The white elephant in the room: Australia is ideal for planes, not trains!

How can Australia spend $130 billion that would best benefit the country?  A response, but not an answer, is not to spend it on an HSR (high-speed rail) system on the east coast.

An HSR would be a terrible outcome for the whole country. However, eventually, it would be great news for long-distance cyclists!

The ALPs COVID-19 response is tunnel-visioned

With Australian governments of both persuasions finally working out how to work together there is hope – or was – that a true Commonwealth driven recovery plan will emerge. Let’s think of commonwealth, as in a plan that would benefit everyone in the country or as many as possible.

Thus, it was disappointing to have the leader of the opposition, Anthony Albanese, revive the east coast HSR (aka VFT, very fast train) project as the way to recovery, even though the idea gets canned time and time again. The Grattan Institute has recently published a damning report on the proposal.

It is possibly the biggest folly the nation could conjure up. And the tragedy is that when the ALP had the opportunity to create a vision for the country, a captain’s call with a limited focus and an astonishing price tag will crowd out almost any other significant project from their policies.

The Australian Greens are just as deluded, having stated that an HSR “would be nation building at its best: big, bold and transformative.” That it would destroy thousands of kilometres of the countryside and native habitat doesn’t seem to come into their calculations.

Support from the Coalition is mixed, though Malcolm Turnbull was enthusiastic for the idea when he was PM.

Dreams and nice ideas do not necessarily make sense financial, social or environmental. Unfortunately, the HSR all seems to be a case of mouth before brain for Albanese maybe he felt the need to say something, to show that the ALP had a plan for post-COVID-19.

The brains the Grattan Institute thankfully have kicked in to slam the idea as a dud. But will their latest financially viability assessment finally knock this mad idea on the head?

White elephants in Australia and other notable failures

According to Wikipedia, it seems the term white elephant derives from South-East Asian monarchs giving away sacred white elephants which are very costly to maintain and with little benefit or use for those unlucky enough to receive one.

This website recently included a feature by John Austen entitled High speed rail where to? Competing with airlines or cars?. He wrote, “The common thread in the debate in Australia assumes competition with intercapital aviation to be the main purpose of high speed rail.”

Herein lies the conundrum – will the HSR complement the aviation industry or kill it? We know our airlines are in trouble.

The viability of both the HSR and aviation would be problematic: they would be cutting each other’s throats. The HSR is clearly the least likely to survive and doomed to be a white elephant.

The equivalent example of doubling up stupidity, I regret to have to say, happened in the 1990s under the watch of then PM, Paul Keating. Along our streets, we would see not just one ugly black cable strung high, but two side by side, both doing the same thing! The consequences were summarised in The Australian:

“After a bloody battle, where both companies announced huge financial losses, Telstra and News Corporation won the day Optus, however, was not able to recover from this rout, and the Optus cable asset has played a minimal role in infrastructure competition.

Is this not exactly what would happen with the east coast HSR? There is at least one instance of two railway companies building tracks right next to each other in the USA in the early 1900s.

There have been more than a few major disasters in Australia.

  • The ALPs NBN plans genuine nation-building at its besthacked apart and restitched by Abbott and Turnbull.
  • In Victoria, Jeff Kennett privatised the State Electricity Commission. We anticipated competition and lower prices. However, each suburb had around 14 providers offering around 100 disparate plans between them. Like 14 ugly black cables, they all do the same thing. Electricity costs have skyrocketed.
  • The Ord Irrigation Scheme with a river catchment almost as big as Tasmania has been an economic failure.
  • In 2003 the Victorian Government decided to set up its own public transport ticketing system, Myki; it still has problems.
  • Clive Palmer built, and subsequently closed, his dinosaur park at Coolum.

Maybe Palmersaurus failed because it didn’t include a white elephant among the exhibits.

What is wrong with the HSR? – The Grattan Institute

The Grattan Institutes recent report Fast Train Fever is 72 pages long, with additional analysis material.

