Tuesday, 2 June 2009

Corporation guilty of match-fixing on rail costs

Newcastle Greens
2 June 2009

The Greens today attacked the credibility of the Hunter Development Corporation’s costings of options for the Newcastle rail line, saying they proved that the process was a stitch-up, to serve the preconceived objective of cutting the line.

“In sport, they call this match-fixing,” Newcastle Greens councillor Michael Osborne said.

“Anyone who takes a fair dinkum look at these figures will see that what they really show is that cutting the Newcastle rail line at Wickham is vastly more expensive than keeping it,” Cr Osborne said.

“Even a superficial examination of the Corporation documents now on public exhibition shows that in order to make the figures for their preferred option stack up, they’ve added in hundreds of millions of dollars worth of “catalyst projects” to compensate for the estimated $600 million cost of cutting the line.

“This compares with the relatively modest $93 million cost estimated for the cheapest keep the line option, which would include constructing an additional Hunter Mall station, landscaping the rail corridor, and improving access at Wickham and Civic stations.

“To artificially inflate the numbers in favour of their preferred cut-the-line option, the Corporation adds the value of a new university campus (estimated at an initial $48.62 million a year and extended over a 20 year period). However, the Corporation’s analysis adds nothing to the value of keeping the line!

“Essentially, the Corporation’s recipe for cooking the books asks us to accept two obviously ridiculous propositions: 1) that a city campus could only happen if the rail line is cut, and 2) that a rail line in to the city would not benefit the students of a future city campus.

“Manipulating the figures in this way is financially misleading and politically dishonest,” Cr Osborne said.

“It’s a clear sign of the extent to which the Hunter Development Corporation has been captured by development interests. Pro-rail advocates already know that cutting the rail line would be socially and environmentally irresponsible. Once you see through the propaganda, what the Corporation’s figures really show is that it would also be financially reckless.”

Cr Osborne said that it was now crucial for the local community and the federal government to critically examine the Corporation’s costings, and to see through the dubious assumptions behind them.

He said that The Greens had also found other problems with the Corporation’s costings and arguments, and he expected that they and other community-based groups would be releasing further information on this in the near future.

[Note: the figures quoted here are from the Newcastle CBD Strategy - Rail Proposal Cost Benefit Assessment, prepared for the Hunter Development Corporation by Urbis (May, 2009). This document can be found on the HDC website.]

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