State’s ‘Big Build’ under scrutiny as price tag hits $81b

 
Topic moved from News by bevans on 20 Apr 2021 09:04
  bevans Site Admin

Location: Melbourne, Australia
There just seems to be so much money waste with this government or is there?  We need the infrastructure we do but the North East Link is a waste of money and damage to the environment.

A lot of rail could be delivered for the money we are spending on the road people really don't need.

It is hard to understand what the total bill for the Suburban Rail Loop at this stage so it could be anything but good to see it going forward.

The rail project of interest in terms of total investment is the Airport Rail.  I just cannot see how airport rail could be so expensive unless the unions have been involved?

Finally I am not happy with the comments by Andrews.  Does he really feel he does not answer to departments whom have the responsibility to keep government honest?

State’s ‘Big Build’ under scrutiny as price tag hits $81b

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  The Vinelander Minister for Railways

Location: Ballan, Victoria on the Ballarat Line
Yet another storm in a teacup that could just have easily been posted into the NEWS thread...

Several rhetorical questions that may never be answered.
  skitz Chief Commissioner

Yet another storm in a teacup that could just have easily been posted into the NEWS thread...

Several rhetorical questions that may never be answered.
The Vinelander
Just defund the auditors office, problem solved.  la la la la la
  Lockspike Chief Commissioner

Yet another storm in a teacup that could just have easily been posted into the NEWS thread...

Several rhetorical questions that may never be answered.
Just defund the auditors office, problem solved.  la la la la la
skitz
or bung on a staff freeze, just as effective
  Lockie91 Assistant Commissioner

There just seems to be so much money waste with this government or is there?  We need the infrastructure we do but the North East Link is a waste of money and damage to the environment.

A lot of rail could be delivered for the money we are spending on the road people really don't need.

It is hard to understand what the total bill for the Suburban Rail Loop at this stage so it could be anything but good to see it going forward.

The rail project of interest in terms of total investment is the Airport Rail.  I just cannot see how airport rail could be so expensive unless the unions have been involved?

Finally I am not happy with the comments by Andrews.  Does he really feel he does not answer to departments whom have the responsibility to keep government honest?

State’s ‘Big Build’ under scrutiny as price tag hits $81b
bevans
Poor Bevans, as someone who lived out in the North East I can attest to the road. The biggest traffic problem was not Hoddle Street or the Eastern, it was driving on single lane roads through the suburbs to get to Greensbrough. Lower Plenty road and Heidelberg Road are gridlock through peak and even on a Sunday afternoon. The project is not perfect, but being able to get to the freeway without the suburban drive will be amazing for those living out there.

As for the rest, 81B of commitments over 8 years isn't a big deal. Sure the number looks big, but its not all being spent right this second. When a government announces a new project, we do pay out the 5B right then and there, its broken up over the project life.

Andrews came to power pleading to clear a backlog of infrastructure, we shouldn't be surprised by the numbers. This is what many voted him in to do. After a standstill 6 years, thanks to the end of the Brumby government the do nothing Napthine there was a massive backlog of projects.

Take MM1 for example, this project was announced in 2008! Was taken to the election by Brumby, who lost to the Libs. For the people, it was too little too late. The liberals scrapped it and in the dying weeks of the election announced Melbourne Airport Tunnel MM1, MM2 and Airport rail wrapped up into one project. Karma came around and just like Brumby it was too little too late after four years of nothing.
Just think if MM1 was under construction in 2011, we would have been ridding the rails in 2018/19 and projects like MM2 and MARL would have been would have been underway by now.

Lockie
  justarider Chief Commissioner

Location: Released again, maybe for the last time??
Still trying to make head or tail of the VAGO dashboard
https://app.powerbi.com/view?r=eyJrIjoiNzg2YmIwOWMtZGU2ZC00ZjY3LTk1YWQtMmVmYjA4MjZiNGI0IiwidCI6IjJjN2YxZjc4LWFmYzYtNDNkZS1iZmRkLWNmMTJjNDAxNmM3MCJ9&pageName=ReportSectionfa02b53d14a8d5f8d7ae

The $81B makes great headlines, until you consider that is the total number of all projects underway (includes road, rail, hospital, school......) extended out to their final completion.
SRL $50B doesn't rate a mention in the detail,  the original estimate hasn't moved. Unsurprising since Bus Case still in development.

