10 July 2009
Newcastle Greens today called on the Hunter Development Corporation to concede that its central claim that the development of a university CBD campus requires the removal of the Newcastle rail line is false, and that its own figures show that retaining the line is financially superior to cutting it.
“We now have incontrovertible evidence – in a statement from the Newcastle University Vice-Chancellor – that the key assumption underpinning the HDC’s cost benefit argument for cutting the rail line is untrue,” Newcastle Greens Cr Michael Osborne said.
“This is a killer blow to the HDC’s financial argument for cutting the rail line, since its cost benefit model depends entirely on the claim that the rail line must be removed in order for a city campus to be developed,” Cr Osborne said.
“If their claim that developing a city campus depends on cutting the rail line is not true, the HDC’s cost-benefit case for cutting the line collapses, and – in the words of the HDC’s own report – removing the rail line would not ‘be a positive investment of community funds’.” [HDC, report, p.60].
On the basis of this claim, the HDC cost-benefit analysis adds the estimated $534 million value of the city campus to the “benefit” side of the equation for cutting the rail line, making what is really a $373.5 million deficit appear to be a $163.4 million ‘benefit’.
If the city campus is not added as a benefit of cutting the line, the HDC’s own figures (which are in any case biased against the rail line) demonstrate that retaining the rail is a far superior option, by more than $190 million.
The HDC report itself concedes that ‘based on the quantifiable benefits for NSW, the preferred rail option [i.e., cutting the line at Wickham] would only be a positive investment of community funds if the University proceeded with its major city campus development as a result of the rail line removal’.
Pressed on this issue at a Throsby Forum meeting earlier this week, the HDC General Manager, Craig Norman, said that the claim that a university CBD campus was contingent on removing the rail line was based on ‘discussions’ with University of Newcastle representatives.
He was unable to confirm who these representatives were.
“However, the University’s Vice-Chancellor, Nick Saunders, has recently confirmed (in an email to a Newcastle University Students Association representative) that ‘The University has not taken a position on the fate of the heavy rail line in Newcastle nor will it’ (see full text of email below).
“This email raises serious questions about both the integrity of the process behind the HDC’s report, and the central assumption behind its financial argument for cutting the rail line,” Clr Osborne said.
“The HDC must now concede that its claim about the University City campus being dependent on cutting the rail line is incorrect, and that its own cost-benefit data therefore demonstrate that retaining the rail line is financially superior to cutting it,” Clr Osborne said.
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Text of email sent to Jonathan Moylan (NUSA), by the University of Newcastle Vice-Chancellor, Nick Saunders:
-------------------------------------------------Dear Jonathan
The University has not taken a position on the fate of the heavy rail line in Newcastle nor will it. You will be aware that a wide range of opinion exists among staff and students, as it does in the community.To my knowledge, no member of the Executive Committee has made public comment on the issue. I have expressed a personal view to a number of journalists: that there is an essential need to maintain a reliable, convenient, comfortable and frequent public transport service to the east end of Newcastle; that the special needs of the elderly and parents with small children must be met; and that this can be achieved by a number of public transport options.
Professor Steffen Lehmann is on the public record as favouring termination of the heavy rail line at Wickham. It may be his opinion that is expressed in the HDC report. Other members of the University have expressed a contrary view over the many years of debate.
Yours sincerely
Nicholas Saunders
Professor Nicholas Saunders
Vice Chancellor and President
University of Newcastle
University Drive
Callaghan NSW 2308
Phone: +61 2 4921 5101
Fax: +61 2 4921 5115
Email: vc@newcastle.edu.au
[The following excerpt is from the Newcastle CBD Strategy – Rail Proposal Cost Benefit Assessment, May 2009, prepared by Urbis for the Hunter Development Corporation, section 2.4.2, p.6, under heading “Catalyst Projects that are Contingent on Removal of the Rail Line”]:
“The University of Newcastle perceives the removal of the rail line to be a key success factor for development of a CBD campus. To this end, if the rail line is not removed, this may jeopardise the development of the CBD campus going ahead. Thus the economic benefits of the CBD campus development are also only considered realisable if the rail is removed. These benefits are therefore incorporated into the CBA analysis of the preferred rail option.”
[The following excerpt is from the HDC Newcastle City Centre Renewal Report, March 2009, section 2.8 “Cost Benefit Assessments, pp.59-60]:
"Thus, based on quantifiable benefits for NSW, the preferred rail option would only be a positive investment of community funds if the University proceeded with its major city campus development as a result of the rail line removal."
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