It indicates the cost in today’s terms for the east coast HSR would be $130 billion. It would take almost 50 years to build. (My cost estimate in 2070 dollars is around $400 billion.)

While recommending some renovated localised rail systems (such as Sydney-Newcastle) the report pulled no punches about the Melbourne-Brisbane line: an expensive folly, unviable, negative greenhouse benefits in the short-medium term, a winner to east coast business travellers and a massive cost to every taxpayer at an average of $10,000.

What is wrong with the HSR? The pub test

But do we need a detailed study to come to Grattan’s conclusion that Australia should dump the decades-old dream of building a bullet train?

First, there is more to our country than Melbourne, Canberra, Sydney and Brisbane. The HSR would be a massive concentration of infrastructure activity benefiting an already prosperous, restricted area of the country.

Second, we can already travel between these cities in an hour or so in a plane. Why would we want to take as little as three hours in a train, as exhorted by Labors Catherine King? There is no guarantee HSR stations will be more accessible than airports.

Third, as leader of the opposition and, more importantly, when/if he becomes PM, would Albanese ever use the bullet train? Most unlikely, apart from the gala opening, if he is still alive in 2070. As PM or opposition leader he might have to be in five different interstate places on the one day!

Opportunity cost

When it was part of the Coalitions policies, I recall a celebrity economist extolling the benefits of the $50 billion company tax-cut plan. But there was no mention of what the money could be spent on if retained by the government.

So how else could we spend the $130 billion in today’s terms, maybe $400 billion in 2070 terms?

Make our aviation system better. Australia is suited for planes, not trains, with huge distances between relatively few cities and locations. Of any nation, Australia should be the most able to perfect this form of transport. Thus beef up all capital and regional airports and improve passenger turn-around time (access to airports, embarkation and disembarkation, security checking). In fifty years time when the HSR might be finished air travel surely will be quieter, faster, more efficient and less polluting.

Fix up our clogged cities suffocating from ever-slower traffic. Remove level-crossings, build tunnels, improve public transport, Commuters would save time and there would be way less vehicle pollution.

Fix up our existing country rail systems, especially regarding freight to get trucks off the roads.

Fix up our third rate NBN so that people from around the country can communicate with each other with clarity and certainty, reducing business travel.

HSR should be considered for short routes such as Sydney-Newcastle/Wollongong, Melbourne-Geelong/Ballarat/Bendigo and Brisbane-Gold Coast. But there may be other suitable routes that never get a hearing. For example, Tasmania is effectively the most densely populated and most decentralised state in the country (after adjusting for capital city size and state-protected areas). A fast transport option linking Burnie-Devonport-Launceston-Hobart would integrate the state (and give it an AFL team). There are no internal commercial flights in Tasmania: four hours to drive from Burnie to Hobart; or fly via Melbourne.

Most importantly, let us decentralise our country. We should populate and encourage regional centres from Broome to Burnie to Bundaberg. Make them attractive places to work and live in, with decent airline and NBN connections. Establish centres for skilled manufacturing and renewables.

After all these, we will still have heaps of money left from our $130 billion: for other infrastructure, and to address health, education, water, climate change and First Nations issues.

In conclusion

The ALP is correct in saying the HSR would revolutionise interstate travel and be an economic game-changer; the Greens correct that it would be transformative. But not in the ways they expect:

  • During the construction phase, other parts of Australia would suffer, bereft of infrastructure projects.
  • Regions, businesses and local governments along the route will be severely disrupted and ultimately compromised.
  • It could be the end of efficient, affordable air travel in Australia.
  • As with any large project the cost is likely to spiral ever upwards.
  • Government bailouts galore will be needed.

But when not if the HSR fails, we will end up with something. Thus, assuming it will go the same way as other disused railway lines, we will eventually gain a continuous and reasonably flat 2,000-kilometre long bike path all the way from Melbourne to Brisbane, including an optional side ride into Canberra.

Oh! And it will probably be perfectly safe to walk your white elephant along too, if you are unlucky enough to have been given one.

