IN THIS EDITION - Infrastructure Partnerships Australia
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IN THIS EDITION 1. EOIs called for Northern Sections of M80 Ring Road Upgrade 2. ROIs called for Inland Rail 3. Three contractors shortlisted for Stage 2 of the Monash Freeway Upgrade 4. Commonwealth Government will introduce legislation to reform GST distribution 5. NSW Government releases its Freight and Ports Plan 6. Consortium submits Melbourne Airport Rail Link market-led proposal to Victorian Government 7. Victorian Opposition announces rail plan connecting regional centres to Melbourne 8. Greater Newcastle Metropolitan Plan and Future Transport Plan released 9. Federal Government to review procurement policies and practices; releases Open Government National Action Plan 10. Ballarat and Gawler rail projects approved by Infrastructure Australia and added to IPL; Waurn Ponds Duplication not added 11. Industry news 12. Industry appointments 13. Infrastructure Partnerships Australia news Home About us Contact 1. EOIs called for Northern Sections of M80 Ring Road Upgrade The Victorian Government has invited Expressions of Interest (EOIs) for the Northern Sections of the broader $2.25 billion M80 Ring Road Upgrade. EOIs for the single design and construct contract are due by 25 October. Construction is expected to start in early 2019. The circa $368.5 million package of works comprises a four-kilometre section between Sydney Road and Edgars Road and a two-kilometre section between Plenty Road and the Greensborough Highway. Works include: adding additional lanes in each direction
widening and lengthening entry and exit ramps between Sydney Road and Edgars Road construction of new separate carriageways to remove weaving between Sydney Road and Edgars Road, and installation of an electronic freeway management system. EOIs are due on 25 October. Construction is expected to start in early 2019 with completion expected in late 2021. Work on the most recently awarded section of the Upgrade – Sunshine to Calder Freeway is nearing completion, with work between Sunshine and the EJ Whitten Bridge completed earlier in September. Work between EJ Whitten Bridge and the Calder Freeway is expected to be completed by the end of the year. Infrastructure Australia lists the M80 Ring Road Upgrade as a High Priority Project on its Infrastructure Priority List. Relevant Links View the EOI on VicTender View M80 Ring Road Upgrade - Northern Sections on infrastructurepipeline.org BACK TO TOP 2. ROIs called for Inland Rail On Thursday, the Australian Rail Track Corporation and the Federal Government announced that Registrations of Interests have opened for the circa $3.5 billion Toowoomba (Gowrie) to Kagaru Public Private Partnership (PPP) of Inland Rail. Respondents are "encouraged" to submit ROIs by 22 October. This will be followed by a market engagement process in late 2018 and an invitation for Expressions of Interest in early 2019. Under the PPP, a 8.9 kilometre rail tunnel will be constructed through the Toowoomba, Teviot and Little Liverpool ranges to accommodate double stacked freight trains. Works will also include construction of: 130 kilometres of dual gauge rail 21 grade separations 11 viaducts totaling 5.7 kilometres in length 39 bridges, and 11 crossing loops. The successful tenderer will design, build, finance and maintain this segment of Inland Rail, with the maintenance phase to last 15 to 30 years.
Figure 1: Toowoomba to Kagaru PPP Source: ARTC The ARTC notes the ROI phase ‘forms a precursor to a planned market sounding process in Q4 of this year’. If prospective tenderers do not participate in the ROI phase, it will not preclude them from participating in the procurement process. The ROI phase will be followed by an EOIs phase in Q1 2019. It is anticipated two or three consortia will be shortlisted for the subsequent Request for Proposal phase that is expected to start in mid-2019. Construction is indicatively scheduled to begin in 2021 and be completed in 2024-25. Relevant links Read the Registrations of Interest document Read ARTC’s media release Read the Federal Government’s media release View Toowoomba to Kagaru Sections PPP on infrastructurepipeline.org BACK TO TOP 3. Three contractors shortlisted for Stage 2 of the Monash Freeway Upgrade The Victorian Government has shortlisted three contractors for the $711 million second stage of the Monash Freeway Upgrade. The shortlisted contractors are Lendlease, CPB Contractors and John Holland. Construction on the project is expected to start in 2019 and be completed in mid-2022. The first stage of the Monash Freeway Upgrade involved widening 30 kilometres of roadway. Following the completion of this stage, Expressions of Interest were called for Stage 2 in June. Following this, Lendlease, CPB Contractors and John Holland have been shortlisted for the Request for Tenders phase. In July, Infrastructure Australia added Stage 2 of the Monash Freeway Upgrade to its Infrastructure Priority List as a High Priority Project. According to the business case, the project has a benefit-cost ratio of 4.6.
