Tram has already cost ‘many millions of dollars’

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IN the April 18 edition of “CityNews”, columnist Jon Stanhope gave a critique of the ACT’s parlous Budget situation and explained that up to $120 million in 2017 alone had been withheld from Canberra’s hospitals as the Labor government prepares to make the first payment (of $412 million) on the light rail project in coming weeks.

Regular, inner-north defender of the Labor faith “Jim” commented on citynews.com.au that “given it’s a PPP arrangement with no payments made as of yet, how can money not spent in previous years’ Budgets be paying for the tram? When net debt is increasing, that clearly shows reserves/funding available are not increasing. It’s a bit of a strange logic for mine.”

He went on to say: “No doubt there will be cuts in expenditure to come to pay for the tram, but I think it’s a bit rich to suggest expenditure on it has cut expenditure on other things, when a cent is yet to be paid for it.”

Jon Stanhope felt Jim’s comments deserved a reply: “While I accept that the government has been less than transparent about light rail costings and it is hard to work out what is going on, it is clear, contrary to your suggestion, that many millions of dollars have been expended by it on the project to date. Take, for example, wages and on-costs of Capital Metro. I am guessing they would run into the tens of millions of dollars – the Budget papers over the last few years would give you the actual amounts.

“In the current financial year, which runs out in 10 weeks’ time, the government will pay $412 million under the PPP contract (see Budget Paper 3, Page 348).

“It is, of course, naive to think that the PPP will deliver anything for free. Capital and interest costs, operating costs and even costs in relation to delays in construction will almost certainly be met by the taxpayer. It is standard practice in PPPs and other major contracts where a private-sector partner is expected to absorb the cost of risk for that cost to be priced into the contract. I will be amazed if our PPP partners, out of the goodness of their hearts, have not done that in this case.

“For a more complete but albeit still limited understanding of the costs of light rail it is also worth having a look at the auditor-general’s report where a range of works and costs not included in the PPP are detailed. “A major gap in the information available to the community was the cost of relocating utilities (reported in ‘The Canberra Times’ in 2013 as possibly being as much as $200 million) and whether any of that cost is funded through the PPP.

“The light rail business case at page 81 also identifies a range of costs related to the project that were not included in its costings.

“One thing that is certain is that, as a consequence of not funding for growth in demand, very heavy cuts have been made to the health budget, to the tune over the last few years, of hundreds of millions of dollars.

“It may, of course, be purely coincidental that these have been made at a time when the government has committed to funding a priority transport project requiring funding of an order similar to the amount of the cuts to health.”

Stanhope for chief minister!

WHAT the hell is Jon Stanhope doing writing opinion pieces for “CityNews”?

Reading his column each week, I am convinced he shouldn’t be a magazine columnist – but chief minister! Yes, chief minister for another 10 years.

His April 18 column (“Health goes short as the tram mandate is met”) says it all. He writes with a lot of experience and has a practical approach to solving territory problems.

Let us hope his political career is resurrected at the next ACT Legislative Assembly election.

John Milne, Chapman

Makes sense for women

I AM an elderly woman of 75 and want to say how interested I was to read Kate Meikle’s column “Do men know how scared we are of them?” (CN, April 18).

Today women seem to be endlessly asserting their physical prowess – and one admires their energy and drive.

But the fact remains that MOST men are bigger, heavier, and stronger than MOST women; so even gentle men can easily appear threatening.

And sometimes a strongly bonded group of young women can be pretty scary, too.

So it makes sense for women to use their brains to avoid being in undesirable situations. That may seem like a burden for women only: but there are many slight, weak or old men who have to protect themselves also.

However, I don’t think women (or men) should feel fearful and threatened because they need to use their brains. Rather, I think they should feel a sense of pride that they CAN look after their interests in this way.

And they should be encouraged to talk with each other about how they can successfully handle challenging circumstances.

Kate makes a good point that kind men should be sensitive to women feeling uncomfortable.

Meanwhile, it’s heartening to know that at least some young women do think and act proactively about their safety.

Felicity Fullagar, via email

From the private to public

A quiet ACT government announcement on Good Friday-eve of the appointment of a chief engineer revealed that their latest, high-level senior executive appointment is the same private-sector consultant who pointed out publicly at the end of March that the property industry needs to convince suburbs such as Downer of the merits of high-density development.

He particularly encouraged Downer residents to embrace having their surroundings take on the appearance of Braddon’s increasing medium and high-rise urban intensification.

Hopefully, as a servant of the public after June, this influential, new appointee will anticipate and address planning impacts and associated infrastructure issues from a well-balanced and informed “people”, rather than a narrow property, perspective.

Sue Dyer, Downer

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1 COMMENT

  1. Nice to see a comment actually responded to for once – thank you to Jon Stanhope for doing so (I did not see the original reply so was not aware of it until now).

    I am more then happy to accept the Government will pay all those costs Jon suggested with the tram (“Capital and interest costs, operating costs and even costs in relation to delays in construction will almost certainly be met by the taxpayer’ etc). That was never my argument, and it is disingenuous to suggest it was – my point was solely that it has not been paid YET, and hence its not logically possible that such expenditure, not yet made, at a point when Government reserves are not increasing, is somehow crowding out existing funding for other things.

    Yes there has been some expenditure associated with the Capital Metro agency (now in TCCS) – and that would not be small $. But compared to the huge $ associated with the tram, or indeed the claimed amounts cut from health, that is mere chicken feed overall.

    In coming years, what Jon has suggested may well be the case. But I don’t buy the argument in the shorter term at all.

    As for the $412 million to be paid in coming weeks – do not forget that the Government has a rather large $ amount arising from Asset Recycling sales that must be spent on the tram, as per the terms of the NPA (which is publicly available). See https://www.canberratimes.com.au/story/6035953/act-walks-away-from-dickson-ambulance-station-sale/

    Hence, whether they’ve pissed that money up the wall or not in the meantime (and hence are likely to borrow to actually pay that money), in effect that part of the Budget was quarantined from being spent on other things. So the picture becomes even murkier again…

    And just for the record – I do not support any major party. I have not voted ‘mainstream’ in my life, at either state or federal level….. but I do get frustrated by arguments that lack internal logic, and in particular by those who pretend to ‘represent the community’ in some commentary on here but in reality represent a very narrow band of it.

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