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Barnaby Joyce's much-hyped inland rail project displaces more productive repairs and upgrades to existing infrastructure and would be better spent on skills investments in rural communities, says a prominent economist who advises governments on freight priorities.
As the rollout of the near $10 billion railway project between Melbourne and Brisbane hits fresh hurdles over land access in NSW, Stephen Bartos warned it was likely to face major political risks over where the line stops, runs and delivers benefits.
"The idea that this is going to be the saviour of remote and rural Australia is just a furphy," said Dr Bartos, who formerly headed ACIL Tasman, a consultancy that worked on a 2010 "alignment" study commissioned by the then Labor government.
"Infrastructure as such is not the answer – that's really a side issue [for the bush]. Easily by far the more important issue for the bush is development of human capital, skills and innovation.
"Whether you have a railway line running through your town will make very little difference to your life," he said.
He said the money would be better spent on improving what is already in place to build links between ports, road and rail. "The inland rail is probably a middling priority by comparison. In terms of what the nation needs, it's some bridges here, some line straightening there, to make the existing network better.
"The problem with those things is that it's not nearly as sexy."
The criticism by Dr Bartos, who says the project will however deliver a broader "economic" benefit by taking freight off roads, improving safety and speed of deliver, comes as the NSW Farmers Federation urged the Australian Rail Track Corporation to halt negotiations with individual farmers over land resumptions.
The federation is urging around 300 farmers along the $1.5 billion Narromine to Narrabri section to avoid signing land access agreements with ARTC until a full agreement is developed between the federation and the company.
"We believe that, until information about route selection is made publicly available to allow farmers to make their own decisions, the ARTC should cease contacting farmers and asking them to sign land access agreements," said federation president Derek Schoen.
"NSW Farmers has previously negotiated land access agreements between landholders and mining companies and we believe we are well placed to ensure the needs of land owners are adequately balanced in any agreements we develop together with the ARTC."
Questions over the cost of land access highlight how sensitive the project is to cost blowouts, given the political importance of the rail link for Mr Joyce, who regards it as one of his signature achievements.
Chief executive of the ARTC, John Fullerton, confirmed late last week that the project won't generate enough revenue to cover its capital cost "and provide a return".
Marion Terrill, transport program director at the Grattan Institute, jumped on the statement to warn in an op-ed in Thursday's The Australian Financial Review, that big projects are especially vulnerable to overruns. "Cost and other risks are particularly important for this project because it has the skinniest of cost-benefit ratios, at just 1:1.1....just $1.10 of benefits - if all goes according to plan".
Mr Bartos said the stoush over land access was an example of how big projects become complicated.
"They've got the sound of cash registers ringing in their brains," he said.
"There's always project risk, particularly in relation to management of contractors, you need continuity of the Commonwealth public service with good experience in major project delivery, and that we typically don't see; and the other important risk is political risk...that decisions about where the line will stop and where it runs are influenced by politics rather than freight needs".
The 2010 study found land compensation would cost around $293 million.
This article first appeared on www.afr.com
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