REPORT 2011–12 ANNUAL
RAILCORP ANNUAL REPORT 2011–12 LETTER OF SUBMISSION
31 October 2012
The Hon. Gladys Berejiklian Minister for Transport
Parliament House Macquarie Street Sydney NSW 2000
Dear Minister,
It is my pleasure to provide for your information and presentation to Parliament the Rail Corporation New South Wales Annual Report for the year to 30 June 2012.
The report has been prepared in accordance with the Annual Reports (Statutory Bodies) Act 1984, the Annual Reports (Statutory Bodies) Regulation 2010 and the Public Finance and Audit Act 1983.
Yours sincerely,
Rob Mason | Chief Executive t Overview
Contents
Overview 3
Chief Executive foreword 5 Transport for NSW 6 Fixing the Trains 7 Interim management structure 9 Financial performance summary 12
Operational performance 15
Safety 16 Growth 28 Assets 32 Value for money 40 People 43
Financial statements 2011-12 47
Appendices 107
Index 141 NSW 2021: A plan to make NSW number one again
NSW 2021 sets the Government’s agenda for change in NSW.
It is a 10 year plan to rebuild the economy, return quality services, renovate infrastructure, restore accountability to government, and strengthen our local environment and communities. It replaces the State Plan as the NSW Government’s strategic business plan. This plan sets immediate priorities for action and guides NSW Government resource allocation in conjunction with the NSW Budget. Agencies will identify cost-effective initiatives to achieve the goals and targets within the plan.
The plan has five key strategies:
1. Rebuild the economy
2. Return quality services
3. Renovate infrastructure
4. Strengthen the local environment and communities
5. Restore accountability to government.
Transport for NSW is the lead agency for delivering on the following goals and measures:
Goal 7 – Reduce travel times (private and public transport)
Goal 8 – Grow patronage on public transport by making it a more attractive choice
Goal 9 – Improve customer experience with public transport services
Goal 10 – Improve road safety
Implementing NSW 2021
There are various mechanisms in place to support the implementation of NSW 2021. Localised plans are being put in place through an extensive consultation process to help Transport for NSW focus on the transport outcomes that matter most in different communities and baseline reporting has been established to outline how success is measured.
Planning and performance management systems ensure accountability for delivering on specific components of the plan. Performance is publicly reported online, so the NSW community can track its progress, and tabled in NSW Parliament in an annual NSW 2021 performance report.
These processes ensure there is clarity about how the transport cluster is contributing to the NSW Government’s vision for transport, and there is transparency in the way performance is measured and reported. NSW 2021 will be reviewed periodically in consultation with the community, and Transport for NSW will work to improve its targets over time as more accurate and nationally comparable measures become available.
2 RailCorp Annual Report 2011–12 Overview Operational Performance
Chief Executive foreword 5
Transport for NSW 6
Fixing the Trains 7
Interim management structure 9
Financial performance summary 12
Operational Performance 3 NSW 2021 FIVE KEY STRATEGIES — REBUILD THE ECONOMY
RETURN QUALITY SERVICES
RENOVATE INFRASTRUCTURE
STRENGTHEN THE LOCAL ENVIRONMENT AND COMMUNITIES
RESTORE ACCOUNTABILITY TO GOVERNMENT
4 RailCorp Annual Report 2011–12 Chief Executive foreword Overview
This year was another record integrated transport authority of trains vandalised by graffiti year for RailCorp with 306 million Transport for NSW. On 1 November receive patch painting to cover up passenger journeys completed 2011 those plans came to fruition. these ugly scars and give customers across the state’s network. CityRail a more pleasant journey experience. on-time running continued to be Transport for NSW is now responsible above target with 94.2 per cent of for planning and strategy for all A major cleaning operation at CBD peak time trains running to schedule modes of transport including rail. stations during weekend track for the year. A NSW Commission of RailCorp, meanwhile, can now focus closures also came about as a Audit report released in May 2012 on customer service, operations and direct result of customer feedback. found that Sydney had the highest maintenance. This is a huge change This saw painting, scrubbing and level of on-time running across for the organisation and one that cleaning make some of our busiest major cities in Australia and we are will directly benefit our customers. It stations look like new again. proud of this achievement. is also only the beginning of the evolution. There is not space here to list all of This accomplishment reflects the initiatives completed or the record level of investment The NSW Government has released underway to give our customers the being made to modernise our a draft Long Term Transport Master railway system they deserve, but it network. For the full year, a capital Plan and a final version will be would be remiss of me not to thank investment of $1.577 billion was released later this year. It will identify all RailCorp employees who are used to help deliver customers a the role of each transport mode in striving to transform our organisation. better rail journey. meeting transport needs over the With NSW 2021 outlining the next 20 years. It is of little surprise government’s plan to make One such example was the renewal that heavy rail will remain the NSW number one again, staff are of the Boundary Street bridge backbone of public transport now dealing with a challenging at Roseville. This project saw in NSW. transitionary period as major the removal of one of Northern structural changes take place Sydney’s major traffic choke points As highlighted above, patronage at speed. while opening up the possibility of figures show that more and future quadrupling of the rail line more people are adopting this Announced by the Minister for passing over the bridge. environmentally attractive mode Transport on 15 May 2012, the of transport. Fixing the Trains initiative will be the Another stand out for the year has largest reform to NSW’s rail network been the introduction of 10 Waratah In response to this increase in in a generation. trains into passenger service. The demand, capacity increases have introduction of the Waratah trains been rolled out during the reporting Indeed, by this time next year, will see 626 carriages added to the period. On the Newcastle & Central RailCorp itself will be well on its way network over the coming years, Coast Line alone, an additional to transforming into NSW Trains dramatically modernising the fleet. 33,000 seats a week have been and Sydney Trains – two separate added to services, many of these organisations each focusing on the This public private partnership is provided by brand new Oscar trains. needs of their different customers. the largest single order of trains in Full details of this transition are on Australia and represents about half With a renewed focus on the following pages. of the current suburban fleet. The our customers, RailCorp has partnership involves the completion worked with Transport for of more than 20 infrastructure NSW to understand what our and technology projects as well as customers want and undertaken change management and training. many initiatives to make these expectations a reality. Taking Back In last year’s annual report, I made the Trains was a customer-led Rob Mason mention of plans to establish an intervention which saw the interiors Chief Executive1
Overview 5 Transport for NSW
Transport for NSW has primary The aim is to put the customer The contract in place reflects the responsibility for transport at the centre of everything the cooperative approach adopted by coordination, transport policy transport portfolio does and to the Director General and RailCorp and planning, transport services, make it easier for services to be to deliver a more capable, safe and and transport infrastructure. The delivered in a seamless way. reliable transport network across intention is to deliver integrated metropolitan, regional and rural transport planning and service The Rail Services Contract NSW, and to achieve efficiencies delivery, and to consolidate like between the Director General of and service delivery improvements. functions, reduce costs and provide Transport for NSW and RailCorp additional funds for frontline staff clearly stipulates the government’s The new contract being developed and services. expectations for service levels, for 2012-13 builds on this approach, service alterations, community establishing clear accountabilities consultation, regular service and robust governance and risk reviews, performance standards and management arrangements. the handling of complaints.
TRANSPORT FOR NSW RAILCORP
Planning, regulation, strategic procurement Rail operator/maintainer
System planning Asset procurement Service design Service delivery Rail transport & delivery value chain
RailCorp functions › Frontline customer service Marketing, › Customer information Rolling stock communications Customer › Customer amenity Service procurement strategy and (cleaning and presentation) branding › Revenue protection › Operations planning and co-ordination Service specification › Train operations Operations Long term Major capital and standards › Network operations and crewing rail planning works projects including standard › Incident management working timetable and recovery › Asset management Maintenance › Maintenance services Design Authority › Infrastructure renewals Network access including › Finance (regulation, planning engineering › Corporate services and commercial) Support standards › Reform and business performance › People and culture › Communications delivery
6 RailCorp Annual Report 2011–12 Fixing the Trains Overview
The organisation needs to change the way it works, and the Fixing the Trains program will target over-complicated processes and empower people to take initiative and get things done.
Being more responsive to its customers is at the core of RailCorp’s commitment to becoming a world- class railway. This is an opportunity to get it right.
On 15 May 2012 the NSW Minister for Transport announced the next stage in the ongoing improvement process for RailCorp – Fixing the Trains.
The three major changes are: RailCorp’s performance has been benchmarked against • The creation of two new specialist other heavy rail operators around the world. The results are organisations – Sydney Trains clear: there is much room for improvement. and NSW Trains – to service the different needs of Sydney and regional/intercity rail customers The transport priority for the There are three key drivers for the NSW Government is to deliver Fixing the Trains program: • Cutting back on back-office an integrated, customer focused bureaucracy transport system. RailCorp is • A need to become better committed to achieving that goal, in organisations and improve service • Creating a specialist cleaning partnership with Transport for NSW for customers subsidiary company to attack and peer transport operators. graffiti and rubbish on trains and • A need to position RailCorp and at stations. its successors to operate and maintain a world-class railway These are the first steps to better position RailCorp to focus on A new beginning • A need to address unsustainable delivering improved customer costs. service. Further steps will be The Fixing the Trains program is taken through 2012-13 to simplify about improving customer services RailCorp’s customers have made it RailCorp’s business, reduce and building a more efficient clear that the organisation needs to bureaucracy and allow the new organisation. The program will lay provide cleaner trains and stations organisations to focus on their out a road map to help RailCorp and as well as more reliable and timely core purpose of passenger its successors achieve its vision of passenger information. There is also a service delivery. being known as Australia’s clear need to further improve the time world-class railway. The best train systems in the world it takes for customers to get on and are focused on the unique needs of off trains at major stations, and have their customers. In NSW, about staff more visible and ready to help. 50 per cent of customers travel less
Overview 7 than 30 minutes. They need quick, Sydney Trains will also operate This will free them from the frequent and reliable trains. Intercity and maintain the existing RailCorp bureaucracy of the RailCorp and regional customers, on the network and provide maintenance organisation and allow appropriate other hand, travel longer distances. services to NSW Trains. Both management processes and systems They need comfortable services, organisations will operate under to be externally sourced to better with on-board facilities. a Rail Services Contract with support cleaning staff in their jobs. Transport for NSW. Currently RailCorp tries to service New performance benchmarks will both city and regional and intercity be applied to cleaning through a customers and, as a result, neither transparent Service Level Agreement Cleaner trains customer group receives the – to drive the types of quality services they deserve. In order to improve customer service, outcomes that customers demand. train and station cleaning functions The establishment of the two new are being restructured. Customer specialist organisations will address satisfaction surveys reveal cleanliness Operator-maintainer focus this problem. of trains is the biggest issue, with RailCorp’s construction, major • Sydney Trains will operate quick, only 46 per cent of customers happy projects and engineering design frequent and reliable trains in the with the state of train carriages. As a responsibilities are moving to greater Sydney suburban area result, RailCorp plans to move more than 800 employees in Presentation Transport for NSW to integrate • NSW Trains will operate train Services to a new subsidiary them with the rest of that services that are focused on the organisation to help facilitate organisation’s responsibilities for needs of regional and intercity improvements in cleaning standards planning and delivering major customers. on trains and at stations. upgrades to the rail network.
FOCUSING ON OUR CUSTOMERS
RAILCORP
MOVES TO TRANSPORT FOR NSW TRANSPORT FOR NSW
Major asset procurement and › System planning System planning delivery/design authority › Shared services › Major asset procurement and Shared services Service design delivery/design authority › Service design
SYDNEY TRAINS NSW TRAINS
› Customer service › Customer service › Maintenance › Operations and minor asset (trains) SERVICE DELIVERY procurement and › Corporate delivery Maintenance and minor asset Customer service › Operations procurement and delivery › Corporate Operations Corporate TRANSPORT CLEANING SERVICES
RAILCORP (Asset owner)
8 RailCorp Annual Report 2011–12 Up to 250 positions in the major Streamlining management project critical. It has not affected Overview capital work projects area, customer-facing staff. engineering design authority and Existing RailCorp groups have network access will be moved been streamlined to reduce the The focus is on simplifying decision- to Transport for NSW. That will number of direct reports to the making processes and management allow the remainder of RailCorp Chief Executive from 11 to eight. structures to make NSW railways to concentrate on operating and The Engineering and Projects easier and more efficient to operate. maintaining the rail system. Group will fold into the Maintenance Group once functional transfers to Transport for NSW are complete. Meeting future challenges Focusing on the customer Passenger numbers are forecast to A new Customer Service Reducing bureaucracy increase by 50 per cent over the Directorate was created on 1 July next 25 years and being able to 2012 in RailCorp to drive focus To help speed up decision-making, meet their demands sustainably will on improvements to customer RailCorp is tackling bureaucracy be no easy task. service across the organisation. and simplifying core processes. It Tackling middle management The Directorate will work closely is also offering up to 750 voluntary inefficiency and bureaucracy is just with Transport for NSW’s Customer separation packages to managerial, the first step. All areas of RailCorp Experience division to translate supervisory and support roles to need improvement. Customers customer insights and service streamline the organisation. expect better services; NSW standards into tangible customer To ensure there is no impact on taxpayers expect better value service improvements. service delivery to customers, for money. The Fixing the Trains the current voluntary separation program is all about progressively program has not been extended implementing measures to deliver to frontline service positions and on these expectations. positions identified as business or
INTERIM MANAGEMENT STRUCTURE AS AT 1 July 2012
The interim management structure is the first step in a series of changes towards the establishment of the Chief Executive new organisations – Sydney Trains, Rob Mason NSW Trains and Transport Cleaning BSc (Hons), MBA Services – announced by the Minister for Transport on 15 May 2012.
Director Director Director Operations Director Maintenance Engineering & Projects Customer Service Anthony Eid Gavin Campbell Philip Pearce Liz Ward, MBA PSM BMechEng, MBA BEng (Hons), CEE
Director Safety, Director Director Finance & Director Reform & Environment, Quality & Risk People & Change Corporate Services BusinessPerformance Clare Kitcher John Cairns Gary Pedersen David Callahan BSc (Hons), CFSIA, CPRM, LLB (Hons), BCom (Hons) BEc, MCom, FCPA BA, MBA, GAICD CMIOSH, MIRO
Overview 9 SYDNEY TRAINS
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Lochinvar Creek c Greta ralba HamiltonWickhaCivim FassifernBooraguTe l Cockle e Awaba
Scon f Aberdeen SingletonBranxton Dora Creek CardifKotara Muswellbrook Morisset Adamstown Newcastle Wyee Broadmeadow
Warnervale Wyong Tuggerah Ourimbah Lisarow Niagara Park Narara
e Gosford Lithgow Point Claree Tascott Zig Zag CowanHawkesburyHawk River WondabynW Koolewongg Bell Berowra Woy Woy Mount Victoria Blackheath Mount Kuring-gai Hawkesbury River Medlow Bath Hornsby Mount Colah Katoomba Asquith Richmond Normanhurst Waitara Leura East Richmond Thornleigh Wahroonga Wentworth Falls Warrawee Clarendon Pennant Hills Bullaburra Turramurra Windsor Lawson Beecroft Pymble Hazelbrook Mulgrave Gordon Woodford Vineyard Killara Cheltenham Lindfield Linden Cudgegong Road Roseville Faulconbridge Riverstone Chatswood Springwood North West rail link Epping Schofields under development Artarmon Valley Heights Quakers Hill St Leonards Warrimoo Carlingford Macquarie Wollstonecraft Marayong University North Ryde Sydney Harbour Blaxland Eastwood Macquarie Park Waverton Glenbrook Telopea North Sydney Lapstone Denistone Milsons Point Blacktown Circular Quay Dundas West Ryde
Penrith rringtoStn Marys Seven Hills Meadowbank Rooty HillDoonside Rydalmere Emu Plains KingswoodWe Toongabbie Mount Druitt Wynyard Martin Place Pendle Hill Rhodes Camellia Wentworthville Concord West Town Kings Cross Westmead Hall St James Edgecliff Rosehill North Strathfield Parramatta City Bondi Olympic Central Circle Junction Harris Park Park Redfern Merrylands Clyde Museum Guildford Granville Yennora Auburn Erskineville CroydonAshfield LewishamPetershamStanmoreNewtown HomebushStrathfieldBurwood Green Square Fairfield Lidcombe Flemington Summer Hill St Peters Berala Macdonaldtown illawood Canley Vale CarramarV LeightonfieldChesterSefton Hill Regents Park Mascot Cabramatta Sydenham Warwick Farm Birrongagoona Campsie Y LakembaBelmore Tempe Liverpool Wiley Park Canterbury Domestic Airport BankstownPunchbowl DulwichMarrickvill Hill e Hurlstone Park Casula International Station access Wolli Creek Airport fee applies at these stations Glenfield LeppingtonEdmondson Park s Arncliffe Banksia South West rail link Narwee Turrella Rockdale East Hill PananiaRevesbyPadstow under construction Holsworthy Riverwood Beverly HillKingsgroves Kogarah Botany Bay Bexley NorthBardwell Park Carlton Macquarie Fields Allawah Hurstville Ingleburn Penshurst Mortdale Minto Oatley e
Como a Key Leumeah Jannali ooloowaronulla Some Southern Highlands services Sutherland Kirrawee Gyme Miranda CaringbahW Cr operate directly to and from Central. Sydney Trains Campbelltown Loftus NSW Trains Engadine Macarthur Heathcote Waterfall Peak hours Helensburgh only Menangle Parkk Otford Menangle Stanwell Park Coalcliff Douglas Parkk Weekends and selected weekday services Scarborough Pictonn Wombarra Some services operate over Coledale shared lines. Austinmer Thirroul Bulli Transport interchanges Woonona Interchange between CityRail services Tahmoor Bellambi Bus (including bus transitways) Corrimal Ferry wharf near station Towradgi Bargoo Fairy Meadow Monorail stop near station North Wollongong Tram Yerrinbool Wollongong s Coach Coniston Sydney Airport LysaghtCringilaPort KemblaPort Kembla North Car park near station Unanderra Stations with wheelchair access Kembla Grange Racecourse N Dapto Wheelchair access Mittagongg (staffed for all train services) Albion Park Oak Flats Wheelchair access Bowralall (not staffed for all train services) Dunmore (Shellharbour)r) Burradoo Minnamurra Assisted access (May be accessible Moss Valee with help from a friend or carer. Bombo Exeter Kiama Please check prior to travel.) Gerringong Map full network grid 440x317 (A3 oversize) May 2012 Bundanoonn Penrose Berry Wingello Bomaderry (Nowra) Tallong Marulan Goulburnn
Sydney Trains will provide services on the network bounded by Berowra, Richmond, Emu Plains, Macarthur and Waterfall. It will provide quick, frequent and reliable trains. It will also be responsible for network operations and maintenance of the metropolitan rail system.
10 RailCorp Annual Report 2011–12 Overview NSW TRAINS
NSWCountryLink Trains Network Roma Street (Brisbane) Beenleigh Gold Coast Robina Surfers Paradise train and coach Burleigh Heads Palm Beach Queensland Tweed Heads South Tweed Heads Chinderah Kingscliff New Murwillumbah Bogangar Hastings Point Burringbar South Pottsville Mooball Wales Northern Rivers Billinudgel turnoff Ocean Shores turnoff a w Brunswick Heads Kyogle e l Mullumbimby Lismor Bexhil Clunes Binna BurrBangalo Byron Bay Casino Suffolk Park Eltham Lennox Head h Tenterfield Ballina Ballina West Goonellaba llongbar Wardell Bolivia Wo Alstonville Broadwater Evans Head Deepwater Woodburn Woombah Iluka
a Dundee Chatsworth Island Clarence River y f l riald Maclean Binigu Gravesend Wa DelungraMt Russellturnof Inverel st Moree Glen Innes y We mba Lightning Ridge Gibraltar Range Tyndale Ya mba Warialda Rail Gilgai Glencoe Cowper Ya North West Palmers Island Jackadger Ulmarra Bingara Tingha Bellata Llangothlin Grafton Bourke Brewarrina Burren Junction Wee Waa Cobbadah Bundarra Guyra Walgett Northern Coffs Harbour Narrabri Barraba Yarrowyck Tablelands Sawtell Upper Manilla Gongolgon Armidale Urunga Byrock Manilla Nambucca Heads Upper West Uralla Coonamble Macksville Boggabri Walcha Attunga Eungai Coolabah Baradine Walcha Road Kempsey Hastings River Gunnedah Kootingal Wauchope Port Macquarie n Coonabarabran Girilambone Tamworth Kendall Gulargambone North Coast a e e Werris Creek Taree Binnaway Wilcanni Emmdal Cobar Boppy Mountai Hermidal Quirindi Hallidays Point turnoff Nyngan Mendooran Coolah Willow Tree Wingham Tuncurry Warren Gilgandra Murrurundi Mt George turnoff Forster Nevertire Burrell Creek Broken Hill Dunedoo Scone Forster Keys Gloucester Krambach Craboon Junction Tiona Park Aberdeen Eumungerie Gulgong Belbora Pacific Palms Trangie Mudgee Town Stratford Mudgee Station Craven Smiths Lake turnoff Dubbo Lue Menindee Muswellbrook Wards River Bungwahl Narromine Stroud Road Rylstone Rylstone Hospital Dungog Geurie t Tomingley Kandos Stroud Bulahdelah Darnick Charbon Singleton Booral Nerong Wellington Clandulla Allworth turnoff Tea GardenHawkss Nes Peak Hill Limeburners Tea Gardens turnoff Ilford Creek Central West Running Stream Karuah Port Stephens est Stuart Town Maitland Ivanhoe W Alectown Central Capertee i e Raymond Terrace Ben Bullen Hunter g Tablelands Newcastle Port Hunter a Cullen Bullen rrabanda Orange Portland East Broadmeadow Euabalong Condobolin Ooth Ya Bogan Gat Parkes Molon t Derriwong Lucknow e Portland llerawang Fassifern Spring Hill Wa Central Euabalong Millthorpe tholme Wyong Manildra Kelso RaglanYe MeadowMt Fl Lambia Lithgow Coast ictoria Gosford
Lake Cargelligo Forbes Mt V Hornsby Cudal l KatoombaPenrithBlacktowParramattan Eugowra Carcoar Sydney Ryda Sydney Harbour Blayney Tarana (Central) Tullibigeal Canowindra Mandurama Bathurst Lower West Botany Bay Lyndhurst d Ungarie t y y Woodstock Port Kembla Bumbaldry Oberon Hartle Campbelltown Wollongong West Wyalong Cowra Hampton Strathfiel n Grenfell Good Fores Little Hartle Mittagong Dapto Wyalong BurrawanRobertsog Koorawatha Bowral Albion Park Barmedman Moss Vale Illawarra Lake Illawarra Bendick Murrell Southern Bomaderry
n rk Tablelands Bundanoon Exeter Young a mora Harden Yass Junction Gunning Yend Binya BarellanArdlethaBeckom Ariah Pa Te Stockinbingal Griffith Goulburn
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o g Cootamundra Galon n BinalongBowning d anc Yass Y n n ACT Tarago Sunraysia Whitto Muttama Narrandera Coolamon Murrumbateman BurongEustoa BalranalHay CarrathoolDarlington turno Point Grong GronMatong Ganmai Coolac Jervis Bay Leeton Canberra Junee Gundagai Bungendore Mildura Canberra Civic Tumut Robinvale t Queanbeyan New South Wales Tumblong Adelong Jerilderie Urana Lockhar in Wagga Wagga Wondalga Canberra John James Hospital Victoria y Batlow Batemans Bay Deniliqu Blight Finley Riverina South Canberra Hospital Berrigan The Rock Laurel Hill South a Henty West Snowy Michelago Coast Mathoura Tocumwal Slopes Tumbarumba Mulwal Howlong Culcairn Mountains N Corowa Bredbo Moama Barooga Albury Cooma Echuca Wangaratta Nimmitabel
Cobram Victoria New South Wales rrawonga Bemboka Ya Benalla Bega Bibbenluke Wolumla
Bombala Merimbula Pambula Eden Twofold Bay
Southern Cross (Melbourne)
Port Phillip Bay CL all network May 2012 400x350 plus 10mm bleed Bus services Rail services
© RailCorp May 2012 Map not to scale
NSW Trains will operate what were CountryLink and Intercity services. These services will have a focus on comfort, as well as onboard facilities.
Overview 11 Financial performance summary
For the 2011–12 year, RailCorp generated $1.113 billion access fees for Airport Link stations income from operating activities, while incurring expenses at Green Square and Mascot. of $3.825 billion operating the business, recording a CountryLink passenger revenue was deficit from operations before government support of also $5 million higher than budget.