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Robin Boyle lectured in statistics at Deakin University and preceding institutes for three decades until 2009. His academic background in mathematics, economics and finance, as well as statistics, led him to developing teaching software in those areas and to be widely sought after as a textbook author.

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8 Responses to The white elephant in the room: Australia is ideal for planes, not trains!

  1. Avatar Ray Laverack says:

    I agree that HSR would be a huge waste of taxpayers’ money with only limited benefit for those living outside of the capital cities.

    What is often overlooked is that the level of fares to recoup its operating costs, let alone to recover its capital cost, would be prohibitive and they’re unlikely to be competitive with air fares. The notion that it would promote decentralisation to regional centres is also questionable as the cost of regular commuting to the respective capital cities would be unsustainable for all but the wealthy. They’re not going to be charging heavily subsidised fares as is the current practice for rail travel.

    There would be far greater benefit for the broader community in focussing on Medium Speed Rail (MSR), particularly for regional centres. By upgrading existing track to a higher standard as well as building deviations and curve easing to permit higher speeds up to 200km/h, there would be more bang for your buck. It could be achieved at a fraction of the cost of HSR and in a much shorter time-frame. The other major benefit would be in significantly reducing transit times for freight, making it more competitive with road transport.

    HSR might be worth looking at again when Australia’s population reaches 50 million.

  2. Avatar Richard Ure says:

    “The viability of both the HSR and aviation would be problematic: they would be cutting each other’s throats. The HSR is clearly the least likely to survive and doomed to be a white elephant.” And that is without considering the impact of the NBN.

    There was a time in very recent memory when business folk were convinced their physical presence at a meeting on the other side of the country was essential to their filling their function. This was despite the fact that even a day trip from Sydney to Melbourne, one of the busiest air corridors in the world, meant a very long day.

    Along came COVID-19 and, even though the NBN is neither as good as it should be nor ubiquitous, over night business meetings are successfully achieving their purposes in ways assumed impossible until only a couple of months ago. What is the future for traffic on that previously busy route?

    Despite the resources required for providing private transport infrastructure, it beats public transport every time when it comes to highly-valued flexible departure times. Will HSR ever be competitive with aviation on that metric?

  3. Avatar Gerald Lynch says:

    Say what it will about east coast HSR, the Grattan Institute paper was sadly deficient on more modest and economically/ socially beneficial aspects of faster passenger rail on shorter distances. The Sydney-Southern Highlands-Goulburn- Canberra line hardly rated a mention. Yet it passes through a “string of pearls” in growth areas not well served by modern or even adequate passenger rail. Plans and solutions to the relatively minor alignment issues of two inadequate 19th century sectors are well established. The result could be an elapsed end to end service of 2 or 2.5 hours against the fastest elapsed air travel of city centre to centre of about 3 hours with at least two modal changes.

  4. Let’s consider just Sydney-Melbourne travel. That air link is one of the busiest in the world. This makes irrelevant the Grattan Institute’s ‘argument’ against high-speed rail (HSR) that ‘Our population is small and spread over vast distances’.

    Travelling between Sydney and Melbourne by air, together with airport transfers, takes at least three hours. The whole trip with HSR would take about the same time while being more comfortable and convenient. HSR would travel mostly through farming country with low environmental impact.
    The air link is fuelled by imported oil and its contributions to greenhouse gas emissions and air pollution are significant. With a power purchase agreement, HSR can run on renewable electricity. HSR has strategic and environmental advantages over air travel.

  5. Avatar Mark Freeman says:

    Over the decades I’ve never read anything honest or comprehensive enough about HSR to support or oppose it. This article is a slightly modernized grab bag of evidence free assumptions, guesses and scaremongering typical of coverage of this matter.

    It starts with the usual favourite of picking a cost number big enough to be scary but not so big as to be clearly ridiculous. I’ve never seen any breakdown of how this number is thought up and the tradition continues.

