On Cross River Rail, Government appears confused over meaning of “business case”

In today’s media release on the Brisbane Cross River Rail project, The Queensland Government appears confused about the meaning of the term “business case.” It risks committing the same error that governments (present and past) across Australia have committed when it comes to infrastructure projects. This error was identified by the Grattan Institute in a recent report Roads to Riches (p. 2) as being that “Decisions on particular projects are dubious or made on the basis of weak or undisclosed business cases.” There is obviously the risk that the business case for Cross River Rail could be weak, because the business case for the new route has not even been developed yet! As Transport Minister Stirling Hinchliffe announced today:

“The Palaszczuk Government has fast-tracked the business case for our number one priority infrastructure project and announced plans to establish a delivery authority to ensure the project is built.”

Amy Remeikis of the Brisbane Times nicely summarised the “Yes Minister” nature of this announcement when she noted that:

“The latest incarnation of Cross River Rail has a route and a promise to keep the politics out of it. What it doesn’t have is funding, a business case, or even a plan on how the estimated $5.2 billion project would be delivered.”

The Delivery Authority may well be compared to that hospital in “Yes Minister” that ran much better without patients. And do we expect the Delivery Authority to take a hard-headed, objective view of the merits of Cross River Rail when its very existence depends on the project proceeding?

Cross River Rail may well be a good project, but the Government should not make the final investment decision until it has a full business case and is confident Cross River Rail is the best option to address the looming capacity constraint problem that it is worried about. Options considered should include doing nothing and, arguably, the previous Government’s BaT Tunnel, so we are sure it is best to revert back to the Cross River Rail concept. Billions of dollars are at stake. Queensland deserves much better infrastructure planning than this.

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6 Responses to On Cross River Rail, Government appears confused over meaning of “business case”

  1. David Loosemore says:

    Interesting but it’s all politics isn’t it? My business case is the uplift in my Fairfield townhouse vs my share of the debt 🙂

    Sent from my iPad

    • Gene Tunny says:

      Yes, it’s all politics, alas. I think your personal Cross River Rail benefit-cost ratio is extremely high, David!

    • Jim says:

      I’m sure the bulk of the ‘business case’ will be looking at the latest trend in financing options like “value capture or ‘tax increment financing’ to make sure the debt doesn’t sit on the general government balance sheet and the analysis is commercial in confidence.

      But I doubt we’ll see a proper cost benefit analysis….

  2. Jay says:

    Lets hope there is not another change in government any time soon as we will waste more money with another plan, although the next Government gets 4 years so they should be able to finish something by then. Personally why tunnels? has to be a question asked. Is this simply so they don’t have to do resumptions and compensation. Is a duplication project of current river crossing easier faster to deliver ? Also should it not be linked with the city council plan that Cr Quirk took to recent election? Too many pollies too many Governments. Left hand right hand and both have a federal government that probably wont fund it anyway. Reminds me of the runway debacle in Brisbane where the BAC were trying to get the airlines to pay for it upfront, while they continued to build car parks.

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