The headline grabbing, 30% have a change in cost, 33% have a change in timeline: has been puffed up into some sort of disaster
UNTIL YOU READ
they are changes UP and DOWN

Our 2 favourite big ticket items, MM1 and LXRA(50 LX), are in fact being delivered EARLIER and LESS EXPENSIVE, than original plan.
No matter what MSM keep harping about cost blow-outs, this VARGO report doesn't say that.

Most projects are on target for time and cost.
The big ticket increases from original eg LXRA , HCMT are scope increases = more crossings, more trains.

When VARGO have a specific project to report running off the rails , then that is something for govt and us to be concerned.
It does need an update from this year's budget.

In the meantime, the govt response "nothing new, it's all previously released info" is completely accurate. So why the outrage?

cheers
John
  don_dunstan Dr Beeching

Location: Adelaide proud
Every single project blown out by a large percentage, MM1 for example originally costed at $11 billion at commencement, now over budget by close to three billion - will probably end up being much more by the time the first train runs. And Westgate Tunnel hemorrhaging red ink by the truckload, originally costed at $6,7 billion but now something like $11 billion plus with work still mostly stalled due to the CFMMEU and the problem of toxic soil.

The VIC government is facing another Cain/Kirner moment in a few years - a refusal of financial markets to give them any more money because they're already in hock up to the eyeballs.
  don_dunstan Dr Beeching

Location: Adelaide proud
...

Our 2 favourite big ticket items, MM1 and LXRA(50 LX), are in fact being delivered EARLIER and LESS EXPENSIVE, than original plan.
No matter what MSM keep harping about cost blow-outs, this VARGO report doesn't say that.

Most projects are on target for time and cost.
The big ticket increases from original eg LXRA , HCMT are scope increases = more crossings, more trains.
justarider
Level crossings, yes a well-budgeted thing and allows more frequent trains to be run but MM1 already shaping up as much more expensive than first planned.

Really not sure about Cheltenham-Box Hill - different voltage, train sets that can't inter-operate with the rest of the system? Also some major traffic centers missed out on including Chadstone.
  justarider Chief Commissioner

Location: Released again, maybe for the last time??
...

Our 2 favourite big ticket items, MM1 and LXRA(50 LX), are in fact being delivered EARLIER and LESS EXPENSIVE, than original plan.
No matter what MSM keep harping about cost blow-outs, this VARGO report doesn't say that.

Most projects are on target for time and cost.
The big ticket increases from original eg LXRA , HCMT are scope increases = more crossings, more trains.
Level crossings, yes a well-budgeted thing and allows more frequent trains to be run but MM1 already shaping up as much more expensive than first planned.

Really not sure about Cheltenham-Box Hill - different voltage, train sets that can't inter-operate with the rest of the system? Also some major traffic centers missed out on including Chadstone.
don_dunstan
Welcome back to Victoria @don. You have been missed.

Did you actually read the VAGO dashboard. "Most way over budget", bull tish.

Just another one buying into the "MM1 is $3B over budget" fiction.
The Age amongst others keep saying that.
Funny thing, the VAGO have never said it.
Who to believe ,? an expert with all the data, or Timna ( I know better).

And for your favourite topic "Lets bash the CCP"
Absolutely correct that John Holland gets a BIG chunk of the contracts.
JH have proven over decades they are very good at what they do.
Problem being they never had the financial clout to bid super large.

With new owners they have the clout and those owners reap the profit.

And the new owners learn HOW to do projects that are not cheap & nasty. A win for BRI and a transfer of Aussie knowhow.
China have always been good at making stuff, lateral thinking not so much.

Good OZ engineering can bid on the world stage, and CCP are learning it is easier to buy than copy. Whose fault that we watch it happen ?

Cheers
John
  don_dunstan Dr Beeching

Location: Adelaide proud
...

