Press Conference - Canberra Light Rail stage 2A

ANDREW BARR: Thank you very much, everyone, for being here to mark this significant occasion. I am delighted to be joined by Minister Catherine King, and Federal Labor Lower House representatives Andrew Leigh, Alicia Payne, and Dave Smith, together with ACT Minister for Transport, Chris Steel, for this very significant announcement of contracts signing for stage 2A of light rail.

This project is one that we’ve been developing for many years and today we welcome, and warmly welcome, a partnership with the Commonwealth Government for the delivery of this next stage of Canberra’s light rail network. Once completed, this will see a line from Gungahlin through to Commonwealth Park. What this will provide is a further move of our CBD down towards Lake Burley Griffin, which is consistent with a long-term planning strategy for the ACT Government to bring our CBD closer to the lake.

Already around this precinct, the ACT Government has released land for new mixed-use development. So what Canberrans can expect from this transport project and the associated works are new public parks, more housing, more hotels, more restaurants and cafes, more commercial activity, and a place that will be used by people.

I have observed before that this current area has a higher rabbit population than it does human population and so we want to see this central part of Canberra CBD become a place for people. And light rail, as the transport anchor for that change, is absolutely critical. We’re delighted with today’s announcement from the Commonwealth Government to continue the funding partnership for this project and I will now invite Minister King to say a few words on behalf of the Australian Government. Catherine. 

CATHERINE KING: Thank you. Thank you very much, Chief Minister. It’s terrific to be here, again with my Federal Parliamentary colleagues, Andrew, Alicia, and David. It’s lovely to be in your part of the world. We generally spend most of it up on the hill, so we don’t get to get out as much as we’d like. Lovely to be here on this terrific project and, of course, my transport colleague, Chris Steel, as well, who is here with us today.

This is a fantastic project. I have to say it is exactly what great urban design looks like. Building new public transport infrastructure at the same time as you’re redeveloping opportunities for housing, for commercial and retail spaces, for recreation and commercial, and I really commend the ACT Government on a great vision. It’s not easy to do these projects and to do the planning work in advance, to say this is the vision, this is what we want. Not only a CBD, but really, a precinct that has hopefully, you know, more accommodation for people, more housing, recreation possibilities, but more importantly, the capacity for people to use public transport to get to and from work.

So, this light rail project stage 2A, of course, is being done in partnership with the Commonwealth Government and I can confirm today the announcement that we’re contributing a further $125 million to this project. Andrew drives a hard bargain so he has written to us and asked for that money, and you will see that money as part of the mid-year economic financial outlook realised as part of the Commonwealth’s budget. We know how important this project is to the ACT. We know how important this is to Canberrans and really looking forward to seeing what is a really large-scale, at the moment, civil works starting to see the construction for light rail. We still call them trams, as a Victorian, but I think we’ll give it that this light rail project, as part of stage 2A, really will see the continuation of this project into the future and really see this part of the city completely activated. So thank you very much.

ANDREW BARR: Chris.

CHRIS STEEL: Thank you, Catherine, and thank you to the Australian Government for continuing a really genuine partnership in helping us to deliver infrastructure projects that are critical for our growing city here in the ACT. This is the next step in extending our light rail line to provide sustainable, reliable mass transport to our rapidly growing city. This stage 2A extension will service the educational precinct of the ANU, it will service residential and commercial precincts in City West and NewActon and Acton waterfront. It will also service the recreational precinct at Commonwealth Park. We know from recent survey data that 51 per cent of existing light rail users will use one of the three new stops being built as part of this project.

This is an important city-shaping project. This will provide a walkable street environment for pedestrians and cyclists, better access and connectivity to mass transit, public transport, that will reshape the southern part of our CBD. I’m happy to take questions but before we do that I’ll hand over to Simon Nicholls from Pacific Partnerships which is part of the key consortium that will deliver this project under the banner of Canberra Metro. 

SIMON NICHOLLS: Thank you. On behalf of Canberra Metro, we are delighted to be continuing our partnership with the ACT Government and the Federal Government to announce this next stage of Canberra stage 2A. We acknowledge the considerable efforts and the collaboration and hard work from the respective teams including Major Projects Canberra, Transport Canberra, and the Canberra Metro Consortium to get us where we are today.

As part of the Canberra Metro Consortium, I personally have been involved with this project since 2016 and so I’m both excited for the next stage and enormously proud on what we’ve achieved in stage 1. Since the operation commenced, we’ve reached many milestones, that includes carrying over 15 million passengers, travelling more than 4 million kilometres, maintaining availability and on-time running that at an average is over 99.9 per cent, which means that our operator, Siemens, continues to ensure that Canberrans have a light rail that’s reliable. We also maintained a high level of customer service with customers 95 per cent likely to recommend the service. We’ve also maintained meaningful community engagement with using voices of local students, and announcers - for announcements and the success of the annual school safety rail poster competition.

