JON STANHOPE & KHALID AHMED continue to expose the inconsistencies, questionable assumptions and conceptual flaws of the embarrassing light rail business cases. 

If you are a regular commuter – or even an occasional one – from the Civic to Woden, you may be confounded by the options presented in the light rail business case(s). 

One of the options, for example, will take you to Barton but terminates the journey there!

We are referring to the Light Rail Stage 2 Business Case prepared by Transport and City Services in 2018, and the City to Woden Light Rail Business Case prepared by Major Projects Canberra in 2019. 

These are the business cases that the Labor Party, along with the Greens, did not want Canberrans to see, necessitating a motion in the Legislative Assembly, a prolonged debate, claims of executive privilege and a review by an independent arbiter before the documents saw the light of the day.

While the claim of executive privilege by Chief Minister Andrew Barr was summarily dismissed by the Honorable Keith Mason AC KC, questions remain about the government’s determination to keep the documents secret and so avoid scrutiny. In this, and subsequent columns, we will highlight some key and frankly embarrassing aspects of the business cases which span more than 400 pages. A Civic to Woden public transport project terminating in Barton is but one example.

Both the business cases consider the following three options:

• Option 1: City – Parkes – Woden

• Option 2: City – Parkes – Barton – Woden

• Option 3: City – Parkes – Barton


Option 1 is the direct route through Capital Circuit to Woden. Option 2 veers through King George Terrace, Brisbane Avenue and Sydney Avenue – referred to as the “dog leg” in the media – before heading back to Woden. Option 3 stands out as ending somewhere other than the declared destination.

To be fair, some 70 pages into the analysis, the 2018 business case makes the remarkable discovery that “Option 3 will not provide light rail connectivity to residential and employment precincts in Woden”. However, this remarkable observation did not deter the authors of the 2019 business case from again considering this as a stand-alone option.

Table 1 provides key measures of travel time, patronage, costs and benefits as estimated in the 2018 business case. We will outline the changes in the 2019 business case in a later article.

The cost estimates by definition imply a 90 per cent certainty that costs will be at or below the estimate. However, noting the Stage 2A contract cost of $577 million, which covers just 1.7 kilometres of the route, we can say with certainty that the above cost estimates are significantly understated, and in fact fanciful. Indeed, more credible estimates for Stage 2B (from Commonwealth Park to Woden) from a number of other commentators, are in the order of $3.5 billion.

There are also serious questions about the inclusion of city-shaping and wider economic benefits which should not be attributed to this project even if there is any evidence about their realisation. The estimates of transport benefits are also clearly overstated noting that travel times under both the options will actually increase.

Accepting both the underestimated costs and inflated benefits at their face value, Option 1 – the direct route – with its shorter travel time (21 per cent), higher patronage (4 per cent), and higher transport benefits (65 per cent) compared to Option 2 would clearly be the preferred option. Nevertheless and staggeringly, the business case recommends Option 2.

The justification for the recommended option is because the “overwhelming majority (75 per cent) of the feedback received during community consultation on the route alignment options preferred an option that travelled via Parkes and Barton” (Page 69). However, the community consultation summarised in Section 11.2.4 (Page 210) cannot be taken seriously as an unbiased and objective survey of current and potential future commuters.

A more fundamental problem with the options analysis is the absence of any consideration of the obvious alternative, ie, bus travel. It could be argued that this mode is captured in the “base case”. 

However, the base case assumes bus travel times will increase by more than 25 per cent, reflecting no or minimal investment in busways and in reality, the deliberate slowing down of bus services. It is quite clear from this that the light rail project is not primarily about the needs of commuters.

Remarkably, the economic analysis in Section 8 of the 2018 business case considers an entirely different Option 2, which is a direct route similar to the Option 1 but through State Circle. The inclusion of the “dog leg” option, without any explanation or justification, appears, therefore, to be a late change in the executive summary. Heading to Barton, either as an end in itself, or as a diversion, appears to us, for reasons we cannot fathom, to be a central focus of the business case.

We have in the above, touched only briefly on the options analysis in the 2018 Business Case. However, it is clearly riddled with inconsistencies, questionable assumptions and conceptual flaws. It is, or at least should be an embarrassment to the government, which perhaps helps to explain the lengths to which it has gone to hide it from the public.

Jon Stanhope is a former chief minister of the ACT and Dr Khalid Ahmed a former senior ACT Treasury official.