JOHN AUSTEN. Public inquiries into NSW infrastructure projects.

The former NSW Opposition Leader proposed a judicial inquiry into WestConnex and Sydney Light Rail.  The new Opposition Leader wants public inquiries into major infrastructure projects.  The NSW Transport Minister called this a ‘hairbrained idea’ saying projects are already subject to ‘independent oversight’.  He is wrong. 

 NSW Government projects – road, rail, light rail – are contentious to say the least.  Official information is contradictory.  Many stated reasons are irrational.   Reasonable options were overlooked.  Expert advice was ignored.  The public was misled and not told about pivotal matters. Little wonder there are calls for independent inquiries!

Major public infrastructure proposals should be assessed independently – by someone other than (government) proponents.  Results and supporting information should be published. Among the reasons: consequences of projects may be hidden until they are irreversible and/or are unable to be considered by the electorate.  The issues at stake go beyond money – even north of the $50 billion involved in NSW – and into democratic accountability.

Whether projects go ahead should be decided by elected governments.  Accountability for such decisions requires Parliament to be properly informed in an authoritative and timely manner.

Advisers such as Infrastructure Australia assess some aspects of some infrastructure proposals – when asked by State governments.  Not all major proposals are considered.  Very few are assessed prior to political lock-in. Their considerations are not public.  They do not call for views. Only summaries are published.  Reliance on untested information from (government) proponents undermines effective independence.

Assessments of NSW projects have not answered the important questions.  Some – such as Infrastructure Australia’s 2017 assessments of Westconnex and Metro – were grossly inadequate. The result: descending confidence in projects and institutions.

Much needs to be done to redeem the NSW situation.  A start is public inquiries into current projects. The NSW Parliament is undertaking inquiries into WestConnex, Sydney Light Rail and the port privatisations implying little confidence in project assessments.  Proceedings to date have been eye-opening – especially for some who highly rate Premier Berejiklian’s infrastructure ‘credentials’.

Parliament’s recent report on WestConnex, while recommending the project be completed, compiled a litany of accountability and community relations concerns.

That there is no inquiry – or loud call by the Opposition for one – into Metro is astonishing.  It is by far the most pressing candidate for an inquiry – as John Menadue and I have argued for some time.  Its issues are far more serious and enduring than WestConnex’s – it threatens to physically divide Sydney.

Public inquiries into infrastructure projects should establish:

  1. The purposes and motives for projects;
  2. Likely effects – economic, social, location and distributional;
  3. Likely costs – including disruption.

As argued by the WestConnex report, inquiries should examine more than ‘business cases’ – most of which are rubbish.

Inquiries need information from a variety of sources, some of it highly technical and some of which otherwise would be withheld.  They should:

  • operate with Parliamentary type powers;
  • be independent from project proponents;
  • be assisted by experts;
  • take submissions from interested parties;
  • call evidence and test claims;
  • issue draft reports for public comment prior to final reports.

There should be consequences for those who mislead or conceal information.  The apparent absence of such consequences is a big flaw in current assessment processes.

Given accountability purposes, in most cases public inquiries should operate under the auspices of Parliament – possibly as a regular task of rejuvenated public works committees.  This differs from the recommendation of the WestConnex inquiry which had government establishing public inquiries.

Judicial inquiries (Royal Commissions) are rare and should be used only for the most serious matters.  They might be preferred over a Parliamentary inquiry if there is a need to ascertain facts without fear, favour or political influence; to deal with fears of wrongdoing; or to have the highest credibility. Commissions can get results where Parliamentary inquiries do not.  The Banking etc. Royal Commission is a case in point.  However, their higher profile can induce mischief e.g.  if governments try to use them to denigrate opponents.

There seems no need for the judicial inquiries sought by the NSW Opposition – into Light Rail and WestConnex.  However, there is a case for a judicial inquiry into Metro even if the NSW Opposition did not call for one.  There are suspicions about the project.  Infrastructure Australia’s assessment was strange.  It is possible to infer Commonwealth and State departments covered-up its downsides.

Given the current national infatuation with infrastructure there is a good case for similar inquiries in other States. When Commonwealth support is sought for a State project its Parliament should satisfy itself a public inquiry has been held.  If not, the Senate should hold one.

What then of independent advisers – Infrastructure Australia etc? They could assist Parliamentary inquiries on matters like benefit:cost analysis; publish ex-post reviews of major projects; and assist in identifying potential policy and project needs – to help long term ‘plans’. They need to be more open and less reliant on government information. This requires abandonment of their present ‘boards’ and behind-closed-doors-collective decision making.  They should become more like the Productivity Commission or the NSW Independent Pricing and Regulatory Tribunal.

To conclude : Parliamentary inquiries – and ex-post reviews – should be routine for major infrastructure project proposals. The NSW Metro project is a very exceptional case for which a commission of inquiry may be warranted. The organisation and practices of ‘independent’ infrastructure advisers should be reformed to make them more open. While the NSW Minister might consider these ‘hairbrained’, the public need to know whether his projects are ‘harebrained’ – impatient and without thought to consequences.  Only public inquiries can tell us that. And only the certainty of regular public scrutiny will lead to decent infrastructure proposals.

 John Austen is a happily retired former NSW and Commonwealth official living in Western Sydney.   Details will be at thejadebeagle.com.

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4 Responses to JOHN AUSTEN. Public inquiries into NSW infrastructure projects.

  1. David B Gillett says:

    In Australia, there is a cultural problem across business and government in relation to the shaping definition and execution of major capital project development resulting in wasted capital. Our paper (Refer P&I 25 Aug 2018) suggests that the current APS Review Panel has an opportunity to instigate a step change in the APS (aim to make it a world benchmark in major project development) with knock on effects to state government and business performance. This sorely needed step change in capital spending effectiveness would be a major innovation.

  2. Greg Cameron says:

    The inquiry by the NSW Legislative Council Public Works Committee into privatisation of the Port of Newcastle is necessary because the evidence is that the confidential privatisation agreements for Port Botany, Port Kembla and the Port of Newcastle are invalid. The NSW government privatised Port Botany and Port Kembla by offering to pay compensation for Port Botany losing container traffic to the Port of Newcastle, but requiring thePort of Newcastle to provide the funds. When the government gave this contractual commitment, in May 2013, it owned the Port of Newcastle. Thus, the government was carrying on a business for the purposes of the Competition Act by contractually requiring a private company, Newcastle Stevedores Consortium, to pay the government so that the government could give a contractual commitment to pay NSW Ports. The company had been negotiating to lease the port’s container terminal site since 2009.

  3. Philip Bond says:

    And, the demolition of existing stadiums to be replaced by, stadiums?

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