Our 2 favourite big ticket items, MM1 and LXRA(50 LX), are in fact being delivered EARLIER and LESS EXPENSIVE, than original plan.
No matter what MSM keep harping about cost blow-outs, this VARGO report doesn't say that.

Most projects are on target for time and cost.
The big ticket increases from original eg LXRA , HCMT are scope increases = more crossings, more trains.
Level crossings, yes a well-budgeted thing and allows more frequent trains to be run but MM1 already shaping up as much more expensive than first planned.

Really not sure about Cheltenham-Box Hill - different voltage, train sets that can't inter-operate with the rest of the system? Also some major traffic centers missed out on including Chadstone.
Welcome back to Victoria @don. You have been missed.

Did you actually read the VAGO dashboard. "Most way over budget", bull tish.

Just another one buying into the "MM1 is $3B over budget" fiction.
The Age amongst others keep saying that.
Funny thing, the VAGO have never said it.
Who to believe ,? an expert with all the data, or Timna ( I know better).

And for your favourite topic "Lets bash the CCP"
Absolutely correct that John Holland gets a BIG chunk of the contracts.
JH have proven over decades they are very good at what they do.
Problem being they never had the financial clout to bid super large.

With new owners they have the clout and those owners reap the profit.

And the new owners learn HOW to do projects that are not cheap & nasty. A win for BRI and a transfer of Aussie knowhow.
China have always been good at making stuff, lateral thinking not so much.

Good OZ engineering can bid on the world stage, and CCP are learning it is easier to buy than copy. Whose fault that we watch it happen ?

Cheers
John
justarider
Didn't actually answer any of my concerns - and neatly skated around the absolute disaster that is the Westgate Tunnel.

Debt is debt is debt. At some stage someone down the line will have to pay for it - whether that's in increased taxes or cut services is going to be something that Victorians will have to face at some stage in the future. This is a fundamental truth that nobody on this board seems to appreciate - that money is REAL and it will have to be paid back with interest.

Cain/Kirner left Victoria with a debt of $30 billion and at the time it was considered toxic enough that the VIC government could no longer borrow on international money markets and had to be rescued in part by the Commonwealth government buying the State Bank. It was a financial disaster of massive proportions.

Fast forward thirty years and there's actually nothing left to privatise (bar crown land) so the Kennett turnaround can't be done again AND you have a projected debt in 2024 of $150 billion, five times what Cain/Kirner left Kennett to deal with.

Did Andrews borrow money directly from CCP controlled banks? We still don't know.
  John.Z Assistant Commissioner

Didn't actually answer any of my concerns - and neatly skated around the absolute disaster that is the Westgate Tunnel.

Debt is debt is debt. At some stage someone down the line will have to pay for it - whether that's in increased taxes or cut services is going to be something that Victorians will have to face at some stage in the future. This is a fundamental truth that nobody on this board seems to appreciate - that money is REAL and it will have to be paid back with interest.

Cain/Kirner left Victoria with a debt of $30 billion and at the time it was considered toxic enough that the VIC government could no longer borrow on international money markets and had to be rescued in part by the Commonwealth government buying the State Bank. It was a financial disaster of massive proportions.

Fast forward thirty years and there's actually nothing left to privatise (bar crown land) so the Kennett turnaround can't be done again AND you have a projected debt in 2024 of $150 billion, five times what Cain/Kirner left Kennett to deal with.

Did Andrews borrow money directly from CCP controlled banks? We still don't know.
don_dunstan
Firstly, what's inflation been between Cain/Kirner and Now? If money is worth at least 5x less, then the debt is notionally the same or less. Looking up online, $1 as of 1982 is equal to $3.61 today. So that $150B debt is worth $41.5B in Cain/Kirner terms.

Secondly, modern monetary policy for government is much more in favour of government debt where it can lead to sustained GDP growth. Hence why governments have moved out of providing services like Airlines (I know that's a federal example, but it's a good one), and towards building infrastructure projects to sustain population growth (Metro 1 etc). Because we know that if you can dwarf your debt with a GDP increase, it becomes chump change in the grand scheme of things. The same reason why it becomes easier to pay off a house mrotgage in the last 10 years of the loan, inflation is working in your favour, so as a % of your income it's less, plus your income has increased so that % of income is doubly less. Same for government debt and GDP.

