Public transport

Nov 25, 2012

Is improving public transport really this easy?

Fairfax contributor John Legge has a $35 billion vision for the future of public transport that's proving popular with readers. Sadly, it's not that simple.

Alan Davies — Editor of The Urbanist

Alan Davies

Editor of The Urbanist

Tram-rich Prahran, Melbourne

John Legge won the hearts and minds of Fairfax readers this week with his proposal for a massive increase in investment in public transport. The praise from commenters for his opinion piece was fulsome – some reckon he’s so visionary he should be PM!

Although his proposal is intended for Melbourne, it’s relevant to the pressing need to improve public transport in all of Australia’s cities.

He starts out by arguing Melbourne is facing a crisis of “looming economic stagnation” due to its outdated public transport system. The city needs to take the sort of decisive action it took back in the 1880s when it faced “another crisis” – from typhoid.

Following a Royal Commission in 1888, he says, decisive action was taken. A Board of Works funded by property rates was set up in 1891 to handle the sanitary removal and treatment of sewage. Melburnians have never looked back.

Mr Legge’s idea for dealing with the current public transport crisis is to extend to the rest of urbanised Melbourne the same level of service as rail and tram-rich inner city Prahran now enjoys. His vision is that 95% of households would be within 800 metres of a fixed-rail station or stop.

He envisages building three new rail lines, an extra 100 km of dual track rail line, 100 km of additional express track, 1,200 km of new tram/light rail lines, and eliminating 10 level crossings. He says it would cost $35 billion over 20 years and could be funded by a (median) $572 p.a. rate on the unimproved value of residential properties.

Prahran is an appealing benchmark. Because it developed prior to mass car access, Melbourne’s inner east has a very dense tram network.

For example, there are nine parallel east-west tram lines between Victoria Rd and Glenhuntly Rd, a distance of just 8 km. The tram line on High St in Prahran is paralleled by another route just 560 metres to the north on Malvern Rd and one 650 metres to the south on Dandenong Rd.

It’s no surprise this would go down especially well with the Fairfax demographic. Many live and/or work in the inner city and are familiar with Melbourne’s high-frequency (during the day) tram system.

The Greens also know talking up big possibilities has popular appeal. The party made a promise along similar lines at the 2010 Victorian State election.

Their infrastructure list was at least as big (it included 10 new rail lines), but the party costed it at a mere $13 billion. Even better, the Greens insisted half the money was already available – it just needed to be reallocated from possible (but unfunded!) freeway projects.

It would be fantastic, of course, if funding for public transport were increased on the scale envisaged by Mr Legge. But as always, it’s better to understand the real story, so I want to discuss some questionable aspects of his proposition.

First, he underestimates the costs. He doesn’t include any of the incremental operating or financing costs associated with his proposed $35 billion spend.

It’s instructive to consider the report of the Independent Public Inquiry into a Long Term Public Transport Plan for Sydney, which proposes a similar level of capital expenditure ($35.9 billion), albeit over 30 years.

The funding and financing plan prepared for the Inquiry by The Allen Consulting Group estimates revenue of $71.1 billion will be required to support that spend. The additional amounts are necessary to cover incremental operating costs ($23.7 billion) and financing costs ($11.5 billion).

Second, Mr Legge’s financing plan is problematic. The proposed median rate of $572 p.a. to raise $1.7 billion p.a. might sound affordable to many Fairfax readers, but implies an average tax in excess of $1,000 per year.

That’s approaching what the average Melbourne household currently pays in local government rates, so serious opposition would be very likely.

The authors of Sydney’s Independent Inquiry don’t put all their eggs in one basket. They envisage a range of funding sources, including an average $0.38 real public transport fare increase, CBD congestion charges, parking fees, and property levies on all businesses and households.

Based on a “willingness to pay” study, the Inquiry concludes the average levy on households would need to be limited to $157 per annum. These sorts of hypothetical studies are ropey at the best of times, but they tend to over-estimate willingness to pay, so the figure is likely to be at the upper bound.

Third, $35 billion will buy a lot less at present than Mr Legge assumes. While it’s unquestionably a large number and could fund a lot of new public transport infrastructure, the cost of construction in Australian cities is very expensive.

Melbourne Metro is likely to cost in the order of $7-$10 billion (depending on whose estimate you accept). New rail lines to Doncaster and the airport could cost in the order of $3 billion each. Add in another $3 billion for the proposed Rowville line and there’s around half the funds gone already.