$2.712 billion. The operating budget for 2012-13 is a surplus of $604 million. This consists of income from operating Government contributions towards Income from operating activities activities of $1.151 billion (including the day-to-day operations of was $34 million higher than budget. $801 million from passenger RailCorp were $1.735 billion, giving CityRail passenger revenue was services revenue) and total expenses an operating deficit of $977 million $14 million higher than budget including depreciation and finance for the year. Government and other primarily due to sustained costs of $3.820 billion. Government contributions towards RailCorp’s patronage growth above contributions towards operating and capital investment program totalled expectations, including a strong capital expenditure are $1.675 billion $1.396 billion and, after treating this response to the removal of station and $1.598 billion respectively. as income for the year, RailCorp recorded a surplus of $419 million. Capital expenditure Income was $1.113 billion, which rose $ million this year by $99 million or 9.8 per 1200 cent, being driven by an increase in passenger and non-passenger revenue on the previous year. 900
Total expenses for the year were 600 $3.825 billion, an increase of 1119 1163 $323 million or 9.2 per cent on the 1043 prior year. 748 734 300
0 2007-082008-09 2009-10 2010-112011-12 Budget Years
The surplus for the 2011-12 year of Maintenance $419 million was $515 million higher than original budget. Government $ million Maintenance expense contributions towards operating 1200 Capitalised maintenance expenditure were $3 million higher 203 200 than budget and contributions 210 183 towards capital expenditure 172 were $588 million higher than original budget. During the year 600 908 911 additional capital funding was 816 756 allocated to RailCorp following 734 the amalgamation of the former Transport Construction Authority into TfNSW. 0 2007-082008-09 2009-102010-11 2011-12 Years
12 RailCorp Annual Report 2011–12 Capital investment Capital investment Overview
RailCorp’s capital expenditure in 2011-12 capital investment, by program $ million 2011-12 increased by 3.9 per cent Clearways 216 to a record $1.163 billion ($1.119 billion 2010-11). In addition, Outer Surburban Cars - tranche 3 136 a further $200 million of major Waratah rolling stock - enabling and ancillary works 107 periodic maintenance was Traction Supply Upgrade (Waratah A-Sets) 72 capitalised. RailCorp also recognised leased assets totalling $214 million Digital Train Radio System 38 having accepted nine sets of Lidcombe to Granville Corridor Upgrade 36 Waratah rolling stock during the Automatic Train Protection 27 year. This gave a total capital investment of $1.577 billion for Easy Access 22 2011-12 ($1.351 billion in 2010-11). Other capital programs 509
Capital expenditure 1163 Capitalised maintenance works 200 Leased assets under Private Public Partnership 214
Total capital investment* 1577
* Includes programs delivered by TfNSW such as the North West rail link
RailCorp finance at a glance
Finance 2007-08 2008-09 2009-10 2010-11 2011-12
$ million Passenger services revenue 623.0 660.8 693.3 703.5 766.2 Other income 286.0 277.3 267.2 310.7 347.0 Income from operating activities 909.0 938.1 960.5 1014.2 1113.2 Total expenses 2684.4 3072.7 3225.9 3502.5 3825.4 Deficit from operations before government contributions -1775.4 -2134.6 -2265.4 -2488.3 -2712.2 Government subsidies and concessions 1496.6 1466.8 1605.8 1638.0 1734.7 Deficit from operations before capital contribution -278.8 -667.8 -659.6 -850.3 -977.5 Government and other contributions for capital expenditure 572.8 932.0 710.8 872.8 1396.6
Surplus for the year 294.0 264.2 51.2 22.5 419.0
Cost and revenue per journey
Finance 2007-08 2008-09 2009-10 2010-11 2011-12
$ Cost per passenger journey 9.42 10.46 11.09 11.82 12.52 Revenue per passenger journey 2.19 2.25 2.38 2.37 2.51
Overview 13 14 RailCorp Annual Report 2011–12 Operational performance Operational Performance
SAFETY 16 A safe railway, a safe workplace, a safe culture
CUSTOMER 21 RailCorp puts the customer at the centre of everything it does
GROWTH 28 RailCorp will work with Transport for NSW to assure its growth program provides for sustainable capacity and service improvement
ASSETS 32 Effective management and stewardship of assets Heritage 36 Environment 38
VALUE FOR MONEY 40 The organisation is managed in a financially sustainable way
PEOPLE 43 A customer-focused workforce that is empowered, accountable, committed and proud of its achievements
Operational Performance 15 Safety
Objective: A safe railway, a safe workplace, a safe culture.
The safety of all who use its services remains RailCorp’s top Key strategies to achieve the priority. That means the safety not only of customers, but objective: also employees, contractors and the community. • Work with and involve all employees in creating a strong, RailCorp has implemented a comprehensive Safety risk-aware safety culture, from the executive to the front line Management System to foster an environment that improves safety for the long term. This is part of the organisation’s • Benchmark systems and ongoing commitment to meeting and, in many cases, performance against the best exceeding the regulatory and statutory requirements. organisations in comparable complex high-risk industries
• Learn the lessons from accidents RailCorp will meet its Safety Success can be measured by: and incidents across rail and Objective by ensuring it has: • Reduced customer injuries other industries to continuously • A safe railway – safe rolling stock, strengthen expertise, systems and infrastructure and systems for • Reduced staff injuries performance customers and the public • Reduced operational incidents • Share this knowledge across • A safe workplace – safe systems, RailCorp and constantly measure • Reduced control failures practices, equipment and facilities and re-assess RailCorp’s safety for employees and contractors • System assurance (audit, and risk performance. investigation, safety action • A safe culture – behaviours and management) attitudes which demonstrate that safety is always a prime objective • Education and training. by creating a strong, risk-aware safety culture at every level of the organisation.
16 RailCorp Annual Report 2011–12 Safety initiatives during the reporting period SPAD management
Where a train passes a signal contrary to a ‘do not proceed’ Safety Management System Progress indication, the incident is referred major review Antenna construction works to as a ‘signal passed at danger’, or commenced, after extensive RailCorp manages safety through SPAD. Such incidents are potential community consultation, with its Safety Management System, a pre-cursors to collisions and the first five base stations and comprehensive suite of principles, derailments, and the reduction of supporting infrastructure installation procedures and guides used SPADs is a high priority. completed between Sutherland and to maintain and improve safety Waterfall. The consultation process This program is a multi-faceted standards in all areas of the Operational Performance has been completed for 33 base approach to reduce the occurrence organisation’s business. stations and 14 sites have entered of SPADs – particularly those The Safety Management System is the construction phase. regarded as high risk. subject to continuous monitoring, The trial laying of surface cable in review and improvement, and Progress this corridor was also completed and is the major component in Revised route knowledge guides testing commenced. Construction the maintenance of RailCorp’s were developed and a professional of a further six towers between St safety accreditation, workers’ driving guide was rolled out with Peters and Cronulla is underway. compensation self-insurer licence, accompanying training. Importantly, and compliance with regulatory recognition of good performance obligations. has been introduced. Identification Automatic Train Protection of ‘difficult to see’ signals and the Commenced during the reporting Implementation of this world-class ensuing application of RailCorp’s period, this major review is intended safety system will provide real- Signal Sighting Framework to to ensure the System is fully aligned time monitoring of train speed and improve visibility has continued. with the new Work Health and location for the CityRail fleet, with Improvements to the Driver Support Safety Act (NSW) 2011, and to automatic intervention or braking Program and investigation process provide users with improved access where appropriate to ensure safe have also been made. to all system documents, forms and operation for passengers and crew. procedures. This long-term program will Worksite Protection deliver significant safety benefits Digital Train Radio System to RailCorp customers, as well The safety of trackside workers as presenting opportunities for continues to be one of RailCorp’s Completion of this long-term network capacity improvements major priorities. Implementation project will see all passenger and and reduced track maintenance of a suite of worksite protection freight trains on the NSW network costs. projects is delivering progressive fitted with compatible radio improvements in the number and systems for communications. This Progress efficacy of safety risk controls in system will provide network-wide place, in order to see all trackside Two test trains, fully equipped radio coverage, including tunnels. workers enjoying better safety. with test equipment, cab Following review with RailCorp’s cameras, personnel facilities delivery contractor, the schedule Progress and communications, have been for completion of the Digital Train commissioned to support system Numerous program components Radio System has been revised to integration. Initial system validation were finalised and have become April 2015. testing commenced in June on business as usual, including the trackside installations between those for incident reporting and Wyong and Gosford. analysis, signage, communications equipment, identification of Works have continued on the lookouts, improved night time Wyong to Berowra section and use visibility of track workers, and a of the system by revenue services is tag-out system for points. expected to commence in 2014.
Operational Performance 17 The number of reported worksite Ongoing operational safety initiatives incidents progressively reduced over the year and this trend is Numerous ongoing safety related to, or caused by, expected to continue as the improvement programs have operational issues. remaining improvement projects continued within RailCorp, including are delivered. Safety Management System and RailCorp measures safety manual handling training, the School performance related specifically to Travel Smart campaign, the Annual the risk of passenger fatality or Corridor fencing Rail Safety Week media campaigns, serious injury through its Operational injury reduction plans and injury Safety Index. The index tracks This joint safety and security program management programs, the Target 12 incident categories: high risk is progressively upgrading rail ZERO Safety Behavioural Change SPADs; explosions presenting risks corridor fencing across the RailCorp program (a leadership commitment to passengers; trains exceeding network. In addition to managing initiative within Asset Operations published speed limit by more than scheduled upgrades, it also uses Group), the BackSafe awareness 20 kilometres per hour; high risk security intelligence in order to program, and the safety events track geometry defects; high risk target trespassing and vandalism program, comprising the RailCorp track misalignments; high risk broken hotspots where specific fencing safety convention (for managers) rails; train collisions with motor requirements can be addressed. and safety competition (for vehicles at level crossing; high risk frontline staff). collisions; high risk derailments; Progress high risk wrong-side signal failures; High security fencing works were These initiatives raise safety high risk rolling stock defects; and completed between Campbelltown knowledge and awareness, and accidental passenger fatalities. and Macarthur, in addition to progressively change behaviour RailCorp’s annualised Operational installation and upgrade works at towards a risk-aware safety culture Safety Index performance, a further 24 locations across both within the RailCorp workforce commencing with the 2009-10 year, the network. and among its customers. is presented on the facing page. The total number of qualifying incidents for each year is normalised per Critical and vital Passenger and public safety million passenger journeys. infrastructure No passenger fatalities reported The annualised Index value for This counter-terrorism program during the year were assessed as 2011-12 of 0.086 was favourable to of works is seeing improved the target of 0.109. security for a number of RailCorp infrastructure sites considered vital to service continuity. Security elements include perimeter fencing, access control, CCTV systems, lighting, anti-ram walls and gates, traffic management measures and explosive blast mitigation works.
Progress Five of the eight projects in this program were completed during the year, including a number of signal boxes and electrical substations.
The new Automatic Train Warning System is designed to give workers improved warning of approaching trains.
18 RailCorp Annual Report 2011–12 Employee safety Operational safety index
0.15 Many of the activities performed Index by RailCorp staff in the course of Target their normal duties are potentially 0.113 high risk. Such activities include 0.109 0.118 track work, heavy engineering, 0.10 security, electrical services and 0.098 construction. Securing progressive 0.086 and sustainable improvement in employee safety, therefore, remains 0.05 a high organisational priority. Operational Performance
Of significant benefit in the implementation and management of safety programs has been the 0 establishment of the Safety Support 2009-102010-11 2011-12 Services Division, which provides expertise to RailCorp operating groups and projects. Lost time injury frequency rate
During the year the division 40 has intensified the focus of line LTIFR managers on the understanding Target of their responsibilities and 30 accountabilities with regard to safety in the workplace. It has provided tools and advice on compliance with legislative 20 requirements and on securing effective implementation of the 33.85 31.08 27.4 26.9 27.1 28.3 27.3 21.0 Safety Management System. The 10 overall benefits have included a significant reduction in lost time injuries (see facing page), and in 0 their severity. 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
Employee safety in RailCorp is measured through two primary performance indicators. Workplace injuries
The first is Lost Time Injury 150 12-month average Frequency Rate (LTIFR), being Target the number of lost time injuries suffered by workers per million hours worked. A lost time injury is 100 defined as an injury that caused an employee to miss a full day’s work or a full working shift, and includes a work-related fatality. 1121121 123 125 18 119119 102 50 RailCorp’s LTIFR performance for the 12 months ended 30 June 2012 was 21, which was significantly below the end of year target of 24. 0 This represents an improvement in 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 days lost as a result of injuries of
Operational Performance 19 approximately 40 per cent, and a Emergency preparedness with. These exercises test and reduction of 23 per cent in LTIFR practise the response protocols and compared to 2010-11. Because of the nature of its skills essential for effective incident business, it is important RailCorp recovery. RailCorp continues The second indicator is Workplace maintains its operational readiness to enjoy a close operational Injuries, a count of all employee for emergencies through well- relationship with Emergency injuries that have been the resourced facilities, equipment, Services personnel. subject of accepted workers’ systems and regular exercises. compensation claims. Exercises are conducted jointly The workplace injuries performance with Emergency Services agencies. of a monthly average of 102 was This is important as the rail corridor favourable to the end of year presents unique hazards that target of 107. emergency crews must be familiar
The following exercises were conducted during 2011-12:
Number of Participants other Exercise Exercises than RailCorp
Counter terrorism 7 ADF, Police Station, train and/or rail corridor familiarisation Fire, Police, Ambulance, and training 20 SES, RFS, LEMO
Field exercise 3 Fire, Police, Ambulance, TfNSW, Airport Link
Desktop exercise 2 Fire, Police, Ambulance, TfNSW, SES
Train lifting exercise 25 Fire
Abbreviations: ADF – Australian Defence Force; SES – State Emergency Services; RFS – Rural Fire Service; LEMO – Local Emergency Management Officer; Fire – Fire & Rescue NSW; Police – NSW Police and/or Australian Federal Police; TfNSW – Transport for NSW
Key performance indicators
Indicator 2011-12 Target
Operational Safety Index 0.086 ≤0.104
Lost time injury frequency rate (LTIFR) 21.0 ≤24.0
Workplace injuries 102 ≤107
BOCSAR* offences against the person per million passenger journeys 8.3 ≤9 (reported quarterly, three months in arrears)
* Bureau of Crime Statistics and Research
20 RailCorp Annual Report 2011–12 Customer
Objective: That the services RailCorp provides continually meet or exceed customer expectations. Operational Performance
Customers are at the centre of everything RailCorp does
RailCorp has worked with Transport • To consistently challenge • To continue to build the for NSW to understand what employees to strive to do behaviours in RailCorp staff that customers want. The key findings better, comparing RailCorp’s customers expect and deserve. are that: performance with best-in-class RailCorp’s management will railway operators be ambassadors, providing • Customers see room for consistent leadership and improvement • To embark upon and continue demonstrating excellent customer to deliver long-term sustainable service behaviours. • Customers want to be proud of plans to improve key customer their rail system critical satisfaction areas Success can be measured by: including: cleaner trains, improved • The way to build pride is to deliver passenger information and an • Overall customer satisfaction on safety, cleanliness, timeliness, advanced ticketing system information and access. • Service reliability – measured by • To promote the social, on-time running Initiatives to address these issues environmental and economic have commenced and there is • Customer ease of use – measured benefits of rail that make it the much more work to be done to by reduced ticketing queues at sustainable transport choice improve customer satisfaction with peak periods
RailCorp’s services. • Customer comfort – reduced • To ask what customers want crowding. and then organise to deliver this, checking back with customers to ensure their expectations have been met
Operational Performance 21 Key strategies employed during the reporting period
On-time trains every week. On the Central Coast, Safe and secure travel train customers will enjoy an In the second half of 2011, extra 33,000 seats every week, as CCTV monitoring operations countdown clocks were installed many of the most popular services were centralised in a new Security at busy CBD stations to make it run between Wyong, Gosford Monitoring Facility in September easier and faster for customers to and Sydney. 2011. The Security Monitoring move on and off the train. Clocks Facility more effectively and were installed at Circular Quay, Additional ticket gates were efficiently monitors travel and St James and Museum, with installed at Central and Martin security issues across the network. additional countdown clocks added Place to help manage crowding, It is capable of responding to to Wynyard and Town Hall stations. alleviate congestion during busy all Help Point calls from across peak periods and maintain safety the RailCorp network as well as New weather protection canopies for customers entering and exiting monitoring and managing the were installed at Bexley North, these stations. CCTV system. Every staff Cardiff, Erskineville, Holsworthy, member in the facility is capable Morisset, Narwee, Panania, of monitoring every camera on Riverwood and Tuggerah allowing Fast, accurate, useful the CityRail network to improve customers to spread out along the information customer security. platform in all weather conditions to help keep trains running on time. In the second half of 2011, automatic Throughout 2011, more than 1700 digital announcement systems were secure car spaces were delivered installed at 22 stations. This system around Blacktown, Revesby, Manage crowding creates separate audio zones on the Schofields, Warwick Farm and platform, which allow customers Woy Woy stations. All of these From October 2011, three services to hear clear, high-quality commuter car parks include on the South Coast Line and one announcements. It also allows enhanced passive and active service on the Newcastle & Central changes impacting scheduled security features, such as CCTV Coast Line were operated by new services to be communicated coverage, high intensity lighting and eight-carriage Oscar trains. Oscars quickly to customers. enhanced security fencing. have enhanced security features, including CCTV, seats with graffiti New station passenger information and fire-resistant covering, air- screens have been rolled out Clean trains and stations conditioning, accessible toilets, to Auburn, Berala, Carramar, on-board information screens and Leightonfield, Lewisham, Toilet facilities have been automated announcements. Merrylands, Pendle Hill, Petersham, refurbished ahead of schedule at Quakers Hill, Schofields, Stanmore, Caringbah, Cronulla, Croydon, Harris Four services on the Blue Mountains Summer Hill and Wentworthville Park and Rooty Hill stations. The Line have been extended from six to stations. These 24-hour information refurbished toilets, which include eight-carriage trains. screens provide details about next new separate family and accessible train departures, stopping patterns toilets, provide improved facilities A total of 41 peak, off-peak and of following trains and timely for families with young children and weekend services between information for a specific line. They people with limited mobility. They Newcastle, the Central Coast and also provide regular train running also incorporate modern vandal- Sydney were built up from six-car updates and can display information resistant interiors designed to be to eight-car trains. That means on the cause of delays. easier to clean and maintain. 200 extra seats on each of these services, which translates to tens The entrance areas of 200 train of thousands of extra seats for carriages have been repainted using Newcastle and Central Coast train a more durable graffiti-resistant customers each week. paint to achieve consistency and For commuters catching the train improve cleanliness across the fleet. from Newcastle, nearly 20,000 extra seats will be available
22 RailCorp Annual Report 2011–12 Fast ticket sales A further 18 new EFTPOS-only Accessible services and machines were installed at stations facilities Following the successful installation including Burwood, Martin Place, of touch-screen machines last Milsons Point, Revesby, St James, The availability of accessible year, 45 existing ticket vending Waverton and West Ryde. The new services and facilities provides all machines were modified to have machines help reduce queues and customers, including those with this functionality. The enhanced congestion at busy stations. special needs or limited mobility, machines are now operating at with improved access to RailCorp’s 26 stations, including Bankstown, network. Major accessibility Burwood, Chatswood, Granville, Quick and fair complaints upgrades at Martin Place and St Hurstville, Kogarah, Liverpool, handling James stations were successfully Parramatta, St Leonards, Strathfield delivered. New lifts were installed Operational Performance and Westmead. These user-friendly In 2011 RailCorp held more than at Central and Picton stations. Two machines increase the speed of 180 ‘Meet the manager’ events lifts each at Town Hall and St Marys ticket transactions. across the network. These events stations have been refurbished. let customers give feedback directly Throughout the year, 125 ticket to CityRail managers. A series vending machines were modified of improvements have been to include EFTPOS facilities, implemented as a consequence, providing more customers with the including more station identification convenience of being able to pay signage at Warabrook Station and for tickets electronically. additional seating on Platform 1 The upgraded machines are at Rhodes. widely distributed across the network at stations including Bondi Junction, Burwood, Gosford, Hurstville, Newcastle, Strathfield, Springwood, Warrawee, Wahroonga and Wollstonecraft.
The 24-hour automatic passenger information screens provide details about next train departures, stopping patterns of following trains and timely information for a specific line.
The screens provide regular train running updates and can display information on the cause of delays.
Operational Performance 23 Special customer initiatives in the reporting period
Everyday Customer Service Quiet carriages trial month quiet carriage trial on these training program train lines from 1 June 2012, with A survey conducted by Transport the Newcastle & Central Coast In August 2011 RailCorp rolled out for NSW indicated that 70 per cent Line quiet carriages becoming the Everyday Customer Service of passengers found loud talking on permanent from that date. training program to frontline staff trains annoying, while 67 per cent to increase awareness of putting considered loud music disruptive. the customer at the centre of In response, RailCorp initiated a trial Major cleaning at CBD and everything they do. The training of quiet carriages on all services Eastern Suburbs stations is based on six customer service travelling between the Central principles – a set of desired Coast and Central Station. Cleanliness of stations is one of the behaviours contributing to excellent The first and last carriages of greatest areas of dissatisfaction for customer service. all six and eight-car trains, and customers. CityRail took advantage the last carriage of all four-car of the CBD station closures on the 1. First impressions count trains, became designated quiet weekends of 26-27 May 2012 and carriages from 13 February to 16-17 June 2012 to give CBD and 2. Friendly and ready to help 3 May 2012. The trial was supported the Eastern Suburbs stations a 3. Communicate clearly by a communications and thorough clean. Interchange and marketing campaign. public areas were also cleaned. 4. Find a solution The trial was an overwhelming The extensive cleaning and 5. Share your knowledge success, with 90 per cent of maintenance works included: customers surveyed indicating 6. Work together • Painting that they would prefer to travel in Since August 2011, approximately quiet carriages in future. Further • Escalators, platform surfaces, 3,800 staff had attended a feedback revealed customers on the stairs and hand railings scrubbed workshop, with more planned in the Blue Mountains and South Coast and cleaned coming year. lines also wanted the opportunity to travel in peace and quiet. As • Tiles painted and repaired, such, RailCorp introduced a three- including an anti-graffiti finish
Cleaning reforms include improving staff productivity, the introduction of escalator cleaning machines, scrubbing machines for station platform cleaning, in-transit train cleaning carried out by individuals, and cleaning flying gangs to carry out major cleans on stations.
24 RailCorp Annual Report 2011–12 • Ledges dusted and cleaned cleaning locations, in-service train The intervention’s success means cleaning, stations and facilities. patch-painting will continue as a • Rubbish removed from the tracks permanent process. By introducing the capability to patch-paint over • Toilets deep cleaned and graffiti, RailCorp has empowered deodorised Taking Back the Trains staff to be able to more rapidly deal • Graffiti and etching removed from Graffiti inside the CityRail fleet with this anti-social behaviour. all surfaces. has continued to be a significant This contributes to enhancing problem for RailCorp. As customer customer experience. feedback demonstrates, this form Rubbish bins of vandalism particularly impacts customer satisfaction. The Taking New security model Operational Performance The provision of rubbish bins Back the Trains intervention tackled on platforms addresses a key this key customer satisfaction area RailCorp Transit Officers and customer demand and contributes by upgrading the graffiti removal NSW Police currently work to to an ongoing improvement in the process to include patch-painting of maintain the safety and security cleanliness of stations. As part of aged or shadowed graffiti. of the rail system. On 14 February the Customer Service Improvement 2012, a dedicated Police Transport Prior to the intervention, a pilot was Program an additional 250 bins Command (PTC) was announced, conducted in late 2011 involving are to be installed on the CityRail consisting of 610 police officers and the patch-painting of internal network. The first 150 bins were led by an Assistant Commissioner vestibule walls. This trial achieved installed in June 2012. A further of Police. A staged approach to the a statistically significant amount of 100 stainless steel bins were transition has commenced. graffiti removal from the fleet. installed across the network on On 1 May 2012 the new PTC was approximately 45 stations by the Based on the success of the established to provide a dedicated end of September 2012. pilot, the Taking Back the Trains police presence focused on the intervention was designed to run safety and security of customers as a 12-week program from travelling on the public transport Cleaning reform 26 February to 19 May 2012, with system. This program will the patch-painting process being The Cleaning Reform Project provide for a highly visible police implemented at three maintenance undertook consolidation and presence for the entire public centres and four stabling yards streamlining of RailCorp cleaning transport system. The PTC will across the network. This project services and activities to deliver have intelligence and criminal initially concentrated on the service improvements and cost investigation capabilities. patch-painting of internal vestibule savings to RailCorp. and saloon walls. Following from The transition will culminate in the The project implemented a range positive results and feedback in PTC assuming full responsibility for of initiatives to improve cleaning the initial phase of the project, the security functions, including patrols outcomes, optimise equipment scope was expanded to include of trains, stations, interchanges, usage and improve staff utilisation the patch-painting of doors. Some buses, ferries, secure taxi ranks and productivity, such as patch floors and seats were also treated in and commuter car parks from painting to remove graffiti on this period. 1 January 2014. trains, centralised staff rostering, This project has made a significant introduction of escalator cleaning improvement in the overall machines, scrubbing machines presentation of the in-scope for station platform cleaning, one fleet. Close to 75,000 graffiti tags person in-transit train cleaning and were removed over 12 weeks, cleaning flying gangs to carry out with internal baselines showing major cleans on stations. that there has been a significant The savings were achieved reduction in on-board graffiti. through rationalising cleaning contracts and staff productivity, as well as cleaning efficiencies and improvements across major train
Operational Performance 25 Underground mobile increased by approximately 800 RailCorp has been progressively coverage per cent, and to train crew through implementing a number of initiatives mobile phone SMS by 200 per cent. to maintain and reduce safe station RailCorp is working with Optus dwell times. These include the roll (representing mobile carriers) to roll Customer insight found customers out of countdown clocks on busy out 3G mobile phone coverage in are often distracted and do not hear CBD platforms, platform signage, CBD train tunnels. This long-awaited audio announcements. The program customer awareness campaigns, project saw special ‘leaky feeder’ delivered individual refresher de-cluttering of stations and staff cable installed along the length of training sessions with more than 150 boarding assistance during peak the North Shore Line tunnels in the operators on displaying customer hours to improve customer flow and CBD, North Sydney and Chatswood, service text messages on electronic reduce safe dwell times. tested and ready for commissioning screens during disruptions. New in July 2012. message functions and templates Safe station dwell management were also implemented to provide practices have been operational in Design work on coverage for the consistent messages for customers. the PM peak on the busy North City Circle and Eastern Suburbs Line Shore & Western Line at Wynyard, was also progressed during the year. Process performance reports are Town Hall and Central platforms. now used after incidents to look for These initiatives will be progressively further improvements. rolled out during the morning peak Rapid improvement in through the CBD to the North Shore. passenger information Dwell time management The data collected during the trial is A revised passenger information being further analysed to formulate operating model was implemented Currently, CityRail can reliably more strategies. in February 2012 to deliver better operate 17 to 19 trains per hour information to station staff and on the most congested North train crew during unplanned Shore & Western Line due to Preparing for the Opal operating constraints caused by service disruptions. This included ticketing system system enhancements to the Train the Sydney Harbour Bridge. These Locator System (TLS) to provide constraints lead to crowding and Transport for NSW is delivering the station staff with a more reliable additional travel times on some Opal electronic ticketing system and comprehensive source of trains. Extended station stop (ETS) to make travelling on public disruption information. The quantity times (dwell times) are one of the transport easier and simpler for of disruption information delivered key contributors to crowding and people living, working in and visiting to station staff and signal boxes has extending travel times. the greater Sydney area. The new
A revised passenger information operating model was implemented in February 2012 to deliver better information to station staff and train crew during unplanned service disruptions.
