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Grattan Institute’s warnings must be heeded to rein in runaway Victorian infrastructure costs

Victoria must learn the lessons revealed in a new report that examines the failings of government in the planning and delivery of major projects.

The Grattan Institute’s Megabang for Megabucks report states that cost blowouts will be recorded for 28 per cent of projects with a price tag over $1 billion, 30 per cent of projects with a price tag between $350m-$1 billion, and 24 per cent of projects with a price tag of below $350 million.

It's an experience all too familiar for Victorians living under the waste and mismanagement of the Andrews Labor Government.

Too many Victorian projects are years late and billions over budget.

The Metro Tunnel is nearing $4 billion over budget, the West Gate Tunnel’s at $3 billion over budget and years behind time, as well as the massive level crossing project blowouts deliberately hidden from view by a secretive Andrews Labor Government.

Labor will go to any lengths to hide the truth – even refusing to release a Budget Paper No. 4 with the 2020-21 State Budget. This is the key Budget Paper that would have revealed the true extent of Labor’s project cost blowouts and massive time delays.

The Grattan Institute’s report Megabang for Megabucks found that:

  • Governments don’t care enough about project costs, rushing out to market without understanding of what a good price for the project is, and without taking the time to see how others have delivered similar projects,

  • Megaprojects can only be delivered by a very small number of organisations or alliances meaning reduced competition and higher costs for the taxpayer. Previous reports have found that megaprojects should be the last resort, not the first,

  • Victoria has a poor transparency ranking when it comes to bidders which points to risks of collusion, reduced competition and higher costs for the taxpayer, and;

  • Governments should select a contract type (traditional, PPP, Alliance) that is right for the job with incentives that are in the taxpayer’s interest.

Daniel Andrews and Jacinta Allan’s failure to properly plan, scope, manage and govern projects has squandered public money. If left unchecked, billions more will be wasted.

Victorians are sick of the lies and cover-ups. A Liberal Nationals Government will deliver accountability and transparency.

Comments attributable to Shadow Minister for Transport Infrastructure, David Davis:

“Labor can’t manage major projects or projects costs. They always botch these projects and waste taxpayers’ hard-earned money.”

“The Grattan Institute recommendations are sensible and practical: Key advice to governments should be heeded. The Andrews Labor Government should come clean with project costs. It should scope projects ahead of time. It should focus more sharply on competition to cut costs and improve value for taxpayers.

“A Liberal Nationals Government will heed the warnings, ensure Victorians get value for money on all projects and will introduce more competition into major project contracting.”

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