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Tuesday, 23 February 2016

Problems With Perth Freight Link: Practical and Philosophical

Last Wednesday, 17th February, I spoke as an invited speaker on behalf of the STCWA at a public meeting organised by the Hilton Action Community to discuss issues with the Perth Freight Link. Whilst this meeting was most directly prompted by Transport Minister, Dean Nalder's promoting a tunnel option for a large part of the PFL, it was concerned about all elements - from roe 8, with its major environmental issues, to the lack of connection to the Port itself.

My speaking notes follow, below.

Planning and Governance

Reservations for major roads in Perth are defined in the Metropolitan Region Scheme (MRS), usually for many years, prior to the road being built.
While some parts of the current PFL are shown in the MRS, others are not. To get them into the MRS requires a statutory process by the WA Planning Commission, including public submissions, and formal adoption.
It may not be legal to build those parts of the PFL that are outside an MRS highway reservation. This would appear to include parts of High St, and land for new grade separations at Stock/Leach, Carrington/Leach, High/Stirling and Stirling/Marmion and large parts of any tunnel option.
We should be looking very closely at the Main Roads Amendment Bill currently before Parliament. This grants powers to the Commissioner of Main Roads to undertake works outside road reservations, including clearing vegetation without the need to comply with the Environmental Protection Act.
Infrastructure Australia says the Business Case lies (or at best misleads) about alignment with State Strategic Priorities:
"The Business Case outlines strong links between the Perth Freight Link Project and State priorities, policies and initiatives … but the Perth Freight Link project is not directly mentioned in any of the State plans and policies it mentions.
This appears to be yet another reason why the 'Moving People' and 'Moving Freight' strategies are being rewritten - to comply with the Government’s political narrative.

Contractual

The current PFL proposal appears to be to call tenders for its construction soon: before details have been decided and before the statutory planning process has been completed.
This will create significant risk and uncertainty for potential tenderers to build the PFL, especially when combined with uncertainty about with the proposed sale of the Fremantle Port and the possibility of a change of government.
Letting a contract for the PFL under these circumstances will mean it will cost tax-payers more than if the details have been decided through proper process.
Tenderers will either load their prices up-front to allow for the uncertainties or prepare their tenders in such a way as to maximise extra payments during the course of the contract.
Either way it is certain to be expensive.
It also increases the probability of litigation between the State and the successful tenderer if the uncertainties continue to grow. This will tend to result in delays and further costs that will only be productive to the legal profession.
Exactly the same applies to the sale or leasing of Fremantle Port, which the Minister for Transport has said he wants to have signed off by July/August.
Tenderers will reduce the price they are willing to offer if PFL is uncertain.
If the Port is sold with an expectation about the PFL that is not finally met, the State will be exposed to litigation.
It would save significant taxpayers money and possible litigation to first finalise planning for port development and freight access and then, if you must, offer the Port for sale.


Appraisal

Public investment is usually assessed using benefit-cost analysis. A project is only justifiable if:
a)   the benefits over time exceed the costs; and
b)   the amount by which they do so is greater than for any alternative way of addressing the problem.
The second, in particular, has not been demonstrated for the Perth Freight Link.

Infrastructure Australia itself has not been able to get sufficient information to satisfy itself that the PFL is the best option for dealing with the land transport needs of WA's international container trade.

Indeed, IA 'damns with faint praise' when it concludes:
 "After accounting for these [risk and uncertainty] factors, Infrastructure Australia still has a high degree of confidence that the BCR is greater than 1.0:1 for the project".

According to IA, "Major risks for the project include costs, environmental approvals and community support", which doesn't leave much in the way of certainty, especially as the final link to the port has not yet been defined or costed.

IA could not state that the project is warranted because it didn’t have comparable information on alternatives and therefore could not assess whether other options would provide better value to the WA community.

The evaluated PFL project was selected from 12 possible ones on the basis of subjective criteria, with only the 'preferred' project being subject to full benefit-cost analysis.

None of the 12 options included adequate consideration of the Outer Harbour.


Ethics

Engineers Australia’s Code of Ethics requires professional engineers to promote sustainability. This includes engage responsibly with the community and other stakeholders:
- being sensitive to public concerns
- informing employers and clients of the likely consequences of proposed activities on the community and the environment
- promoting the involvement of all stakeholders and the community in decisions and processes that may impact upon them and the environment.
It also includes:
- balancing the needs of the present with the needs of future generations
- considering all options in terms of their economic, environmental and social consequences
It is clear that the present PFL process is not promoting the involvement of all stakeholders and the community in decisions and processes that may impact upon them and the environment.
It is clear that not all options have been considered in terms of their economic, environmental and social consequences; especially the development and use of the outer harbour and the option of moving freight at night.

It is unfair of the Government to put professional engineers involved in the PFL in a position where they are being asked to act unethically.

Written and Posted by Ian Ker, Convenor, STCWA

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