26 RailCorp Annual Report 2011–12 electronic system will be gradually continuous speed restrictions CountryLink Call Centre at introduced across transport imposed by the Australian Rail Newcastle. The staff in this unit are operators, starting with Sydney Track Corporation on the South dedicated to customer information, Ferries and, after testing, will be Line that impacted on-time running and their duties include contacting introduced to RailCorp’s operations, for the Melbourne and Canberra all passengers booked on followed by State Transit and private services. Additional factors such CountryLink services to advise bus operators. RailCorp is managing as floods further impacted on-time of any changes to their booked the early works required to prepare running results. services, including trackwork its 307 stations for the new system. and incidents that may change The ETS early works began in Customer contact the nature of the service or alter December 2011 and approximately In 2011 CountryLink developed an departure or arrival times.
25 per cent of the interim poles and outbound calls unit within the Operational Performance cabling required had been installed by 30 June 2012. The poles are RailCorp OTR performance at a glance* designed to protect the new cabling and civil infrastructure 07-08 08-09 09-10 10-11 11-12 until the phased deployment of the Opal card readers by the Pearl CityRail Consortium. During 2012-13, Passenger journeys (millions) 283.3 292.2 289.1 294.5 304.2 Opal card readers will start to be Metropolitan trains on time – installed on ticketing gates across peak (%) 93.6 95.8 96.5 95.4 94.4 the network. Intercity trains on time – peak (%) 91.7 94.0 94.9 94.0 92.8 Total CityRail trains on time – peak (%) 93.4 95.5 96.3 95.2 94.2 CountryLink CountryLink Passenger journeys (millions) 1.55 1.68 1.81 1.89 2.04 Service standards Trains on time (%) 70.5 76.6 75.0 72.7 62.1 In May 2012 CountryLink introduced * All CityRail OTR data are post force majeure. OTR is defined as arriving within an inaugural CountryLink Coach five minutes for metropolitan and within six minutes for Intercity. Customer Service Standards, designed to assist contracted coach companies and their drivers in CountryLink on time running % meeting the service level agreements Year Arrive within 10 Arrive within 15 Arrive within 30 negotiated as part of their contract. minutes minutes minutes The customer service standards relate to drivers knowledge, coach 2011-12 62.1 69.5 81.2 quality and cleanliness as well as 2010-11 72.7 79.0 87.8 customer management. 2009-10 74.7 80.8 89.2 Improving reliability 2008-09 76.7 N/A 89.5
CountryLink has developed and 2007-08 70.5 N/A 85.5 implemented a strategy to further reduce delays impacting on time RailCorp Key Performance Indicators 2012 running. Key Performance Indicator 2011-12 Target CountryLink’s target is 78.0 per cent of its services to arrive CityRail peak on-time running (OTR) – post force majeure 94.2% ≥ 92.0% within 10 minutes of the scheduled arrival time. In 2011-12 CountryLink CityRail peak delay minutes (monthly average) 6423 ≤ 4620 on-time running was 62.1 per cent, CityRail crowding – average number of 1.1 a decrease on last year. A number passengers per m2 of standing space in the peak (March 2011) ≤ 1.9 of factors influenced CountryLink’s CountryLink OTR 62.1% ≥ 78.0% performance in 2011-12, including
Operational Performance 27 Growth
Objective: RailCorp will work with Transport for NSW to assure its Growth Program provides for sustainable capacity and service improvement.
RailCorp’s role in delivering capital works is decreasing but, as an asset maintainer and operator, it will have a key role in reviewing and assuring asset requirements. RailCorp will work closely with Transport for NSW and third-party suppliers to support the growth of a transport system that meets customer expectations.
In determining its growth priorities In developing its program Railcorp • Improved access to services for for the reporting period, RailCorp considered: customers with restricted mobility focused on building a program that: • Community obligations and • Increased capacity at peak times • Supported the achievement of local social, environmental and (more services, more carriages) the NSW Government’s transport economic impacts priorities • Designs that incorporate • Potential efficiencies environmental sustainability • Facilitated patronage growth, as projected through transport and • Environmentally sustainable • Delivery of projects to plan land use planning design • Increased availability of travel • Increased market share, • Opportunities to address demand paths for freight. geographic penetration, revenue and deliver revenue growth. The key growth strategies for the growth and customer satisfaction The measurement indicators set for reporting period were: • Strengthened RailCorp’s asset the reporting period included: • Develop the capital program for base – both network and fleet • Increased share of commuter trips future years through effective • Contributed to building a made by public transport prioritisation and benefit analysis sustainable public transport network.
28 RailCorp Annual Report 2011–12 • Develop and implement new accessible toilet. Construction In January 2012, the upgrade at timetables to take advantage of is well underway on the fourth Central’s Devonshire Street entrance increased capacity provided by platform with precast sections was opened. The upgrade included infrastructure investments necessary for the concourse and two new lifts, one at the Devonshire footbridge extensions being lifted Street entrance and one joining the • Implement the Fleet Management into place in May and the installation Eastern Suburbs Line and Strategy for planned service of the precast box sections, which electric paid concourse areas. improvements to 2020 form the base of the new platform, A new accessible ramp was installed being placed. from the Eastern Suburbs Line paid • Construct new lines to support concourse to the Devonshire Street population and developing Approximately 60 per cent of the entrance. Two new escalators were employment centres new 1.8 kilometres of track, which
also provided at the Devonshire Operational Performance will help strength reliability and • Acquire additional rolling stock to Street entrance. Other works improve journey times of the South, increase capacity by supporting included a new ticket office facility, Bankstown and Inner West lines, the introduction of additional additional ticket gates, widening has been constructed. services, more carriages per train of the entrance to the Devonshire Street tunnel and new entrance and more passengers per carriage The remainder of the rail operating awnings as well as ceiling and infrastructure is planned to be • Separate lines to simplify and roof structure. complete by early 2013, with project expand sections of the existing completion intended for early 2014 rail network New wayfinding signage was with the commissioning of the installed at 31 stations across the • Cater for special events signal system. network, in accordance with the State Signage Plan. • Adopt automatic train protection systems Major sandstone restoration work was completed on the Goulburn • Provide adequate freight access. Station upgrades Street viaduct and the Central Clock RailCorp is progressively updating Tower. The scaffolding was removed its station infrastructure to better and the Clock Tower revealed in address future growth and increase December 2011, complete with new Liverpool Turnback customer convenience and amenity. flag pole and renovated clock face. Liverpool Turnback Project, Progress Works commenced in January programmed for commission in early 2012 on the installation of the Opal 2014, will improve the capacity and In 2011-12, transport access upgrades card electronic ticketing system. reliability of local train services by were completed at three stations. The works, to span the 307 CityRail reducing congestion on the network In October 2011 Quakers Hill stations, includes installation of especially during peak periods. upgrade was completed. The cable containment, cabling, Opal The significant works completed upgrade included three new lifts, Card readers and top-up machines during this period have seen one of footbridge and access stairs. to pre-determined locations at each two new stabling roads completed A complete new station building station. Work is expected to be and the majority of enabling track with ticket facilities, a family completed in September 2013. works either side of Liverpool accessible toilet and staff facilities Station installed. As a result of the was provided. The platform was discovery of unstable foundation resurfaced, with new platform conditions, it was necessary to canopies installed. Novo Rail Alliance design and construct a section of In November 2011, the Picton The Novo Rail alliance (a RailCorp viaduct and ground slab to support Station upgrade was completed. alliance in partnership with Aurecon, the lines. These works are now The upgrade included two new lifts Laing O’Rourke and O’Donnell substantially complete. and a footbridge, new platform Griffin) is now in its fourth year Works completed at Liverpool canopies, new car park facility and delivering a substantial program Station this year, aimed at making new toilet facilities, including a of infrastructure works across it more efficient for passengers, family accessible toilet. The station the network. These works include include the construction of a family buildings were also repainted. substantial brownfield projects
Operational Performance 29 at Glenfield Junction and Auburn safety continue to be a major focus. In February 2011, an additional Junction, the historic installation New technology has delivered contract for 25 carriages was and commissioning of Automatic greater project efficiencies, such announced. This will bring the Oscar Train Protection equipment on the as the use of sophisticated track fleet up to a total of 221 carriages, Main North Line; and a range of key building machines called PEM LEMs, with completion of deliveries Traction Supply Upgrades, including enabled an Australian first in the expected by early 2013. the construction of new substations installation of a 1:18.5 turnout in one and installation of feeder lines piece over a weekend possession at Progress across Sydney’s inner west. Glenfield Junction. All 196 carriages of Stages 1, 2 and Progress 3 have been delivered and entered passenger service. There are close to $500 million worth of projects currently in progress or Oscar rolling stock Significant progress was made in complete. acquisition 2011-12 on Oscar deliveries with 44 carriages entering service prior Demonstrable capability in tackling The Oscar project will see 221 to 30 June 2012, with the remaining multi-stakeholder, brownfield double-decker carriages enter 25 carriages at various stages of projects through to highly complex the CityRail network. The new production. Traction Supply Upgrade design carriages are equipped with CCTV, and construct solutions, and air-conditioning, fully disability Oscar carriages are being used on in driving innovation on repeat accessible toilets, on-board a daily basis to deliver more than installation work (such as Automatic passenger information screens and 1000 weekly services on the Eastern Train Protection) has been achieved. reversible seats. Suburbs & Illawarra, South Coast, Newcastle & Central Coast, North More than 250 staff have been The first two stages delivered Shore and Western lines, providing mobilised into the alliance, including 122 carriages onto the CityRail improved comfort and security for over 25 per cent recruited from network, including two spare customers. overseas to help address carriages. Australia’s rail industry engineering RailCorp and UGL received two resource issue. The third stage of the project project management achievement initially involved delivery of an awards by the Australian Institute of A rolling 12-month LTIFR of 1.34 additional 74 carriages and Project Management: NSW Winner, (only two LTIs in the life of Novo associated stabling works by mid- and National High Commendation, Rail) and further improvements in 2012 at a cost of $370 million. for Product Development.
The Liverpool Turnback Project, programmed for commissioning in early 2014, will improve the capacity and reliability of local train services by reducing congestion on the network especially during peak periods.
30 RailCorp Annual Report 2011–12 The Waratah fleet is maintained at Reliance Rail’s Auburn Maintenance Centre, which was opened in 2010. This project moved under the control of Transport for NSW as of 1 May 2012.
Stabling
In 2011-12 progress was made on Operational Performance RailCorp’s stabling yard strategy to replace, improve and, in some cases, to build additional stabling facilities across the rail network in order to increase the capacity as the network moves to all trains being eight-car sets. Penrith and Campbelltown had stabling improvements completed during the reporting period. A total of 626 new air-conditioned Waratah carriages will provide passengers with improved security, comfort and accessibility features. In May 2012, Transport for NSW commenced a review of network Rolling stock PPP Northern lines, and on the weekend stabling requirements. are used to provide Olympic Park The Public Private Partnership shuttle services. As more Waratah (PPP) contract is the largest trains are delivered, they will be single order of trains in Australia progressively introduced onto the Dunmore Loop – representing about 50 per cent South, Bankstown, Western and of the current suburban fleet and North Shore lines. The Dunmore Loop Extension supporting future demand for more Project was completed on services. A total of 626 new air- The Waratah PPP project also 4 December 2011, with the first conditioned carriages will replace involves the completion of freight train passing through the non-air-conditioned cars and more than 20 infrastructure and new loop the next day. The project provide passengers with improved technology projects, as well as commenced concept design in security, comfort and accessibility change management and training. March 2010 and was commissioned features. In the past year, significant within a tight timeframe, despite progress has been made on key heavy rain and a challenging In total, 78 new air-conditioned infrastructure projects and staff geographical location. Waratah trains are to be delivered training to support the deployment to replace around half the suburban plans for the new Waratah trains. The 21 months of work was electric fleet. Secure transitional stabling for the undertaken by RailCorp and new trains at the Enfield Marshalling its alliance partner, TSA (Track The first Waratah eight-car train Yard has been constructed, as well Services Australia). Works included entered passenger service on as track upgrades at Auburn and the construction of 1.7km of new 1 July 2011. As at 30June 2012, there Sulphide Junction. track, drainage, culverts, removal were 27 Waratah trains in various of the old turnout, installation of stages of manufacture and testing The Traction Supply Upgrade a new crossover, new overhead and 10 available for passenger Program, which includes new and wiring, commissioning of all signal, services. upgraded substations, high voltage communication and control system feeders and overhead wiring projects infrastructure both on site and at The Waratah trains are being at key sites, is being progressively Wollongong Signal Box. progressively introduced across completed to support the the network, starting with the introduction of the Waratah fleet. Airport & East Hills, South and
Operational Performance 31 Assets
Objective: Effective management and stewardship of our assets.
With a growing and diverse asset base that is geographically spread over NSW, effective asset management is crucial to providing good customer service.
RailCorp invests more than $1 billion To ensure RailCorp meets its • Minimising environmental each year to maintain and renew Assets Objective it has committed impacts and maximising positive its assets. to these strategies: outcomes for the community.
With such a significant investment Asset management plans, corridor RailCorp looks after the full range it needs to work smarter to plans and asset strategies are in of operational and non-operational deliver customer outcomes in a place and regularly reviewed to assets in a considered and holistic financially and environmentally consider the lifecycle view of our way. Its asset strategy and asset sustainable manner, offsetting new assets. RailCorp’s asset strategy management plans incorporate costs with savings in base costs and and asset management plans environmentally sustainable ensuring that acquisition decisions demonstrate delivery of responsible principles, including energy are taken with an informed view of asset management through: efficiency. lifecycle costs. • Achieving prioritised objectives RailCorp’s success can be Many asset management tasks for routine and major periodic measured by: are not visible to customers but maintenance, to maintain asset play a critical role in providing • Reduced customer impact from quality levels and performance the level of safety, availability and asset-related incidents reliability, optimising customer reliability customers expect (see benefits • Achieving the approved rolling diagram opposite). More efficient 10-year Asset Management Plan maintenance will free up funding • Undertaking prioritised capital to improve customer facilities, projects to upgrade the network • A minimal maintenance backlog information and ambience.
32 RailCorp Annual Report 2011–12 • Delivering the Routine The customer is at the centre of asset management Maintenance Program
• Delivering the Major Periodic Maintenance Program.
Key asset strategies for the Customer reporting period: ambience RELIABLE ASSET • Develop skilled people to manage Customer SERVICEABILITY and lead asset management information
• Continuously improve the Customer HIGHER facilities CUSTOMER Operational Performance RailCorp Total Asset Management IMPACT System to increase the efficiency Availability Reliability and effectiveness of our HIGHER CUSTOMER Available for Reliable investment in asset management VISIBILITY safe use asset safety
• Develop reliable information and Customer Customer Staff Safety technology platforms to support security safety effective and timely business, asset and operational decision making
• Develop routine and major SAFE ACCESS periodic maintenance plans for each asset type to maintain the best possible condition and integrity for the life of the asset with concrete ones and install Wollongong) and South Coast new rail and ballast on passenger (Dapto to Kiama) lines. Track • Utilise industry partners to mainlines. The upgrades provide reconstruction on the Richmond support delivery of effective asset long-term benefits by improving and Main South corridors is planned management plans the reliability of train services, for completion in 2013. • Through effective prioritisation, particularly during the warmer RailCorp is continuing work on schedule planned works and months where tracks have a recontructing the South Coast Line efficiently transition all projects tendency to expand in the heat and trains are required to slow down to track. RailCorp has, since 2008, • Progress the integration and maintain safety. New rails provide a upgraded more than 90km of track. improvement of RailCorp’s smoother ride for passengers and Additional work on this corridor is heritage management, within heavier, more modern, concrete scheduled over the coming years. resourcing constraints. sleepers mean trains In addition, RailCorp’s existing can operate at normal speeds in fixed tension overhead wiring higher temperatures. Concrete (OHW) is being replaced by a sleepers also have a longer lifespan regulated tension system that and need less maintenance. By Corridor renewal ensures the contact wire remains June 2012 more than 83 per cent of at a constant height regardless RailCorp’s investment in the CityRail passenger mainline track of ambient temperature. This condition of its rail corridor and had been converted from timber to eliminates the problem of low wire infrastructure has reduced incidents, concrete sleepers. resulting in better on-time running, in summer and entanglements. safer and more reliable rail services Throughout 2011-12, good progress At 30 June 2012, 97 per cent of for customers. The corridor renewal was made, with major track RailCorp’s OHW modernisation project includes track reconstruction, reconstruction work taking place program had been completed. new overhead wiring, signalling and on the North Shore Line and Major overhead reconstructions control systems. the Richmond Branch Line, as were carried out on the well as the Main South (between North Shore, Western and Central RailCorp has had an ongoing Merrylands and Glenfield), Eastern Coast lines. program to replace timber sleepers Suburbs & Illawarra (Coalcliff to
Operational Performance 33 Major Periodic Maintenance
RailCorp operational assets are managed under the Strategic Asset Maintenance Plan, of which a core component is the Major Periodic Maintenance program (MPM). The MPM program includes cyclic renewal and preventative actions, safety and environmental programs and upgrading key assets to improve performance and extend asset life.
Signalling
A number of major signalling and control systems were successfully delivered: Maintenance highlights for 2011-12 • Southern Sydney Freight Line Stage 1 to Leightonfield Major program production 2011–12 final results:
• Quakers Hill to Schofields’ • Rerailing: 60 km Duplication • Points machines: 88 • Bidirectional signalling between Sutherland and Oatley • Contact wire renewal: 23 km
• Dunmore Loop Extension • New sleepers laid: 68,196
• Rail Deviation Lawson • Turnouts renewed: 69
• Replacement of the Central Coast • Trainstops renewed: 133 infrastructure monitoring server • Bridges refurbished: 16 • Eastern Suburbs Railway Relay • Platforms resurfaced: 12 Replacement Project. • Component change-out (electric fleet): 231
Turnout renewals • Fleet presentation work: 192
These continued at record levels • Overhead wire rebuilds: 15 km during 2011-12 with 69 renewals • Track reconstruction: 26 km delivered.
Highlights of this program included continued delivery of turnout Geotechnical risk sites In addition to CBD station cleaning renewals in the CBD (Central to and maintenance works, a number Goulburn Street) and the installation Treatment of geotechnical risk sites of platforms were resurfaced and of state-of-the-art bearers at on cuttings and embankments was stations refurbished. Hornsby Junction. undertaken as a result of additional funding in 2011-12 and resulted in delivery of an increased volume of works.
34 RailCorp Annual Report 2011–12 Lift car renewal Case study: Boundary The project made use of an Street bridge renewal innovative product: self-compacting Passenger lifts are critical to concrete. Self-compacting concrete passenger convenience and to During the reporting period, offers many advantages over enable accessibility to the RailCorp RailCorp renewed the rail bridge at regular concrete mix. It does not network. The lift car renewal Boundary Street, Roseville, paving require external vibration to be program has been established the way for the removal of one of sufficiently packed down which is to improve the availability and Northern Sydney’s major traffic deal for use inside a pipe. the mean time between failures choke points. It also opened up the It travels unassisted through the of passenger lift assets through future possibility of allowing the rail reinforcement steel inside of the replacement of assets at the end of line passing over the bridge to be pipe and fills every last nook and their average economic life. quadrupled, which would provide cranny. The result is that the beam is Operational Performance The first passenger lifts placed in for an increase in network capacity far stronger and able to bear a much service are now close to the end to meet future customer needs. heavier load. Its success has been of their economic life and cyclic well documented across the world. renewal is necessary. The new bridge has a higher, wider structure which will be able to A number of mix designs and trial A prioritised future program of accommodate a six-lane road with pours were conducted prior to lift car renewals is now in place increased vehicle clearance. It also incorporating the concrete into the and will see an increasing number reduces noise for local residents. permanent works. Special materials of assets renewed each year in reduced the heat of hydration order to maintain a steady state During construction, two generated by the concrete mix. of performance. As the lift and 100-tonne concrete girders and 11 This had the added benefit of escalator population increases with 30-tonne precast deck slabs were introducing a waste material into new projects across the Sydney rail manoeuvred into place on the the mix design, adding to the network, an increasing focus will be western side of the existing bridge. sustainable use of materials for the required to deliver this program. Positioning the enormously heavy construction of the bridge. girders into place involved some Strength gains from the concrete To date lifts at Town Hall, very delicate heavy lifting, requiring were used to replace expensive Lidcombe and St Marys have been the use of two cranes and involved grouting mixtures. delivered, with future renewals a mid-air lifting hook transfer. planned at stations such as Central and Blacktown.
During construction of the Boundary Street bridge, two 100-tonne concrete girders and 11 30-tonne precast deck slabs were manoeuvred into place on the western side of the existing bridge.
Operational Performance 35 Heritage
RailCorp has the largest portfolio of statutory-listed Operating network heritage assets in NSW. This portfolio includes both operational and non-operational assets. Heritage management priorities are reflected in a four-year Heritage Conformance to Heritage Act requirements Asset Management Strategy (HAMS). Conformance to Heritage Act requirements is an integral element In the second year of HAMS, • Working with the Office of of station upgrading and building initiatives progressed included: Environment and Heritage (OEH) maintenance. To assist project to bring RailCorp’s State Heritage managers, the RailCorp intranet • Establishment of a Heritage Register listing up to date with has been populated with a link Service Provider Panel for new nominations, de-listings and to resources and information on business-wide access to curtilage amendments heritage processes. specialised heritage services • Participation in a pilot program Projects achieving positive heritage • A Surplus Heritage Assets to enhance the S170 Register outcomes during the year include: Management Study to guide database to a web-based strategic management of disused centralised system • Restoration and repair of non-operational heritage assets, the stonework of the 86m along with adaptive reuse and • Advancing the development of high Central Station clock feasibility studies for four surplus an online ‘Railway Conservation tower, together with internal heritage assets Guide’, including guidelines for strengthening works and upgrade maintenance and upgrade works, of the clock mechanism. This • Completion of the alignment such as an updated Engineering has been a major achievement, of the S170 Heritage Register Standard for heritage station ensuring that this significant with RailCorp’s primary asset paint colour schemes. structure is conserved for many management system, Ellipse years to come
36 RailCorp Annual Report 2011–12 • Restoration of the Waterfall Highlights this year include: attraction – within the context of turntable to display condition – the economic downturn, extensive one of the few remaining in the • RailCorp was announced wet weather and the close-out of metropolitan railway network winner of the ‘Conservation upgrade activities. Nevertheless, Movable Heritage Corporate and Trainworks was a finalist in the • Reconstruction of the Cronulla Government’ category at the 2011 NSW Tourism Awards and, at Station platform awnings to 2012 National Trust NSW Heritage 30 June 2012, was a finalist in the remove hazardous materials while Awards for the reconstruction Greater Sydney Tourism Awards. keeping the original profile. of a Powder Van by RailCorp apprentices. RailCorp was also The Apprentice Heritage highly commended for the Restoration Program at the South upgrade of the rail heritage Eveleigh Annexe replaced 40 Operational Performance Non-operating network centre, Trainworks, at Thirlmere windows in two Southern Aurora in the ‘Regeneration and New dining cars. The rejuvenation Development’ category of these 50-year-old carriages Heritage collection assets involved an intergenerational skills • Trainworks is operated by transfer and knowledge capture. RailCorp’s extensive collection of RailCorp’s not-for-profit Also completed by the apprentices heritage assets – precincts, rolling subsidiary company, Trainworks in 2011, the reconstructed Powder stock and small objects – is largely Limited (with Board oversight), to Van is on display at Cooma Railway assigned to community groups promote and manage the visitor Station. across the state. Volunteers with experience. In its first full year of specialist skills keep RailCorp’s operation, Trainworks at Thirlmere The Rail Heritage Care Program, a heritage fleet rolling under their own proved to be a popular attraction RailCorp/Conservation Volunteers accreditation. Funding assistance to with visitor numbers exceeding Australia (CVA) partnership, these groups is provided to support 34,000. As the onsite rail generated a range of successful asset maintenance plans. operator, the NSW Rail Transport projects from repairing heritage Museum (NSWRTM) continues rolling stock to cataloguing Heritage assets were the subject to conserve and maintain rolling collections. By the end of 2011, 57 of a review to determine the future stock and provide heritage CVA volunteers had undertaken arrangements for the management train rides from the site. It was a 1377 incident-free volunteer days at of these assets. challenging year for this visitor six sites across NSW. The program generated positive media coverage and feedback.