    Concerns over land use are no greater than for roads and ordinary trains. The various inapplicable comparisons with other infrastructure projects are furphies at best. The comparison with the carefully crafted rent seeking privatisation of electricity is particularly unsuitable.

    To talk of decentralising the nation as an argument against HSR really stretches credulity. But it’s the issue of time, comfort and convenience that is most misrepresented. Most HSR travels between city centers and is easily accessible, comfortable and, importantly, more punctual than air travel. Spain understandably has strict security but it isn’t onerous. Travel between Melbourne to Sydney CBDs by air isn’t possible in three hours.

    In fifty years air travel will hopefully be non fossil powered and lots of other improvements. It’s likely trains will be better too. HSR is not an either / or choice. We’ve also had decades of talk of getting freight off trucks and on to trains with little success. Meanwhile Switzerland has built and operated a revolutionary system doing just that for most freight through its country. Cheaper, faster and popular.

    It’s likely the current opportunistic anti China sentiment will pass and we can get the assistance of a country that’s built more HSR quicker and cheaper than anyone. I’m still yet to be convinced one way or another but I do know every time I’ve travelled on HSR I’ve wished we had it here.

    • Avatar Robin Boyle says:

      Many thanks for your comments Mark.

      It is hard not to empathise with your final statement: “I do know every time I’ve travelled on HSR I’ve wished we had it here.”

      They can be thrilling and impressive experiences.

      But practicalities and economics – according to the Grattan Institute and others – rules HSR out for Australia.

      Following is the link to the Grattan report I mentioned in the article. I could only highlight their key findings and statements. From the top left of the link you can download the full report and an Excel file with data and charts. As a minimum, it is worth a quick skim of the first few pages and some of the graphs. The report is objective and evidence based.

      Grattan Institute – Fast train fever: Why renovated rail might work but bullet trains won’t https://grattan.edu.au/report/fast-train-fever/

      The Age included this reference to the report – Australia must ‘move on’ from the dream of fast rail: Grattan Institute
      https://www.theage.com.au/national/victoria/australia-must-move-on-from-the-dream-of-fast-rail-grattan-institute-20200523-p54vsp.html

      There are others against the idea. For example, The Australian’s Judith Sloan says the government should not “even think about” investing in a bullet train to connect the eastern seaboard cities. In the video see her comment at 5.00 minutes.
      https://www.skynews.com.au/details/_6159192772001

      To address some of the points you make it is worth checking the Grattan report and Excel file:

      The Grattan report gives the estimated cost in today’s terms at $130 billion. Using a (very low) discount/interest/inflation rate of 2.25% I estimated the value in 2070 terms at around $400 billion.

      Figure 2.1 shows that the Melbourne-Brisbane line would be one of the longest in the world (1749 km) but with a relatively small population catchment (14 million). Compare with Tokyo-Kagoshima (1326 km, 80 million) or the proposed London-Manchester/Leeds (428 km, 22 million).

      Figure 3.6 gives a worrying chart entitled: “Many people have left small towns for larger cities over the past 100 years” – Population of towns under 25,000 people dropping from around 55% to 15%.

      Page 10 of the full report gives estimated travel times for the HSR. It looks like over 5 hours by the HSR for Melb-Brisbane compared to just over 2 hours for flying and 2 ¾ hours Melb-Sydney by HSR compared to 1 ¼ flying. There may be time savings if HSR stations are well-located and there is quicker turn-around.

      I hope a check of the Grattan report will clear up other concerns.

      Regards, Robin

  6. Avatar Anthony Pun says:

    Sorry to be a nuisance but you sole argument against an HSR is how long and how much it would cost to build. Join the China’s BRI and get it build for peanuts. Ops – stepped on a few toes!! In the long term, the HSR is a better infrastructure than the aeroplane which may be too expensive to maintain, service and finding the fossil fuel for it.

    • Avatar Robin Boyle says:

      Hi Anthony,

      You will see in my reply to Mark that I recommend checking the Grattan report.

      It does address the range of issues, including pollution.

      Regards, Robin

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