We'll fund entire Toowoomba Bypass: Coalition

Despite announcing $700 million for Toowoomba Bypass, the Coalition says it will spend the $1.75 billion required to build it

By Brad Gardner | August 19, 2010

Despite announcing it will spend $700 million to build the Toowoomba Bypass, the Coalition has vowed to cover the entire $1.75 billion cost of the project.

The office of opposition spokesman on transport Warren Truss has confirmed the remaining $1.05 billion will be drawn from new infrastructure funding to begin in 2014 once the current Nation Building Program expires.

Opposition leader Tony Abbott last month committed $700 million to the project, saying $280 million of it will be spent in the next four years starting in 2011.

A report commissioned by the previous Coalition government estimated the 42km stretch of road from the Warrego Highway to the Gore Highway will cost $1.75 billion.

"We’re not going to stop suddenly. We intend to build it," a spokesman for Truss says, adding that the project will be built by 2017.

"The total cost will be there, but it will be in the next tranche of Auslink."

The Auslink program was rebranded the Nation Building Program after Kevin Rudd came to power following the 2007 election.

The infrastructure fund works on six-year timeframes, with money in the latest program allocated between 2008 and 2014.

Following Abbott’s announcement, the Federal Government questioned where the remaining funding was coming from.

"It will become reality under us. It’s important to the people of Toowoomba," Truss’ spokesman says.

The Toowoomba Bypass Project Business Case report says the project is important due to the region’s significance as national freight route and the deficiencies in the existing road.

It cites high congestion levels and a poor accident record on the Toowoomba Range due to levels of traffic, a sloping road and tight horizontal curves.

Under the project, road lanes will be widened, interchanges constructed and twin tunnels built. The report says 27 bridges at 19 locations will also be erected.

The $1.75 billion price tag is based on construction beginning between 2010 and 2013, with the report saying costs will rise by about $100 million each year the project is delayed.

However, the report says "the project’s direct economic costs outweigh the direct economic benefits, resulting in a negative economic net present value".

According to the report, only about 30 percent of heavy vehicles will divert to use the bypass because a lot of trucks need to reach Toowoomba’s CBD.

"Clearly, this creates an issue in terms of the Toowoomba Bypass Project meeting its proposed objectives," the report says.

"A potential solution to this issue is to consider an options where all heavy vehicles travelling across the Toowoomba Range would be obliged to use the Toowoomba Bypass crossing unless they have an origin or destination in the eastern side of Toowoomba."

The report also highlights the lack of a viable public-private partnership option because government will need to cover 97 percent of capital expenditure.

"If governments were required to make an upfront payment of this magnitude…the private sector would have the majority of its financial obligations repaid upon construction completion," the report says.

As such, it says the private sector will have not incentive to efficiently manage the bypass.

While saying cost benefit analysis is important, Truss’ spokesman believes it must not always dictate government policy.

"If you follow that religiously…a lot of roads and rail would never get built," he says.

Although he says there is no intention to make the bypass a tolled road or rely on private investment for its construction, the report says a mandated toll of $15.02 for rigid trucks and $20.61 for multi-combination vehicles will reduce government expenditure costs to $1.4 billion.

"Economic analysis shows there is marginal difference in economic outcome between the untolled and tolled base case scenarios…," the report says.

As well as the Toowoomba Bypass, the Coalition lists the completion of the Pacific Highway duplication and the duplication of the Bruce Highway from Cooroy to Curra as its highest priority road projects.

The spokesman for Truss says the Coalition will also consider restoring Auslink name in favour of the Nation Building Program if it wins the election on August 21.

"We’re upset it was changed in the first place," he says.

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