The other thing to consider is that Australian government debt (both state and federal) is miniscule compared to a lot of governments around the world. We're still a safe bet.
  don_dunstan Dr Beeching

Location: Adelaide proud
Firstly, what's inflation been between Cain/Kirner and Now? If money is worth at least 5x less, then the debt is notionally the same or less. Looking up online, $1 as of 1982 is equal to $3.61 today. So that $150B debt is worth $41.5B in Cain/Kirner terms.

Secondly, modern monetary policy for government is much more in favour of government debt where it can lead to sustained GDP growth. Hence why governments have moved out of providing services like Airlines (I know that's a federal example, but it's a good one), and towards building infrastructure projects to sustain population growth (Metro 1 etc). Because we know that if you can dwarf your debt with a GDP increase, it becomes chump change in the grand scheme of things. The same reason why it becomes easier to pay off a house mrotgage in the last 10 years of the loan, inflation is working in your favour, so as a % of your income it's less, plus your income has increased so that % of income is doubly less. Same for government debt and GDP.

The other thing to consider is that Australian government debt (both state and federal) is miniscule compared to a lot of governments around the world. We're still a safe bet.
John.Z
I stopped taking you seriously when I got to the part about "modern monetary theory". That's just a steaming pile of cobblers invented by the 'unlimited growth' people to reassure the public that runaway borrowing by government is all A-OK, peachy. Just sit back and relax, it's not your problem. This debt will never, ever have to be paid off.

"Modern Monetary Theory" adherents seriously believe (as you just pointed out) that governments can continue to borrow heavily into the future in order to pump prime the economy and nothing will ever happen to stop this growth in debt - it can continue exponentially into the future like some kind of perpetual money machine. It's pure, unadulterated socialist thinking - but the Victorian government can't even print its way out of debt (unlike the Commonwealth) and yet you seriously believe there's nothing wrong with the accumulation of massive amounts of debt? What happens when (as with Cain/Kirner) international financial markets say "no more for Victoria" and you can't borrow any more? Victoria's credit rating has recently been downgraded by Standard and Poor's because of the concern that they have no plan to stop borrowing: Adherents of MMT have no answer for that scenario because everything they say is predicated on the debt tap never being turned off.

And our debt is only 'minuscule' when you compare it to economically moribund states like Japan - a place with such a ridiculously deformed financial system that the government owns a huge chunk of the stock-market in order to stop it from collapsing. This is the kind of future we're being condemned to.
  justarider Chief Commissioner

Location: Released again, maybe for the last time??
...
Didn't actually answer any of my concerns - and neatly skated around the absolute disaster that is the Westgate Tunnel.

Debt is debt is debt. .....
blah blah ...  Dons fabourite topic ...blah blah.
don_dunstan
After your drivel about Westgate, your thin ice claims have nothing to skate upon.

Blown out from 6.7B to 11B.  Any evidence for that? , nobody else of repute is saying that. The last audit was a small decrease, which contradicts your assertion..

Stalled by CFMMEU and toxic soil.
Certainly not "stalled". Surface works, bridges  etc powering along and the western side nearing completion. They have even started the pretty garden works at Altona, normally associated with the project end.

The dirt problem does mean the tunnel itself is yet to start. About a 1/3 of the project total.
It is a lawyers picnic, which I suppose the taxpayer will have to pick up the Councils' tab.
Community ginger groups better have deep pockets.

2 year delay looks probable, but whether that results in any cost shift other than finance cost (at current ridiculous low rates) is unknowable
Very few staff affected,  for most it's work as usual just at a different part of the jigsaw. The specialist CBD drivers have plenty of other sites aound OZ and moved on, and there is aready a school training replacements.

Even the Benalla concrete plant is going gang-busters. Just keep piling up the finished panels, ready to be trained out. No delays there.

Cain/Kirner. We have differing views of ancient history.  Your never gunna change, so I dont bother.

cheers
John
  don_dunstan Dr Beeching

Location: Adelaide proud
So we have some Labor Party apparatchiks here who think perpetual, ever-expanding debt is 'funny'?