Exhibitions Significant asset maintenance projects included repairs to the During the year, visitors to Central Station were able to enjoy three Large Erecting Shop at Eveleigh, exhibitions at Rail Heritage Central: preparation for major hazardous materials remediation works at • ‘Central Station – a Timeless Treasure’ continued its run until August Cooma, Tenterfield and Werris 2011. Creek and remodelling the ‘Igloo’ building at Chullora to • As part of History Week September 2011, ‘Food to Go’ was launched receive heritage collection items to tell the story of food on the rails – from how food was prepared relocated from North Eveleigh. and delivered in the small confines of railway buffet cars to the The manufacturer commenced Railway Refreshment Rooms and the romance of railway dining. rectification works on the new boiler • On 16 April 2012 celebrations marking 50 years of the Southern for heritage locomotive 3801 further Aurora began with a new exhibition Glamour and the Gauge, and to its non acceptance by RailCorp the launch of a commemorative anniversary book. Along with the in 2011. standardisation of the rail gauge between Sydney and Melbourne, this new ‘non-stop’ service with new rolling stock was the height of glamorous travel and customer experience in an age before the rise of airline travel.
Operational Performance 37 Environment and sustainability
Objective: To be an environmentally sustainable railway, with an environmentally responsible culture.
Apart from providing customers with a sustainable mode of to deliver RailCorp’s sustainability travel, RailCorp also plays a role in caring for the environment. objectives have been captured with a view to widespread replication.
RailCorp’s environmental and RailCorp’s sustainability sustainability objectives are: strategy Sustainable design guideline for NSW rail • To steward the long-term RailCorp’s first sustainability strategy sustainability of the rail transport was completed during 2011-12. It RailCorp revised and improved the network, assets and services builds on the previous benchmarking guidelines driving sustainability under our care and development work undertaken considerations in new rail on the significance of sustainability infrastructure projects. In partnership • To understand and manage the in the organisational context. with the Transport Projects division effects of our rail transport service The strategy embeds RailCorp’s of Transport for NSW, the guidelines on the environment and the environmental vision – to be an assist projects to meet their community environmentally sustainable railway, objectives in a manner consistent • To maximise the benefits of rail as with an environmentally responsible with ecologically sustainable a sustainable transport option. culture – by documenting our development. That is, by minimising sustainability objectives around environmental and social impacts, RailCorp’s commitment to these the key themes of climate change, minimising operational costs, objectives resulted in a number of water efficiency, resource use, waste maximising environmental and initiatives and improvements being management and biodiversity. social opportunities, as well as conducted throughout the reporting driving sustainable performance period, as illustrated by the Communicating the benefits and improvement through innovation. following highlights. opportunities the strategy presents is critical as RailCorp seeks to further The guidelines are first applied build environmental sustainability during the design of new rail into existing business practices. A infrastructure so sustainability is part number of practices already in place of the core scope and is considered
38 RailCorp Annual Report 2011–12 through the life of the project. undertaken a number of of ‘reduce – reuse – recycle’, and by These guidelines provide a vehicle initiatives including LED lighting at purchasing recycled products when for RailCorp, in partnership with various locations. appropriate. The RailCorp Pitt Street the Transport Projects division, to office has adopted this approach, continue to bring design excellence In early 2012 RailCorp partnered using a waste management system to new infrastructure to better serve with the Office of Environment that aims to increase recycling and our customers. and Heritage through the NSW reduce office waste. Government Building Retrofit Program to upgrade lighting at eight In 2011-12 RailCorp returned almost stations to LED technology. The 6000 toner cartridges to the Planet Operational environmental upgrades are scheduled to be Ark recycling company C4PA, management plans completed in 2012 and, once diverting more than 4.5 tonnes Operational Performance RailCorp has continued to develop implemented, will reduce the lighting from landfill. Our cartridge recovery and implement operational energy consumption at these program has been so successful environmental management plans selected sites by up to 45 per cent that Planet Ark placed RailCorp in for specific areas of RailCorp that while providing additional benefits the top 20 companies in Australia carry environmental risk. Through such as maintenance savings. for ink cartridge recycling over the its Environmental Management past 10 years. System Program, these plans work Biodiversity Since October 2010, RailCorp’s at the local management and CountryLink catering group operational staff level and facilitate Being a large land owner, RailCorp is has donated food suitable for the effective management of actively promoting biodiversity consumption but not for resale to RailCorp’s environmental risks good practice and stewardship, and the OzHarvest food rescue charity and the continual improvement continues to implement management for distribution to people in need. of the organisation’s overall plans for threatened species of flora This food would otherwise have environmental performance. and fauna, including the Downy ended up in landfill and to date Wattle (Acacia pubescens) and the more than 64,000 meals have Green and Gold Bell Frog (Litoria Noise monitoring been provided to disadvantaged aurea). Bush regeneration on the and homeless people in and The angle between a bogie Downy Wattle was conducted at around Sydney. wheel and the track on which it is eight locations over 2011-12, and travelling is the ‘angle of attack’. An habitat enhancement works were RailCorp continues its commitment excessive angle of attack can lead also completed for the Green and to improving recycling and waste to a number of issues, including Gold Bell Frog. facilities for customers at stations noise on curves. and commenced the roll out of 250 During 2011-12, RailCorp has additional bins to 70 stations across RailCorp operates an angle of undertaken bush regeneration the network. attack detection system at a curved works to enhance environmentally section of track near Beecroft and sensitive locations around the collaborates with the Australian metropolitan network. Regeneration Government’s Cooperative works have been undertaken on RailCorp offices recognised Research Centre rail noise project Blue Gum High Forest remnants for environmental to analyse the data and provide in northern Sydney and remnant improvement results back to freight operators. bushland in the World Heritage In 2011 RailCorp achieved a The detection system was listed Blue Mountains. three star NABERS (the National upgraded during the year to Australian Built Environment Rating improve its performance. Waste reduction and System) tenancy rating for its main purchasing policy corporate offices at 477 Pitt Street Energy efficient LED lighting as part of its commitment to the RailCorp is committed to City Switch program. City Switch RailCorp is continuing to assess its implementing the principles of is a partner program between operations for energy efficiency the NSW Government’s Waste business and local government to opportunities. Following a series of Reduction and Purchasing Policy encourage office tenants to improve such assessments RailCorp has by promoting the waste hierarchy their environmental performance.
Operational Performance 39 Value for money
Objective: The organisation is managed in a financially sustainable way.
• Accomplishing objectives within RailCorp will be able to offer much better value for its an appropriate risk and control customers and for the taxpayer if it continues to improve framework.
efficiency and service standards. Customers have told Success can be measured by: RailCorp that the service improvements achieved in recent years are making a difference. However these benefits have • Achieving the target for RailCorp’s operating costs set by come at an unsustainable financial cost. government (Community Support Ratio) It costs approximately $3.8 billion in place to deliver these outcomes • Reducing real costs of operations each year to operate RailCorp and more will be rolled out through for each carriage kilometre including depreciation. Around 20 the Fixing the Trains program. per cent of this cost is returned • Operating within budget through fares. Increasing efficiency To ensure that RailCorp will meet will allow RailCorp to reinvest in the its value for money objective, it • Growing revenue, both from business, however, it will require will deliver the required customer farebox and other sources of a combination of cost reduction, services by: income. productivity improvement and • Efficiently managing its operating Key value for money strategies are: simplified work practices if and capital budgets the organisation is to sustain • Cost-effective operations to growth and customer service • Challenging itself to improve reduce government subsidy and improvements. net costs of operations against cost to customers appropriate service and cost RailCorp will pursue opportunities benchmarks • Strategic sourcing and delivery for business improvement and will – to expand resource availability strengthen commercial practises, • Spending on the right things and better control costs ensuring it meets compliance obligations and manages risk • Maximising revenue contribution • Strategic and risk management appropriately. Several programs are within the agreed framework practices to efficiently utilise
40 RailCorp Annual Report 2011–12 human, capital and intellectual Rolling stock inspections will be replaced with a assets through effective maintenance reform balanced maintenance regime. integrated planning RailCorp’s in-house rolling stock • Taking a thorough and systematic maintenance function is capable of approach to identify and pursue competing with the private sector, Lean Six Sigma opportunities for efficiency with an independent assessor improvements generated confirming to the NSW Government Lean Six Sigma is a structured by functional, structural and that all maintenance reform problem-solving discipline technological change milestones have been met. Progress that works best on processes fundamental to an organisation’s • Effective and efficient business included cross-skilling of fitters and operation or value creation. The processes and platforms that electricians in the electric depots. Operational Performance Lean method reviews processes to improve the accessibility At an operational level, incidents identify and eliminate waste, and of relevant management involving passenger door failures can also improve process flow. The information. This will lead to on the Intercity (V Set) fleet complementary Six Sigma method better decision making and decreased 60 per cent, thanks uses statistics to understand why accurate and timely information to the Flemington Maintenance process outputs vary or cannot on all aspects of service and Centre improvement project – part reach targets to create solutions. operations to ensure compliance of RailCorp’s Everyday Service RailCorp has been using Lean and control Essentials Program. Six Sigma since 2007 to better • Benchmarking – continuously understand why assets are not Other key reform initiatives in look to improve performance by consistently reliable and to help 2011-12 included: identifying best practice through drive improvement. comparisons with industry, both • A career development program, locally and internationally. giving staff the opportunity to Progress become qualified fitters and Value for money strategies Lean Six Sigma projects have electricians employed during the reporting contributed substantially to period include; • A new line management structure improved asset reliability, supporting consistently better than • The comprehensive review of • Electronic time capture 92 per cent on-time running and maintenance processes and delivering financial benefits. procedures • Electronic rostering in the XPT Service Centre Asset reliability improvement • The consolidation and projects have continued to focus streamlining of operations • Rolling out reform at the diesel on control circuits, points, train functions depots and up-skilling fitters with door, brake, traction and indication car-building skills. • Removal of bureaucratic systems. Business efficiency projects have focused on improving processes and duplication Oscar maintenance fleet availability, improved vendor • Reduction in management Following its successful rolling stock performance, faster response layers and renewed focus on maintenance reform, RailCorp was times, possession management, consistency in processes and given the opportunity to maintain inventory, housekeeping and safety decision making its new Oscar fleet. These trains will management. be maintained via a 24/7 operation, • Work with Transport for NSW balanced general inspections and Asset reliability will remain a key on Corporate and Shared better use of condition monitoring. focus for Lean Six Sigma project Service (CSS) Reform, focusing Continuous operation of the Oscar work as the benefits of fewer on the establishment of clear Eveleigh maintenance centre will incidents and delays are directly accountabilities and new allow crews to get more work done and continually felt by customers. organisational structures. outside of the morning and evening Seventy-three Lean Six Sigma peaks, when the trains are needed projects have been undertaken most – boosting staff utilisation and since July 2011, with 30 being train availability. Monthly general completed by 30 June 2012.
Operational Performance 41 These projects focused on waste services, and to deliver value for Consolidation of security reduction, improved turnaround money to customers and taxpayers. monitoring facilities time and greater utilisation of scarce It presents further opportunities by resources. A3 thinking projects, This reform improved efficiency, supporting existing reform projects a proven Lean concept, were staff and passenger safety, security and further improvements in fleet introduced into RailCorp in the last and incident response, through safety, availability, reliability and year. Using the Plan-Do-Check- the development of enhanced customer satisfaction. Adjust cycle these projects are detection, alarm management and utilised at the workplace to provide The contract replaces the existing monitoring systems. simple and quick solutions. These maintenance and logistics contract, have been extremely successful, The security monitoring facility is which commenced in 1993. The new with a further 100 projects either a state-of-the-art CCTV and Help contract will run for seven years, commenced or completed by Point monitoring unit managed with the option for RailCorp to 30 June 2012. by RailCorp’s security division consider extensions totalling up to and located at Central Station. It five years. An increasing number of projects replaces the former group remote have been supported by Lean Six Central to the new contract are monitoring locations around the Sigma to focus on the customer ‘gain-share’ provisions, which mean RailCorp network and is now experience. These include improved savings through innovation are responsible for responding to Help customer communications during shared between RailCorp and the Points and other alarms, monitoring incidents, better ticket vending contracting joint venture. the CCTV system for incidents and machine availability, reduced rail for managing the CCTV system. The corridor vandalism and improved project has also delivered significant toilet availability on intercity improvements in terms of system trains. New projects under way Auto logbooks resilience and productivity will focus on continued reliability improvements. improvements and business The aim of the auto logbook project The centre is capable of responding efficiency projects to drive is to provide an automated system to all Help Point calls from across cost reductions. based on a GPS satellite navigation the RailCorp network. Moreover, the display unit and other in-vehicle CCTV system also receives alarms equipment to record trip details for from ticket vending machines reporting, such as Fringe Benefits and is rolling out a capability to Fleet major maintenance Tax and Fuel Tax Credits. manage ‘video motion detection’ – and logistics contract Benefits include: movement activated alarms. In December 2011, RailCorp • Replacing the manual creation awarded a $1.4 billion contract to CCTV Monitoring and processing of motor vehicle UGL Unipart Rail Services Pty Ltd (a Every position in the centre is running sheets with an easy-to- joint venture between UGL Limited capable of monitoring every camera use driver entry of trip details and and Unipart Rail) to manage heavy on the CityRail network, as well as the reporting of this detail for maintenance and logistics for 1050 cameras from a number of RailCorp interested parties carriages of RailCorp’s fleet. buildings, CCTV retrieved from trains • Better utilisation of RailCorp’s and live CCTV from Waratah trains. The contract covers a range of vehicle fleet and the reduction maintenance, engineering and in costs of using short-term hire CCTV Management logistics services for RailCorp’s vehicles electric train fleet, excluding the The facility will be the future repository for all CCTV data saved Millennium and Waratah (PPP) • Providing satellite navigation by RailCorp or NSW Police. fleets, as well as project and capabilities and Bluetooth The new system will replace the logistics work for RailCorp’s functionality to the driver. diesel fleet. previous practice of filling in paper Significant progress was made forms, distributing DVDs and The contract will play a key role in throughout the reporting period limiting access to a small number RailCorp’s commitment to deliver with full implentation occuring in of computers capable of safe, clean and reliable passenger 2012-13. viewing CCTV.
42 RailCorp Annual Report 2011–12 People
Objective: A customer- focused workforce that is empowered, accountable, committed and proud of its Operational Performance achievements.
At the heart of the Fixing the Trains program is the need The outstanding performance pilot to ensure not only that customers get excellent service sought to identify managers and leaders who have demonstrated but that taxpayers also get value for money through continuous improvement over a RailCorp operating as efficiently as it can. Delivering on this period of time against specific commitment, together with implementing transport-wide performance indicators. A defined corporate and shared services reform, involves fundamental methodology was applied and change for RailCorp and its people. as a result, three managers were recognised for the improved performance of their unit. Case The Our People Strategy provided unsatisfactory performance and studies were developed as a the framework for driving maximise good performance. form of recognition, outlining improvements in workforce the actions and initiatives the capacity, performance and culture A Leadership and Management managers undertook to achieve this in 2011-12. The outcomes achieved Heat Map Process has been outstanding performance. These during this reporting period are developed and piloted. The heat case studies form the basis for outlined below. A rethink of these map is an organisational diagnostic further communication and sharing approaches will now be required in tool that helps identify positive as of best practice with other parts of light of the transformational change well as negative performance in the organisation. agenda underway. operational units across a business. The poor performance pilot in the Two pilots were undertaken to Rolling Stock Division was delivered test heat mapping at RailCorp. in two phases. The main objective One focused on outstanding of this pilot was to identify areas Maximise performance performance in the Service of the division where performance Delivery Group and one on improvement was required. This This workstream provides the poor performance in the Asset was followed by consultation with framework, tools, training, Operations Group. line managers to identify targeted support and rewards to minimise solutions for implementation.
Operational Performance 43 Transform culture has been an important part of the of managers and leaders in the design of the induction process. As workplace was developed and This workstream aims to define part of the ‘Removing Bureaucracy’ piloted within the Rolling Stock and embed a values-based commitment, a review of the Local Division with positive results. organisational culture that enables Managers’ Induction checklist strategic objectives to be met. has commenced with input from The Management Development stakeholders. Program identifies manager The 2011 Culture Survey received a facilitated learning activities and record response rate of 56 per cent The Employee Life Cycle framework courses that aim to increase the across the organisation. The results was developed in mid 2011. This capabilities of our managers. indicated a steady improvement provides a tool to identify areas in Mandatory modules completed across all corporate values and were the life cycle where HR may develop include Manage People and communicated through briefing strategies to enhance employee Performance, Ethical Behaviour sessions across the organisation. engagement. An Employee & Conduct, Financial Awareness, Engagement Strategy was Safety, Just Culture and Leadership The Just Culture Program was developed as well as a Dashboard Awareness. reviewed to identify strategies that can be used for ongoing to further embed the principles measurement of engagement. Asset Operations Group continued and behaviours into ‘business as to run the ‘We Lead the Way’ usual’ and enable the program to Leadership Challenge. Within the be sustainably managed by the program, participants develop business in the future. An updated a greater understanding of their training curriculum was developed Develop managers and leadership styles, and how to be a which provides more standardised leaders more effective leader. messaging across the Just Culture RailCorp recognises that managers principles and alignment with the and leaders play a crucial role in corporate values. driving the performance of staff and achieving business goals. For this Build knowledge and reason, RailCorp is investing in the skills development of its managers and Engage employees leaders. This workstream aims to ensure that RailCorp develops and retains The first edition of the RailCorp This workstream aims to engage knowledge and skills to mitigate Manager’s Handbook was staff to support the purpose and business risk and enable the developed and provided to all values of RailCorp and demonstrate continuity of our business. their commitment through RailCorp managers. The handbook behaviour and purpose. assists managers in understanding A Lessons Learned System has their roles and responsibilities been designed and developed. This Promotion of RailCorp’s people and provides easy access to system addresses a strong business initiatives has increased through tools to assist them in their role. need to improve the way RailCorp communication at staff briefings The handbook was distributed in identifies, captures and shares and Leader’s Forums. In addition, conjunction with a comprehensive lessons learned from projects. It a 2012 People Calendar was communication plan including also allows RailCorp to leverage developed to inform RailCorp numerous briefings at business project successes and reduce the people of the activities that impact team meetings. cost of repeated mistakes. A pilot on them and areas of interest to was successfully conducted in the In a continued effort to embed employees and their families. Projects Division of the Engineering the Leadership and Management and Projects Group. The review of RailCorp’s induction Development Framework, a process is underway. The schedule of master classes was A Knowledge Continuity Project participation in the induction developed to support management was rolled out with five subject e-learning project team culminated development at RailCorp. Sessions matter experts in the Engineering in the delivery of the online have focus on communication, and Projects Group. A Knowledge ‘Introduction to RailCorp’ interactive dignity and respect, change, and Continuity Tool Kit was piloted e-learning tool for new starters. recruitment. A workshop to support and updated based on feedback Ongoing stakeholder engagement and encourage the development from participants. A Knowledge
44 RailCorp Annual Report 2011–12 Continuity Roadmap was also for Rail Innovation (CRC) and to the Gay, Lesbian, Bisexual, Transgender developed, and awareness sessions Australian Rail Association (ARA) and Intersex people. held. Scoping of knowledge for national rail industry projects. continuity in the business has The CRC project is aimed at commenced to mitigate business enhancing the image of the rail Women risk of knowledge loss. industry as an employment sector and identifying career options across Fifty-four female employees in the industry. The ARA project is non-managerial and aimed at identifying industry wide non-traditional roles participated resources issues. These two projects in the Springboard Women’s Secure RailCorp’s future are targeted at improving the ability Development Program, which workforce aimed to assist them with career
of the rail industry to attract and Operational Performance retain resources. development at RailCorp. This workstream is targeted at attracting, developing and retaining International Women’s Day was appropriate numbers of people at celebrated on 8 March 2012 by the right levels of the organisation inviting female students, performers with the necessary operational, Equity and diversity and guest speakers to Central technical and human skills to meet achievements in 2011-12 Station. Twenty female employees current and future requirements. were sponsored to attend the UNIFEM (UN Women Australia) Awards Implementation of the Success breakfast. Factors Workforce Planning RailCorp’s equity and diversity application was delivered. The programs have been recognised by application went live in April 2012 two distinguished awards: Aboriginal and Torres Strait and work is being undertaken to Islander people customise the workforce reporting • NSW Carers Award; Winner and planning components to the of Carer Friendly Workplace Four Aboriginal undergraduates RailCorp environment. category are continuing their placements at RailCorp under the Aboriginal A RailCorp Workforce Profile has • Australian Human Resources Cadetship Program. been developed which provides Institute Awards; finalist of the baseline data on the state of the Inclusive Workplace of the Year Reconciliation Week was celebrated current workforce, its challenges category. by staff participating in an and risks. As well as reviewing Aboriginal painting workshop held the internal workforce issues, the in May 2012. reports also assessed the RailCorp Policies and procedures workforce against the external NAIDOC Week was celebrated environment. This report identified RailCorp established a Flexible by unveiling Aboriginal artwork a number of workforce areas and Work Practices Procedure displayed on a CountryLink train. issues requiring attention. Data introducing a range of options, such from this profile will help inform the as variable start/finish times, part- workforce planning process. time work, purchased leave, phased People with a disability retirement and individual flexibility A review of the RailCorp agreements. Through the Disability Traineeship engineering resources was Program, five people with a Disability were offered one-year paid conducted during the year to Diversity networks determine the scope of available traineeships to complete Certificate RailCorp continued to resource resources, competency streams, III in Business Administration and and manage six employee diversity career pathways and potential on-the-job training. networks dedicated to advising resourcing risks. These resource and assisting RailCorp in enhancing International Day of People maps will be utilised in the equity for Women, Aboriginal & with a Disability was celebrated workforce planning process. Torres Strait Islanders, Culturally in December 2011 by inviting RailCorp provided subject matter & Linguistically Diverse people, customers to Central Station where expertise and reference material to People with a Disability, Carers, and accessible features were showcased the Cooperative Research Centre by guided tours.
Operational Performance 45 Culturally and linguistically Health and wellbeing • The SafeSpine program diverse people commenced in March 2012 A national training program in conjunction with Asset The Community Language and online learning exercise for Operations Group. The program Assistance Scheme was launched Authorised Health Professionals is aimed is at reducing manual as a pilot program and four was launched in 2012. The training injuries and for employees to gain employers have been recognised program has been adopted a greater understanding of the as interpreters to assist customers by rail transport operators in activities and work tasks which who speak Italian, Hindi, Arabic and all mainland states and in New may trigger injuries Tagalog languages. Zealand. It creates a national panel of Authorised Health Professionals • The inaugural Quit Smoking Eighteen employees are taking for use by industry. The provision of Program sustained a quit rate of part in a 20-day Workplace English instruction to doctors undertaking 33 per cent of total participants Language and Literacy program to rail safety health assessments was after six months improve their communication skills. a recommendation of the Special • Skin checks were conducted Commission of Enquiry into the for 107 people at the Safety Waterfall train ccident. Gay, lesbian, bisexual, Competition, resulting in 37 referrals transgender and intersex A manufacturer has been engaged to produce to order RailCorp’s people • The occupational nurse program colour vision simulated test, known had a 30 per cent increase in On 3 March 2012, 80 participants as the RailCorp Lantern. referrals compared to 2011. marched in the Sydney Gay and A program of drug and alcohol Lesbian Mardi Gras Parade with the The annualised usage of the assessments was developed RailCorp float promoting equality Employee Assistance Program and incorporated into the health for GLBTI people. was five per cent, with nearly 900 assessment process for contractors employees utilising the service over who have had previous positive the reporting period for an average drug or alcohol tests. Other initiatives of two hours per employee. Health Services has continued to Approximately 100 managers Critical incident support was manage RailCorp’s automated participated at the annual Diversity provided to 279 employees, with external defibrillator (AED) Conference presented by a an average of just below 7 hours of program, with 105 AEDs deployed panel of academics and diversity trauma counselling per employee. and four lives saved since 2009. practitioners. A decrease in employees requiring RailCorp’s health promotion support, but an increase in Sixty-three employees in non- programs for 2011-12 included the counselling hours provided, reflects managerial roles participated in following: the complexity of many of the four Job Seeking Skills Workshops cases, specifically fatalities. to enhance their ability to apply for • Teams for the City2Surf and the positions and achieve promotions. JP Morgan Corporate Challenge, The Managers’ Assistance Program with employee participation was used by 41 managers for a Two Transition to Retirement increasing by 20 and 21 per cent total of 27 hours service, averaging Seminars were held to raise respectively approximately 40 minutes per awareness among managers employee. and staff about retirement and • A 21 per cent increase in capturing the critical knowledge of participation in the pedometer A health e-learning module was retiring staff. challenge launched on 22 February 2012. This is a new interactive method to • Health fairs, in which 1200 educate employees how common employees participated in 2011-12 lifestyle factors impact.
