Getting Inland Rail back on track
The Albanese Government is taking prudent and responsible action to rescue Inland Rail from the shameful state it was left in by the Coalition Government.
The independent review of Inland Rail led by Dr Kerry Schott AO found major deficiencies in the governance and delivery of Inland Rail.
It confirmed that Inland Rail is an important project to meet Australia’s growing freight task, improve road safety and to help decarbonise our economy.
However, it also confirmed that the project is running significantly over budget and significantly behind schedule with just over 16% of the 1700km of track completed so far.
Dr Schott reported the estimated the cost of Inland Rail blew out to approximately $31 billion under the Liberals and Nationals.
This revised estimate is almost double what the Coalition Government said it would cost as recently as 2020, a blowout described by Dr Schott in her report as, “astonishing”.
Dr Schott concluded that, “Somewhat surprisingly the project has commenced delivery without knowing where it will start or finish”, adding that the final date and cost remain uncertain, because of a lack of confidence in the current estimates.
Flagrant mismanagement of the project by the Coalition has led to the need for comprehensive change and a renewed look at the underpinnings of the project.
In her report, Dr Schott outlines 19 recommendations to improve the delivery of Inland Rail including through enhanced governance arrangements, the identification of intermodal terminal locations, and ensuring appropriate environmental approval processes. The Government has accepted all of Dr Schott’s recommendations in full or in-principle.
The Government will take a staged approach to delivering Inland rail, prioritising its delivery from Beveridge in Victoria to Parkes in New South Wales – increasing resilience and improving supply chain productivity between Melbourne, Perth, Sydney, Newcastle, the Illawarra and Adelaide.
An independent cost estimator and value engineer will be tasked to undertake detailed assurance work to determine the updated cost and schedule for the program.
Cost assessments will be informed from a position of greater certainty on the engineering and design of the route, with the Government acknowledging Beveridge and Truganina in Victoria, and Ebenezer in Queensland, subject to the completion of a business case with the Queensland Government, as the preferred locations for open-access intermodal terminals, with Beveridge and Ebenezer the end points for Inland Rail’s double stacked service offering.
In the near term, work will continue to support completion of existing construction activities and planning works north of Parkes.
New governance arrangements will ensure the Australian Rail Track Corporation (ARTC) has the necessary skills and experience to deliver its functions. The Government has already commenced this process, having appointed Mr Peter Duncan AM as the new Chair of the ARTC and Dr Collette Burke as a Non-Executive Director in January 2023. A new substantive chief executive of Inland Rail will also be appointed as soon as possible.
These moves will address the failures of the Coalition Government to meet its obligation to ensure the ARTC is governed properly and has the skills necessary for the work.
The Government will also support Dr Schott’s recommendation to establish a subsidiary board of ARTC to oversee Inland Rail as a separate entity from the day to day work of ARTC.
ARTC has not received an updated the Statement of Expectations since 2018. This will be rectified shortly to give the necessary clarity and guidance to the ARTC Board to effectively deliver the Government’s objectives.
Details of the Government response and the 19 recommendations made in the Schott Review, The Delivery of Inland Rail: An Independent Review, can be accessed from www.inlandrail.gov.au/independent-review
Quotes attributable to Federal Minister for Infrastructure, Transport, Regional Development and Local Government Catherine King
“Dr Schott’s report is clear. Inland Rail is behind schedule, over budget and requires a fundamental reset.
“Australia’s investment in Inland Rail is critical to help us move more freight as our population grows. Inland Rail can reduce our transport emissions and make our roads safer, but it comes at a significantly higher cost.
“Given the abysmal state the former government left the project in, we must take immediate action to get it back on track.
“ARTC will prioritise the delivery of Inland Rail sections between Beveridge and Parkes, while we continue to affect change across the program, improve governance and risk management.
“When this Government can have faith that adequate environmental planning approvals are in place and there is sufficient certainty as to the scope and cost to build more of Inland Rail, we will do just that.”
Quotes attributable to Federal Minister for Finance, Senator Katy Gallagher
“The Australian Government accepts the recommendations in the Schott Review and acknowledges the lack of confidence with respect to the costs of Inland Rail.
“The findings of the Review are another damning indictment of the former Coalition Government, and another example of the Albanese Labor Government needing to clean up the mess left behind by our predecessors.”
“We will act sensibly and responsibly to ensure this important project is put back on track”.