REGARDING RDA Hunter's plans for the region’s economy: The Herald might ask deputy chair John…
Author: Greg Cameron
Greg Cameron argues for a case for the single biggest economic boost to the Hunter since BHP.
On Tuesday in federal Parliament, western Sydney backbencher Ed Husic asked the Transport and Infrastructure Minister Anthony Albanese how the government’s infrastructure investment plans would help move freight more quickly into Port Botany.
Mr Albanese answered: “The current NSW proposal has a number of weaknesses in it, and we are insisting that they be fixed. That is the way you do good infrastructure development: get your business plan in place first and then get your funding commitments made.”
AN economy without a container terminal is hopelessly disadvantaged because world trade for everything except bulk commodities, such as coal, is conducted using containers.
New industry will not invest in a region where there is no container terminal.
There is a clear and compelling opportunity for a container terminal at Newcastle to replace the one at Port Botany.
An upgrade of the Northern Sydney Freight Corridor – essentially Strathfield to the Hawkesbury River – is needed within 15 years.
But it would cost $4 billion to install the dedicated freight line to service the container terminal at Port Botany.
There is no money for this project.
The NSW government does not have the funds. The Australian government has not committed the funds, despite being asked.
But a dedicated freight line running through Sydney is the cornerstone of the NSW government’s freight transport plan.
No funds means no plan.
The solution is for the Australian government to buy the Port Botany container terminal from the NSW government at the market price of $2 billion.
Since BHP paid the NSW government $100 million in 2001 to take ownership of the former Newcastle steelworks and now container terminal site, the Australian government should acquire it for $1.
With these purchases, the Australian government could invite private enterprise to finance and build a freight rail line between Glenfield in south-west Sydney and Newcastle – otherwise known as the freight rail component of the “Outer Western Sydney Orbital”. This dedicated freight line would service a container terminal at Newcastle.
Containers would reach a terminal at Badgery’s Creek faster from Newcastle than if they were shipped to Port Botany and then moved by truck and rail to Moorebank (near Badgery’s Creek).
Here are the other implications of the Australian government purchasing the Port Botany container terminal:
– There would be no need to upgrade the Northern Sydney Freight Corridor and build a dedicated freight rail line between Strathfield and the Hawkesbury River, costing $4 billion in present value terms, because only the Orbital freight rail line would be required.
– All Sydney metropolitan rail capacity would be devoted to passenger services when north-south rail freight was transported on the Orbital freight rail line. The economic benefits would be up to $1 billion a year by reducing the growth in Sydney road traffic.
– The Australian government could invite private enterprise to add a freight rail line to the South West Rail Link, currently under construction between Glenfield and Leppington. Extending the line 10 kilometres to Badgery’s Creek would provide a dedicated freight rail line between Port Botany and Badgery’s Creek, enabling all containers to be railed from Port Botany. There would be no need for heavy trucks to access the Port Botany container terminal.
– The Australian government could invite private enterprise to finance and build an intermodal terminal on government-owned land at Badgery’s Creek. The terminal’s design would allow for orderly expansion to meet demand for the next 100 years.
– The Australian government could cancel its plan for building an intermodal terminal on its Moorebank site and can release the land for use as a business park. A business park would be financed and developed by private enterprise to provide up to 15,000 jobs.
– The Australian government could facilitate a new era of economic development in northern NSW by inviting private enterprise to build and operate a major container terminal at Newcastle.
Financially, the Australian government’s $2 billion investment in acquiring the Port Botany and Newcastle container terminal sites could be recovered by leasing the sites to private enterprise.
After container terminal operations were transferred to Newcastle, the Port Botany site could be used for improving passenger and cargo services at Sydney Airport.
In addition, $970 million would be saved by cancelling the Moorebank intermodal terminal project.
A contribution of $1 billion already offered by the Australian government towards a road project aimed at reducing traffic congestion in the Port Botany and Sydney Airport precinct would not be needed when all containers were transported by rail.
A freight rail by-pass of Newcastle, as part of the Orbital freight rail line, would enable re-development of government-owned land along Newcastle’s existing rail corridor. Light rail would replace the existing heavy rail.
All of the infrastructure projects can be financed and built by private enterprise – at no net cost to the Australian or NSW governments – by moving containers and general freight by rail between Newcastle, Badgery’s Creek and Glenfield.
The alternative is more trucks on more roads.
Greg Cameron is a former BHP executive interested in regional economic development.