• The influenza vaccination program, with participants taking 0.63 days less sick leave per annum than non-participants
46 RailCorp Annual Report 2011–12 Financial Statements
Statement by the Chief Executive 48
Statement of Comprehensive Income 49
Statement of Financial Position 50
Statement of Changes in Equity 51
Statement of Cash Flows 53
Notes to the Financial Statements
Note 1 Reporting entity and financial statements 54
Note 2 Summary of accounting policies 55 Financial Statements
Note 3 Income 67
Note 4 Expenses 68
Note 5 Cash and cash equivalents 70
Note 6 Trade and other receivables 71
Note 7 Inventories 72
Note 8 Non-current assets held for sale 73
Note 9 Property, plant and equipment 73
Note 10 Intangible assets 76
Note 11 Other assets 76
Note 12 Trade and other payables 77
Note 13 Borrowings and finance lease liabilities 77
Note 14 Provisions 78
Note 15 Contributed equity 89
Note 16 Reserves 90
Note 17 Retained earnings 90
Note 18 Expenditure commitments 90
Note 19 Contingent liabilities and contingent assets 92
Note 20 Financial instruments 93
Note 21 Joint venture 102
Note 22 Events occurring after reporting date 102
Independent Auditor’s Report 103 Financial Statements 47 Statement by the Chief Executive
In relation to the Financial Statements for the year ended 30 June 2012
Pursuant to section 41C (1B) of the Public Finance and Audit Act 1983 and clause 7 of the Public Finance and Audit Regulation 2010 I declare that:
(a) In my opinion, the accompanying financial statements, read in conjunction with the notes thereto, exhibit a true and fair view of the financial position of RailCorp and the consolidated entity as at 30 June 2012 and of their financial performance for the year ended 30 June 2012
(b) The financial statements have been prepared in accordance with the provisions of the Public Finance and Audit Act 1983, the Public Finance and Audit Regulation 2010, the Australian Accounting Standards, which includes Australian Accounting Interpretations, and Treasurer’s directions.
(c) I am not aware, as at the date of this statement, of any circumstances which would render any particulars included in the financial statements to be misleading or inaccurate.
Rob Mason Chief Executive
27 September 2012
48 RailCorp Annual Report 2011–12 (Start of audited financial statements) Statement of Comprehensive Income for the year ended 30 June 2012
Consolidated Parent 2011-12 2010-11 2011-12 2010-11 Note $000 $000 $000 $000 Income
Passenger services revenue 766 180 703 528 766 180 703 528 Non passenger revenue 3.1 346 322 309 962 345 703 309 850 Interest 689 702 677 699 Income from operating activities 1 113 191 1 014 192 1 112 560 1 014 077
Expenses
Operating expenses - Payroll costs and other employee benefits 4.1 1 616 367 1 425 771 1 615 792 1 425 612 - Other operating expenses 4.3 1 302 886 1 244 137 1 302 840 1 244 212 Depreciation and amortisation 9.2,10.2 873 216 814 825 873 208 814 824 Finance costs 4.5 32 943 17 803 32 943 17 803 Total expenses 3 825 412 3 502 536 3 824 783 3 502 451 Financial Statements Deficit from operations before Contributions (2 712 221) (2 488 344) (2 712 223) (2 488 374)
Government subsidies 1 485 107 1 389 832 1 485 107 1 389 832 Government concessions 248 785 247 389 248 785 247 389 Other Government operating subsidies 779 809 779 809
Deficit from operations before Capital Contributions (977 550) (850 314) (977 552) (850 344)
Contributions for capital expenditure 3.2 1 396 584 872 801 1 396 584 872 801
Surplus for the year from continuing operations 419 034 22 487 419 032 22 457
Other Comprehensive Income
Net gain/(loss) in forward foreign exchange 16 994 (2 573) 994 (2 573) Net gain/(loss) in commodity swaps 16 (4 481) 4 524 (4 481) 4 524 Revaluation of property, plant and equipment 16 694 4 606 315 694 4 606 315 Superannuation actuarial gains/(losses) on defined benefit schemes 17 (345 091) (20 931) (345 091) (20 931) Other Comprehensive Income for the year (347 884) 4 587 335 (347 884) 4 587 335 Total Comprehensive Income for 71 150 4 609 822 71 148 4 609 792 the year The Statement of Comprehensive Income should be read in conjunction with the accompanying notes.
Financial Statements 49 Statement of Financial Position as at 30 June 2012
Consolidated Parent Note 30.6.2012 30.6.2011 30.6.2012 30.6.2011 $000 $000 $000 $000 Current assets Cash and cash equivalents 5.1 77 609 15 034 77 467 14 925 Trade and other receivables 6.1 189 480 187 095 189 428 187 092 Security deposits 43 41 43 41 Inventories 7 35 017 34 193 35 006 34 193 Non-current assets classified as held for sale 8 1 754 7 801 1 754 7 801 Derivative financial instruments 20.1 788 3 743 788 3 743
Total current assets 304 691 247 907 304 486 247 795 Non-current assets Inventories 7 32 347 28 878 32 347 28 878 Trade and other receivables 6.1 34 769 28 599 34 769 28 599 Property, plant and equipment 9 25 860 971 24 464 588 25 860 956 24 464 579 Intangible assets 10 242 771 173 467 242 765 173 459 Derivative financial instruments 20.1 28 992 28 992 Other 11 70 095 69 977 70 095 69 977
Total non-current assets 26 240 981 24 766 501 26 240 960 24 766 484 Total assets 26 545 672 25 014 408 26 545 446 25 014 279 Current liabilities Trade and other payables 12 663 457 525 519 663 296 525 432 Borrowings and finance lease liabilities 13 13 663 334 661 13 663 334 661 Provisions 14 645 192 510 203 645 159 510 191 Derivative financial instruments 20.1 13 811 14 209 13 811 14 209
Total current liabilities 1 336 123 1 384 592 1 335 929 1 384 493 Non-current liabilities Borrowings and finance lease liabilities 13 599 266 379 908 599 266 379 908 Provisions 14 823 296 465 333 823 296 465 333 Derivative financial instruments 20.1 2 355 2 389 2 355 2 389
Total non-current liabilities 1 424 917 847 630 1 424 917 847 630 Total liabilities 2 761 040 2 232 222 2 760 846 2 232 123 Net assets 23 784 632 22 782 186 23 784 600 22 782 156
Equity Contributed equity 15.1 14 647 015 13 715 719 14 647 015 13 715 719 Reserves 16 8 210 203 8 230 505 8 210 203 8 230 505 Retained earnings 17 927 414 835 962 927 382 835 932
Total equity 23 784 632 22 782 186 23 784 600 22 782 156
The Statement of Financial Position should be read in conjunction with the accompanying notes.
50 RailCorp Annual Report 2011–12 Statement of Changes in Equity for the year ended 30 June 2012
Note Contributed Retained Asset Other Total Consolidated Equity Earnings Revaluation Reserves $000 $000 $000 $000 $000
Balance at 1 July 2011 13 715 719 835 962 8 242 368 (11 863) 22 782 186 Surplus for the year - 419 034 - - 419 034 Reserves transferred to/(from) Retained Earnings 16,17 - 17 509 (17 509) - -
Other Comprehensive Income Net gain/(loss) in forward foreign exchange 16 - - - 994 994 Net gain/(loss) in commodity swaps 16 - - - (4 481) (4 481) Increase/(decrease) in Asset Revaluation Reserve 16 - - 694 - 694 Superannuation actuarial gains/(losses) on defined benefit schemes 17 - (345 091) - - (345 091) Total Other Comprehensive Income for the year - (345 091) 694 (3 487) (347 884) Increase/(decrease) in net assets from equity transfers (contribution by owners) 15.2 931 296 - - - 931 296
BALANCE AS AT 30 JUNE 2012 14 647 015 927 414 8 225 553 (15 350) 23 784 632 Financial Statements
Balance at 1 July 2010 13 600 268 832 230 3 638 229 (13 814) 18 056 913 Surplus for the year - 22 487 - - 22 487 Reserves transferred to/(from) Retained Earnings 16,17 - 2 176 (2 176) - -
Other Comprehensive Income Net gain/(loss) in forward foreign exchange 16 - - - (2 573) (2 573) Net gain/(loss) in commodity swaps 16 - - - 4 524 4 524 Increase/(decrease) in Asset Revaluation Reserve 16 - - 4 606 315 - 4 606 315 Superannuation actuarial gains/(losses) on defined benefit schemes 17 - (20 931) - - (20 931) Total Other Comprehensive Income for the year - (20 931) 4 606 315 1 951 4 587 335 Increase/(decrease) in net assets from equity transfers (contribution by owners) 15.2 115 451 - - - 115 451 BALANCE AS AT 30 JUNE 2011 13 715 719 835 962 8 242 368 (11 863) 22 782 186
The Statement of Changes in Equity should be read in conjunction with the accompanying notes.
Financial Statements 51 Statement of Changes in Equity for the year ended 30 June 2012
Note Contributed Retained Asset Other Total Parent Equity Earnings Revaluation Reserves $000 $000 $000 $000 $000
Balance at 1 July 2011 13 715 719 835 932 8 242 368 (11 863) 22 782 156 Surplus for the year - 419 032 - - 419 032 Reserves transferred to/(from) Retained Earnings 16,17 - 17 509 (17 509) - -
Other Comprehensive Income Net gain/(loss) in forward foreign exchange 16 - - - 994 994 Net gain/(loss) in commodity swaps 16 - - - (4 481) (4 481) Increase/(decrease) in Asset Revaluation Reserve 16 - - 694 - 694 Superannuation actuarial gains/(losses) on defined benefit schemes 17 - (345 091) - - (345 091) Total Other Comprehensive Income for the year - (345 091) 694 (3 487) (347 884)
Increase/(decrease) in net assets from equity transfers (contribution by owners) 15.2 931 296 - - - 931 296 BALANCE AS AT 30 JUNE 2012 14 647 015 927 382 8 225 553 (15 350) 23 784 600
Balance at 1 July 2010 13 600 268 832 230 3 638 229 (13 814) 18 056 913 Surplus for the year - 22 457 - - 22 457 Reserves transferred to/(from) Retained Earnings 16,17 - 2 176 (2 176) - -
Other Comprehensive Income Net gain/(loss) in forward foreign exchange 16 - - - (2 573) (2 573) Net gain/(loss) in commodity swaps 16 - - - 4 524 4 524 Increase/(decrease) in Asset Revaluation Reserve 16 - - 4 606 315 - 4 606 315 Superannuation actuarial gains/(losses) on defined benefit schemes 17 - (20 931) - - (20 931) Total Other Comprehensive Income for the year - (20 931) 4 606 315 1 951 4 587 335 Increase/(decrease) in net assets from equity transfers (contribution by owners) 15.2 115 451 - - - 115 451 BALANCE AS AT 30 JUNE 2011 13 715 719 835 932 8 242 368 (11 863) 22 782 156
The Statement of Changes in Equity should be read in conjunction with the accompanying notes.
52 RailCorp Annual Report 2011–12 Statement of Cash Flows for the year ended 30 June 2012 Consolidated Parent Note 2011-12 2010-11 2011-12 2010-11 $000 $000 $000 $000 Cash flows from operating activities Cash received Passenger services 767 721 703 057 767 721 703 057 Other receipts from customers and others 573 662 477 065 573 013 476 953 Government subsidies and concessions 1 733 892 1 637 221 1 733 892 1 637 221 Other Government operating subsidies 779 809 779 809 Interest received 689 702 677 699
Total cash received 3 076 743 2 818 854 3 076 082 2 818 739 Cash used Payments to suppliers, employees and others (2 837 635) (2 752 688) (2 837 019) (2 752 700) Interest paid (33 169) (9 229) (33 169) (9 229)
Total cash used (2 870 804) (2 761 917) (2 870 188) (2 761 929) Net cash from operating activities 5.2 205 939 56 937 205 894 56 810
Cash flows from investing activities Cash received Capital grants 1 345 725 875 960 1 345 725 875 960 Property, plant and equipment and intangible assets disposals 1 500 2 969 1 500 2 969 Financial Statements Total cash received 1 347 225 878 929 1 347 225 878 929 Cash used Property, plant and equipment and intangible assets acquisitions (1 264 142) (1 358 040) (1 264 130) (1 358 022) Milestone advances to a supplier - (12 000) - (12 000)
Total cash used (1 264 142) (1 370 040) (1 264 130) (1 370 022)
Net cash from / (used in) investing activities 83 083 (491 111) 83 095 (491 093) Cash flows from financing activities Cash received Proceeds from borrowings 3 086 602 3 012 153 3 086 602 3 012 153
Total cash received 3 086 602 3 012 153 3 086 602 3 012 153 Cash used Repayment of borrowings (3 418 900) (2 587 636) (3 418 900) (2 587 636)
Total cash used ( 3 418 900) (2 587 636) (3 418 900) (2 587 636) Net cash from / (used in) financing activities (332 298) 424 517 (332 298) 424 517 Net (decrease)/increase in cash and cash equivalents (43 276) (9 657) (43 309) (9 766) Cash and cash equivalents at the beginning of the year 15 034 24 691 14 925 24 691 Cash transferred in from TfNSW 105 851 - 105 851 - Cash and cash equivalents at the end of 5.1 77 609 15 034 77 467 14 925 the year The Statement of Cash Flows should be read in conjunction with the accompanying notes
Financial Statements 53 Notes to the Financial Statements for the year ended 30 June 2012
Note 1 Reporting entity and financial statements (a) Reporting Entity Rail Corporation New South Wales (RailCorp) is a Statutory Authority constituted under the Transport Administration Act 1988 and scheduled under the Public Finance and Audit Act 1983. It is domiciled in Australia and its principal office is at 477 Pitt Street Sydney, NSW 2000. Its principal objectives are: • to deliver safe and reliable railway passenger services in New South Wales in an efficient, effective and financially responsible manner, and • to ensure that the part of the NSW rail network vested in or owned by it enables safe and reliable railway passenger and freight services to be provided in an efficient, effective and financially responsible manner.
RailCorp, the parent entity and Trainworks Ltd, the controlled entity, constitute the reporting economic entity in these consolidated financial statements. Trainworks is a company limited by guarantee and RailCorp is the sole member. Trainworks commenced operations on 4 April 2011. The Transport Legislation Amendment Act 2011 established Transport for NSW (TfNSW) as a controlled entity of the Department of Transport, while RailCorp is a controlled entity of Transport for NSW. The Department of Transport is consolidated as part of the NSW Total State Sector Accounts.
On 15 May 2012, the Minister for Transport announced the creation of a new rail transport model. NSW Trains and Sydney Trains will be formed as two separate organisations structured to meet the different needs of regional and intercity, and Sydney customers. The change is likely to be effective on or after 1 July 2013.
NSW Trains will operate services currently operated by CountryLink and CityRail Intercity brands. Sydney Trains will operate the remaining Sydney services currently operated by the CityRail brand.
In addition a separate cleaning company, Transport Cleaning Services, will be established during 2012-13.
The proposed new organisations, NSW Trains, Sydney Trains and Transport Cleaning Services will operate as public subsidiary companies under RailCorp. (b) Principles of consolidation The consolidated financial statements comprise the financial statements of RailCorp (the parent entity) and its controlled entity, after elimination of all inter-entity transactions and balances.
(c) Authorisation of the Financial Statements
The Financial Statements were authorised for issue by the Chief Executive on the date on which the accompanying Statement by the Chief Executive was signed.
Note 2 Summary of accounting policies 2.1 Basis of accounting The consolidated financial statements are general purpose Financial Statements prepared in accordance with Australian Accounting Standards, which includes Australian Accounting Interpretations, the Public Finance and Audit Act 1983, the Public Finance and Audit Regulation 2010, and specific directions issued by the Treasurer. Generally, the historical cost basis of accounting has been adopted and these financial statements do not take into account changing money values or current valuations. However, property, plant and equipment, certain provisions, and derivative financial assets and liabilities are measured at fair value. Refer Notes 2.3(ii), 2.14(ii), and 2.19. The accrual basis of accounting has been adopted in the preparation of the financial statements, except for cash flow information. RailCorp and the controlled entity are not-for-profit entities for accounting purposes. The financial statements have been prepared on a going concern basis which assumes that RailCorp and the controlled entity are expected to be able to pay their debts as and when they fall due and continue in operation without any intention or necessity to liquidate or otherwise wind up their operations. Despite current liabilities exceeding current assets at year end, RailCorp’s continued operation and ability to pay its
54 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 2 Summary of accounting policies (continued) 2.1 Basis of accounting (continued) debts are satisfied because of annual appropriations of funds by the Government to support RailCorp in delivering services, offering fare concessions and undertaking capital works during the ensuing year. The NSW Government funds the majority of the cost of operation of the rail network. The proportion of total expenses met by the travelling public through fares was 20.1% in 2011-12 (20.1% in 2010-11). All amounts are rounded to the nearest one thousand dollars and are expressed in Australian currency. Certain comparatives have been reclassified to conform to the current year’s presentation.
2.1.1 Change in accounting policy There have been no changes in accounting policy in 2011-12
2.2 Adoption of new and revised Accounting Standards The Financial Statements have adopted all the new and revised Standards and Interpretations issued by the Australian Accounting Standards Board (the AASB) that are relevant to RailCorp and its controlled entity effective for the annual reporting period beginning on 1 July 2011. The adoption of these new and revised Standards and Interpretations has not resulted in any significant changes to RailCorp and controlled entity accounting policies. RailCorp and the controlled entity did not early adopt any new Accounting Standards and Interpretations that are not yet effective. NSW Treasury has mandated not to early adopt any of the standards that are not effective. Financial Statements The following new Accounting Standards and Interpretations have not yet been adopted and are not effective as at 30 June 2012.
Change in AASB Application date Affected Standard(s) and Interpretations Accounting Amendment of Standard Standard Amendments to Australian Accounting Standards – Presentation of AASB 2011-9 Other Comprehensive Income (AASB 1, 5, 7, 101, 112, 120, 121, 132, 1 Sept 2011 1 July 2012 133, 134, 1039 & 1049) Financial Instruments. Consequential amendments were also made to AASB 9 other standards as a result of AASB 9, introduced by AASB 2009 -11 1 Dec 2010 1 Jan 2013 and superseded by AASB 2010 -7 and 2010 -10 Consolidated Financial Statements. Consequential amendments were also made to other standards via 2011-7 (AASB 1, 2, 3, 5, 7, 9, 2009- AASB 10 1 Aug 2011 1 Jan 2013 11, 101, 107, 112, 118, 121, 124, 132, 133, 136, 138, 139, 1023 & 1038 and Interpretations 5, 9, 16 & 17) Disclosure relating of Interests in Other Entities. Interest in AASB 12 1 Aug 2011 1 Jan 2013 subsidiaries, joint arrangements, associates and other structures. Fair Value assessment. Consequential amendments were also made to standards via AASB 2011-8 (AASB 1, 2, 3, 4, 5, 7, 9, 2009-11, AASB 13 2010-7, 101, 102, 108, 110, 116, 117, 118, 119, 120, 121, 128, 131, 1 Sep 2011 1 Jan 2013 132, 133, 134, 136, 138, 139, 140, 141, 1004, 1023 & 1038 and Interpretations 2, 4, 12, 13, 14, 17, 19, 131 & 132) Employee Benefits. Consequential amendments were also made to AASB 119 standards via AASB 2011-10 (AASB 1, AASB 8, AASB 101, AASB 1 Sep 2011 1 Jan 2013 124, AASB 134, AASB 1049 & AASB 2011-8 and Interpretation 14). Amendments to Australian Accounting Standards to remove individual AASB 2011-4 1 Sept 2011 1 July 2013 key Management Personnel Disclosure (AASB 124) Application of Tiers of Australian Accounting Standards, being Tier 1 AASB 1053 1 Sept 2011 1 July 2013 and Tier 2.
The impact of these standards and interpretations on the Financial Statements is not expected to be significant.
Financial Statements 55 Notes to the Financial Statements for the year ended 30 June 2012
Note 2 Summary of accounting policies (continued) 2.3 Financial instruments Financial instruments are contracts that give rise to both a financial asset of one entity and a financial liability (or equity instrument) of another entity. They include cash and cash equivalents, receivables, payables, borrowings and derivatives (forward foreign exchange contracts, and commodity swap contracts).
(i) Recognition
A financial asset or financial liability is recognised when RailCorp becomes a party to the contractual provisions of the instrument.
Financial assets are derecognised when the contractual rights to the associated cash flows expire, are effectively transferred, or are otherwise lost. Financial liabilities are derecognised when the contractual obligation is discharged, is cancelled, or expires.
Any applicable amortisation, impairment loss (or reversal), or fair value adjustment is recognised in the income statement.
On derecognition, any difference between the items carrying amount and the consideration received or paid is recognised in the income statement.
(ii) Measurement
On initial recognition, a financial asset or financial liability is measured at its fair value (which is usually its cost) plus any directly-attributable transaction costs.
After initial recognition, receivables and payables are carried in the Statement of Financial Position at amortised cost, which is a reasonable approximation of their fair value. Borrowings are carried at amortised cost. Their fair value at year end is disclosed in note 13. Derivatives are carried at fair value.
The fair value of borrowings and derivatives is determined at year end as the quoted offer price or the risk- adjusted market price of the instrument. It represents current market value.
(iii) Hedging
Derivative financial instruments are used to hedge against exposures to foreign currency risk on overseas purchase commitments and on commodity price risk on forecast distillate and electricity purchases (where applicable).
Forward foreign exchange contracts are used to hedge against currency risk on firm commitments for the purchase of goods or services from overseas suppliers. These contracts entail a right to receive a fixed amount of foreign currency at a specified future date, which is offset by an obligation to pay a fixed amount of domestic currency at that time.
Forward foreign exchange contracts and commodity swap contracts are used to hedge against commodity price risk on forecast purchases of distillate. The contracts effectively entail a right to buy a specified quantity of distillate at a fixed price on a future date, which is offset by an obligation to sell a similar quantity at its prevailing monthly average market price at that time.
RailCorp policy for electricity hedging is similar to distillate operations. Electricity hedging applies only to periods not under a fixed price contract. Hedges are subsequently closed out once a fixed price contract is in place.
(iv) Hedge accounting
Cash flow hedge accounting is adopted for all hedging relationships involving forward foreign exchange contracts and commodity swap contracts. The portion of the gain or loss on the hedging instrument that is determined to be an effective hedge is initially recognised directly in the Hedging Reserve. When the cash flow in relation to the hedged item eventually occurs, the gain or loss is transferred from the Reserve to property, plant and equipment (in the case of equipment purchases) or to inventories (in the case of distillate purchases) where it is included in the cost of the hedged item. If the hedge is ineffective the
56 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 2 Summary of accounting policies (continued) 2.3 Financial instruments (continued) (iv) Hedge accounting (continued) portion of the gain or loss on the ineffective portion of the hedging instrument is recognised immediately in the income statement.
Hedge accounting is used on all RailCorp exposures. The hedging relationship is formally designated and documented at the inception of the hedge; the hedge is expected to be highly effective; the effectiveness is measurable, assessed on a quarterly basis and is actually achieved; and the hedged forecast transaction remains highly probable.
Hedge accounting is discontinued when the hedging instrument expires, is sold, is terminated, is exercised, no longer meets the hedge accounting criteria, has its designation revoked, or if the hedged forecast transaction is no longer expected to occur. Generally, any associated cumulative gain or loss in the Hedging Reserve is only transferred out when the hedged cash flow eventually occurs. However, if the hedged transaction is no longer expected to occur, the gain or loss is immediately transferred to the income statement.
Refer Note 20.
2.4 Taxes (i) Income tax equivalents Financial Statements RailCorp and the controlled entity are exempt from the National Tax Equivalent Regime (NTER) and the Tax Equivalent Regime (TER) and are not required to pay income tax.
(ii) Goods and Services Tax
Revenues, expenses and assets are generally recognised net of the amount of Goods and Services Tax (GST). However, receivables and payables are stated with the amount of GST included, and GST that is not recoverable from the Australian Taxation Office (ATO) is recognised as part of the relevant asset or expense.
The net amount of GST recoverable from (or payable to) the ATO is recognised as part of receivables (or payables) in the Statement of Financial Position. Cash flows are included in the Cash Flow Statement on a gross basis and the GST component of any cash flow arising from investing activities that is recoverable from (or payable to) the ATO is classified as an operating cash flow.
(iii) State Taxes
RailCorp being a statutory authority representing the Crown means that it is exempt from land tax levied after 2009.
2.5 Leases The determination of whether an arrangement is or contains a lease is based on the substance of the arrangement and requires an assessment of whether the fulfilment of the arrangement is dependant on the use of a specific asset or assets and the arrangement conveys a right to use the asset.
(i) Details of operating leasing arrangements
Various operating leases are in place.
The NSW rail network in the country rail area is used by RailCorp as lessee under 10 or 15 year, non- exclusive, non-cancellable operating leases (access agreements). The lease rental (access fee) is reviewed annually.
Certain Victorian and Queensland railways and stations are used by RailCorp as lessee under informal non-exclusive operating leases (access agreements).
Financial Statements 57 Notes to the Financial Statements for the year ended 30 June 2012
Note 2 Summary of accounting policies (continued) 2.5 Leases (continued) Coaches for rural passenger services and buses for use during service disruptions are obtained under various operating leases. The rural coaches are obtained under 3 year non-cancellable leases, renewable at RailCorp’s option for up to 2 years.