You can't use borrowed government money to pump-prime the economy ad-infinitum - there's no place on the planet, no time in history - where this ridiculous idea has ever worked.
  don_dunstan Dr Beeching

Location: Adelaide proud
After your drivel about Westgate, your thin ice claims have nothing to skate upon.

Blown out from 6.7B to 11B.  Any evidence for that? , nobody else of repute is saying that. The last audit was a small decrease, which contradicts your assertion..

Stalled by CFMMEU and toxic soil.
Certainly not "stalled". Surface works, bridges  etc powering along and the western side nearing completion. They have even started the pretty garden works at Altona, normally associated with the project end.

The dirt problem does mean the tunnel itself is yet to start. About a 1/3 of the project total.
It is a lawyers picnic, which I suppose the taxpayer will have to pick up the Councils' tab.
Community ginger groups better have deep pockets.

2 year delay looks probable, but whether that results in any cost shift other than finance cost (at current ridiculous low rates) is unknowable
Very few staff affected,  for most it's work as usual just at a different part of the jigsaw. The specialist CBD drivers have plenty of other sites aound OZ and moved on, and there is aready a school training replacements.

Even the Benalla concrete plant is going gang-busters. Just keep piling up the finished panels, ready to be trained out. No delays there.

Cain/Kirner. We have differing views of ancient history.  Your never gunna change, so I dont bother.

cheers
John
justarider
It's not 'ancient history' - it's here and now and its playing out all over again. But people like you can't ever be convinced of the truth of the matter because you're so blinded by the belief that everything Andrews is doing is marvelous and that nobody will ever have to pay for it (the miracle of MMT don't you know). All the money is completely free don't you know - no need for oversight or diligence in Dan's Victoria.

They haven't even started earthworks for the tunnel yet - so how many more years until its actually finished? And ultimately whose fault is it that the contract for the Westgate Tunnel was so flawed? Dan's fault? No of course not, Dan can do no wrong.
  don_dunstan Dr Beeching

Location: Adelaide proud
Certainly not "stalled". Surface works, bridges etc powering along and the western side nearing completion. They have even started the pretty garden works at Altona, normally associated with the project end.
justarider

This is just straight-up dishonest - the project itself can't be completed without the tunnel segment and as you said yourself work hasn't even started on that part.

But as usual in Dan-World, nobody will lose their job over this atrocious planning and lack of contingency.
  justarider Chief Commissioner

Location: Released again, maybe for the last time??
So we have some Labor Party apparatchiks here who think perpetual, ever-expanding debt is 'funny'?

You can't use borrowed government money to pump-prime the economy ad-infinitum - there's no place on the planet, no time in history - where this ridiculous idea has ever worked.
don_dunstan
Name calling, normal programming has resumed.

Debt is never funny, just your interpretation.

As some-one having a lot of skin in the game , should Transurban fall over, I'm comfotable with the quality Project Management displayed in recent years by both Govt and the big Private enerprises.
  justarider Chief Commissioner

Location: Released again, maybe for the last time??
Certainly not "stalled". Surface works, bridges etc powering along and the western side nearing completion. They have even started the pretty garden works at Altona, normally associated with the project end.

This is just straight-up dishonest - the project itself can't be completed without the tunnel segment and as you said yourself work hasn't even started on that part.

But as usual in Dan-World, nobody will lose their job over this atrocious planning and lack of contingency.
don_dunstan
"dishonest" , you really try....

Contingencies abound. One part of project is problematic, just move resources to another whilst it's sorted out. That might affect costs, evidence of which we have none. Transurban initiated the proposal and carry the risk..
It will be completed so what is your point?
  don_dunstan Dr Beeching

Location: Adelaide proud
So we have some Labor Party apparatchiks here who think perpetual, ever-expanding debt is 'funny'?

You can't use borrowed government money to pump-prime the economy ad-infinitum - there's no place on the planet, no time in history - where this ridiculous idea has ever worked.
Name calling, normal programming has resumed.

Debt is never funny, just your interpretation.