The Canberra Metro Consortium is really looking forward to delivering stage 2A so that we can continue to provide a safe, reliable, and accessible light rail service to more of the Canberra community. Thank you. 

ANDREW BARR: I’ll step up first for questions. Who would like to go first?

JOURNALIST: I guess obviously there will be some things that will be, I guess, considered private under the contract and can you detail, Chief Minister, about this new contract that will be entailed in this project?

ANDREW BARR: It’s a single-source engagement with the existing consortium who, we just have heard, operated stage 1 incredibly well, very successfully for our community. So we’ve undertaken a number of years of work, associated with the different works packages associated with this project. The commitment today, a contract signing for construction, will see works commence effectively a handover of the raising London Circuit project to the Canberra Metro Team in fiscal year 24/25. We anticipate the earliest that would be would be around 12 months from now, but potentially early into 2025. We will know the exact month a little bit more detail in 2024. Then begins the construction process which will take several years, and then a testing commissioning phase for the extension and then passengers able to utilise the extended service. Minister Steel, I think, will provide a little bit more detail on the different elements of that but that’s, I guess, the headline. 

JOURNALIST: I guess we’re not looking to people taking light rail to Commonwealth Park until 2027?

ANDREW BARR: That’s, I think fiscal ‘27 would be the appropriate target time given the current construction program, yes.

JOURNALIST: In terms of the funding - sorry, Minister, did you want to chime in with that?

CHRIS STEEL: Happy to give further detail. So expect construction to take around two years, followed by testing and commissioning with the first passengers being able to take a light rail service in January 2028.

JOURNALIST: In terms of funding, we heard $125 billion will come from the Federal Government, this may have already been canvassed in the ACT Budget, but how much is going to be contributed from the ACT Government to this phase of the project? 

ANDREW BARR: Sure. So, we made provision for our share of the project, so it’s effectively a 50/50 partnership between Commonwealth and the Territory. That’s, I think, a pretty established funding formula for these sorts of transport infrastructure projects. There are elements of the project that we have undertaken ourselves and then there are elements that are 50/50 with the Commonwealth. The announcement today of the extra funding reflects, I guess, an adjustment towards that 50/50 notion within all of the elements of the project that are consistent with the usual Commonwealth State and Territory infrastructure funding formulas. 

JOURNALIST: What’s the all-up number?

ANDREW BARR: So, 577 is the number for the construction pose the contract that we’re signing.

JOURNALIST: We know that there’s been cost increases to the construction industry, it’s undergoing some pretty difficult challenges at the moment. Have the funding arrangements considered any potential blowouts or escalation in costs with the current pressures that the -

ANDREW BARR: These are factors that have been experienced across the infrastructure sector and, in particular, infrastructure asset classes quite sharply in recent times. So, part of the Commonwealth’s infrastructure review is to look at some of these questions and look at the existing project pipelines in each jurisdiction, to have a really good engagement with the State and Territory governments and that’s exactly the process that we undertook with Minister King and her department and we were really pleased with the outcome of that engagement. And so today’s announcement, I think, reflects the quality of that engagement, the detailed examination of construction cost pressures, supply and materials, issues that are impacting on the Australian infrastructure market and have led us to a value-for-money procurement with 50/50 partnership with the Commonwealth and a fantastic project for Canberra.

JOURNALIST: In terms of the contract itself, are you able to talk us through the procurement process that was involved in getting to this point?

ANDREW BARR: I might invite Minister Steel to talk through that.

CHRIS STEEL: So, we’ve engaged with a sole-source of supply with the existing -

JOURNALIST: Can I get you to do the - yeah, great.

CHRIS STEEL: So the Major Projects Canberra has been working closely to procure this project through our existing supplier, Canberra Metro, that was successfully delivered reliable services and a project that has been a remarkable success in stage 1. This has taken some time and obviously the approvals for this project had to be sought as well prior to that being concluded, including getting works approval through National Capital Authority, our own ACT Planning, the Land Authority, those were obtained around the middle of this year and now we’ve been able to finalise the contract for this. Of course, it’s also assisted in the process to have the support of the Australian Government to be able to deliver this with certainty and it’s great to be able to have the announcement today for that additional funding which will support the delivery of this project. 

JOURNALIST: It’s great to have a contract signed but are you somewhat disappointed that it’s going to be 2028 before passengers can use -

CHRIS STEEL: I’ve been very consistent saying that the timing of the delivery of this project would be contingent on the procurement process. We’ve now finalised that procurement process and we’re announcing under timeframe today. It will take around two years of construction followed by that testing and commissioning and see passengers starting to use light rail line from 2028.