The larger part of the proposed 100 km of new dual track rail line will need to go through urban areas if it’s going to be useful, so much of it will need to be underground or elevated.

Even at a conservative $250 million per kilometre, the remaining money isn’t going to fund it all, much less the 1,200 km of light rail line and 100 km of express rail track proposed by Mr Legge.

He doesn’t say how he arrived at his $35 billion figure, but it’s implausible it would be anywhere near enough to extend “Prahran-class” heavy and light rail to the rest of urbanised Melbourne.

Fourth, even if funding on the required scale were available to make all of Melbourne like Prahran, it would be a very questionable investment. The middle and outer suburbs developed in the era of mass car ownership – public transport would struggle there to support inner city levels of service in competition with cars, at least over Mr Legge’s 20 year time frame.

Notwithstanding these issues, it’s essential that strategically important rail projects like Melbourne Metro are constructed. However the main priority should be to improve the operations of the existing system and “connect it up”.

For example, one of the key constraints on increasing train frequencies is Melbourne’s 170 level crossings. Just eliminating them is estimated to cost circa $17 billion.

I like the idea of a long term vision for public transport and it’s something that should be debated and discussed publicly. However I don’t think glib and populist proposals like this one are helpful. They gloss over the difficulty and complexity of what’s involved in improving public transport.

Mr Legge’s reference to the decisive collective action taken in the 1880s to address typhoid is a brilliant rhetorical tactic. But the less gullible might be aware that back then people were actually dying from typhoid.

Moreover, everyone living in or visiting Melbourne was at risk of catching the disease, irrespective of their station in life. It’s no small matter either that the citizens of Melbourne could afford to take decisive action – they lived in the richest city in the world at the time.

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29 thoughts on “Is improving public transport really this easy?

  1. Alan Davies

    rhubarb rhubarb #28:

    The Mandurah line was eons ago in terms of the history of infrastructure costs in Australia. There’s also immense variability across projects, so you can’t reasonably extrapolate from one. All of these issues have been discussed before at length (e.g. see here and here). There’s a useful discussion of the circumstances of the Mandurah line in the comments section of this article. I’d suggest people who trot out ridiculously out-dated figures like Mandurah aren’t in touch with reality.

  2. rhubarb rhubarb

    Where’s the “conservative” figure of $250M per km come from? The Mandurah rail line in Perth (including underground sections and 14 stations) came in at about $13.5 M per km. Actual engineering costs for double rails above ground are around $6M km, not including stations or land acquisition. Assuming a 25m reservation and land cost of $1000/m2, that’s a further $25M/km. I’d suggest that ridiculous figures like this are trotted out by people who don’t want train lines to be built.

  3. Austin M

    Stephensons Road Mount Waverley looks allot like road rising over rail to me from street view and the grades onsite. Maybe its a combination of both which confuses things a bit.

  4. Tom the first and best

    Mount Waverley is not a road raising it is a railway that was built in a cutting. The proper way to do it.

    Raising the road over is about getting cars through without sufficient regard to the consequences. It is not an acceptable solution in urban areas.

  5. Dylan Nicholson

    Is it much cheaper long term though, counting the lost retail opportunities etc.? It surprises me that when they do rail underpasses they often don’t really take advantage of the opportunity to do at least some cut & cover on either side of the road, particularly when they did Springvale Rd, but I guess it’s not a sufficiently dense/busy retail hub.

  6. Austin M

    Tom road over rail is usually by far the cheapest option. Lowering rail often means chasing grade for long distances due to the very restrictive grades compared to roads and thus often the rebuilding of stations.
    The problem with road over rail or road under rail comes when intersecting roads are to close to the rail or there is a high inflow of ground water (which can not be effectively pumped).
    I also don’t think all road over rail jobs are as bad visually as Warrigal Road. Mount Waverley seems OK amenity wise (more minimal structure etc). I also think the new stockmans bridge (george street bridge) in dandenong $29.5m 2010 has future potential. At the end of the day we may be better off with 5-10 road overpasses for the price of 1-2 rail underpasses.

  7. mook schanker

    I wouldn’t blink at $100m average for a crossing, though for a range I would say $50-$100m myself, so $75m? Pah, just get a cost estimate book and run some figures…Be much much cheaper to truncate the roads though 🙂

    Dunno Dudley about the Czech timely & half cost trams. They’re not like cars that you can just chuck on a road and drive. Bombardier have a manufacturing plant in Czech (was called Ceska) and also in a lot of other countries in the world and growing significantly in Asia. The new Melbourne trams are built overseas primarily, just put together, seats chucked in and painted in Oz.

