esque low-density sprawl (wasteland) far away from all current and future amenities, where it is obvious that public transport will never become viable in the future (see: Molonglo and West MacGregor).

This continued poor planning works against the development of light rail in the whole city, because it not only forces on those areas permanent dependence on private cars but also syphons population growth and commercial development away from parts of the city where light rail could become viable if they were developed correctly.

Comic_and_Gamer_Nerd4:14 pm 07 Jul 13

It’s incredibly lol that some self entitled assholes think that their taxed pay still somehow belongs to them.

its 40 years too late to build light rail in this city, time for the ACT Govt to stop wasting my money on this project. there is simply not enough people living in the ACT to justify the service, and I cannot see the population growing much in the future either.

unlike building a shopping centre which may have a wide catchment area, it is unlikely that many people would have a need to travel from Gungahlin to the City just for the sake of it.

oh and I won’t mention the fact that there is no obvious plans to build the light rail on the southside, so how would I benefit from it?

Masquara said :

If the bus service can’t even break even, this is a desire to gamble with OUR money. I’d put the odds of any public transport system in Canberra making money as pretty much pokie machine territory.

If ACTION was run like QTrans in Queanbeyan they would lose less money but remember, most private bus services for the public benefit are subsidized by Governments just like ours does albeit at an unacceptably high rate.
Also remember that if a light rail network isn’t introduced in the ACT and integrated with existing bus services then more buses will end up on our roads which isn’t a good outcome.

Ben_Dover said :

dungfungus said :

A tram could get from Queanbeyan to Canberra City in 15 minutes.

Then they’re stuffed, as they will have to get to their places of work from the City centre.By bus one would imagine. What a hell of a way to start/end your working day.

Makes the parking fees seem cheap at half the price.

dungfungus said :

I thought one had to be a thinker to comment on this blog.

You are kidding, right?

If you’re comfortable with that well OK but the example I am using would be an express one which would then transit to Gungahlin. The same logic could be applied to the Capital Metro project moving people from Gungahlin to Canberra City so they can then catch buses.
Obviously you don’t live in Queanbeyan and work in Canberra like a lot of commuters in Queanbeyan I talk to who would love a tram service into Canberra.
Incidentally, there would be other services that would stop at Fyshwick, Kingston Station and several other places in Kingston, Barton, Parkes, Capital Hill (3,000 people work at Parliament House I believe) etc. before Canberra City and then there are all the planned stops on the way to Gungahlin.
I must probe the deeper part of my brain to get some negative thoughts and then I can go back to vege land. I’m wasting my time here.

dungfungus said :

bundah said :

dungfungus said :

bikhet said :

As sien notes, the benefit cost ratio can be easily manipulated. Achieving that rubbery ratio relies on getting people to actually use light rail in the numbers used in calculating the ration.

Damien Haas comments that ACTION patronage is declining.

How does the government plan to ensure people use the light rail network in sufficient numbers to achieve the benefit cost ratio? How will those plans effect those who don’t benefit from the light rail network?

You raise a good point and the current City to Gungahlin plan is doomed to fail for several reasons. One is that is that it makes an unfounded assumption that everyone in Gungahlin works in Canberra City.
The only way the light rail can be viable is to extend it immediately via the Commonwealth Avenue bridge to the Parliamentary Triangle/Capital Hill, through Parkes, Barton, Kingston to the Railway Station and then to Queanbeyan on the existing railroad.
The network does not have to be electrified either – Canberra has gone to great pains to avoid the visual pollution that poles and wires create so the last thing we need are catenaries over tram tracks.
This amended proposal will generate the necessary users, take a lot of pressure off key road vehicle routes, make the service inclusive to Canberrans living and working South of The Lake and will also make the financing attractive to a PPP (it isn’t in its current form).
The way it is going now (with plans to re-develop EPIC into high density housing) it could end up like what is happening in some parts of the USA:
http://citiwire.net/columns/learning-again-why-plans-sometimes-fail/

Yeah and can you imagine how much it would cost to extend it all the way down to Qbyn FFS!