Now that we’ve signed the contract with Canberra Metro, the major projects team working on light rail will start to shift their focus to look at stage 2B and designing that stage of the project, the development of an environmental impact statement which will begin consulting on with the community this year and we expect that, the EIS to be delivered around the end next year.

JOURNALIST: If I’m not mistaken, Minister, certainly correct me if I’m wrong, but the Government a little while back had the intention of perhaps completing each stage within a five-year sort of increment, that was, of course, extended to around about 10 years or so. I guess what measures have you looked at to try to bring this forward and are you still happy with the timeframe that it’s currently moving at?

CHRIS STEEL: Well, the reason why we split stage two into two parts, 2A and 2B, was so that we could start work earlier on the first initial stage to Commonwealth Park while we worked through the planning approvals process for the more complex, larger stage with 2B and so this actually does enable us to get on with work. We’ve started out with raising London Circuit, a crucial enabling project for light rail stage 2A with the construction well under way. We’re delighted to be able to sign the contracts so that we can then get the construction under way as raising London Circuit is completed to start building the light rail track, the light rail stops, and the light rail systems that will be for those reliable, sustainable services to more Canberrans.

JOURNALIST: Will 2A have to be complete before you make a start on 2B?

CHRIS STEEL: No, they’re not contingent on each other. But certainly, we know that there’s a lot of work that needs to be done to work through the planning and design approvals process for stage 2B. The focus to date has been on stage 2A for the project team and it’s only now that contracts are signed that we will then start to shift our focus on stage 2B. We need to undertake a level of design to be able to move through the environmental impact statement development process. We will now be doing that. We’ve got $50 million in the budget to undertake that work which we will be focussing on next year.

JOURNALIST: Still hoping to make a start by 2030 or are you looking at 2B being a project for next decade?

CHRIS STEEL: As we know, a lot of these decisions are out of our hands with third parties that make decisions about the project. So, we’re going to work milestone by milestone through each of those stages to get on with building light rail. Stage 2A is the focus of today’s announcement. It’s been the focus of the project team to date and then next year we’ll start to look at how we confirm the development and design and work through that approvals process for stage 2.

JOURNALIST: Minister King, what kind of commitment can you give to the ACT about stage 2B, which is the bigger and more complex of the projects?

CATHERINE KING: Well, today we’re here with a fantastic announcement - $125 million in additional money bringing the total Commonwealth contribution to stage 2A to over $344 million we’ve been contributing here. The ACT Government 50/50, they have already undertaken the funding and the work for the civil works that you can see behind us. That is a great project.

These things take time to build and the thing that if anything has taught us over the wasted decade and frankly the decade of the Liberal National Party frankly have been absolute economic vandals when it came to infrastructure, is that they went out, made announcements before any planning work had been done, no idea about how much projects were going to cost, no idea about how long they were going to take to build and the last thing I’m going to do is exactly what they did because that has left us in a position where we were left with an infrastructure investment pipeline that had known cost blowouts of over $33 billion.

So I want to commend the ACT Government. This is what you are supposed to do with infrastructure. You do the planning work, you work out all of the geotech. You make sure you know what it is you’re going to build and how much it’s going to cost. You do the environmental approvals, you do the planning approvals, and then you start to work on the capital in that process, and that’s exactly what they’ve done with this stage 2A and what they will do, I know, as it gets closer to understanding what the costs are for stage 2B. I’m sure they will come to the Commonwealth and we, again, will talk constructively with them about what we know is a very important project for the ACT.

JOURNALIST: Let’s wait and see. 

CATHERINE KING: Let’s do it properly is what that is. Let’s do it properly. 

JOURNALIST: Minister, we recently heard that a number of infrastructure projects had to be cut nationally to keep a cap on cost blowouts. How much was the funding for the stage 2A section of light rail that we’re announcing today at risk? Was there a genuine risk that funding was going to be cut?

CATHERINE KING: No, because this project was under construction. What the review of the infrastructure investment pipeline taking out some of the Commonwealth investment in projects that frankly would never be delivered, they were projects that had no funding partner, so in some areas States had not committed to funding those projects at all. They were, in some cases, over 500 per cent short of what was required to actually build them, so an announcement had been made and largely during an election campaign and they could not be delivered.

What that has allowed us to do is find additional money for important projects like light rail 2A and I really thank the ACT Government for working with us on making sure we’d have a sustainable pipeline that is able to be delivered, that takes into account market capacity constraints that we are all dealing with across the country, because that is what Labor governments want to do. We want to build things, we don’t just want to announce things. Thank you.