  8. Tom the first and best


    That is a very ban idea. raising the road over the railway is the worst kind of grade separation as it creates pedestrian hostile environments around the bridge. It kills shopping strips (Warrigul Rd, Oakleigh being a prime example). In the case of High St, the tram should not terminate near Glen Iris it should go further, at least to Ashburton. Rail lowered under road is the best solution for level crossings followed by raising the railway and lowering the road, then raising the road.

  9. Alan Davies

    Robert Merkel #20:

    “Trollrail”! That is indeed a wonderful term. I also like “Railbait”.

  10. Alan Davies

    IkaInk #18:

    The way infrastructure costs in Melbourne have been escalating, four years ago is an eternity. The Government has allocated $350 million for three level crossing eliminations. Whether that turns out to be the actual cost is another question.

    All the interface design is done by Crikey management. I wish they’d make a few other improvement too e.g. nested comment threads; a darker shade of green on hyperlinks.

  11. Robert Merkel

    Liam Hogan has adopted a wonderful term, “trollrail”, to describe proposals like these.

    They sound wonderful – particularly to people who never actually use public transport – but inevitably would cost many times more than what is claimed, and often don’t meet people’s actual transport needs.

  12. IkaInk

    Alan I don’t doubt that’s how most people read the figure. The important question is, how did they arrive at either the $100million average, or the $17billion total figure? As I’ve never seen any actual document that calculates this average cost, the closest thing I can find is the quote from that press release which talks about the average cost of the 10 projects that the Baillieu government committed to.

    Mulder’s figures are just as questionable as he is undoubtedly talking about the projects that the government have been working on, which of course are all high-priority and therefore the more difficult projects. I also don’t understand where he gets $150-$200million per, as this is exaggerating the costs of the projects currently underway.

    Even when looking at projects that the PTUA media releases quotes, the Altona project was only 4 years ago and cost less than $50million. The Laburnum project was 5 years ago and cost $66million, but that involved a station rebuild.

    Of the most recently completed grade separations, the Springvale Road, Nunawading project did cost over $100million at a total of $142million, but that was considered to be one of the states busiest level crossings, involved a 6 lane road and construction of an entirely new station. That project was completed in 2010.

    There is also $350million allocated to remove 3 rail crossings in Victoria at the moment. This includes Springvale Road, Springvale which hasn’t been designed yet, and Mitcham and Rooks Roads in Mitcham. This project presumably will be the more expensive of the two projects, as it involves 2 level crossings and once again, a new train station. It also involves a rail cut-under which tends to be more expensive then rail bridges, or road cut unders or fly overs. So once again these three projects will cost over $100million, but these are the more complex projects that will inevitably cost more than many of the simpler crossings.

    Unrelated to the discussion: Is there any reason that there is a “Preview” button on the comment box at the top of the comments section, but none on the box that appears at the bottom? After reading other comments I think most readers would be inclined to use the box at the bottom of the page, and although I’d love to be able to edit comments after they’re made, the Preview button is the next best thing. In fact I’m pretty sure this is the only blog where I’m aware even having two comments boxes!

  13. gapot

    The funding of public works in Australia used to be with borrowed money at very cheap rates. Governments now want private sector to fund these projects at much higher rates for good reason, they go broke so often. So round and round we go and the borrowing rates go even higher. The Brisbane airport motorway is the latest disaster and the people who were talked into buying the first installment lost 100%. I doubt that investors will fall for that again, or maybe we have short memories.

  14. Dylan Nicholson

    Gah, Canada sorry. And the total cost may have been $21-25M, but certainly nowhere near $100M!

  15. Dylan Nicholson

    BTW, this is what they can do in the US for $14 million:

  16. Dylan Nicholson

    (Bit confused about the Springvale Rd one actually – if they really did the separation AND built the new station both for $140M, it’s a bargain – but one other page suggestion the new station cost an additional $120M. Either way the whole project took 7 months and involved only 10 days of road/rail closures, which is pretty remarkable).

  17. Dylan Nicholson

    Yes well when a government needs every excuse it can get for sitting on its hands, I’m going to take that figure with a very large grain of salt!
    The most significant grade separation project I’ve seen recently was Springvale Rd/Nunawading, which cost $140M (vs ~$60M for the somewhat simpler-though-still-significant Middleborough Rd underpass). So, sure, there will be some jobs that cost $150M, even $200M, but I’d hazard a guess that the majority of them are doable for closer to $50M from what I’ve read.