Motor vehicles are obtained under 3 or 4 year operating leases. Rentals are all contingent, being based on floating interest rates.
Some office accommodation is obtained under operating leases. Some leases are renewable at RailCorp’s option for periods up to 5 years.
Some telecommunications facilities in the country rail area are obtained under a non-cancellable operating lease.
Some items of office equipment and plant are also obtained under operating leases.
RailCorp has granted various operating leases (access agreements) to other rail operators giving them non-exclusive access to the metropolitan rail network or stations. Such leases generally cover a 5 year period.
Various real estate leases have also been granted (including air space and advertising rights), sometimes covering long periods (up to 99 years). To the extent the initial term of the lease is greater than 50 years then these leases are treated as finance leases – refer Note 2.5 (iv).
(ii) Details of PPP finance leasing arrangements
An agreement is in place for a Rollingstock Public Private Partnership (PPP), which incorporates finance leases, whereby Reliance Rail will:
• Design, manufacture and commission a total of 626 carriages, together with simulators for training; • Design, manufacture and commission a maintenance facility on RailCorp land at Auburn; • Make a certain number of 8 car train sets available for RailCorp’s use over the term of the contract; (the term continues for 30 years after the delivery of the tenth last set, i.e. until about 2043). • Provide a maintenance facility for the sets over the term of the contract; • Decommission any sets which RailCorp does not wish to acquire at the end of the contract; • Handover the maintenance facility at the end of the contract.
In accordance with the PPP contract RailCorp is required to make certain milestone payments. These are treated as interest free advances pending satisfactory completion of the construction of carriages together with the simulators and maintenance facility.
Refer Note 18.4.
(iii) Accounting treatment – operating leases Lease rentals under an operating lease are recognised as income (or expense) on a straight-line basis over the lease term unless another systematic basis is more representative of the time pattern of the user’s benefit. Initial direct costs incurred, as lessor, in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised as an expense over the lease term on the same basis as the lease income. An asset leased to a lessee is presented in the Statement of Financial Position according to the nature of the asset and is subject to the depreciation policy for similar but non-leased assets. Refer Note 2.16
58 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 2 Summary of accounting policies (continued) 2.5 Leases (continued) (iv) Accounting treatment – finance leases As lessee Finance leases, which transfer to RailCorp substantially all the risks and benefits incidental to ownership of the leased item, are capitalised at the commencement of the lease term at the fair value of the leased asset or, if lower, at the present value of the minimum lease payments. The corresponding liability to the lessor is included in the Statement of Financial Position as a finance lease liability. Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are capitalised in accordance with the accounting policy on borrowing costs. Refer Note 2.8. Finance leased assets are depreciated on a straight-line basis over the shorter of the estimated useful life of the asset and the lease term if there is no reasonable certainty that RailCorp will obtain ownership by the end of the lease term. Where there is reasonable certainty that RailCorp will obtain ownership of the asset after the lease term the asset is depreciated over its estimated useful life. Refer Note 18.4. As lessor RailCorp, as the lessor, classifies its long-term land leases (typically where the initial lease term exceeds 50 years), as finance leases if it transfers to the lessee substantially all the risks and rewards incidental to ownership of the land. The leased assets are recognised as current and non-current receivables at amounts equal to the net investment in the leases.
The lease receipt is recognised in two components, one as a reduction of the lease receivables and the Financial Statements other as finance income. The finance income is calculated relevant to the term of the lease. Refer Note 6. (v) Arrangements in the form but not the substance of a lease An arrangement comprising a series of transactions involving the legal form, but not the economic substance, of a lease is accounted for as one linked transaction rather than as a lease. Any fee resulting from the arrangement is recognised as income in the year it is received. Refer Notes 2.7 and 9.4. (vi) Accounting treatment for prepaid rentals Prepaid rentals where the initial lease term exceeds 50 years are treated as sales in accordance with NSW Treasury policy, TPP 11-01, Lessor Accounting for Prepaid Long-term Leases of Land.
2.6 Foreign currency translation A foreign currency transaction is recognised and initially translated into Australian currency using the market rate at the date of the transaction. Outstanding transactions at any subsequent reporting date is translated at the market rate at that date.
Exchange differences on monetary items that qualify as hedging instruments in a cash flow hedge are recognised initially in equity to the extent that the hedge is effective. Exchange differences on other monetary items are recognised as income or expense.
2.7 Income Income is measured at the fair value of the consideration or contributions received or receivable. In most cases this is the value of the cash exchanged or exchangeable. Income is only recognised if its receipt is probable and the amount is reliably measurable. The accounting policies for the recognition of income are discussed below:
Passenger revenue Proceeds received from the sale of tickets are reported as passenger services revenue. Passenger service revenue is initially recognised based on ticket sales. Revenue received prior to passenger travel, and the pro-rata unearned portion of periodic tickets, is assessed annually and treated as deferred revenue.
Financial Statements 59 Notes to the Financial Statements for the year ended 30 June 2012
Fines and penalties Fines and penalties are collected by the State Debt Recovery Office on behalf of RailCorp and are recognised by way of an estimate of the amount expected to be collected.
Rendering of services Revenue from the rendering of a service is recognised by reference to the stage of completion of the transaction, provided that the transaction’s outcome, stage of completion, and the past and prospective costs are all reliably measurable. Otherwise such revenue is only recognised to the extent of the associated recognised recoverable expenses. The stage of completion of a construction contract is determined by comparing the cost incurred to date with the estimated total cost of the contract.
Government contributions
Contributions are received from the NSW Government towards the cost of providing certain agreed services and concessions. The passenger revenue covers only a part of operating expenses and the shortfall is met by those contributions by the NSW Government for subsidies and concessions (refer Statement of Comprehensive Income).
Contributions are recognised when control of the cash or other asset (or the right to receive it) is obtained.
The presentation of the Statement of Comprehensive Income includes subtotals for the result from operations before Government Contributions and the result from operations before Capital Contributions. That presentation has been adopted as it is a more informative representation of the operating result with reference to RailCorp’s sources of funding.
Interest revenue Interest revenue is recognised as interest accrues using the effective interest method, which uses a rate that exactly discounts a financial instrument’s expected future cash receipts through the expected life of the financial instrument (or shorter period) to the net carrying amount of the instrument. Interest revenue includes all earnings from NSW Treasury Corporation (TCorp) Hourglass cash facility and 11am Call Deposit.
Leases Operating lease income is recognised on a straight-line basis over the lease term. Fees received under an arrangement that is in the legal form of a lease but that is not, in substance, a lease under AASB 117, are recognised as revenue over the term of the lease.
Sale of assets and goods Revenue from the sale of assets or other goods is recognised when control and the significant risks and rewards of ownership have passed to the buyer and the past and prospective transaction costs are reliably measurable.
2.8 Borrowing costs Borrowing costs are capitalised in respect of constructed property, plant and equipment that meet the criteria of qualifying assets. Other borrowing costs are recognised as an expense in the period in which they are incurred. 2.9 Cash and cash equivalents Cash and cash equivalents in the statement of financial position includes cash at bank and on hand, at call deposits, and short-term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value.
For the purposes of the statement of cash flows, cash and cash equivalents consist of cash and cash equivalents as defined above, net of outstanding bank overdrafts.
Refer Note 5. Note 2 Summary of accounting policies (continued) 60 RailCorp Annual Report 2011–12 2.10 Trade and other receivables Trade receivables are measured initially at fair value and subsequently at invoiced cost less a provision for impairment, which is not materially different from amortised cost due to their short-term nature. A trade Notes to the Financial Statements for the year ended 30 June 2012
Note 2 Summary of accounting policies (continued) 2.10 Trade and other receivables Trade receivables are measured initially at fair value and subsequently at invoiced cost less a provision for impairment, which is not materially different from amortised cost due to their short-term nature. A trade receivable is usually due for settlement within 30 days of invoicing. Collectability of trade receivables is reviewed on an ongoing basis.
A receivable is recognised when it is probable that the future cash inflows associated with it will be realised and it has a value that can be measured reliably. It is derecognised when the contractual rights to future cash inflows from it expire or are transferred.
An expected reimbursement of expenditure required to settle a provision is only recognised as a receivable when it is virtually certain that the reimbursement will be received. Such reimbursement is treated separately from the related provision and its amount does not exceed the amount of that provision.
If there is objective evidence at year end that a receivable may not be collectable, its carrying amount is reduced by means of a provision for impairment and the resulting loss is recognised in the income statement. Receivables are monitored during the year and bad debts are written off against the provision when those are determined to be irrecoverable. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments are considered indicators that trade receivables are impaired.
Refer Note 6.
2.11 Inventories Financial Statements Inventories comprise materials and supplies to be consumed in operations and construction works in progress for customers. Inventories held for distribution are measured at cost adjusted for any loss of service potential. Inventories held for sale are measured at the lower of cost and net realisable value.
The cost of inventories comprises all costs of purchase, costs of conversion and other costs incurred in bringing them to their present location and condition. This includes material, labour and attributable fixed and variable overhead costs.
The cost of inventories of items that are not ordinarily interchangeable and goods or services produced and segregated for specific projects is assigned by using specific identification of their individual costs. The cost of remaining inventories is assigned by using the weighted average cost formula. Cost formulae are applied consistently to all inventories having a similar nature and use to the entity.
The carrying amount of inventories sold is recognised as an expense when the related revenue is recognised. The amount of any write-down of inventories to net realisable value and any loss relating to inventories is recognised as an expense in the year in which the write-down or loss occurs. The amount of any reversal of any write-down of inventories, arising from an increase in net realisable value, is recognised as a reduction of the expense relating to inventories in the year in which the reversal occurs.
Refer Note 7.
2.12 Non-current assets held for sale Non-current assets are classified as held for sale, where their carrying amount will be recovered principally through a sale transaction, not through continuing use. This condition is regarded as met when the sale is highly probable; the asset is available for immediate sale in its present condition and is expected to be completed within 1 year from the date of classification.
Non-current assets held for sale are recognised at the lower of carrying amount and fair value less cost to sell. Such assets are presented separately from other assets in the Statement of Financial Position and are not depreciated or amortised while they are classified as held for sale.
Refer Note 8.
Financial Statements 61 Notes to the Financial Statements for the year ended 30 June 2012
Note 2 Summary of accounting policies (continued) 2.13 Impairment of financial assets All financial assets are subject to an annual review for impairment. An allowance for impairment is established when there is objective evidence that RailCorp will not be able to collect all amounts due. The calculated impairment loss is recognised in the income statement as an allowance to reduce the carrying amount of the financial asset.
When there is objective evidence that impairment no longer exists previously recognised impairment losses are reversed through the income statement so that the carried amount at amortised value does not exceed what the carrying amount would have been had there not been an impairment loss.
2.14 Property, plant and equipment (i) Recognition
An item of property, plant and equipment is recognised as an asset if it has service potential controlled by RailCorp, is expected at acquisition to be used for more than 1 year, has a cost or value that can be measured reliably and exceeds the capitalisation threshold.
A component is accounted for separately if it (a) has a useful life materially different from that of the prime asset and therefore requires separate replacement during the life of the prime asset, (b) is material enough to justify separate tracking, and (c) is capable of having a reliable value attributed to it. A dedicated spare part does not normally have a useful life of its own.
Dedicated spares purchased specifically for a particular asset, or class of assets, and which would become redundant if that asset or class were retired or use of that asset or class were discontinued, are considered to form part of the historical cost of that asset or class.
Expenditure on the acquisition, replacement or enhancement of property, plant and equipment is capitalised, provided it exceeds the capitalisation threshold or qualifies for recognition as a capital spare.
The capitalisation threshold for a network of property, plant and equipment items or for an individual (non- networked) item (other than a capital spare) is $5,000. A capital spare is only capitalised if it is part of a pool of rotable spares, primarily held for the overhaul of the asset to which it relates, and significant enough to warrant it being individually tracked. Expenditure below the capitalisation threshold or not qualifying for recognition as a capital spare is charged to the income statement.
An item of property, plant and equipment in the course of construction is classified as capital work in progress.
An item leased to a lessee under an operating lease continues to be recognised as property, plant and equipment and to be classified according to the nature of the asset.
(ii) Measurement
An item of property, plant and equipment purchased or constructed is initially measured at its cost, which is its fair value on acquisition. This includes the purchase price and any costs directly attributable to bringing it to the location and condition necessary for it to be capable of operating as intended. An item of property, plant and equipment acquired at no cost, or for a nominal cost, is initially measured at its fair value.
Property, plant and equipment is revalued, at least once every 5 years, to fair value having regard to its highest and best use. As existing natural, legal, financial or socio-political restrictions on asset use or disposal generally prevent any alternative use being feasible within the next 5 years, highest and best use is taken to be existing use. Fair value is an asset’s market price or, if such a price is not observable or estimable from market evidence, its replacement cost, being the written-down cost of an optimised modern equivalent asset. Non-specialised assets with short useful lives are measured at depreciated historical cost as a proxy for fair value.
If an item of property, plant and equipment is revalued, the entire class to which it belongs is revalued.
62 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 2 Summary of accounting policies (continued) 2.14 Property, plant and equipment (continued) (ii) Measurement (continued)
Bored and excavated tunnels, excavations for stations and site formations including cuttings and embankments entering service prior to 2000 are carried at nil value as their value can not be reliably measured, due predominantly to the lack of historical records relating to the earthworks carried out and the costs involved.
Any accumulated depreciation at the date of a revaluation is restated proportionately with the change in the gross carrying amount of the related asset so that the carrying amount of the asset after revaluation equals its revalued amount.
Upon revaluation of a class of property, plant and equipment, a net revaluation increase is recognised in Other Comprehensive Income and accumulated in equity under Asset Revaluation Reserve. A net revaluation decrease shall be recognised in Other Comprehensive Income to the extent of any credit balance existing in revaluation surplus in respect of that same class of asset. The net revaluation decrease recognised in Other Comprehensive Income reduces the amount accumulated in equity under the heading of Asset Revaluation Reserve.
(iii) Depreciation
Each item of property, plant and equipment (except land) is depreciated on a straight-line basis over its estimated useful life commencing when the item is available for use. A capital spare is depreciated over the useful life of the asset or class of assets to which it relates. Financial Statements
Each part of an item of property, plant and equipment with a cost that is significant in relation to the total cost of the item is depreciated separately, except for rolling stock which is depreciated as a discrete asset.
The depreciation charge for each period is recognised as an expense unless it is included in the carrying amount of another asset.
In determining an asset’s useful life consideration is given to its expected usage, its expected wear and tear, technical or commercial obsolescence; and legal or similar limits on its use.
The expected useful lives of items of property, plant and equipment are as follows: Years Stations and buildings 15 - 200 Station services and facilities 15 - 25 Track, including sleepers and ballast 15 - 100 Turnouts 15 - 50 Bridges and tunnels 100 Electrical overhead wiring and structures 15 - 100 Substations 10 - 50 Signalling equipment 20 - 50 Rolling `stock 32 - 35 Plant and machinery 3 - 30
Each asset’s useful life, residual value and depreciation method are reviewed each year and any resulting adjustments are accounted for as a change in accounting estimate.
(iv) Derecognition
An item of property, plant and equipment is derecognised either on disposal or when its service potential ceases and it is not expected to have any disposal value.
On derecognition of an item of property, plant and equipment, any gain or loss or any related compensation receivable is recognised in the income statement. Any revaluation increase remaining in the Asset Revaluation Reserve in respect of a derecognised asset is transferred to retained earnings.
Refer Note 9.
Financial Statements 63 Notes to the Financial Statements for the year ended 30 June 2012
Note 2 Summary of accounting policies (continued) 2.15 Intangible assets (i) Recognition
An identifiable, non-monetary asset without physical substance (such as computer software that is not integral to the related hardware) is recognised as an intangible asset if it has service potential controlled by RailCorp, is expected at acquisition to be used for more than 1 year, and has a cost or value that (a) can be measured reliably, (b) exceeds the capitalisation threshold of $5,000 and (c) has not previously been expensed.
The service potential is assessed using reasonable and supportable assumptions relating to the estimated conditions likely to exist over the useful life of the asset.
An intangible asset arising from development (or from the development phase of an internal project) is only recognised if it is likely to be completed and actually used and the development expenditure can be measured reliably. Expenditure on research (or on the research phase of an internal project) is not recognised as an intangible asset.
An intangible asset in the course of development is classified as intangible capital work in progress.
(ii) Measurement
An intangible asset that is purchased or internally developed is initially measured at its cost. This includes the purchase price and any costs directly attributable to preparing the asset for its intended use. An intangible asset acquired at no cost, or for a nominal cost, because it is transferred by the government is initially measured at its fair value, which is based on its amortised cost as recognised by the transferor. After initial recognition, such assets are accounted for under the cost model.
Due to the absence of active markets for intangible assets, they are not subsequently revalued but continue to be carried at cost less any accumulated amortisation.
(iii) Amortisation
Each intangible asset is amortised on a straight-line basis over its estimated useful life commencing when the item is available for use. Useful lives are all finite. Residual values are assumed to be zero, due to the absence of active markets for disposing of the assets.
In determining an asset’s useful life, consideration is given to its expected usage; technical, technological, commercial or other types of obsolescence; legal or similar limits on its use; and whether its life is dependent on the useful life of other assets.
The expected useful life of an item of software ranges between 2 and 4 years.
Each intangible asset’s useful life and amortisation method are reviewed each year and any resulting adjustments are accounted for as a change in accounting estimate.
The amortisation charge for each year is recognised in the income statement as depreciation and amortisation expense unless it is included in the carrying amount of another asset.
(iv) Derecognition An intangible asset is derecognised either on disposal or when its service potential ceases and it is not expected to have any disposal value. On derecognition, any gain or loss is recognised in the income statement.
Refer Note 10.
2.16 Service concession arrangements Airport Link Company (ALC) has a concession to build and operate 4 stations on the Airport Line until 2030. Under the concession arrangement, RailCorp is to provide train services to the stations. RailCorp will take over the 4 stations in 2030.
64 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 2 Summary of accounting policies (continued) 2.16 Service concession arrangements (continued) This right to receive the 4 stations is accounted for as a premium on the ground lease of the station premises, which is a non-cancellable operating lease. The premium is recognised as rent revenue and a non-current asset (earned portion of right to receive Airport Line stations). It is measured as the estimated written-down replacement cost of the stations in 2030 and the value of the emerging asset is calculated by use of an annuity formula whereby the ultimate value of the right to receive the property is treated as the compound value of an annuity that accumulates as a series of equal annual receipts together with a notional compound interest thereon. The discount rate used is the NSW Government bond rate applicable to the purchaser at the commencement of the concession period - in this case 7%. The present value of the written-down replacement cost of the stations in 2030 is allocated over the term of the lease on the basis of a formula which calculates the annual annuity sum.
Refer Note 11, Other Assets, for the cumulative value as at 30 June 2012.
In October 2005 RailCorp and the ALC entered into a Restated Stations Agreement as part of the overall restructuring of the ALC operations and related debt. The revised agreement included amended terms in respect of various matters including revenue sharing, fee arrangements and RailCorp's various performance obligations.
Refer Note 18.3.
2.17 Trade and other payables A payable is recognised on the Statement of Financial Position when a present obligation arises under a contract. It is derecognised when the obligation expires or is discharged, cancelled or substituted. Financial Statements A payable is measured at original invoice amount, which is not materially different from amortised cost due to the short-term nature of trade payables.
Any gain or loss arising when a payable is settled or transferred is recognised in the income statement.
Trade payables are unsecured and, unless otherwise agreed with the creditor, are due for settlement by the end of the month following the month in which the invoice is received.
Refer Note 12.
2.18 Borrowings A borrowing is recognised when a present obligation arises under a debt instrument. It is classified as a current liability if settlement is due within twelve months after the reporting date. Otherwise it is classified as non-current. It is derecognised when the obligation expires or is discharged, cancelled or substituted.
Borrowing costs that are directly attributable to the acquisition, construction or production of an asset are capitalised as part of the cost of that asset. All other borrowing costs are expensed in the period in which they occur.
A borrowing is initially measured at its fair value and subsequently measured at amortised cost, being its face value less unamortised discount or plus unamortised premium.
Discount or premium is amortised over the term of the borrowing on an effective interest rate basis and recognised as a loss or gain in the income statement. Any difference between the carrying amount and the consideration paid on repayment or transfer of a borrowing is also recognised as a gain or loss.
Refer Note 13. 2.19 Provisions (i) Provisions generally
Provisions are made for liabilities of uncertain amount or uncertain timing of settlement, eg employee benefits, workers’ compensation claims, public liability claims, legal claims, Airport Line asset replacement, quarry site restoration, land and buildings remediation, ballast disposal, restoration of leased premises and other charges.
