Off the wire
• Donewald: Cohesive teamwork will make up for Jilin's lack of big names  • Urgent: CPC convenes key meeting on strict Party governance  • Real go top in Spain after Atletico lose to Sevilla  • Japan's exports drop 6.9 pct on year in Sept., imports down 16.3 pct  • Tokyo stocks open lower as U.S. shares' decline sets cautious mood  • Australian teenagers continue to drink alcohol at alarming rate: study  • Dollar trades in upper 103 yen range in early trade in Tokyo  • Aussie govern't approves Chinese takeover of pharmaceutical company Vitaco  • Australian share market brought down at open on disappointing health stocks  • Motorbikes involved in 95 pct of road accidents in Laos  
You are here: 　 Home

Budget blowouts in major Aust'n road projects hit 21bn USD since 2001: report

Xinhua, October 24, 2016 Adjust font size:

Australian governments underquoted taxpayer-funded road and infrastructure projects by a combined 21.3 billion U.S. dollars over the past 15 years, new research by the Grattan Institute has found.

The Grattan report, titled "Cost overruns in transport infrastructure", found cost blowouts accounted for nearly a quarter of the final and total cost of 836 projects valued at 15 million U.S. dollars or more.

It said the root cause was state governments choosing to make premature announcements with unreliable accounting; one third of the 836 major projects were found to have gone significantly over budget.

"While only 32 percent of projects were announced early, these projects accounted for 74 percent of the value of cost overruns over the past 15 years," the report, released on Monday, said.

"Governments should not commit money to transport infrastructure before tabling proper evaluation and the underlying business case in Parliament... and once a project is completed, governments should report to the public on how it performed against the cost-benefit estimates behind the original decision."

The Grattan Institute's Transport Program Director Marion Terrill said while underquoting project costs might not seem damaging at the time, but they have the ability to take money away from other vital developments, such as investment in healthcare.

"Promising to build infrastructure for less than it finally costs makes infrastructure projects seem more attractive than they really are," Terrill said in a statement accompanying the report.

"Understating costs also makes it impossible for decision makers to differentiate good projects from bad ones. With more accurate numbers, we would often spend the money on other priorities."

According to the report, Western Australia's Forrest Highway cost over five times the initial quoted figure, while New South Wales' Hunter Expressway blew out by four times the predicted cost.

Current major projects in Victoria, including the Western Distributor and the Melbourne Metro Rail Project, are also at risk of experiencing cost blowouts. Endit