Auditor-General slams NSW government over lack of business case, consultation before Newcastle light rail decision

The NSW government decided to spend hundreds of millions of dollars of public funds on a Newcastle light rail line without a business case and without consulting the community, the Newcastle Herald reports:

That is one of the extraordinary findings of a NSW Auditor-General’s report released on Wednesday into the government’s Revitalising Newcastle program.

The report said the cost of the tram, which had ballooned from $165 million to $368 million since it was announced in 2013, was not justified by “conventional cost-benefit analysis”.

The report confirmed what many observers have long suspected: the government did no planning before announcing the light rail project in June 2013, six months after saying it would cut the heavy rail line and replace trains with buses.

The lack of a business case contravened government policy requiring detailed analyses of infrastructure proposals and alternative options.

The report said a business case had been prepared belatedly, after the project was announced, but this document had not been released publicly.

Click here to read the Newcastle Herald’s full article.

From the Audit Office’s report:

“There was no business case or other preliminary planning work done before this announcement,” the report said.

“This is important for transparency and accountability in the use of public funds.”

“ … The analysis in the program business case showed there is no strong economic rationale for light rail in Newcastle.”

“Recent policy statements from Transport for NSW have compounded this by incorrectly stating that investment decisions in Newcastle were influenced by the light rail, including the Newcastle court house development and University of Newcastle city centre expansion,” the report said.

Click here to read the full report from the NSW Auditor General’s Department.