Stage 2 of the upgrade will involve: 36 kilometres of new lanes to the Monash Freeway between Warrigal Road and EastLink to the west, and between Clyde Road and Cardinia Road to the east installation of on-road smart technology from the South Gippsland Freeway to the Beaconsfield Interchange, and additional links to the freeway via an upgraded Beaconsfield Interchange, connecting to a duplicated and extended O’Shea Road. Figure 2: Stage 2 of the Monash Freeway Upgrade Source: Victorian Government The total cost of Stage 2 of the Monash Freeway Upgrade is $711 million. The Australian Government is funding $500 million of the project, while the Victorian Government is funding $211 million. Stage 1 of the upgrade was completed in June 2018. Construction on Stage 2 is expected to start in 2019 and is scheduled to be finished by mid-2022. Relevant links Read the joint media release from the Victorian and Australian governments View Monash Freeway Upgrade – Stage 2 on infrastructurepipeline.org BACK TO TOP 4. Commonwealth Government will introduce legislation to reform GST distribution
Next week, the Commonwealth Government will introduce legislation to reform the way the GST is distributed between states and territories. The legislative changes follow a recent Productivity Commission inquiry which identified several weaknesses in the current distribution system. The proposed changes seek to improve distributional fairness, with the Commonwealth allocating an additional $9 billion over 10 years to ensure that no state or territory is worse off as a result of the changes. The Commonwealth Government’s proposed reforms to the GST distribution system has three aspects: introduction of a new horizontal fiscal equalisation (HFE) benchmark introduction of a permanent in-system GST relativity floor, and provision of transitional assistance and a permanent boost to the GST pool via Commonwealth cash injections. The changes aim to address issues identified by the Productivity Commission’s recent inquiry into the current GST distribution system. The inquiry found that the current system does not function well when faced with economic shocks, such as the mining boom. It also noted that the system discourages state tax reform and natural resource development as it does not allow the states to retain dividends resulting from their policy reform efforts. The current practice of HFE seeks to give all states the same fiscal capacity to deliver public services. To do this, all States are brought up to the fiscal capacity of the fiscally strongest state, currently Western Australia. The method to calculate the fiscally strongest state and subsequent GST distribution is based on a three-year moving average, as well as a two-year lag to ensure that robust data is available. The Productivity Commission found that this results in predictable and stable GST payments but can "exacerbate budget cycles where state fiscal situations change abruptly", as in the case of Western Australia. Under the new the legislation, the HFE will change so that it no longer equalises to the ‘highest state’. Instead, NSW or Victoria (whichever is higher) will become the new benchmark. This would help to reduce the volatility in the GST which resulted in Western Australia receiving less than 30 cents in the dollar in FY2015-16. In addition, the GST distribution reform will introduce a floor on the share that each state or territory can receive. A floor of 70 cents per person per dollar of GST will be introduced from FY2022-23, increasing to 75 cents from FY2024-25. Alongside the reforms to the GST distribution mechanism, the Commonwealth has committed extra funding of $9 billion over the next 10 years to ensure that no jurisdiction is worse off under the changes. The first injection into the GST distribution will be worth $600 million in 2021-22, the first year of transition to the new equalisation standard. The Commonwealth’s contributions in the following years would then continue to grow at the same rate as GST collections each year. This would be followed by a second injection of $250 million in 2024-25, with the 75 cents floor introduced at the same time. The combined additional Commonwealth funding would then be indexed to grow in line with GST collections on a permanent basis. On Wednesday the Council of Federal Financial Relations (CFFR) met to discuss the changes. Several jurisdictions expressed some concern over the changes. The Federal Opposition has stated it supports a floor of 75 cents however it has not yet committed to supporting the full legislation. Relevant links Read the Federal Government’s media releases HERE and HERE Read the Productivity Commission Report