Last time I looked there was an under-utilised railway line between Kingston and Queanbeyan (read my OP please) so the extension cost will be zero which makes it so attractive. I should add that over 12,000 people a day drive into Canberra to work/go to school etc. and there is a great park and ride facility at the Queanbeyan Railway Station.
The Greens are fanatical about keeping cars out of Canberra and commuters who drive into Canberra daily from across the border are getting sick of paying $55 a week to park in Canberra. A tram could get from Queanbeyan to Canberra City in 15 minutes. It is so logical it is bound to fail I know.
I thought one had to be a thinker to comment on this blog. I am trying my hardest.

Yeah there’s little doubt that the existing track from Kingston/Queanbeyan is underutilised and the cost to make that a viable proposition wouldn’t be excessive however i’d hate to think how much it would cost to establish a track that would wind its way through Kingston,Barton,Parkes then Commonwealth Ave ending up in Civic.

My argument is that we do not currently have the population density to justify its existence .eg if one was to superimpose Canberra’s layout and size say over Sydney it would extend from Bondi to approx. Prospect Reservoir encompassing a substantial proportion of southern Sydney to almost the Georges River. I’m not certain of the overall population in that part of Sydney but I guess it would have to be around 4 to 5 fold Canberra’s population which therefore makes it necessary and viable.

The role of crystal ball gazers like PWC and their ilk is not to provide accurate and reliable predictions; it’s to provide justification for decisions already made and a scapegoat if and when things go pear-shaped.

Those who place faith in the predictions of these seers may have forgotten their role in assuring the world about what great investments securitised US loans were and what rock-solid institutions Enron, Lehman Bros, Bear Stearns, Northern Rock etc. were before they disappeared up their collective corporate fundament.

I haven’t, so you’ll forgive my cynicism, I trust.

No-one will be happier than I if, having been built, this thing is a roaring – or even modest – financial success. In that case I will be delighted to eat a hearty helping of humble pie, cold and without tomato sauce if needs be. But I’m not tying on my bib just yet.

dungfungus said :

A tram could get from Queanbeyan to Canberra City in 15 minutes.

Then they’re stuffed, as they will have to get to their places of work from the City centre.By bus one would imagine. What a hell of a way to start/end your working day.

Makes the parking fees seem cheap at half the price.

dungfungus said :

I thought one had to be a thinker to comment on this blog.

You are kidding, right?

If the bus service can’t even break even, this is a desire to gamble with OUR money. I’d put the odds of any public transport system in Canberra making money as pretty much pokie machine territory.

bundah said :

dungfungus said :

bikhet said :

As sien notes, the benefit cost ratio can be easily manipulated. Achieving that rubbery ratio relies on getting people to actually use light rail in the numbers used in calculating the ration.

Damien Haas comments that ACTION patronage is declining.

How does the government plan to ensure people use the light rail network in sufficient numbers to achieve the benefit cost ratio? How will those plans effect those who don’t benefit from the light rail network?

You raise a good point and the current City to Gungahlin plan is doomed to fail for several reasons. One is that is that it makes an unfounded assumption that everyone in Gungahlin works in Canberra City.
The only way the light rail can be viable is to extend it immediately via the Commonwealth Avenue bridge to the Parliamentary Triangle/Capital Hill, through Parkes, Barton, Kingston to the Railway Station and then to Queanbeyan on the existing railroad.
The network does not have to be electrified either – Canberra has gone to great pains to avoid the visual pollution that poles and wires create so the last thing we need are catenaries over tram tracks.
This amended proposal will generate the necessary users, take a lot of pressure off key road vehicle routes, make the service inclusive to Canberrans living and working South of The Lake and will also make the financing attractive to a PPP (it isn’t in its current form).
The way it is going now (with plans to re-develop EPIC into high density housing) it could end up like what is happening in some parts of the USA:
http://citiwire.net/columns/learning-again-why-plans-sometimes-fail/

Yeah and can you imagine how much it would cost to extend it all the way down to Qbyn FFS!

