Yet that is exactly the message that Infrastructure NSW,the state’s planning body for major projects,has delivered to Premier Dominic Perrottet.
of about a dozen “megaprojects” that were announced with much pomp over the past few years.
The projects that should be put on ice in Sydney include the second stage of the M6 motorway,the Beaches Link road tunnel,part of a key element of a motorway upgrade in the Blue Mountains,Parramatta light rail stage two and two huge dams in country NSW at Dungowan and Wyangala.
Cancelling some of these projects will disappoint local residents and businesses who made plans because they trusted solemn promises by politicians that infrastructure upgrades were on the way.
For example, in the seat of Manly. Many people will have bought in the area since then expecting the new road would shorten their commuting time.
Perrottet,who is addressing the Herald Infrastructure Summit on Wednesday,has told theHerald that he will not delay the fairly small Parramatta light rail project.
But he should heed the rest of the advice because it is based on a realistic assessment of what is feasible without risking more cost blow outs.
Infrastructure NSW warns that the civil engineering industry cannot manage all the projects that are already under way or in the pipeline both here in NSW and interstate in Victoria and Queensland.
Pressing ahead would increase the risk of huge cost overruns and tax the “limited capacity of government and the construction industry to deliver more megaprojects in the near term,” INSW says.
Infrastructure Australia,its federal counterpart,last year said that demand is growing 33 per cent a year in the three eastern states but the industry has low confidence that it can handle growth over 18 per cent. Demand for key construction materials is growing at 120 per cent a year and with unemployment in NSW under 4 per cent it is impossible to find enough workers.
While there will be a political price to delaying projects,Perrottet should not be running the risk of more cost blowouts at a time when the state is struggling to control the $70 billion in debt incurred during the COVID-19 pandemic.
When choosing projects to put on hold,the state should take the opportunity. Some of the projects were announced for political reasons and have not been rigorously assessed by a business case.
It should also consider whether the projects still stack up given the slower growth in population and social changes wrought by the pandemic,such as the rise of working from home and the use of video conference in health and even the courts.
While politicians like nation-building,legacy projects,Infrastructure NSW says that smaller projects such as fixing road pinch points,replacing old bridges,creating more open green space and active transport corridors offer a “higher payback” in the next few years.
In the medium and long term,NSW will need to build a lot more infrastructure projects. Population growth stalled during the pandemic but it is expected to jump back quickly now that borders have reopened to about 1.2 per cent in 2024-25.
The state needs to keep ahead of the curve.
But the government should reprioritise and reassess its enormous pipeline of projects before it turns into a train wreck of cost blowouts.
This will not be easy but people need to plan their lives and Perrottet should level with voters before the state election.
Bevan Shields sends an exclusive newsletter to subscribers each week..