A BRT system in Nantes, France, managed by Transdev (source: Transdev PLC)

The Age reports the Victorian Government has rejected an unsolicited bid by international transport company,Transdev, to build and operate a $500 million Bus Rapid Transit (BRT) system between middle-suburban Doncaster and the CBD (see Red light for Transdev’s rapid busway between Doncaster and CBD):

Transdev submitted its rapid busway proposal through the government’s market-led proposals guidelines, by which the private sector can put forward its own ideas for infrastructure projects.

Submissions are assessed by the Department of Treasury and Finance in a five-stage process, and only those proposals that get past stage two are publicly revealed. The busway was rejected at stage two. 

A spokesman for Treasurer Tim Pallas declined to explain why it did not proceed, saying it was “not appropriate to comment”.

Unsurprisingly, the decision was met with disappointment and was hardly helped by the Government’s refusal to disclose why it’s rejected Transdev’s pitch. For circa $0.5 Billion, this seemed like a reasonable investment compared to the estimated $4 – $6 Billion (and the appalling BCA of o.1 – 0.2 even with Wider Economic Benefits) required to construct a rail line from Doncaster Hill to the Hurstbridge rail line (see Should Doncaster BRT be a priority?).

It’s bound to be taken by some as evidence the Government isn’t serious about improving public transport or isn’t interested in improving regions where it’s political prospects aren’t promising. There’s the inevitable suspicion the Government’s silence is because its planned North-East Link motorway will preclude using the Eastern Freeway median for BRT or rail.

So, what should we make of this?

There’s a warrant to improve bus services in the Doncaster area. Infrastructure Victoria recommended the existing Doncaster Area Rapid Transit (DART) service be upgraded within a five to ten-year timeframe at an estimated cost of $250 – $500 million:

This option would include the provision of additional dedicated lanes, supporting infrastructure such as increased depot capacity, interchange facilities and new rolling stock as needed. This could also include upgrade of the entire corridor from Melbourne CBD to Doncaster to Bus Rapid Transit standard with dedicated bus lanes in the central median of the Eastern Freeway.

But while there’s merit in the idea, the particular version of it at issue now is an unsolicited bid from Transdev. It wasn’t sought by the Government and it’s not a free lunch. Urban public transport doesn’t usually make a profit, so the Government will ultimately have to pay the company for putting up all or most of the initial funds and for accepting some degree of risk.

It’s a commercial proposal so it must advance the company’s interests. Transdev might be the nicest bunch of folks you’ll ever meet, but the public interest isn’t the company’s number one priority.

We should accordingly expect the Government to reject the company’s bid if analysis shows it wouldn’t give taxpayers sufficient net benefit e.g. it might not be adequate in terms of level of service, it might not offer value for money, or it might simply be too under-developed. That it didn’t get past stage two of a five-stage evaluation process could mean it wasn’t even close to plausible.

The vigorous debate over the proposed Westgate Tunnel motorway – another unsolicited bid – indicates it should never be assumed that such proposals are automatically in the public interest. Transdev’s pitch shouldn’t be given a free pass just because it’s about public transport (see The problem with Transurban’s proposed motorway and Should this motorway report be secret?).

It might be better if the improvements recommended by Infrastructure Victoria go to competitive tender or, heaven forbid, the Government builds and operates them itself.

Another critical point is no Government can afford to build all the many infrastructure proposals that have merit. Infrastructure Victoria developed an inventory of worthwhile projects, but the Government must compare this proposal with all the other expenditure priorities and rank them within the constraints of the budget.

Infrastructure Victoria has in any event said the upgrade to DART isn’t warranted for at least five years and perhaps ten. It also notes that while there are “pinchpoints where buses merge with general traffic”, nevertheless “DART provides some of the highest quality public transport service in Victoria, even though it is delivered with buses rather than rail”.

As I noted when Transdev announced their bid in June, we should be especially wary of unthinkingly accepting that the Doncaster area is somehow “owed” priority over the rest of Melbourne because it didn’t inherit a rail line. DART isn’t perfect but that doesn’t mean Doncaster is the most pressing public transport priority for scarce dollars in Melbourne.

What this issue underlines yet again is that other than the Network Development Plan for Melbourne’s rail system, the Government doesn’t have a long-term plan for investment in tram, bus, bicycle and, for that matter, car and truck infrastructure. That’s no doubt because it’s politically risky, but from our point of view that’s a constraint, not a justification for poor planning.

The Treasurer’s apparent resolve to maintain silence is disappointing for transparency and inevitably fuels the suspicion that his motivation is self-serving. The Government has until December to respond to Infrastructure Victoria’s 30-year infrastructure strategy so perhaps it’s keeping its powder dry until then on what it has in mind for Doncaster. But don’t hold your breath because it’s only undertaken to prepare a five-year plan.