Last time I looked there was an under-utilised railway line between Kingston and Queanbeyan (read my OP please) so the extension cost will be zero which makes it so attractive. I should add that over 12,000 people a day drive into Canberra to work/go to school etc. and there is a great park and ride facility at the Queanbeyan Railway Station.
The Greens are fanatical about keeping cars out of Canberra and commuters who drive into Canberra daily from across the border are getting sick of paying $55 a week to park in Canberra. A tram could get from Queanbeyan to Canberra City in 15 minutes. It is so logical it is bound to fail I know.
I thought one had to be a thinker to comment on this blog. I am trying my hardest.

dungfungus said :

bikhet said :

As sien notes, the benefit cost ratio can be easily manipulated. Achieving that rubbery ratio relies on getting people to actually use light rail in the numbers used in calculating the ration.

Damien Haas comments that ACTION patronage is declining.

How does the government plan to ensure people use the light rail network in sufficient numbers to achieve the benefit cost ratio? How will those plans effect those who don’t benefit from the light rail network?

You raise a good point and the current City to Gungahlin plan is doomed to fail for several reasons. One is that is that it makes an unfounded assumption that everyone in Gungahlin works in Canberra City.
The only way the light rail can be viable is to extend it immediately via the Commonwealth Avenue bridge to the Parliamentary Triangle/Capital Hill, through Parkes, Barton, Kingston to the Railway Station and then to Queanbeyan on the existing railroad.
The network does not have to be electrified either – Canberra has gone to great pains to avoid the visual pollution that poles and wires create so the last thing we need are catenaries over tram tracks.
This amended proposal will generate the necessary users, take a lot of pressure off key road vehicle routes, make the service inclusive to Canberrans living and working South of The Lake and will also make the financing attractive to a PPP (it isn’t in its current form).
The way it is going now (with plans to re-develop EPIC into high density housing) it could end up like what is happening in some parts of the USA:
http://citiwire.net/columns/learning-again-why-plans-sometimes-fail/

Yeah and can you imagine how much it would cost to extend it all the way down to Qbyn FFS!

Ben_Dover said :

The ACT Government’s Capital Metro light rail project delivers a benefit cost outcome similar to, or better than, other light rail projects that are going ahead around Australia, Minister for the Environment and Sustainable Development, Simon Corbell said today.

Thanks for my “coffee down the nose” moment for today.

Old Simon, he really is a card isn’t he?

No question he an absolute crack up with the emphasis on crack(ed)!

bikhet said :

As sien notes, the benefit cost ratio can be easily manipulated. Achieving that rubbery ratio relies on getting people to actually use light rail in the numbers used in calculating the ration.

Damien Haas comments that ACTION patronage is declining.

How does the government plan to ensure people use the light rail network in sufficient numbers to achieve the benefit cost ratio? How will those plans effect those who don’t benefit from the light rail network?

You raise a good point and the current City to Gungahlin plan is doomed to fail for several reasons. One is that is that it makes an unfounded assumption that everyone in Gungahlin works in Canberra City.
The only way the light rail can be viable is to extend it immediately via the Commonwealth Avenue bridge to the Parliamentary Triangle/Capital Hill, through Parkes, Barton, Kingston to the Railway Station and then to Queanbeyan on the existing railroad.
The network does not have to be electrified either – Canberra has gone to great pains to avoid the visual pollution that poles and wires create so the last thing we need are catenaries over tram tracks.
This amended proposal will generate the necessary users, take a lot of pressure off key road vehicle routes, make the service inclusive to Canberrans living and working South of The Lake and will also make the financing attractive to a PPP (it isn’t in its current form).
The way it is going now (with plans to re-develop EPIC into high density housing) it could end up like what is happening in some parts of the USA:
http://citiwire.net/columns/learning-again-why-plans-sometimes-fail/

As sien notes, the benefit cost ratio can be easily manipulated. Achieving that rubbery ratio relies on getting people to actually use light rail in the numbers used in calculating the ration.

Damien Haas comments that ACTION patronage is declining.

How does the government plan to ensure people use the light rail network in sufficient numbers to achieve the benefit cost ratio? How will those plans effect those who don’t benefit from the light rail network?

Felix the Cat5:22 pm 06 Jul 13

damien haas said :

ACTION Buses are costing ACT Ratepayers $130 million dollars a year, and patronage is declining. Attracting full fare paying riders to public transport, reducing parking demand, reducing road congestion and encouraging Transit Oriented Development along the Northbourne/Flemington Corridor are just a few of the benefits to the ACT and its economy that Capital Metro will provide. Did the GDE do that?

l/

So why would light rail be feasible, not taking into account the community benefits? How many hundreds of millions of dollars will taxpayers need to subsidise it with? Why would someone take a tram rather than a bus?

