Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search


Australian PPP failures a warning for Transmission Gully

22 November 2012

Australian PPP failures a warning for Transmission Gully

New research shows that Public-Private Partnerships (PPPs) are a recipe for expensive, white elephant highways, Green Party transport spokesperson Julie Anne Genter said today.

Recent research from Australian Professor John Goldberg shows that PPPs are a bad investment that routinely grossly over-estimate traffic volumes and, therefore, the economic benefit of PPP projects. Professor Goldberg concludes: "The public-private partnership concept has failed in Australia”. Additionally, analysis conducted for the Green Party confirms a legacy of cost blow-outs and low traffic volumes.

“The failure of the PPP model in Australia should be a lesson for New Zealand. Yet the National Government is repeating the same mistakes by announcing a PPP for Transmission Gully,” said Ms Genter.

“Private consortiums in PPPs know that they have an effective taxpayer guarantee on their investment. That results in over-hyped projects that end up costing billions more than expected and fail to deliver the promised traffic volumes.

“In Australia, ordinary investors have lost their shirts and taxpayers have been saddled with multi-billion dollar bills, while the investment banks and developers walk away with enormous profits.

“The companies operating Cross City, Clem7, and Lane Cove PPPs all failed soon after their projects opened and the Brisconnections company is heading the same way. New Zealanders would face a similar debacle if the Transmission Gully PPP goes ahead.

“National has already acknowledged that borrowing for the construction of Transmission Gully rather than paying for it out of the National Land Transport Fund will add $300 million in interest to the cost of the project before it even opens. If the Australian experience is anything to go by, this would be just the first of many cost blow-outs.

“Public-Private Partnerships have proven to be a very costly failure across the Tasman. Why would we repeat that mistake here?” said Ms Genter.

Summary of major PPP roading projects in Australia

Australia PPP Roading Projects



Initial Forecast Cost

Actual Cost

Traffic Forecast

Actual traffic

Clem 7 Tunnel


$1.2 Billion

$3 Billion

Opening 60,000

34,705 (2010 peak during lower toll period)

100,000 (2012)

28,086 (Feb 2012)

Lane Cove Tunnel


$1.1 billion

$1.6 Billion

110,000 (2007)

40,000 (2007)

120,000 (2010)

66,694 (2010)


67,795 (2011)

WestLink M7


1.856 billion

$1.9 billion

150,000 (2006)

100,000 (2006)

225,000 (2010)

128,973 (June 2010)


135,691 (June 2011)

Cross City Tunnel


$620 million

$1 Billion

87,600 (2006)

34,000 (2006)

Melbourne City Link


$1.5 Billion

$2.15 Billion

730,000 (2011)

710,483  (2010)


747,021 (2011)

Go between bridge


$120 million

$342 million

12,800 Oct 2010

11,700 (Sept 2010)

17,500 2011

Peak 15,783 ($1 reduced toll)




$4.8 billion

135,885 (August 2012)

81,470 (August 2012, no toll for account holders)





53,172 (October 2012)

Eastern link


$2 billion

$2.5 billion

300,000 (2012)

200,000 (2012)

250,000 (2009)

158,900 (2009)

Compiled by the Parliamentary Library


© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines



Gordon Campbell: On John Key’s Trip To Iraq

In the embedded press coverage on this trip, the absence so far of any evaluation of the wider context of what New Zealand thinks it is doing at Camp Taji has been striking. More>>


Labour: Parata Puts Brakes On Charter School Appraisal

“When the Ministry of Education recommended they compare the achievements of children at charter schools to those of their counterparts at state schools, the documents show Hekia Parata specifically prohibited them from doing so." More>>


Bad Day For Universities: Gun, Bomb Threats On Three Campuses

Dunedin Police are continuing their investigation into the threat made against the University of Otago. Staff are following a number of lines of inquiry, and police are working to verify the authenticity and source of the post. More>>


Gordon Campbell: On The TPP Deal Reached In Atlanta

Yes, the TPP has helped to knock a few points off the tariffs facing our exporters. Yet some of those alleged dollar gains may well have been made regardless over time – and without the negative baggage of the concessions in the non-trade areas (intellectual property, copyright extensions, investor-state dispute mechanisms etc) that the TPP deal also brings in its wake. More>> (Cartoon by Dave Wolland)

Public Summaries:


Wellington.Scoop: Serco – First The Prisons, And Now It Wants To Run The Trains

As the government continues its inquiry into Serco’s discredited administration of Mt Eden prison in Auckland, here in Wellington there’s further scrutiny of the British outsourcing company – because it’s competing to take over the running of our commuter trains. More>>


Pre-Signing: Gordon Campbell On The TPP Countdown

To date, the Key government has been unwilling to share any information about this TPP deal until it is too late for outraged public opinion to affect the outcome... the disclosure process is likely to consist of a similarly skewed and careful exercise in spin. More>>


Australia Deportations: English Relaxed On Immigration Centre Conditions

Labour's Annette King: “There have been numerous reports from inside these detention centres on just how bad conditions are... If they were being held in any other foreign jail, I imagine Mr English would be somewhat concerned. More>>


Schools: Achievement-Based Funding Would Be A Disaster

The Education Minister’s speech to the PPTA Conference raising the spectre of achievement data driving a new funding system would be disastrous, says NZEI Te Riu Roa. More>>

  • Video Out-Link - PPTA Annual Conference 2015 on Livestream (Q+A dicussion suggests funding would be directed to less successful schools.)

  • ALSO:

    ECE Report:

    Get More From Scoop



    Search Scoop  
    Powered by Vodafone
    NZ independent news