More than 16 million passengers a year would pay $31 for a one-way trip on a proposed $90 billion high-speed rail line between Sydney and Newcastle that is promised to deliver hundreds of thousands of new homes across the two cities.
The business case for the long-discussed mega-project released on Tuesday suggests a single ticket for the hour-long trip would be $21 more expensive than the $10 passengers pay for a 2.5-hour journey on the existing train line, but cheaper than $38 for a Greyhound bus.
There are doubts over whether the line, which would not be fully operational into central Sydney and out to Western Sydney Airport until 2042, can be built for $90 billion, as even proponents are warning it could cost tens of billions of dollars more.
The business case highlights the benefits of the proposed line running to Central Station, which diverges from the previous NSW Coalition government’s plans for the main station to be built at Olympic Park.
The latest plans have already earned the ire of western Sydney councils and lobby groups who fear the extension to Parramatta and the new airport will fail to eventuate.
However, the rail authority warns in the business case that building the line directly to Parramatta, and missing out the CBD, posed a “significant threat” to the value proposition of a line eventually spanning the east coast. It cited extra travel time and the need to switch to other train services to reach the Sydney CBD as a drag on the value.
Under the plans, stations would be built as part of the initial stages in Broadmeadow in Newcastle, Morisset in Lake Macquarie, Gosford and Central Station. The following stage envisages stations at Parramatta and Western Sydney Airport.
The 194 kilometres linking Newcastle to Sydney would form the initial stages of a 1800-kilometre line along the east coast connecting Brisbane to Melbourne via Canberra by 2060. The business case said a full high-speed rail would boost the national economy by $1.7 trillion by 2086.
The cost of building the line from Newcastle to Central Station is estimated at $61.2 billion, and the onward leg to Parramatta and the new airport at $32.4 billion.
The business case found the entire project would deliver between 80¢ and $1 for every dollar spent on its construction. It said that if the business case had underestimated the project’s economic benefits, it would deliver a net boost of between $12.2 billion and $26.1 billion.
But if it overestimated those benefits, the project would deliver a drag on the economy of between $20.8 billion and $32.8 billion.
The largest share of the expected benefits from high-speed rail is expected to come from more housing, with almost 200,000 new homes – largely in Newcastle and Sydney – likely to be built because of the project.
Some of those new homes will be needed to house up to 46,000 households who are expected to relocate to be close to the rail line, particularly around Lake Macquarie and the Central Coast.
“By enabling the supply of new land for housing, the project will help address imbalances in the housing market in greater Sydney and across the project corridor, enabling more people to own their own home, rent more affordably, and to live and work in the corridor, delivering $5.5 billion to $10.3 billion in benefits,” it argues.
If given the green light, the project would be the single most expensive piece of public infrastructure in Australian history. The business case compares the financing of the line to other substantial global projects, including London’s Elizabeth Line and the Grand Paris Express in the French capital.
A clear concern is the possibility of a blowout in construction costs. The current inland rail link between Melbourne and Brisbane, first estimated to cost $5 billion, is now expected to cost at least $31 billion.
The business case sets out proposals to reduce the risk of blowouts, starting with a two-year development plan that would include major contractors.
Federal Transport Minister Catherine King acknowledged public scepticism in high-speed rail, but said staging of the project represented a “cautious but purposeful approach to actually get this delivered”.
“We’ve learnt the lessons from high-speed rail projects overseas,” she said.
NSW Premier Chris Minns has repeatedly ruled out the state committing funding for the project, but has said his government would be willing to fast-track planning for a high-speed rail line.
King said the federal government would need help from the state on planning, environmental approval and some land acquisition matters. “We’d love them to invest, too, but I understand Premier Minns has said he doesn’t want to do that,” she said.
Infrastructure Partnerships Australia chief executive Adrian Dwyer warned that the government needed to be “clear-eyed” from the outset, including the “very real prospect” of unplanned cost increases that were often a feature of mega-projects.
“Projects of this scale are littered with unknown unknowns, carrying inherent complexity and significant delivery risk,” he said.
“This is not a decision that should be made in isolation. Every dollar committed here is a dollar not spent elsewhere. What’s crucial is realism at every step of this journey. Realism about the costs, realism about the risks and realism about the trade-offs.”
Minns said on Tuesday it would take a “huge effort and a lot of money” to turn the plans for a Newcastle-Sydney high-speed line into reality, but it could happen.
“I’d love to see investment in NSW. That kind of infrastructure investment is fantastic for our state,” he said.
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Shane Wright is a senior economics correspondent for The Age and The Sydney Morning Herald.Connect via X or email.
Matt O’Sullivan is transport and infrastructure editor at The Sydney Morning Herald.Connect via X or email.From our partners
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