  18. Alan Davies

    Dylan Nicholson #11:

    Here’s Victoria’s Transport Minister claiming earlier this month that eliminating level crossings costs $150-$200 million each (doesn’t say which ones he’s referring to, although presumably that’s not the average). So it’s not just the Committee for Melbourne.

  19. Dylan Nicholson

    What’s the most expensive grade separation that’s been done in Australia recently? 100 million as an *average* is extremely hard to swallow…

  20. Alan Davies

    IkaInk #9:

    Possibly, but I read that as $17 billion divided by 170 to arrive at an average figure across all crossings, rather than as the average for the 10 highest priority crossings.

  21. IkaInk

    I’m making an assumption here but this release hints at how they might have arrived at the figure and if I’m right, the method is extremely flawed.

    Committee for Melbourne commends the Baillieu Government and Planning Minister, Matthew Guy for their commitment to remove 10 level crossings. But, with each level crossing removal estimated to cost $100 million – the government simply cannot tackle this enormous challenge alone.

    So the Baillieu Government commits to remove 10 rail crossings and estimates that these crossings would cost approximately $100million each. The Committee for Melbourne then takes that figure and decides that must be the average cost for eliminating level crossings. They multiply the number of crossings by the average figure and hey presto we’re talking about a $17billion project.

    However, we can confidently assume that the government didn’t decide to eliminate the 10 cheapest and easiest level crossings. Instead they wanted to eliminate the most troublesome. The most troublesome are also pretty likely to be the most expensive, they’re where roads are busiest, where train lines have the most services running, etc. So the $17billion figure seems to have been arrived at by multiplying the most expensive project by 170.

    Of course I might be wrong about these assumptions but I’m yet to see anything from the Committee for Melbourne or anyone else for that matter to convince me that the average level crossing removal should cost anywhere near that amount.

  22. IkaInk

    I didn’t question the figure, but I did question as to whether they should cost that.

    As to the $100million each figure. When the DoT continues to agree to pay contractors absurd amounts for all rail projects, contractors will continue to ask for these figures. When you base every cost on previously inflated-costs then why would you ever expect them to come in at a reasonable figure?

    It’s interesting, but I’d want to see something more solid than a media release that cites actual costs from a few 2007 and 2008 eliminations

    I’d like to see even a shred of evidence that they should cost that much to remove. I’ve read numerous Committee for Melbourne releases saying that is the average cost, but never anything indicating how they arrived at that figure.

  23. Alan Davies

    IkaInk #6:

    The $17 billion estimate comes from an analysis done last year by the Committee for Melbourne. That figure’s been in the public realm for over a year and I’ve mentioned it many times before (e.g. here. Indeed someone sporting the same gravatar as you didn’t question the accuracy of the estimate at the time!).

    I’ve not seen it questioned seriously before, save for the media release you linked to (from earlier this month) by the new President of the PTUA. It’s interesting, but I’d want to see something more solid than a media release that cites actual costs from a few 2007 and 2008 eliminations (and even one from the 90s inflated to today’s dollars) and simply asserts that costs have gone down. If they have, there should be solid evidence from other projects the PTUA can show us.

    It’s a complex issue, but there seem to be some basic structural reasons why infrastructure costs are so high. They might fall a bit, but I’m not confident they’re going to go way back down to the levels of even 2007/08 any time soon.

  24. IkaInk

    I know you’ve written a few article discussing why rail works cost lots in parts of Australia, however the idea that eliminating 170 crossings should cost $17billion is absurd. That equates to $100million per crossing! Sure a handful of crossing might cost more than $100million due to density, traffic disruptions, and the amount of work that needs to be done, but the vast majority of the 170 crossings are not going to cost even a fraction of that. The vast majority of level crossings are out in suburbs that are not particularly dense and grade separations could be achieved for roughly $50million or less in many cases.

    The PTUA has outlined some separations that have cost significantly less than $100million in the last few years, and point to Kennett era projects that were done at even less cost.

    Remember also, if we start working towards level crossing elimination on a wide-scale manner across the state, we will build local expertise in how to proceed with these projects. That expertise should help reduce costs over time. When you only do something every 10 years, contractors will reinvent the wheel every time.

  25. Dudley Horscroft

    Re Dylan 2 and your 3. Who has a list of the worst level crossings – by value of delays to road and rail traffic? I would suggest that the proposed improvements are often considered on the basis of “what would we like to have if money were no object” (and then come to the conclusion that the money is not enough so do nothing)instead of “how much can we improve matters given the money we have.