As some-one having a lot of skin in the game , should Transurban fall over, I'm comfotable with the quality Project Management displayed in recent years by both Govt and the big Private enerprises.
justarider
Transurban is one of the biggest listed companies in the nation and they own nearly every toll road in the country - there's no way on earth they're going to 'fall over' because of exposure to the dog's breakfast that is the Westgate Tunnel. And they have the best legal teams exploiting all those juicy loopholes that the Victorian government left in the contract hence they stopped work last year when it was convenient for them to do so on account of the 'unexpected' discovery of contaminated soil. They're not the ones who are exposed though this disastrous project - the Victorian taxpayer are.

Transurban have been running rings around the Andrews government on this thing ever since Andrews decided to accept their unsolicited proposal for the tunnel five years ago, over-riding a much cheaper plan to improve access to existing roads that had been taken to the election. The work didn't even go to tender, Andrews just accepted the project in its entirely appointing builders to start work five months BEFORE the public hearings into the cost/benefit and environmental analysis had even begun. And what a surprise that Chinese-owned John Holland is the lead contractor on the project...
  don_dunstan Dr Beeching

Location: Adelaide proud
I have no objection to the overall program that Andrews embarked on - just the way that it was done. I was living in Melbourne under the previous Liberal government and anyone could see that the lack of infrastructure spending was going to cause enormous problems down the track. Bailieau/Napthine didn't even deliver the least expensive projects on their list from the 2010 election like the Avalon Airport train. Then at the last moment before the election they rushed through East-West link with bugger all consultation with the public, staking their reputation on it (and the public rightly rejected it).

But at least Napthine had the sense to reject an unsolicited offer from Metro to remove level crossings between Caulfield and Oakleigh that was shrouded in secrecy being 'off the budget' - Andrews on the other hand took a costed and sensible plan to alleviate traffic in the inner West to the electorate in 2016 and then after the election went with the unsolicited plan from Transurban to build a whopping big tolled tunnel that (conveniently) funneled traffic directly onto their existing tollways. No community consultation, no EIS, no explanation as to why the previously approved plan wasn't being used any longer.
  RTT_Rules Oliver Bullied, CME

Location: Dubai UAE
On the debt thing, Don isn't wrong on this.

Borrowed money is still borrowed money that has to be paid back. If you borrow today, you are borrowing against your children's future, in some cases before they haven't even been born. Sure we can try and hide the issue under GDP growth, but our growth rate is nominally 2-3% pa. So yes while GDP growth will dilute it, it doesn't make it "miniscule", those days of high inflation are gone.

$1B borrowed in 2000 is still worth around $750M and even with the largest population growth in decades in that time frame diluting it, that debt is still worth $600M plus interest.

Just because we have some of the lowest debt levels per GDP, doesn't give us the justification to borrow more. Imagine if we had no debt and money in the bank. Billions per year saved in interest plus interest earned?

Just because inflation is near zero doesn't give us the excuse to borrow as what this weak reasoning is an excuse to borrow up now and then when interest rates rise, we have a large interest bill to deal with. Yah for stupidity.

There is a time and a place for debt, but considering the current forecast debt levels over the comin few years, perhaps time o start focusing on living within our means.
  Upven Junior Train Controller

MM1 is over-budget $3B of which $1.5B might be paid for by the consortium, because at the moment the state government has a very weak in-principle only agreement. The other $1.5B has to come from somewhere. The VAGO and the state's own financial report show the tunnel is an ongoing unquantifiable contingent liability. I wonder what else the May budget will say is running over cost.
  don_dunstan Dr Beeching

Location: Adelaide proud
Certainly not "stalled". Surface works, bridges etc powering along and the western side nearing completion. They have even started the pretty garden works at Altona, normally associated with the project end.

This is just straight-up dishonest - the project itself can't be completed without the tunnel segment and as you said yourself work hasn't even started on that part.

But as usual in Dan-World, nobody will lose their job over this atrocious planning and lack of contingency.
"dishonest" , you really try....