BACK TO TOP 5. NSW Government releases its Freight and Ports Plan The NSW Government has released its Freight and Ports Plan 2018-2023 (the Plan). It details priorities for the sector, including $5 billion that will be spent to improve freight networks over the next five years. The Plan is accompanied by a Freight Performance Dashboard, Freight Data Visualisations and Strategic Forecasts. The Plan builds on the NSW Government’s Freight and Ports Strategy, released in 2013, and lays out the State Government’s five-year road map for freight in NSW. It includes 73 initiatives ranging from infrastructure investment to trials of new technologies to be delivered by 2023. A Growing Freight Task According to the Plan, the freight task in NSW is projected to grow by 28 per cent by 2036. In response, the NSW Government is investing more than $5 billion in road and rail infrastructure upgrades over the next five years. The key investments include: $2.2-$2.6 billion towards Sydney Gateway $1.17 billion towards Coffs Harbour Bypass ($971 million Federal Government commitment and $200 million pledge from the NSW Government) $543 million towards Fixing Country Roads $500 million towards the Sydney Airport Road Upgrade $400 million towards Port Botany rail duplication $400 million towards Fixing Country Rail $21.5 million towards the Main West rail line, and $15 million towards the Fixing Country Rail Improving Freight Performance Consistent with its Open Data Policy, the NSW Government publicly released the data used to prepare the Plan. They have also committed to continue working with industry to improve data availability to help guide investment in the network, support innovation and facilitate improvements across the freight sector. Specific commitments include: publishing and updating freight forecast and performance measurement data in collaboration with the industry enhancing freight data by creating a ‘Freight Hub’ on the Transport for NSW website and consolidating rail freight data held by various agencies and stakeholders into a single database, and improving data sharing across the supply chains. The lack of visibility and the need for greater freight measurement is also discussed and recommended in Infrastructure Partnerships Australia’s report, Fixing Freight: Establishing Freight Performance Australia. Regulation and Reform In addition, the Plan aims to ‘simplify and harmonise regulation’ in the industry. To achieve this the Plan states that
the NSW Government will advocate “for Australian legislative amendments to facilitate the greater use of coastal shipping”. They will also support Transport Infrastructure Council’s work on road user charging for heavy vehicles. Relevant links Read the NSW Government’s Freight and Ports Plan 2018-2023 Read Infrastructure Partnerships Australia’s report Fixing Freight: Establishing Freight Performance Australia BACK TO TOP 6. Consortium submits Melbourne Airport Rail Link market-led proposal to Victorian Government The AirRail Melbourne consortium has submitted a market-led proposal to the Victorian Government to build and operate the Melbourne Airport Rail Link. Under the proposal, MARL would run from Southern Cross Station to Melbourne Airport via Sunshine. The AirRail Melbourne proposal will now enter the Victorian Government’s Market-Led Proposal process. The AirRail consortium is made up of IFM Investors, Melbourne Airport, Metro Trains Australia and Southern Cross Station. The proposal would include construction of 27 kilometres of new track running from SCS to Melbourne Airport via Sunshine, through a mix of tunnels and rail corridor reserve.
Figure 3: AirRail Melbourne’s proposed MARL Source: AirRail Melbourne The journey from SCS to Melbourne Airport would take an estimated 20 minutes. The new dedicated track would also allow for up to 16 additional regional trains per hour from Southern Cross Station. AirRail Melbourne would also procure "custom-built airport trains" to service the route. The cost of the proposal is estimated at $15 billion. This includes the announced allocations from the Federal and Victorian governments of up to $5 billion each, along with $5 billion from AirRail Melbourne. Construction of the proposal could begin in 2020 according to AirRail Melbourne, two years earlier than currently planned by the Victorian Government. AirRail Melbourne’s proposal follows the Victorian Government beginning its market engagement process for MARL last week. In July, the Victorian Government announced that its preferred route for MARL would run from the CBD to Melbourne Airport via Sunshine. AirRail Melbourne’s route alignment is broadly consistent with the Victorian Government’s preferred route. However rather than connecting to the Metro Tunnel, it would connect to Southern Cross Station. The Strategic Appraisal of the Sunshine route released by the Victorian Government earlier this year stated that "city access options are to be explored" for the route. This indicates that while under any of these scenarios MARL would run via Sunshine and connect to the CBD, it may not necessarily be through the Metro Tunnel.