If people are going to spend say 10-15 minutes drive from their Gungahlin suburb to a light rail interchange at say Mitchell, why wouldn’t they just stay in their cars and drive for another 10-15 minutes to the city and then park near their place of work rather than stand in the freezing cold or boiling sun waiting for a tram and then when it finally reaches the city be faced with a long walk to work (or catch a bus to somewhere else that the tram doesn’t go to).

The post heading isn’t really helpful, but something as abstruse as an economic model doesn’t lend itself readily to pithy post headings.

I think Alistair Coe is well within his rights as a shadow to raise the questions he has been raising, and certainly the government needs to communicate its financing model to the public. I suspect that the government hasn’t yet arrived at a model to finance Capital Metro, having only recently determined its actual cost.

I’d like the same questions asked of all transport infrastructure spends. Where is the cost benefit analysis for Majura Parkway ? Have the opposition raised the same level of concern on that project? The true costs of more roads and paid parking are borne by us all. Public transport provides greater benefits than simple economic benefits – which is why triple bottom line measures are applied.

ACTION Buses are costing ACT Ratepayers $130 million dollars a year, and patronage is declining. Attracting full fare paying riders to public transport, reducing parking demand, reducing road congestion and encouraging Transit Oriented Development along the Northbourne/Flemington Corridor are just a few of the benefits to the ACT and its economy that Capital Metro will provide. Did the GDE do that?

At the moment I’m seeing battle of the press release. Capital Metro need a communications strategy and the media need to do more than just be a press release mechanism – perhaps they can assess the claims and report their analysis.

Damien Haas
Chair, ACT Light Rail
http://www.facebook.com/groups/actlightrail/

The ACT Government’s Capital Metro light rail project delivers a benefit cost outcome similar to, or better than, other light rail projects that are going ahead around Australia, Minister for the Environment and Sustainable Development, Simon Corbell said today.

Thanks for my “coffee down the nose” moment for today.

Old Simon, he really is a card isn’t he?

Gungahlin Al2:44 pm 05 Jul 13

Deref said :

Gungahlin Al said :

Yes there’s a big difference between making money and reducing costs. Light rail will do the latter in spades

Do you have any evidence for that, Al?

Well seeing as you appear to have missed it, yes – the benefit:cost ratio of 2.34:1. As determined by PriceWaterhouseCoopers. To which I would point out did not include provisions for (not inconsiderable) increases in land sale revenues or increased rates revenues along the routes, as these were specifically excluded from the Terms of Reference given to PWC (as explained to me by the PWC guy himself).

Gungahlin Al said :

Yes there’s a big difference between making money and reducing costs. Light rail will do the latter in spades

Do you have any evidence for that, Al?

Gungahlin Al12:11 pm 05 Jul 13

Yes there’s a big difference between making money and reducing costs. Light rail will do the latter in spades, as opposed to roads, which cost and cost and cost. Well that’s not entirely true – there is an economic return from roads, but the issue is that many people don’t look at the entire transport delivery cost picture when discussing rail costs. It’s like Alistair Coe banging on all the time about the cost of ACTION buses, but never giving a rats about the enormous cost of building new 4-lane roads everywhere.

Light Rail aims to make money

Um, no it doesn’t. I think you are confusing the benefit cost ratio from an economic analysis and the return on investment from a financial analysis. You can quite easily have a project with a high BCR that looses millions of dollars a year. Benefits include everything you can think of to add onto the list such as: reduced noise pollution, visual amenity, reduced travel times of the people not using the tram, increased economic activity brought by about higher levels of development along the corridor (none of which will result in any money in the fare box).

That press release doesn’t say that light rail will make money, just that there will be a cost benefit ratio above 1.0.

Costings like that can be manipulated fairly easily. You can just add some ‘social costs’ and get the answer you want. Crikey had an excellent piece about this recently.

http://media.crikey.com.au/dm/newsletter/dailymail_0e637a5e7ad7dc32df975e4f7b027381.html#article_24921

In economics the debate over the Keynsian multiplier is similar.

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