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The NSW State Government settles a year-long legal dispute with construction company Acciona over Sydney's light rail project, agreeing to a $576 million compensation payout that takes the total cost of the project to more than $3 billion.
The final payout, confirmed by the State Government this morning, will take the trouble-plagued project's total cost to more than $3 billion — almost double the original price tag predicted by then-transport minister Gladys Berejiklian in 2012.
Acciona sued the NSW Government for misleading or deceptive conduct in April last year. It was initially chasing $1.2 billion over issues relating to the cost of digging up and replacing Ausgrid powerlines for the project, which has turned Sydney's George Street — and parts of Sydney's eastern suburbs — into a construction site.
The NSW Government accused the company of ordering a go-slow at the time, pushing the already delayed project back further.
Of the $576 million payout confirmed today, it is understood $129 million will be held back until construction deadlines are met.
The first portion of the light rail, to Randwick in the city's east, must be complete by December.
The second leg of the project, to the south-east suburb of Kingsford, will need to be finished by March.
The project was supposed to be finished before the March state election.
The agreement clears $1.5 billion the company was seeking in claims, including the $1.2 billion it was originally suing the State Government for.
Transport Minister Andrew Constance said it had been a "complex negotiation" but the agreement reset the relationship between the parties.
Opposition spokeswoman Jodi McKay said the project cost was "extraordinary" and a sign of the Government's mismanagement.
The 12km light rail project runs from Circular Quay to Randwick and has caused mass disruption to businesses and foot traffic in some of Sydney's busiest areas, triggering an inquiry last year.
This article first appeared on www.abc.net.au
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