Figure 4: Victorian Government’s preferred Sunshine route for MARL Source: Victorian Government The AirRail Melbourne proposal will now enter the Victorian Government’s Market-Led proposal process, which comprises five stages (see Figure 5). The consortium expects more information on the proposal to be available before the end of 2018.
Figure 5: Victorian Market-led proposal assessment process Source: Victorian Department of Treasury and Finance Relevant links Read AirRail Melbourne’s media release Read more about AirRail Melbourne’s proposal Read more about Victoria’s Market-Led proposal framework View MARL and Melbourne Metro Tunnel on infrastructurepipeline.org BACK TO TOP 7. Victorian Opposition announces rail plan connecting regional centres to Melbourne This week, the Victorian Liberal and National Opposition committed to deliver a $15-$19 billion Regional Rail Network plan that would allow for faster connections between Melbourne and several regional centres, if elected in November. The plan would be delivered in three stages over 10 years, starting with Melbourne to Geelong. The Opposition has said the first section would be operational by 2022. Under the plan, rail lines connecting regional areas to Melbourne would receive track upgrades to enable trains to travel up to 200 kilometres per hour on the lines. There would also be signalling upgrades, timetable changes and procurement of two fleets of new-generation rollingstock. Lines would be upgraded between Melbourne and major centres (with connections to smaller regional towns), including: Geelong Ballarat Bendigo Shepparton, and Traralgon. The Opposition has said this would significantly reduce travel times between regional centres and Melbourne (see Figure 6).
Figure 6: Lines to be upgraded between Melbourne and regional centres Source: Victorian Opposition The Opposition has said this would significantly reduce travel times between regional centres and Melbourne (see Figure 6). The programme of works would be delivered in three stages over 10 years, with the Opposition stating that the first stage of the project between Melbourne and Geelong would be operational by 2022. Two fleets of rolling stock, capable of travelling up to 200 kilometres per hour, would also be procured. The first rolling stock fleet would be ready in time for the opening of the first stage of the project, with the second fleet to be procured at a later stage. In announcing the regional rail plan, Opposition Leader Matthew Guy said that it would complement the proposed Melbourne Airport Rail Link, and the Metro Tunnel, which is currently under-construction. The Opposition expects that the regional rail plan will be funded through State, Federal and "private sector contributions", if its elected in November. Relevant links Read the Victorian Opposition’s media release View MARL and Melbourne Metro Tunnel on infrastructurepipeline.org BACK TO TOP 8. Greater Newcastle Metropolitan Plan and Future Transport Plan released The NSW Department of Planning and Environment has released the Greater Newcastle Metropolitan Plan 2036. The Metropolitan Plan was developed by the NSW Government and the five Greater Newcastle
councils. It details planning initiatives out to 2036, including improved transport links and an expansion of the Port of Newcastle. The Metropolitan Plan focuses on four major outcomes across the local government areas of Cessnock, Lake Macquarie, Maitland, Newcastle and Port Stephens including: providing more skilled employment enhancing amenity and the environment delivering housing close to jobs and services, and improving connections to work, services and recreation facilities. The release of the Metropolitan Plan follows a significant programme of works currently underway in the Newcastle CBD, alongside the construction of Newcastle Light Rail, which will start operating in 2019. The Metropolitan Plan underlines the need to improve public transport services between Newcastle CBD, John Hunter Hospital, Broadmeadow, Callaghan, Cardiff, Charlestown and Kotara. In terms of Newcastle Port, the Metropolitan Plan sets out a focus on increasing trade and tourism. Specific initiatives include: Port of Newcastle will develop a Cruise Ship Terminal with Transport for NSW to improve transport connections to the CBD the Port and DPE to "support the growth and diversificatio" of import and export operations and protect freight rail access, and DPE and the Port to work together on planning instruments to allow for the development of logistics, intermodal and warehousing facilities. The Hunter Special Infrastructure Contribution (SIC), under development by DPE, will set out contributions to be made by the State and developers towards the cost of State infrastructure in the region. The Metropolitan Plan also aligns with the visions and goals of the Hunter Regional Plan 2036, which will include annual reporting on Newcastle’s Metropolitan Plan. Implementation of the Metropolitan Plan will be monitored and reviewed every five years. In addition, Transport for NSW has released the Greater Newcastle Future Transport Plan 2056. It has been developed concurrently with the Metropolitan Plan to ensure that land use and transport outcomes are properly integrated. It also details initiatives that the NSW Government is committed to over the next 10 years. The Transport Plan provides an overarching strategic direction for the transport network that will guide future planning and investment in the Greater Newcastle region. It defines Newcastle as one of NSW’s two Global Gateway cities, along with Sydney. Currently, 80 per cent of trips in Greater Newcastle are by private vehicle, with public transport use low (see Figure 7). Without significant investments or travel behaviour changes, the T ransport Plan forecasts that the road network will reach capacity by 2056.