Financial Statements 65 Notes to the Financial Statements for the year ended 30 June 2012 Notes to the Financial Statements for the year ended 30 June 2012 Note 2 Summary of accounting policies (continued) Note 2 Summary of accounting policies (continued) 2.19 Provisions (continued) 2.19(i) Provisions generally (continued)(continued) (continued) (i) Provisions generallygenerally (continued)(continued) A provision is recognised when (a) there is a likely present legal or constructive obligation as a result of a Apast provision event; (b)is recognised it is probable when that (a) an therthere outflowe is aof likely resources present embodying legal or constructiveconstructive economic benefits obligation will as be a requiredresult of toaa past event;pastsettle event; the(b) obligation;it (b)is probableit is probable and that (c) a anthat reliable outflow an outflow estimate of resources of canresources be embodying made embodying of the economi amount economicc ofbenefits the benefits obligation. will be will required be required to settle to the obligation;settle the obligation; and (c) a reliable and (c) estimatea reliable can estimate be made can of be the made amount of the of theamount obligation. of the obligation. The amount recognised is the best estimate of the expenditure required to settle the likely present Theobligation amountamount as recognised atrecognised reporting is date, isthe the best taking best estimate intoestimate account of the of expenditure thethe risks expenditure and required uncertainties required to settle thatto the settlesurround likely thepresent thelikely events obligation present and as at reportingobligationcircumstances d asate, at that takingreporting affect into date,the account provisi taking theon. into risksWhere account and the uncertainties effectthe risks of theand thattime uncertainties surroundvalue of money thethat events surround is material, and the circumstances eventsa provision and that affectcircumstancesis measured the provision. using that affect theWhere present the the provisi effectvalueon. ofof Where thethe timeexpenditure the value effect of sof moneyexpected the time is valuematerial,to be ofrequired money a provision tois material,settle is measured the a obligation provision using the presentisand measured using value a discount using of the the expendituresrate present that reflec value expectedts currentof the to expenditure market be required asses ssments expectedto settle of the to the beobligation time required value and toof usingmoneysettle athe anddiscount obligation the risks rate that reflectsspecificand using currentto athe discount liability. market rate assessments that reflec tsof currentthe time market value ofasse moneyssments and theof the risks time specific value toof themoney liability. and the risks specific to the liability. Each provision is reviewedreviewed asas atat eacheach reportingreporting datedate and and adj adjustedusted to to reflect reflect the th ecurrent current best best estimate. estimate. If Ifit isit is no longerEachno longer provision probable probable is that reviewed that a settlementa settlement as at each will will reporting be be required, required, date andthe the provisionadjprovisionusted to is reflect reversed the. currentAA provisionprovision best isestimate.is only only used used If it for isfor its intendednoits intendedlonger purpose. probable purpose. that a settlement will be required, the provision is reversed. A provision is only used for its intended purpose. (ii) Employee benefitsbenefits (ii) Employee benefits Employee benefitbenefit provisionsprovisions represrepresentent thethe expected expected amounts amounts payable payable in thein thefuture future in respect in respect of unused of unused entitlementsEmployee benefit accumulatedaccumulated provisions asas atatrepres the the reporting reportingent the date.expected date. amounts payable in the future in respect of unused entitlements accumulated as at the reporting date. Superannuation, longlong serviceservice leave,leave, annualannual leave,leave, andand awardaward leaveleave liabilitiesliabilities areare recognisedrecognised asas provisionsprovisions when theSuperannuation,when obligations the obligations arise, long which arise,service iswhich leave,usually is annual usuallythrough leave, throu the renderi ghand the award ngrendering of leaveservice ofliabilities byservice employees. are by recognisedemployees. Expenditure as Expenditure provisions creating such provisionswhencreating the such obligationsis eitherprovisions expensed arise, is either which or capitalised,expensed is usually or dependingthrou capitalised,gh the on renderingdepending its nature. of on Severanceservice its nature. by employees.liabilitiesSeverance are liabilitiesExpenditure recognised are as a provisionrecognisedcreating such (and as provisions ana provision expense) is (and eitherwhen an expenseda expense)voluntary or whenredundancy capitalised, a voluntary agreementdepending redundancy ison reached its nature.agreement or whenSeverance is there reached liabilitiesis a ordemonstrable when are commitmentrecognisedthere is a demonstrable as to athe provision termination commitment (and of an employees’ expense) to the terminati services when aon andvoluntary of aemployees’ valid redundancy expectation services agreementhas and been a validcreated. is reached expectation or when has therebeen created.is a demonstrable commitment to the termination of employees’ services and a valid expectation has Provisionsbeen created. are not recognised for employee benefits that have already been settled (e.g. payments to First State Super,Provisions a fully are fundednot recognised superannuation for employee scheme); benefits that dothat not have accumulate already been (eg allowances,settled (e.g. nonpayments-monetary to First benefits, parentalProvisionsState Super, leave), are a notfully that recognised fundedare unlikely super for toannuation employee be settled scheme); benefits beyond tthatthehat currenthavedo not already accumulateyear’s beenentitlement (egsettled allowances, (e (e.g..g. sick payments leave),non-monetary toor Firstthat have littleStatebenefits, or Super, no parental marginal a fully leave), fundedcost (e t .hatgsuper. post areannuation- employmentunlikely scheme);to betravel settled thatpasses). dobeyond not Costs accumulate the associated current (eg year’s allowances,with, entitlementbut that non-monetary are (e.g.not, employeesick benefitsbenefits,leave), or (such parentalthat ashave payroll leave), little tax)or t hatno are marginalare recognised unlikely cost separately.to(e.g. be post-employmentsettled beyond the travel current passes). year’s entitlement (e.g. sick leave), or that have little or no marginal cost (e.g. post-employment travel passes). SuperannuationCosts associated and with, long but service that are leave not, employeeprovisions benef are actuariallyits (such as assessed payroll tax) prior are to recognised each reporting separately. date and are measuredCosts associated at the presentwith, but valu thate areof thenot, estimated employee future benef itspayments. (such as Allpayroll other tax) employee are recognised benefit provisionsseparately. (i.e. for benefitsSuperannuation falling due and within long twelveservice months leave provisions after reporting are ac date)tuarially are assessedassessed byprior management to each reporting and are date measured and at the undiscounted amount of the estimated future payments. Superannuationare measured at andthe longpresent service value leave of the provisions estimated are fu tureactuarially payments. assessed All other prior em toployee each reporting benefit provisions date and
(i.e.are measuredfor benefits at fallingthe present due within value twelveof the estimatedmonths after future reporting payments. date) All are other assessed employee by managementbenefit provisions and The amount recognised for the superannuation provision is the net total of the present value of the defined benefit are(i.e. measuredfor benefits at fallingthe undiscounted due within amounttwelve months of the estimated after reporting future date)payments. are assessed by management and obligation at the reporting date, minus the fair value at that date of any plan assets out of which the obligations are are measured at the undiscounted amount of the estimated future payments. to be settled directly. However, any prepaid superannuation asset recognised cannot exceed the total of any The amount recognised for the superannuation provision is the net total of the present value of the defined cumulative unrecognised net actuarial losses and past service cost and the present value of any economic benefitThe amount obligation recognised at the reportingfor the superannuation date, minus the provision fair value is theat that net datetotal ofof anythe planpresent assets value out of of the which defined the benefits that may be available in the form of refunds from the plan or reductions in future contributions to the plan. obligations are to be settled directly. However, any prepaid superannuation asset recognised cannot benefit obligation at the reporting date, minus the fair value at that date of any plan assets out of which the exceed the total of any cumulative unrecognised net actuarial losses and past service cost and the present Theobligations amount arerecognised to be settledin the incomedirectly. statement However, for anysuperannuation prepaid superannuation is the net total assetof current recognised service cost,cannot interest value of any economic benefits that may be available in the form of refunds from the plan or reductions in cost,exceed and the the total expected of any cumulativereturn on any unrecognised plan assets net. Actuarial actuarial gains losses or and losses past for service superannuation cost and the are present recognised future contributions to the plan. outsidevalue of of any profit economic or loss inbenefits other comprehensive that may be available income. in the form of refunds from the plan or reductions in future contributions to the plan. The amountactuarial recognised assessment in ofthe superannuation income statement and for long super serviceannuation leave is provisions the net total uses of currentthe Projected service Unit cost, Credit MethodTheinterest amount cost,and recognised reflectsand the estimatedexpected in the income returnfuture onsalarystatement any increasesplan for assets super and. annuationActuarial the benefits gains is the setor net lossesout total in offorthe current superannuation terms service of the cost,plan. are The liabilitiesinterestrecognised cost, are outside discountedand the of expectedprofit using or lossthe return market in other on anyyield comprehensive plan rate assetson government. Actuarialincome. bonds gains ofor similarlosses maturityfor superannuation to those obligations. are Actuarialrecognised assumptions outside of profit are unbiasedor loss in otherand mutually comprehensive compatible income. and financial assumptions are based on market expectationsThe actuarial for assessment the period overof superannuation which the obligations and long are toservice be settled. leave provisions uses the Projected Unit TheCredit actuarial Method assessment and reflects ofestimated superannuation future salary and longincreases service and leave the benefitsprovisions set uses out inthe the Projected terms of Unit the Anplan.Credit asset The Method relating liabilities and to areonereflects discountedsuperannuation estimated using future plan the issalarymarket not offset increases yield against rate andon a governmentliabilitythe benefits relating bondsset to out another of in similar the plan terms maturity because of the to there isplan.those no legally Theobligations. liabilities enforceable Actuarial are discountedright assumptions to do so.using arethe unbiasedmarketRefer yiNote eldand rate14. mutually on government compatible bonds and financial of similar assumptions maturity to thoseare based obligations. on market Actuarial expectations assumptions for the areperiod unbiased over which and themutually obligations compatible are to and be settled.financial assumptions are based on market expectations for the period over which the obligations are to be settled. An asset relating to one superannuation plan is not offset against a liability relating to another plan because Anthere asset is no relating legally to enforceable one superannuation right to do plan so. is not offset against a liability relating to another plan because 66 RailCorp Annual Report 2011–12 there is no legally enforceable right to do so. Refer Note 14. Refer Note 14. Notes to the Financial Statements for the year ended 30 June 2012
Note 2 Summary of accounting policies (continued) 2.20 Equity adjustments due to industry restructuring/transfer of assets and liabilities A transfer of assets (or liabilities) from (or to) another NSW public sector entity as a result of a Ministerial Order to give effect to industry restructuring or transfer of assets or liabilities from certain other government entities is treated as a contribution by (or distribution to) the Government and recognised as a direct adjustment to contributed equity.
Refer Note 15. 2.21 Significant accounting judgements, estimates and assumptions Management is required to make judgements, estimates and assumptions about carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and various factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future period.
In particular refer Note 9.3 - Valuation of property plant & equipment and Note 14 - Provisions.
Note 3 Income Financial Statements 3.1 Non passenger revenue Consolidated Parent 2011-12 2010-11 2011-12 2010-11 $000 $000 $000 $000 Rental income 33 513 31 421 33 513 31 421 Access fees 56 082 54 718 56 082 54 718 Construction contract revenue 90 599 94 841 90 599 94 841 Sale of rail products 45 401 26 676 45 401 26 676 Fines and penalties 8 528 7 331 8 528 7 331 Sale of quarry products 13 263 12 293 13 263 12 293 Recoveries for interstate services 12 182 10 884 12 182 10 884 Operating lease contingent rents 2 288 2 421 2 288 2 421 Advertising revenue 10 247 9 388 10 247 9 388 Other revenue* 74 219 59 989 73 600 59 877 Total non passenger revenue 346 322 309 962 345 703 309 850
*Note: Other revenue comprises a number of items which individually are not material.
3.2 Capital Contributions
Consolidated Parent 2011-12 2010-11 2011-12 2010-11 $000 $000 $000 $000 NSW Government capital grant 1 317 063 872 801 1 317 063 872 801 Other Government agencies - cash 23 172 - 23 172 - Other Government agencies - non cash 12 950 - 12 950 - Commonwealth agencies - non cash 37 909 - 37 909 - third parties 5 490 - 5 490 -
Total Capital Contributions 1 396 584 872 801 1 396 584 872 801
Financial Statements 67 Notes to the Financial Statements for the year ended 30 June 2012
Note 4 Expenses 4.1 Payroll costs and other employee benefits Employee related expenses include the following items:
Consolidated Parent 2011-12 2010-11 2011-12 2010-11 Note $000 $000 $000 $000 Salaries and wages 1 276 138 1 206 045 1 275 640 1 205 914 Annual leave 121 923 111 765 121 902 111 753 Long service leave 95 302 37 798 95 302 37 798 Superannuation – defined benefit plan 4.2 (2 930) (2 874) (2 930) (2 874) Superannuation – defined contribution 76 477 72 862 76 436 72 853 Workers compensation 20 111 28 911 20 103 28 909 Payroll tax and fringe benefits tax 78 091 74 121 78 089 74 121 Redundancy 84 562 3 272 84 562 3 272 Other 33 115 37 768 33 110 37 763 1 782 789 1 569 668 1 782 214 1 569 509 Less : Employee related expenses allocated to capital works 166 422 143 897 166 422 143 897 1 616 367 1 425 771 1 615 792 1 425 612
4.2 Defined benefit superannuation plan expense Consolidated Parent 2011-12 2010-11 2011-12 2010-11 $000 $000 $000 $000 Current service cost 25 630 27 003 25 630 27,003 Interest cost 84 645 80 271 84 645 80,271 Expected return on plan asset (113 205) (110 148) (113 205) (110 148) Total defined benefit 14.2.5 (2 930) (2 874) (2 930) (2 874) superannuation expense/(income)
68 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 4 Expenses (continued) 4.3 Other operating expenses Consolidated Parent 2011-12 2010-11 2011-12 2010-11 $000 $000 $000 $000 Subcontractors 258 487 243 137 258 464 243 137 Materials 178 134 164 793 178 134 164 793 External maintenance costs 181 290 203 973 181 290 203 973 Operating lease non-contingent rents 108 913 102 589 108 913 102 589 (including rail access fees) Operating lease contingent rents 13 673 13 089 13 673 13 089 Plant and equipment hire 85 921 90 583 85 921 90 583 Bulk electricity 80 574 71 566 80 518 71 566 Security costs 24 982 27 416 24 967 27 416 Traction fuel costs 22 711 22 259 22 711 22 259 Derecognition and write off of assets 139 980 119 702 139 980 119 702 Insurance costs 18 443 17 428 18 419 17 428 Telecommunications expenses 17 205 12 170 17 187 12 170 Computer expenses 67 611 60 513 67 605 60 513 Shared services costs from Transport for NSW 51 157 31 500 51 157 31 500 Recovery of cost of staff assigned to Transport for NSW (60 819) (33 749) (60 819) (33 749)
Advertising and marketing 3 625 4 713 3 421 4 713 Financial Statements Printing and stationery 9 216 10 368 9 210 10 368 Land and buildings remediation 6 607 5 529 6 607 5 529 Consultants (See note (a) below) 7 371 1 157 7 371 1 157 Discounting of provisions 6 541 5 774 6 541 5 774 Audit fees 784 752 767 738 Bad debts 76 76 76 76 Impaired trade receivables 56 (1 590) 56 (1 590) Contribution to Trainworks - - 828 369 Other 80 348 70 389 79 843 70 109 Total other operating expenses 1 302 886 1 244 137 1 302 840 1 244 212
Note (a): A further amount of $0.008m for consultants was capitalised in 2011-12 (2010-11: $0.923m).
4.4 Maintenance expenses Included in total operating expenses are maintenance related costs as follows:
Consolidated Parent 2011-12 2010-11 2011-12 2010-11 $000 $000 $000 $000 Labour 323 710 302 840 323 710 302 840 Contracted and non labour expenditure 587 245 605 438 587 245 605 438 910 955 908 278 910 955 908 278
In addition to the above a further $200.3m of major periodic maintenance was capitalised during the year ended 30 June 2012 (2010-11: $202.7 m). 4.5 Finance Costs Borrowing and interest charges 53 864 28 419 53 864 28 419 Less amount capitalised (20 921) (10 616) (20 921) (10 616) Finance costs expensed 32 943 17 803 32 943 17 803
The capitalised rate used to determine the amount of borrowing costs to be capitalised is the weighted average interest rate applicable to the outstanding borrowings. The rate is 4.91%.
Note 5 Cash and cash equivalents Financial Statements 69 Notes to the Financial Statements for the year ended 30 June 2012
Note 5 Cash and cash equivalents 5.1 Cash and cash equivalents Consolidated Parent 30.6.2012 30.6.2011 30.6.2012 30.6.2011 $000 $000 $000 $000 Cash at bank 8 308 3 677 8 170 3 572 Cash in hand and in transit 6 517 6 698 6 513 6 694 Cash deposits with NSW Treasury Corporation (TCorp) 62 784 4 659 62 784 4 659 Total cash and cash equivalents 77 609 15 034 77 467 14 925
5.2 Reconciliation of surplus for the year with net cash from operating activities
Surplus for the year 419 034 22 487 419 032 22 457 Cash capital grants (1 345 725) (875 960) (1 345 725) (875 960) Non cash capital grants (50 859) - (50 859) - Derecognition and write off of assets 139 980 119 702 139 980 119 702 Airport Line lease premium (4 733) (4 423) (4 733) (4 423) Depreciation and amortisation 873 216 814 825 873 208 814 824 Impaired trade receivables expense 132 (1 514) 132 (1 514) Amortisation of borrowing premium (309) (103) (309) (103) Amortisation of borrowing discount 59 35 59 35 Discounting of provisions 6 541 5 774 6 541 5 774 Net movements in assets and liabilities applicable to operating activities: (Increase)/decrease in trade and other receivables (8 680) (64 104) (8 638) (64 104) (Increase)/decrease in inventories (4 275) 3 047 (4 282) 3 047 Increase/(decrease) in trade and other payables and provisions 181 558 37 171 181 488 37 075 Net cash from operating activities 205 939 56 937 205 894 56 810
5.3 Credit standby arrangements and loan facilities (Parent and Consolidated) The credit standby arrangements and unused amounts available are: 30.6.12 30.6.12 30.6.11 30.6.11 Credit Unused Credit Unused Facilities Facilities $000 $000 $000 $000 Tape negotiation authority 70 000 70 000 70 000 70 000 Purchasing card facility 20 097 - 20 097 - Bank guarantee 11 - - - Borrowing facility 1 200 000 1 075 061 1 100 000 708 511 Come and Go facility 80 000 80 000 80 000 14 000 Total 1 370 108 1 225 061 1 270 097 792 511
5.4 Non-cash investing activities During 2011-12 Transport for NSW transferred assets to RailCorp and RailCorp transferred assets to the State Property Authority and the former Transport Construction Authority. The net transfer represents a non-cash increase in property, plant and equipment and equity of $825.4m (2010-11: $115.5m). Refer Note 15.2.
70 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 6 Trade and other receivables 6.1 Analysis of trade and other receivables Consolidated Parent 30.6.2012 30.6.2011 30.6.2012 30.6.2011 $000 $000 $000 $000 Current trade and other receivables Trade receivables 52 759 57 766 52 718 57 748 Other receivables 117 973 117 021 117 979 117 050 Less provision for impairment (2 000) (1 938) (2 000) (1 938) 168 732 172 849 168 697 172 860 Prepayments 20 516 13 642 20 499 13 628 Finance lease – minimum payments 232 604 232 604 Total current trade and other receivables 189 480 187 095 189 428 187 092
Non-current receivables Finance lease – Minimum payments 30 805 28 599 30 805 28 599 Other 3 964 - 3 964 - Total non-current receivables 34 769 28 599 34 769 28 599 Total trade and other receivables 224 249 215 694 224 197 215 691
Movements in the provision for impairment were as follows:
Parent and Parent and Consolidated Consolidated Financial Statements 30.6.2012 30.6.2011 $000 $000
Balance at beginning of year 1 938 3 688 Allowance recognised in income statement 56 (1 590) GST movement 6 (160) Balance as at 30 June 2 000 1 938 6.2 Impaired trade and other receivables As at 30 June 2012 current trade and other receivables with a nominal value of $2.0m (2010-11: $1.9m) were impaired. The ageing of the impaired trade and other receivables is as follows:
Parent and Parent and Consolidated Consolidated 30.6.2012 30.6.2011 $000 $000
1 to 3 months 192 169 3 to 6 months 193 184 Over 6 months 1 615 1585 Balance as at 30 June 2 000 1 938 6.3 Past due but not impaired receivables As at 30 June 2012, trade receivables of $24.9m (2011: $29.5m) were past due but not impaired. The ageing analysis of these trade receivables is as follows:
Parent and Parent and Consolidated Consolidated 30.6.2012 30.6.2011 $000 $000 1 to 3 months 15 695 14 213 3 to 6 months 4 442 10 255 Over 6 months 4 829 5 008 Balance as at 30 June 24 966 29 476
Financial Statements 71 Notes to the Financial Statements for the year ended 30 June 2012
Note 6 Trade and other receivables (continued) 6.4 Nature and extent of risk arising from receivables Exposure to credit risk in relation to trade and other receivables is provided in Note 20.
Due to the short-term nature of these receivables, their carrying amount is assumed to approximate their fair value. The maximum exposure to credit risk at the reporting date is the carrying amount of each class of receivables mentioned above.
6.5 Minimum lease rentals receivable under non-cancellable operating leases Parent and Parent and Consolidated Consolidated 30.6.2012 30.6.2011 $000 $000 Not later than 1 year 19 408 19 901 Later than 1 year and not later than 5 years 31 780 30 184 Later than 5 years 22 748 41 653 Total non-cancellable lease rentals receivable 73 936 91 738
6.6 Finance lease receivable The gross investment and present values of receivables relating to future minimum lease payments under the finance lease agreements, for long term land lease with an initial term over 50 years are distributed as follows: Parent and Parent and Consolidated Consolidated 30.6.2012 30.6.2011 $000 $000 Not later than 1 year 1 866 1 886 Later than 1 year and not later than 5 years 7 386 7 545 Later than 5 years 96 734 98 417 Total gross receivable 105 986 107 848 Less unearned finance charges (74 949) (78 645) Present value minimum lease receivable 31 037 29 203
Split: Current 232 604 Non-current 30 805 28 599 31 037 29 203
Note 7 Inventories
Parent and Parent and Consolidated Consolidated 30.6.2012 30.6.2011 $000 $000 Materials and supplies, at cost 71 963 67 267 Work in progress 1 088 800 73 051 68 067 Less provision for obsolete inventory 5 687 4 996 Total inventories 67 364 63 071
Total inventories are comprised of: Current inventories 35 017 34 193 Non-current inventories 32 347 28 878 67 364 63 071
72 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 8 Non-current assets held for sale
Various properties (including certain properties vested from State Rail Authority in June 2007 to fund sustainable heritage management) have been identified as land for future sales and are valued by an independent valuer at $28.0m (2011: $30.5m) of which $1.8m (2011: $7.8m) is disclosed as a current asset held for sale as other properties are in the process of being prepared for sale. The balance is included in the Statement of Financial Position as Property, Plant and Equipment.
Note 9 Property, plant and equipment 9.1 Classes Consolidated Parent 30.6.2012 30.6.2011 30.6.2012 30.6.2011 $000 $000 $000 $000 Land Gross carrying amount* 3 877 807 3 855 545 3 877 807 3 855 545
Buildings Gross carrying amount 8 161 605 7 931 295 8 161 605 7 931 295 Less accumulated depreciation 2 721 279 2 548 537 2 721 279 2 548 537 Total buildings 5 440 326 5 382 758 5 440 326 5 382 758
Rolling stock Gross carrying amount 7 301 054 6 799 874 7 301 054 6 799 874 Less accumulated depreciation 4 489 934 4 324 386 4 489 934 4 324 386 Financial Statements Total rolling stock 2 811 120 2 475 488 2 811 120 2 475 488
Plant and machinery Gross carrying amount 604 096 573 249 604 075 573 240 Less accumulated depreciation 356 801 327 806 356 795 327 806 Total plant and machinery 247 295 245 443 247 280 245 434
Trackwork and infrastructure Gross carrying amount 18 528 606 18 334 614 18 528 606 18 334 614 Less accumulated depreciation 8 383 625 8 131 541 8 383 625 8 131 541 Total trackwork and infrastructure 10 144 981 10 203 073 10 144 981 10 203 073
Capital works in progress Trackwork and infrastructure work in progress 2 617 905 1 702 553 2 617 905 1 702 553 Other work in progress 721 537 599 728 721 537 599 728
Total capital work in progress 3 339 442 2 302 281 3 339 442 2 302 281 Total property, plant and equipment 25 860 971 24 464 588 25 860 956 24 464 579
* Land includes land for sale valued at $26.2m (2011: $22.7m).
Included in the above asset classes are assets under finance lease of:
Buildings - with a gross carrying value of $242.4m (2011: $242.4m) and a net carrying amount of $232.6m (2011: $237.4m)
Rolling stock - with a gross carrying value of $303.5m (2011: $30.4m) and a net carrying amount of $ 299.1m (2011: $ 30.4m)
Plant and machinery - with a gross carrying value of $5.9m (2011: $5.9m) and a net carrying amount of $5.1m (2011: $5.5m)
Financial Statements 73 Notes to the Financial Statements for the year ended 30 June 2012
Note 9 Property Plant and Equipment (continued) 9.2 Asset class movement - Consolidated Land Buildings Rolling Plant and Trackwork Capital works Total stock Machinery and in progress Infrastructure $000 $000 $000 $000 $000 $000 $000 Gross carrying amount
Balance at 1 July 2011 3 855 545 7 931 295 6 799 874 573 249 18 334 614 2 302 281 39 796 858 Additions - 194 296 508 499 44 040 479 658 362 775 1 589 268 Disposals/derecognition/ write-offs (1 714) 1 036 (7 319 ) (14 566 ) (285 666 ) (58 708 ) (366 937) Revaluations 694 - - - - - 694 Transfers to TCA* (825) - - - - - (825) Transfers to SPA* (2 583) - - - - - (2 583) Transfers from TfNSW * 20 643 35 948 - - - 772 262 828 853 Transfers other - (970 ) - 1 373 - (39 168 ) (38 765) Classify (to)/from assets held for sale 6 047 - - - - - 6 047 Balance at 30 June 2012 3 877 807 8 161 605 7 301 054 604 096 18 528 606 3 339 442 41 812 610
Balance at 1 July 2010 3 656 717 5 395 480 6 614 032 513 947 13 113 906 1 716 926 31 011 008 Additions 14 226 283 630 187 667 32 245 126 178 661 861 1 305 807 Disposals/derecognition/ write-offs (18 647) (8 904 ) (1 411 ) (13 405 ) (65 130 ) (41 497 ) (148 994) Revaluations 192 972 1 812 244 - - 5 519 039 - 7 524 255 Transfers from TCA* 18 575 159 506 - - - - 178 081 Transfers to SPA* (2 600) (6 853 ) - - - - (9 453) Transfers to RMS* - - - - (18 427 ) (35 009 ) (53 436) Other movements - 296 192 (414 ) 40 462 (340 952 ) - (4 712) Classify (to)/from assets held for sale (5 698) - - - - - (5 698) Balance at 30 June 2011 3 855 545 7 931 295 6 799 874 573 249 18 334 614 2 302 281 39 796 858
Accumulated depreciation
Balance at 1 July 2011 - (2 548 537 ) (4 324 386 ) (327 806 ) (8 131 541 ) - (15 332 270) Depreciation for the year - (161 431 ) (172 867 ) (40 521 ) (470 541 ) - (845 360) Revaluations ------Disposals/derecognition/ write-offs - (44 ) 7 319 12 013 207 106 - 226 394 Other movements (11 267 ) - (487 ) 11 351 - (403) Balance at 30 June 2012 - (2 721 279 ) (4 489 934 ) (356 801 ) (8 383 625 ) - (15 951 639)
Balance at 1 July 2010 - (1 766 847 ) (4 140 176 ) (289 058 ) (5 461 740 ) - (11 657 821) Depreciation for the year - (128 780 ) (186 036 ) (48 554 ) (420 889 ) - (784 259) Revaluations - (656 614 ) - - (2 261 326 ) - (2 917 940) Transfer to RMS - - - - 259 - 259 Disposals/derecognition/ write-offs - 7 858 1 411 8 970 8 642 - 26 881 Other movements - (4 154 ) 415 836 3 513 - 610 Balance at 30 June 2011 - (2 548 537 ) (4 324 386 ) (327 806 ) (8 131 541 ) - (15 332 270)
Net carrying amounts At 1 July 2010 3 656 717 3 628 633 2 473 856 224 889 7 652 166 1 716 926 19 353 187 At 30 June 2011 3 855 545 5 382 758 2 475 488 245 443 10 203 073 2 302 281 24 464 588
At 1 July 2011 3 855 545 5 382 758 2 475 488 245 443 10 203 073 2 302 281 24 464 588 At 30 June 2012 3 877 807 5 440 326 2 811 120 247 295 10 144 981 3 339 442 25 860 971
* TCA: former Transport Construction Authority * TfNSW: Transport for New South Wales * SPA: State Property Authority * RMS: Roads and Maritime Services
74 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 9 Property Plant and Equipment (continued) 9.3 Valuation of property, plant and equipment To confirm that the carrying value of the asset classes for land and buildings and rolling stock materially reflects fair value as at 30 June 2012, an independent valuer reviewed the appropriateness of the replacement costs derived at the time of the last revaluation. Infrastructure was reviewed by management using an external methodology.
(a) Land Land, other than land identified as available for sale, was valued by the Land and Property Management Authority on the basis of existing use as at 1 January 2011 and an indexation factor applied for the period 1 January 2011 to 30 June 2011. Each area was valued taking into account adjacent land use values, discounted to reflect limited existing use of the subject land, and its physical attributes. An increase in the value of this class of asset, totalling $193m was credited to the Asset Revaluation Reserve in 2010-11.
Land identified as available for sale was valued by the Land and Property Management Authority as at 30 June 2011.