    Thinks – given the frequency of rail services on some lines a level crossing could be shut to road traffic close to 50% of the time. Most of these would have at least four traffic lanes either side of the crossing (though some may be used for parking). Consider the crossing near Glen Iris Station. Trains go slowly here as they are either about to stop or slowly accelerating from a stop. There are four traffic lanes, and just west of the crossing is a road junction with traffic lights. Given these hindrances, the effective capacity of the crossing is considerably less than 50% of the available road space. This means that a two lane overpass would have greater traffic capacity than the existing road at the crossing. Two lanes means that alongside the ramps up and down parking will have to be prohibited, but there could be extra parking under the elevated section of road. And the route 6 tram could be extended to terminate in a layby alongside the railway station, thus greatly improving the connectivity of the public transit system, to the great benefit of the passengers.

  26. Dudley Horscroft

    You say: “Melbourne Metro is likely to cost in the order of $7-$10 billion (depending on whose estimate you accept). New rail lines to Doncaster and the airport could cost in the order of $3 billion each.” IRC there have been authoritative views disputing the value of Melbourne Metro, so forget it. A new rail line to the Airport would cost nowhere near $3B – more likely $300M – we have had this one before. And the Doncaster Rail is not on – the problems are major – whereas the Doncaster Light Rail line would give about 80-90% of the value at about 10% of the cost.

    The problem is that his article is just pie in the sky. Proposing “X” km of new rail lines is worthless without saying where they should be. And much though I should like to see many new tram/light rail lines, they should be sited where there is already substantial demand and provision of the service will be less costly with the tram/light rail than bus. There are several short links in inner Melbourne that would greatly improve matters. But even these are not worth anything unless there are plenty of new trams to run the routes. Given the cost of new trams from Bombardier – and the fact that they are already running a year or so late – it would be worthwhile importing new trams from the Czech Republic – which could provide substantial numbers of GOOD trams in half the time and probably much less cost.

    A good start would be to recognize that in the peak hour buses and trams are loaded and tram and bus priority at all sets of traffic lights is needed to speed the service. Even the old W class trams were marked as capacity 150 – quite often exceeded – and this means one tram was equivalent to about 125 cars. And tram and bus priority can be done wherever there is traffic lights – hence over the whole metropolitan area, and not just the inner city. A few million would enable the B class trams to be fitted with a low floor centre section, and given a good overhaul, they could be useful for another 20-30 years, instead of having to be scrapped soon due to the Disability requirements. Similarly tha A class trams could be lengthened with low floor sections, given them another lese of life. Both improvements would greatly improve the capacity of the existing tram fleet and improve conditions for passengers.

  27. Alan Davies

    Dylan Nicholson #2:

    Thanks for the tip – 1991 corrected to 1891.

    The high priority crossings will give the best returns and thereafter there’ll be diminishing returns (although I’d expect the cost of the priority ones will be much higher than the average because of their location)

  28. Dylan Nicholson

    Pretty sure it didn’t take 103 years to decide to form the Board of Works 😛

    Eliminating *all* level crossing might not be economically justifiable, but I don’t doubt for a moment that if you picked the 20 most problematic ones (as far as causing rail and road congestion) and got rid of them, it would pay for itself within 5 years. Surely you can get some sort of discount on a bulk order of under & overpasses…

  29. Last name First name

    Parker Alan• OAM.

    Unfortunatly state and Commonwealth governments sacrificing proper levels of investment in infrastructure for PT, pedestrians and cyclists has been a disaster that has not recognised here as it was in Japan In 1973. And the Netherlands after the first oil crisis in the 1970s.

    Japan was always more dependent on imported fuels and the cost of electricity was very high with an ageing population. This explains the large Japanese investment in the rail network and the 27% of trips made to work or education by public transport by 1990. Seven million people cycle to the rail system every workday; around 15% of the population cycle all the way to work and another 12% walk to work. Japan’s energy security policy has reduced oil dependence in the transport sector from 80% in 1973 to a 55 % in 2010, thus reversing a negative trend.

    The problem has always been that both state and commonwealth transport planning studies where always based on the arrogant assumption that all Public transport users, bike riders and walkers where losers. That is my experience of the ignorant mentality of the elite in land use and transport planning by being involved as a volunteer in Melbourne and several state bicycle advocacy groups over 35 years.

    One CEO of road organisation said at study group said in response to my lecture to students. What you accusing me of Mr parker my answer was short and swift. ‘ The coming oil crisis when it becomes critical is a threat to Australian National security what I am accusing you of is simple TREASON.

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