Figure 7: Travel in Greater Newcastle Source: Greater Newcastle Future Transport Plan 2056 The Transport Plan sees opportunities for travelers in Greater Newcastle to transition from private vehicles to more sustainable transport modes. To meet the needs of Greater Newcastle, the transport system must: provide transport connections to and within strategic centres and locations, such as Newcastle Airport have public transport that is frequent and easy to use, including turn up and go services for high demand routes and on demand services for more isolated communities improve interchanging between transport modes and services. The Transport Plan identifies several initiatives that the NSW Government has committed to over the next 10 years. These include: the delivery of a new intercity fleet of rolling stock Newcastle Cruise Ship Terminal Newcastle Inner City Bypass – Rankin Park to Jesmond M1 upgrades around Hexham and Raymond Terrace, and preservation of a freight corridor between Fassifern and Hexham. The Transport Plan also identifies several initiatives to be investigated over the next 10 years, including:
protecting freight corridors and last mile freight delivery extending Newcastle light rail improvements to Newcastle Port Greater Newcastle Rapid Bus Package, and on demand services and travel demand management tools. Initiatives to be explored beyond the decade include M1 Newcastle Smart Motorway, development of the Fassifern to Hexham freight corridor and a Dubbo to Newcastle rail connection. The Transport Plan complements Transport for NSW’s overarching Future Transport Strategy 2056. It has also been developed in conjunction with the Regional NSW Services and Infrastructure Plan. Relevant links Read the Greater Newcastle Metropolitan Plan Read the Greater Newcastle Future Transport Plan BACK TO TOP 9. Federal Government to review procurement policies and practices; releases Open Government National Action Plan At Infrastructure Partnerships Australia’s Partnerships 2018 conference, the Deputy Prime Minister Michael McCormack announced that a review will be conducted into Commonwealth procurement and policy practices. Consultations with industry will occur over the coming weeks. A final report is expected to be taken to the COAG Transport and Infrastructure Council later this year. The review will consider how procurement policy and practices can better target two broad themes: delivering “value for money” for taxpayers, and how to further develop the Australian construction sector. The review will specifically look at current Commonwealth and state payment arrangements and ensure that these are not “hampering a competitive market”. In announcing the review, the Commonwealth Government referenced the procurement process for Western Sydney Airport. This has involved breaking down the works for the project into smaller packages to encourage tier two, tier three contractors and new entrants to bid for work. The review will also examine industry experiences in the major procurement bidding processes and how to further open the market to competition, specifically among smaller contractors. A range of industry workshops will be conducted over the next month. A final report is expected to be presented to the COAG Transport and Infrastructure Council later this year for consideration. Separately, the Commonwealth released its second Open Government National Action Plan 2018-20. The Plan identifies eight focus areas, each containing specific implementation measures. The focus areas include greater access to public data, encouraging state and territory participation in the process, and expanding “open contracting and due diligence in procurement”. The Commonwealth’s second Plan follows a Productivity Commission review of public address data arrangements.
