Sth Yarra Station
South Yarra station, Toorak Rd

The Victorian opposition responded to news this week the government sold the Port of Melbourne for $9.7 billion by demanding it use the money to build everything the opposition favours e.g. reinstate the abandoned East West Link motorway, replace the planned “Skyrail” solution to level crossings on the Dandenong rail line with trenches, and build a new station adjacent to the existing one at South Yarra as part of the planned Melbourne Metro project. (1)

Its gotten most coverage for the idea of an interchange station at South Yarra. The idea appeals to many public transport supporters because Metro will remove the current ability to transfer from the  Franskton and Sandringham lines to the Dandenong (Metro) line at South Yarra station. Moreover, South Yarra is one of the busiest stations on the network and is located in the rapidly growing Forrest Hill apartment precinct.

But the thing the opposition conveniently ignores is having extra money doesn’t suddenly turn otherwise poor projects into good ones e.g. the benefit cost ratio for the East West Link will still be appallingly low. In the case of a South Yarra station, the government rejected the idea because it wouldn’t represent good value for money. Of course the opposition is motivated by political advantage, not good policy (the Greens took the seat of Prahran off the Liberals at the last election).

For their part, public transport supporters make the mistake of taking it for granted that all interchange proposals are automatically a good thing. We’ve seen this sort of unreflective thinking before with the support of “nice to haves” like the proposed rail extensions to Rowville and Doncaster. Too often supporters don’t consider the possibility that not all rail proposals are equally good; some represent very poor value for money. Nor do they always stop to think there might be alternative projects that would give a much superior outcome.

I discussed the idea of a station at South Yarra at length some time ago (Would building this rail station be a sensible idea?), so this time I’ll just point out the essentials. The key one is the benefit-cost ratio for the station is a mere 0.3; that’s even less than the ratio for the much derided East West Link.

It would cost circa $970 million to build and require acquisition of 94 properties. Users of South Yarra station will in any event still have a high level of service; they’ll have a train every two minutes direct to the city in the peak on the existing line when Metro opens. Also, crowding will be much reduced. Those travellers who want to interchange to Metro (Dandenong line) will be able to do so at adjacent stations (Caulfield and Flinders St), or by taking a short tram ride to the new Domain station.

There’s no doubt it would be nice for users of South Yarra station if they could interchange directly with the Metro line, but the problem is the cost of providing this option would be way in excess of the benefits. There’s no shortage of other options with a vastly superior benefit-cost ratio; public transport supporters should insist they’re where scarce money should go. The thing to remember is there is never enough money; an extra $9.7 billion sounds huge but its still way short of all the things that urgently need to be done in the transport portfolio, let alone across all portfolios.


  1. $9.7 billion is the headline figure from the sale of a 50 year lease over the port. It’s not clear if it is net of revenues the Government would otherwise earn from the port if it retained ownership e.g. dividends. Note also the brouhaha over whether or not the Turnbull government will deliver in full the bonus the state is eligible for under the Commonwealth’s asset recycling scheme.