Contingencies abound. One part of project is problematic, just move resources to another whilst it's sorted out. That might affect costs, evidence of which we have none. Transurban initiated the proposal and carry the risk..
It will be completed so what is your point?
justarider
Well it is dishonest to say 'work is progressing', the tunnel boring won't recommence until the end of the year - it can't open without it can it: Financial Review.

Corey Hannett, Director-General of Victoria’s Major Transport Infrastructure Authority, told a media briefing on Tuesday that the approval of a site at Bulla, which received planning and environmental approval on Monday, would help kick-start the troubled West Gate Tunnel. He said the project should be completed within three years of starting later this year, leaving a deadline for late 2024. Transurban declined to comment.

“We are hoping a site will be chosen shortly [for the toxic soil],” Mr Hannett said.

“We are in daily conversation with Transurban and their builders John Holland CPB. We need the joint venture and Transurban to choose a site, the site needs to be constructed ... if it takes about six months ... we are anticipating to see tunnel boring starting later this year, then it’s about a three year process from there.

“Originally, the tunnel boring was starting in 2019, it’s now a couple of years later ... Transurban said a couple of weeks ago they can’t make 2023, so we’ll provide further advice once they provide a date for tunnel boring.”

Still no answer as to who will actually pay but I'll bet you the VIC government will be picking up most of the tab. And I can't believe the stupidity of these people in not anticipating toxic soil - the tollway's route runs right over Coode Island (!)
  don_dunstan Dr Beeching

Location: Adelaide proud
MM1 is over-budget $3B of which $1.5B might be paid for by the consortium, because at the moment the state government has a very weak in-principle only agreement. The other $1.5B has to come from somewhere. The VAGO and the state's own financial report show the tunnel is an ongoing unquantifiable contingent liability. I wonder what else the May budget will say is running over cost.
Upven
I don't have as much of a problem with MM1 because it was planned for several years prior to commencement - there was a lot of evidence to say that an additional cross-city route that connected several already very heavily used destinations was a really good idea. And frankly the Liberal alternative plan that Napthine came up with was really bad - a dog-leg thing out to Fisherman's bend. Why? Just to benefit property developers? Made no sense at all.
  don_dunstan Dr Beeching

Location: Adelaide proud
On the debt thing, Don isn't wrong on this.

Borrowed money is still borrowed money that has to be paid back. If you borrow today, you are borrowing against your children's future, in some cases before they haven't even been born. Sure we can try and hide the issue under GDP growth, but our growth rate is nominally 2-3% pa. So yes while GDP growth will dilute it, it doesn't make it "miniscule", those days of high inflation are gone.

$1B borrowed in 2000 is still worth around $750M and even with the largest population growth in decades in that time frame diluting it, that debt is still worth $600M plus interest.

Just because we have some of the lowest debt levels per GDP, doesn't give us the justification to borrow more. Imagine if we had no debt and money in the bank. Billions per year saved in interest plus interest earned?

Just because inflation is near zero doesn't give us the excuse to borrow as what this weak reasoning is an excuse to borrow up now and then when interest rates rise, we have a large interest bill to deal with. Yah for stupidity.

There is a time and a place for debt, but considering the current forecast debt levels over the comin few years, perhaps time o start focusing on living within our means.
RTT_Rules
I'm in two minds about this - on the one hand there's never any situation in which stimulus has worked long term, there's nearly always a debt crunch when debt grows this fast - also we already have almost the highest household debt in the world - Bloomberg;

Australia’s household debt, among the highest in the developed world, could exacerbate a severe economic downturn by forcing a pullback in consumption, a Reserve Bank research report showed.

“We find that a severe stress scenario would have a somewhat larger effect on consumer spending today than it would have had a decade or two earlier,” according to the report, lead-authored by Jonathan Kearns, head of financial stability at the RBA. The increased sensitivty reflects higher debt levels, a shift to riskier investments and changes in consumer spending patterns, they said. Australians racked up enormous debts as rising incomes and falling interest rates allowed them to take out larger mortgages to pursue escalating property prices. This vulnerability is frequently highlighted as a risk to banks and the broader economy in the event of a severe downturn.

We're second only to Switzerland (for some reason) in household debt levels - I guess we need the government to keep spending for the time being or everything will flat-line even worse than it already has.

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