Honeysuckle Conflict of Interest and Misinformation

Below is an extract from two speeches given by our President, Joan Dawson, in 2005 to the TAFE Teachers’ Association and to the Lake Macquarie Teachers’ Association. It focuses on the conflict of interest between the report recommending the closure of the Newcastle rail line and those interests seeking to gain from its complete removal. In whose interest is it to remove the rail into Newcastle?

Honeysuckle Conflict of Interest and Misinformation

Joan Dawson – 20th May 2005

The only benefit of the closure of the rail would be short-term gain for developers, including the Honeysuckle Corporation, which is responsible for those ugly buildings now cluttering up the Newcastle Harbour foreshore and creating a visual barrier.

Hon Michael Costa, when Minister for Transport, made a decision to cut the line from Broadmeadow to Newcastle, advised by a committee, appointed by him, The Lower Hunter Transport Working Group (LHTWG).

The composition of the committee is cause for concern, with three of the four members also on the Board of the Honeysuckle Corporation, a clear conflict of interest.

One of these is the Secretary of Newcastle Trades Hall Council (NTHC), Gary Kennedy, who in April 2005, in the context of criticism by some unions, gained the support of the NTHC for the findings of the LHTWG.

Another member of both groups is Newcastle Lord Mayor, John Tate. The Newcastle City Council has repeatedly voted to support retention of the rail service to Newcastle Station, yet Lord Mayor Tate, as a member of the LHTWG was part of the decision to close the rail. The LHTWG’s final report incorrectly indicated the Council’s support for cutting the line.

The third member of the LHTWG, also on the Honeysuckle Board is Glenn Thornton, Chair of the Hunter Business Chamber. His position in favouring developer interests is more understandable, even though many businesses in Newcastle will be adversely affected by the decision.

Honeysuckle Corporation, which began as a government instrumentality, is now fully self-funded, therefore needs to make a profit from its development activities. One of the recommendations of the Lower Hunter Transport Working Group was that Honeysuckle should be the agent for the redevelopment when the railway is closed.

The Lower Hunter Transport Working Group advised that it was in the best interest of Newcastle to get rid of the rail into the heart of the City, however other advice gives a totally opposite perspective, leading one to conclude that the members of the LHTWG were misinformed, either deliberately or through oversight, as to the implications of closing the railway.

Through Freedom of Information, Save Our Rail obtained a copy of a letter to the Honeysuckle CEO, Angus Dawson, written in October 2000 by the valuation firm of Dupont Fagan. This document, while critical of the rail line in its present state, nevertheless definitely advises that there would be increased value to Honeysuckle land with additional crossings over the line, and added value through the provision of rail services. The document includes a quote from the Real Estate body in Toronto, Canada, when that city opted for rail investment over road as follows:

“If an urban transit system never earned an operating profit it would still pay for itself a thousand times over through its beneficial impact on real estate values and increased assessments.”

The authors of the subsequent three reports of the LHTWG have either misinterpreted this advice, or have never received it.

Prof Peter Newman (NSW Commissioner for Sustainability) has visited Newcastle several times, constantly advising that taking out the rail would destroy the viability of the Newcastle CBD as the professional and business centre. Many business people agree with his advice. Newman was involved in the retention and revitalisation of the Perth to Fremantle rail system, and related the experience at Subiaco. $70 million was invested in lowering the line and allowing building to occur over it. The investment was returned and in fact doubled within two years and he advises Newcastle to invest in its rail system, similarly.

Many academics and transport planners, including Prof Warren Pengilley (University of Newcastle), Prof Bruce McFarling (University of Newcastle), Mr Len Regan (Transit Planners), and Prof Peter Newman (Murdoch University) have condemned the findings of this committee as flawed, having begun with a premise then setting out to arrive at a predetermined conclusion using flawed processes and data. It is therefore felt that the government planning bodies were misinformed and are acting on the basis of errors or misinterpretations and this is being continually reinforced.

Additional Information

(Last updated 9th January 2006)

Some additional information is available that was not known at the time of the original speeches.

Newcastle Council Supports Retaining the Newcastle Rail Line

The following is from a Newcastle City Council letter to the NSW Ministry of Transport, dated 21st February 2005:

“Newcastle City Council was not one of the authors of these reports [LHTWG First, Second, or Third Reports]. The Lord Mayor, Councillor John Tate was a member of the Lower Hunter Transport Working Group, however in this capacity, he was acting independently of Council. The inclusion of Newcastle City Council is misleading. While the Lower Hunter Transport Working Group’s preferred option “is the removal of the heavy rail line from Broadmeadow to Newcastle CBD and replacement with a free bus service…” (Final Report, December 2003, p.3.) Newcastle City Council has resolved that it opposes the removal of the rail line.”

“Councillors have expressed concern that some members of the general community and Cabinet members may, as a result of the referencing, hold the [incorrect] view that Newcastle City Council authored the reports of the Lower Hunter Transport Working Group and supports closure of the rail line [which it does not].”

Professor Graham Currie’s Independent Review Slams LHTWG Findings

Prof Currie’s report was commissioned by Newcastle City Council and the Lower Hunter Councils’ Transport Group.

In his conclusion Prof Currie slams the reports of the LHTWG . “They display a bias in favour of consideration of closure of the rail line to Newcastle in exclusion of almost anything else” he says, “and no options have been considered which improve services to passengers”.

In reference to the Metropolitan Strategy he speaks of poor sustainability and states, “Increased car dependence and transport disadvantage will result for the people of the Hunter Region.”

The word “sham” he says, “has been used by other people to describe the analysis undertaken by the NSW Government in its decision to close the Newcastle Line”. “These reports were used to make substantive decisions involving potentially hundreds of millions of dollars.”

Prof Currie’s review concludes with the following paragraph:

“The passenger rail services in the Hunter region are a high quality feature of the region’s public transport system. Many cities of substantially greater size than Newcastle lack rail services and would covet the opportunity for such a substantive resource as a means for providing sustainable transport into the future. Newcastle is clearly gifted in the physical and natural resources it possesses. It is unfortunate that its sustainable transport system is to be discarded so easily, based on what can be factually identified as biased, flawed and misrepresented advice.”