The PC found that legislative requirements around data release were restrictive and that a "whole-of- government" approach was lacking. Following the PC’s review, the Commonwealth committed to streamlining public access arrangements to data. They will implement a Commonwealth Data Sharing and Release Act and appoint a National Data Commissioner by quarter four 2019 to oversee the framework and guide Commonwealth agencies in meeting its obligations. Specifically, the Plan details several implementation measures, including: consulting on the legislation regarding what data will be captured by quarter four 2019 establishing a National Data Advisory Council to advise the National Data Commissioner by quarter four 2019, and the National Data Commissioner to issue first guidance and standards by quarter three 2020. In terms of encouraging state and territory involvement in the process, the specific implementation measures contained in the Plan include: engaging with states and territories to support collaboration with an aim of agreeing formal cooperation arrangements around data access by quarter four 2018 working with state and territory Information Commissioners to design a survey to measure how the community feels about having access to government information by quarter four 2018, and conducting the survey and publish the results by the end of 2019. The Plan also highlighted expanding open contracting and due diligence in procurement as a focus area. This involves publishing AusTender contracting data on data.gov.au using the Open Contracting Data Standard (OCDS) schema by the end of 2018. The OCDS is a global non-proprietary standard structured to reflect the complete contracting cycle. The standard enables users to: show project data in a transparent, globally standardised format join and share data from multiple sources in a standardised way build tools to analyse the data, and publish shareable, reusable, machine readable data. Other specific measures to be implemented include: engagement with industry on additional datasets to be published by quarter two 2019, and reviewing Commonwealth due diligence processes and publishing the outcomes by the end of 2019. Relevant links Read the Commonwealth Government’s media release Read the Open Government National Action Plan 2018-20 BACK TO TOP 10. Ballarat and Gawler rail projects approved by Infrastructure Australia and added to IPL; Waurn Ponds Duplication not added Infrastructure Australia has released project evaluations for the Ballarat Line Upgrade, Gawler Rail
Electrification project and Waurn Ponds Duplication Stage 2. Infrastructure Australia found that the Ballarat and Gawler projects both have Benefit Cost Ratios of 1.1. Both projects have subsequently received priority project status on the Infrastructure Priority List. The Waurn Ponds Duplication Stage 2 returned a BCR of 0.6 and has not been added to the IPL. Gawler Rail Electrification The $615 million project, which is jointly funded by the South Australian ($395 million) and Commonwealth ($220 million) governments, involves electrification of the rail line between Adelaide and Gawler, along with associated station upgrades and procurement of new rolling stock. In January this year, the contract for Stage 1 from Adelaide to Salisbury, was awarded to Lendlease. In July, Lendlease’s contract was expanded to include Stage 2 between Salisbury and Gawler. The Electrification is expected to be completed in 2020, with rolling stock procurement estimated to be completed in 2021-22. Figure 8: Gawler Rail Electrification Source: Infrastructure Australia Ballarat Line Upgrade The $551.7 million Ballarat Line Upgrade involves the duplication of the Melton to Ballarat rail line along with new passing loops and stabling facilities. Stage 2 of the Upgrade will improve services for Ararat and Maryborough (see Figure 9). The Upgrade will allow for the future electrification of the line between Melbourne and Melton. The alliance contract was awarded to a consortium comprising Lendlease, Coleman Rail and SMEC in July 2017. They will work in partnership with Rail Projects Victoria and V/Line to deliver the project. Major construction started in early 2018 and is expected to be complete by late 2019.
Figure 9: Ballarat Line Upgrade Source: Victorian Government Waurn Ponds Duplication project The $736 million Waurn Ponds Duplication Stage 2 was announced in August by the Victorian Government, which is seeking a 20/80 funding split with the Federal Government. The Federal Government has already committed $150 million towards the wider project to date. In providing the negative evaluation, IA stated it would welcome a revised business case, recommending that it include Stages 1, 2 and 3 together. Stage 1 of the Duplication is the $160 million Geelong Line Upgrade, which comprises a second platform at Waurn Ponds station and a passing loop at Waurn Ponds. Stage 2 includes the duplication of 13 kilometres of track between Waurn Ponds and South Geelong, two level crossing removals and upgrades to South Geelong and Marshall train stations. Stage 3 will look to improve the 400-metre-long South Geelong tunnel bottleneck.
Figure 10: Waurn Ponds Duplication project Source: Infrastructure Australia Relevant links Read Infrastructure Australia’s Project Evaluations View Infrastructure Australia’s Infrastructure Priority List View Gawler Rail Electrification, Ballarat Line Upgrade and Waurn Ponds Duplication Stage 2 on infrastructurepipeline.org BACK TO TOP
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