(b) Buildings Buildings were valued by an independent valuer (Evans & Peck Pty Ltd) as at 31 March 2011 on the following bases: • Railway stations / commercial / industrial type buildings and leased properties are portions of railway property generally adjacent to the corridor, the majority of which is used for railway purposes, and which land is not intended to be sold. Such properties were classed as specialised buildings and were valued
at the replacement cost of the assets’ remaining economic benefits based on a modern equivalent Financial Statements asset. Indirect costs, professional and builders’ fees were added to direct costs. An additional allowance is made for heritage buildings to replicate the heritage appearance. • Residences are severable, stand alone, properties that may be sold and, therefore, were classed as non specialised buildings and were valued at market value.
An increase in the value of this class of asset, totalling $1,156m was credited to the Asset Revaluation Reserve in 2010-11.
(c) Trackwork and infrastructure Trackwork and infrastructure was valued by an independent valuer (Evans & Peck Pty Ltd) as at 31 March 2011 at depreciated replacement cost, i.e. the current replacement cost of each asset less accumulated depreciation (which depreciation is calculated by reference to the remaining life of each asset as determined by RailCorp engineers). Replacement cost is measured by reference to the lowest cost of replacing the economic benefits with a technologically modern equivalent optimised asset, having regard to differences in the quality and quantity of outputs and operating costs, and adjusting for over design, over capacity and redundant components. An increase in the value of this class of asset, totalling $3,257m was credited to the Asset Revaluation Reserve in 2010-11.
(d) Rolling stock Rolling stock was valued by an independent valuer as at 30 June 2009 at depreciated replacement cost based on replacement costs of both domestic and international vehicles adjusted by an optimisation factor to reflect the technical and functional obsolescence and attractiveness of the fleet sub types relative to the modern equivalent. RailCorp engineers confirmed technical data and the remaining life of rolling stock. An increase in the value of this class of asset, totalling $107.5m was credited to the Asset Revaluation Reserve in 2008-09.
(e) Major Plant and Equipment Major plant and equipment, a sub class of plant and machinery, was revalued by RailCorp management as at 30 June 2009 by obtaining current replacement cost from major suppliers and determining economic life and remaining life to obtain a depreciated replacement cost. An increase in the value of this sub-class of asset, totalling $58.1m was credited to the Asset Revaluation Reserve in 2008-09.
Financial Statements 75 Notes to the Financial Statements for the year ended 30 June 2012
Note 9 Property Plant and Equipment (continued) 9.4 Leasing arrangements – certain rolling stock RailCorp is the lessee to leasing arrangements for some of its rolling stock. Each arrangement is accounted for as a single linked transaction in accordance with its economic substance. The arrangements do not restrict RailCorp’s use of the rolling stock in normal operations and have terms of up to 36 years. The leases include options for RailCorp to purchase the rolling stock on certain specified future dates. Refer Note 2.5(v). 9.5 Heritage Rolling stock Heritage rolling stock, which includes locomotives and carriages, is held for its historical significance. It is recorded at nominal value.
Note 10 Intangible assets 10.1 Class Consolidated Parent 30.6.2012 30.6.2011 30.6.2012 30.6.2011 $000 $000 $000 $000 Software Gross carrying amount 214 327 178 652 214 318 178 643 Less accumulated amortisation 134 321 107 035 134 318 107 034 Net carrying amount of software 80 006 71 617 80 000 71 609 Software works in progress 162 765 101 850 162 765 101 850 Total intangible assets 242 771 173 467 242 765 173 459
10.2 Movements during the year Software Software work Total in progress $000 $000 $000 2012 Carrying amount at start of year 71 617 101 850 173 467 Additions 37 182 21 747 58 929 Disposals/write-offs (937 ) - (937 ) Amortisation expense (27 856 ) - (27 856 ) Transfers - 39 168 39 168 Carrying amount at end of year 80 006 162 765 242 771 2011 Carrying amount at start of year 77 572 71 689 149 261 Additions 23 185 30 688 53 873 Disposals/write-offs - (527 ) (527 ) Amortisation expense (30 566 ) - (30 566 ) Other movements 1 426 - 1 426 Carrying amount at end of year 71 617 101 850 173 467
Note 11 Other assets
Parent and Parent and Consolidated Consolidated Note 30.6.2012 30.6.2011 $000 $000
Earned portion of right to receive Airport Line stations 2.16 40 223 35 490 Milestone advances under rolling stock PPP contract 18.4 29 872 34 487
Total other assets 70 095 69 977
76 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 12 Trade and other payables 12.1 Current trade and other payables Consolidated Parent 30.6.2012 30.6.2011 30.6.2012 30.6.2011 $000 $000 $000 $000
Trade payables 173 082 135 965 173 071 135 940 Capital works accruals 231 366 133 306 231 366 133 298 Accrued salaries and wages 40 401 33 352 40 401 33 333 Other payables and accruals 197 814 204 416 197 704 204 381 Deferred revenue 20 794 18 480 20 754 18 480
Total current trade and other payables 663 457 525 519 663 296 525 432
12.2 Fair value Due to the short-term nature of current trade and other payables, their carrying value is deemed to approximate their fair value.
12.3 Risk exposure
Information about RailCorp exposure to payables with a foreign exchange risk is provided in Note 20. Financial Statements
Note 13 Borrowings and finance lease liabilities
Parent and Parent and Consolidated Consolidated Note 30.6.2012 30.6.2011 $000 $000
Current Borrowings - 332 300 Finance lease liabilities 18.4 13 663 2 361 13 663 334 661 Non-current Borrowings 124 939 125 189 Finance lease liabilities 18.4 474 327 254 719 599 266 379 908
Total borrowings and finance lease liabilities 612 929 714 569
The Finance Lease relates to the provision of a maintenance facility, simulators and ten sets of trains under a Public Private Partnership (PPP) for rolling stock.
Financial Statements 77 Notes to the Financial Statements for the year ended 30 June 2012
Note 14 Provisions 14.1 Provisions Consolidated Parent 2011-12 2010-11 2011-12 2010-11 Note $000 $000 $000 $000 Current provisions Annual leave (see note (a) below) 175 305 166 207 175 272 166 195 Long service leave (see note (a) below) 14.3 319 631 266 431 319 631 266 431 Pay in lieu of certain holidays worked 23 155 20 305 23 155 20 305 (see note (a) below) Redundancy 14.12 75 000 - 75 000 - Total current employee benefits 593 091 452 943 593 058 452 931 Workers’ compensation 14.5 17 725 17 269 17 725 17 269 Public liability claims 14.6 7 122 4 594 7 122 4 594 Legal claims 14.7 6 546 874 6 546 874 Airport Line asset replacement 14.8 1 340 719 1 340 719 Land and buildings remediation 14.10 11 967 15 131 11 967 15 131 Ballast disposal 14.11 5 684 14 562 5 684 14 562 Restoration of leased premises - 3 522 - 3 522 Quarry restoration 14.9 1 717 - 1 717 - Other - 589 - 589 Total current provisions 645 192 510 203 645 159 510 191 Non-current provisions Superannuation 14.2 625 833 289 908 625 833 289 908 Long service leave (see note (a) below) 14.3 34 837 27 193 34 837 27 193 Total non-current employee benefits 660 670 317 101 660 670 317 101 Workers’ compensation 14.5 81 566 83 003 81 566 83 003 Public liability claims 14.6 - 3 986 - 3 986 Airport line asset replacement 14.8 8 128 7 955 8 128 7 955 Ballast disposal 14.11 12 522 - 12 522 - Quarry restoration 14.9 3 602 4 081 3 602 4 081 Restoration of leased premises 3 375 - 3 375 - Land and buildings remediation 14.10 53 433 49 207 53 433 49 207 Total non-current provisions 823 296 465 333 823 296 465 333 Total provisions Superannuation 14.2 625 833 289 908 625 833 289 908 Annual leave 175 305 166 207 175 272 166 195 Long service leave 14.3 354 468 293 624 354 468 293 624 Pay in lieu of certain holidays worked 23 155 20 305 23 155 20 305 Redundancy provision 14.12 75 000 - 75 000 - Total employee benefits 1 253 761 770 044 1 253 728 770 032 Workers’ compensation 14.5 99 291 100 272 99 291 100 272 Public liability claims 14.6 7 122 8 580 7 122 8 580 Legal claims 14.7 6 546 874 6 546 874 Airport Line asset replacement 14.8 9 468 8 674 9 468 8 674 Quarry restoration 14.9 5 319 4 081 5 319 4 081 Land and buildings remediation 14.10 65 400 64 338 65 400 64 338 Ballast disposal 14.11 18 206 14 562 18 206 14 562 Restoration of leased premises 3 375 3 522 3 375 3 522 Other - 589 - 589 Total provisions 1 468 488 975 536 1 468 455 975 524 (a) In accordance with Australian Accounting Standards all annual leave and unconditional long service leave is classified as a current liability in the Statement of Financial Position because RailCorp does not have an unconditional right to defer settlement. Only conditional long service leave is shown as a non current liability. However, on the basis of past payment experience, leave is expected to be settled in the following pattern:
78 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 14 Provisions (continued) 14.1 Provisions (continued) Within Later than Total 12 months 12 months $000 $000 $000 2012 Long service leave 37 891 316 577 354 468 Annual leave 134 927 40 345 175 272 Pay in lieu of certain holidays worked 23 155 - 23 155 195 973 356 922 552 895
Within Later than Total 12 months 12 months $000 $000 $000 2011 Long service leave 35 667 257 957 293 624 Annual leave 125 899 40 296 166 195 Pay in lieu of certain holidays worked 20 305 - 20 305 181 871 298 253 480 124 14.2 Superannuation 14.2.1 Overview Financial Statements Employer contributions are made to 3 defined-benefit superannuation schemes administered by the SAS Trustee Corporation (STC): the State Authorities Superannuation Scheme (SASS), the State Authorities Non-Contributory Superannuation Scheme (SANCSS) and the State Superannuation Scheme (SSS), which together form the Pooled Fund. Each scheme is closed to new members and its investments are held in trust by the Pooled Fund. At least a component of the final benefit is derived from a multiple of member salary and years of membership. All fund assets are invested by SAS Trustee Corporation at arm’s-length through independent fund managers. The defined-benefits scheme applies to the parent only.
An underfunded scheme is recognised as a provision and an overfunded scheme is recognised as an asset. Details of both provisions and assets are given below.
The recognised liability or asset at reporting date comprises the following:
Financial Statements 79 Notes to the Financial Statements for the year ended 30 June 2012
Note 14 Provisions (continued) 14.2.1 Overview (continued)
SASS SANCSS SSS Total $000 $000 $000 $000 30.6.2012 Underfunded schemes Accrued liability 1 680 365 176 288 52 013 1 908 666 Estimated reserve account balance (1 137 950) (122 699) (22 184) (1 282 833) Net liability 542 415 53 589 29 829 625 833 Future service liability (see Note (a) below) (98 025) (56 659) (1 331) (156 015) Surplus in excess of recovery available from schemes - - - - Net liability recognised in Statement of 542 415 53 589 29 829 625 833 Financial Position
30.6.2011 Underfunded schemes Accrued liability 1 476 047 157 470 36 198 1 669 715 Estimated reserve account balance (1 215 390) (141 746) (22 671) (1 379 807) Net liability 260 657 15 724 13 527 289 908
Future service liability (see note (a) below) (92 235) (52 779) (1 073) (146 087) Surplus in excess of recovery available from schemes - - - - Net liability recognised in Statement of 260 657 15 724 13 527 289 908 Financial Position Note (a) The Future Service Liability (FSL) does not have to be recognised by an employer. It is only used to determine if an asset ceiling limit should be imposed. Any prepaid superannuation asset recognised cannot exceed the total of any unrecognised past service cost and the present value of any economic benefits that may be available in the form of refunds from the plan or reductions in future contributions to the plan. Where the surplus in excess of recovery is zero, no asset ceiling limit is imposed.
SASS SANCSS SSS
Member numbers 30.6.2012 Contributors 3 512 3 526 14 Deferred benefits - -1 Pensioners 238 - 15 Pensions fully commuted ---
30.6.2011 Contributors 3 748 3 765 17 Deferred benefits - - 1 Pensioners 190 - 13 Pensions fully commuted - - -
80 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 14 Provisions (continued) 14.2 Superannuation (continued) 14.2.2 Reconciliation of the present value of the defined benefit obligation
SASS SANCSS SSS Total $000 $000 $000 $000 2012 Present value of defined benefit obligations at the beginning of the year 1 476 047 157 470 36 198 1 669 715 Current service cost 18 572 6 852 206 25 630 Interest cost 74 851 7 906 1 888 84 645 Contributions by fund participants 15 149 - 308 15 457 Actuarial (gains)/losses 205 062 23 140 14 235 242 437 Benefits paid (109 316) (19 080) (822) (129 218) Present value of defined benefit obligations at the end of the year 1 680 365 176 288 52 013 1 908 666
2011 Present value of defined benefit obligations at the beginning of the year 1 422 971 150 990 35 543 1 609 504 Current service cost 20 053 6 735 215 27 003
Interest cost 70 994 7 457 1 820 80 271 Financial Statements Contributions by fund participants 14 989 - 378 15 367 Actuarial (gains)/losses 27 395 (4 707) (625) 22 063 Benefits paid (80 355) (3 005) (1 133) (84 493) Present value of defined benefit obligations at the end of the year 1 476 047 157 470 36 198 1 669 715
14.2.3 Reconciliation of the fair value of fund assets
SASS SANCSS SSS Total $000 $000 $000 $000
2012 Fair value of Fund assets at beginning of the year 1 215 389 141 746 22 671 1 379 806 Expected return on fund assets 99 758 11 525 1 922 113 205 Actuarial gains/(losses) (89 014) (11 493) (2 147) (102 654) Employer contributions 5 985 0 250 6 235 Contributions by Fund participants 15 148 0 310 15 458 Benefits paid (109 316) (19 079) (822) (129 217) Fair value of Fund assets at end of the year 1 137 950 122 699 22 184 1 282 833
2011 Fair value of Fund assets at beginning of the year 1 181 777 133 709 22 167 1 337 653 Expected return on fund assets 97 353 10 918 1 877 110 148 Actuarial gains/(losses) 1 626 124 (619) 1 131 Employer contributions - - - - Contributions by Fund participants 14 989 - 379 15 368 Benefits paid (80 355) (3 005) (1 133) (84 493) Fair value of Fund assets at end of the year 1 215 390 141 746 22 671 1 379 807
Financial Statements 81 Notes to the Financial Statements for the year ended 30 June 2012
Note 14 Provisions (continued) 14.2 Superannuation (continued) 14.2.4 Reconciliation of the assets and liabilities recognised in the Statement of Financial Position
SASS SANCSS SSS Total $000 $000 $000 $000 2012 Present value of partly funded defined benefit obligations at end of year 1 680 365 176 288 52 013 1 908 666 Fair value of fund assets at end of year (1 137 950) (122 699) (22 184) (1 282 833) Subtotal 542 415 53 589 29 829 625 833 Unrecognised past service cost - - - - Unrecognised gain/(loss) - - - - Adjustment for limitation on net asset - - - - Net Liability/(Asset) recognised in Statement of Financial Position at end of year 542 415 53 589 29 829 625 833
2011 Present value of partly funded defined benefit obligations at end of year 1 476 047 157 470 36 198 1 669 715 Fair value of fund assets at end of year (1 215 390) (141 746) (22 671) (1 379 807) Subtotal 260 657 15 724 13 527 289 908 Unrecognised past service cost - - - - Unrecognised gain/(loss) - - - - Adjustment for limitation on net asset - - - - Net Liability/(Asset) recognised in Statement of Financial Position at end of year 260 657 15 724 13 527 289 908
14.2.5 Expense recognised in the Statement of Comprehensive Income
SASS SANCSS SSS Total $000 $000 $000 $000 2012 Components recognised as expenses Current service cost 18 572 6 852 206 25 630 Interest cost 74 851 7 906 1 888 84 645 Expected return on Fund assets (net expenses) (99 758) (11 525) (1 922) (113 205) Expense/(income) recognised (6 335) 3 233 172 (2 930)
2011 Components recognised as expenses Current service cost 20 053 6 735 215 27 003 Interest cost 70 994 7 457 1 820 80 271 Expected return on Fund assets (net expenses) (97 353) (10 918) (1 877) (110 148) Expense/(income) recognised (6 306) 3 274 158 (2 874)
82 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 14 Provisions (continued) 14.2 Superannuation (continued) 14.2.6 Amounts recognised in Other Comprehensive Income
SASS SANCSS SSS Total $000 $000 $000 $000 2012 Actuarial (gains)/losses recognised in year 294 076 34 633 16 382 345 091 Adjustment for limit on net assets - - - - Cumulative amount of actuarial (gain)/losses 294 076 34 633 16 382 345 091
2011 Actuarial (gains)/losses recognised in year 25 769 (4 831) (7) 20 931 Adjustment for limit on net assets - - - - Cumulative amount of actuarial (gain)/losses 25 769 (4 831) (7) 20 931
14.2.7 Fund assets
The percentage invested in each asset class at the Statement of Financial Position date: Financial Statements
2012 2011 % % Australian equities 28.0 33.4 Overseas equities 23.7 29.5 Australian fixed interest securities 4.9 5.7 Overseas fixed interest securities 2.4 3.1 Property 8.6 9.9 Cash 19.5 5.1 Other 12.9 13.3
14.2.8 Fair value of Fund assets
All Fund assets are invested by STC at arm’s-length through independent fund managers.
14.2.9 Expected rate of return on assets
The expected return on assets assumption is determined by weighting the expected long-term return for each asset class by the target allocation of assets to each class. The returns used for each class are net of investment tax and investment fees.
14.2.10 Actual Return on Fund Assets
SASS SANCSS SSS $000 $000 $000
2012 Actual return on Fund assets 279 32 9
2011 Actual return on Fund assets 98 809 11 042 1 852
Financial Statements 83 Notes to the Financial Statements for the year ended 30 June 2012
Note 14 Provisions (continued) 14.2 Superannuation (continued) 14.2.11 Valuation method and principal actuarial assumptions at the Statement of Financial Position date
a) Valuation method
The Project Unit Credit (PUC) valuation method was used to determine the present value of the defined benefit obligations and the related current service costs. This method sees each period of service as giving rise to an additional unit of benefit entitlement and measures each unit separately to build up the final obligation.
b) Economic assumptions
2012 2011 Salary increase rate (excluding promotional increases) 2.50% pa 3.50% pa Rate of CPI increase 2.50% pa 2.50% pa Expected rate of return on assets 8.60% pa 8.60% pa Discount rate 3.06% pa 5.28% pa
c) Demographic Assumptions
The demographic assumptions at 30 June 2012 are those that were used in the 2009 triennial actuarial valuation. The triennial review report is available from the NSW Treasury website. The current triennial actuarial review is due to be completed in December 2012.
84 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 14 Provisions (continued) 14.2 Superannuation (continued) 14.2.12 Historical information:
SASS SANCSS SSS $000 $000 $000 2012 Present value of defined benefit obligation 1 680 365 176 288 52 013 Fair value of Fund assets (1 137 950 ) (122 699) (22 184 ) (Surplus)/deficit in Fund 542 415 53 589 29 829 Experience adjustments – Fund liabilities 205 062 23 139 14 235 Experience adjustments – Fund assets 89 104 11 493 2 147
2011 Present value of defined benefit obligation 1 476 047 157 470 36 198 Fair value of Fund assets (1 215 390 ) (141 746) (22 671) (Surplus)/deficit in Fund 260 657 15 724 13 527 Experience adjustments – Fund liabilities 27 395 (4 707) (625) Experience adjustments – Fund assets (1 626 ) (124) 619
2010 Present value of defined benefit obligation 1 422 971 150 990 35 543
Fair value of Fund assets (1 181 778 ) (133 709 ) (22 167) Financial Statements (Surplus)/deficit in Fund 241 193 17 281 13 376 Experience adjustments – Fund liabilities 88 651 8 770 2 696 Experience adjustments – Fund assets (9 931 ) (904) (30)
2009 Present value of defined benefit obligation 1 299 094 136 714 30 715 Fair value of Fund assets (1 133 710 ) (130 410) (20 328) (Surplus)/deficit in Fund 165 384 6 304 10 387 Experience adjustments – Fund liabilities 17 290 8 544 6 269 Experience adjustments – Fund assets 217 013 26 811 2 484
2008 Present value of defined benefit obligation 1 243 505 121 569 21 801 Fair value of Fund assets (1 308 277 ) (152 520) (20 185) (Surplus)/deficit in Fund (64 772 ) (30 951) 1 616 Experience adjustments – Fund liabilities (23 846 ) 2 203 1 697 Experience adjustments – Fund assets 176 929 23 639 1 139
14.2.13 Expected contributions
2012 Expected employer contributions for 2013 0 0 0
2011 Expected employer contributions for 2012 0 0 0 Actual employer contributions for 2012 0 0 0
Financial Statements 85 Notes to the Financial Statements for the year ended 30 June 2012
Note 14 Provisions (continued) 14.2 Superannuation (continued) 14.2.14 Funding arrangements for employer contributions
a) Surplus/deficit
The following is a summary of the financial position of the Fund calculated in accordance with AASB 25 Financial Reporting by Superannuation Plans:
SASS SANCSS SSS $000 $000 $000 2012 Accrued benefits 1 320 937 146 127 26 869 Net market value of Fund assets (1 137 950) (122 699) (22 184) Net deficit 182 987 23 428 4 685
2011 Accrued benefits 1 313 644 141 738 25 405 Net market value of Fund assets (1 215 390) (141 746) (22 671) Net (surplus)/deficit 98 254 (8) 2 734
b) Contribution recommendations
SASS SANCSS SSS multiple of member % member multiple of contributions salary member contributions 2012 Recommended contribution rates for the entity were: 0.00 0.00 0.00
2011 Recommended contribution rates for the entity were: 0.00 0.00 0.00
c) Funding method
The method used to determine the employer contribution recommendations at the last actuarial review was the Aggregate Funding method. The method adopted affects the timing of the cost to the employer.
Under the Aggregate Funding method, the employer contribution rate is determined so that sufficient assets will be available to meet benefit payments to existing members, taking into account the current value of assets and future contributions.
d) Economic assumptions
The economic assumptions adopted for the last actuarial review of the Fund were:
Weighted average assumptions 2012 2011
Expected rate of return on Fund assets backing current pension liabilities 8.3% pa 8.3% pa Expected rate of return on Fund assets backing other liabilities 7.3% pa 7.3% pa Expected salary increase rate 4.0% pa 4.0% pa Expected rate of CPI increase 2.5% pa 2.5% pa
86 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 14 Provisions (continued) 14.2 Superannuation (continued) 14.2.15 Nature of asset / liability
If a surplus exists in the employer’s interest in the Fund, the employer may be able to take advantage of it in the form of a reduction in the required contribution rate, depending on the advice of the Fund’s actuary.
Where a deficiency exists, the employer is responsible for any difference between the employer’s share of fund assets and the defined benefit obligations.
14.3 Long service leave Long service leave is recognised as an expense and a provision when the obligations arises, which is usually through the rendering of service by an employee.
Long service leave is measured at present value in accordance with AASB 119 Employee Benefits. This is based on the application of certain factors to employees with five or more years of service, using current rates of pay.
The liability for long service leave was assessed by a consulting actuary, Mr G. Holley FIAA of Mercer Human Resource Consulting. The actuary assumed an interest rate of 3.0 % (2011: 5.2%) per annum and a salary growth rate of 3.5% (2011: 3.5%-4%) per annum.
14.4 Movements in provisions parent and consolidated (other than employee benefit provisions) Financial Statements
Carrying Increase in Discounting Sub Total Payment of Unused Carrying amount at provision adjustment claims amount amount at start of year reversed end of year $000 $000 $000 $000 $000 $000 $000 2012 Workers’ Compensation 100 272 20 103 4 656 125 031 25 740 - 99 291 Public liability claims 8 580 279 - 8 859 1 737 - 7 122 Legal claims 874 6 546 - 7 420 572 302 6 546 Airport Line asset replacement 8 674 - 1 067 9 741 273 - 9 468 Quarry restoration 4 081 235 1 003 5 319 - - 5 319 Land and buildings remediation 64 338 6 665 739 71 742 6 342 - 65 400 Ballast disposal 14 562 8 325 (739) 22 148 3 194 748 18 206 Restoration of leased premises 3 522 39 (186) 3 375 - - 3 375 Other 589 - - 589 85 504 -
2011 Workers’ Compensation 89 442 31 259 3 999 124 700 22 734 1 694 100 272 Public liability claims 4 718 6 501 - 11 219 2 639 - 8 580 Legal claims 3 048 797 - 3845 1 662 1 309 874 Airport Line asset replacement 9 548 - 472 10 020 829 517 8 674 Quarry restoration 3 809 155 117 4 081 - - 4 081 Land and buildings remediation 65 480 5 557 1 186 72 223 7 857 28 64 338 Ballast disposal 9 614 9 333 - 18 947 3 457 928 14 562 Restoration of leased premises 3 973 242 (81) 4 134 288 324 3 522 Other 1 078 - - 1 078 101 388 589
Financial Statements 87 Notes to the Financial Statements for the year ended 30 June 2012
Note 14 Provisions (continued) 14.5 Workers’ compensation Workers’ compensation insurance is in place to cover any claim exceeding $1m and the workers’ compensation provision is maintained for smaller claims, for which RailCorp is a licensed self-insurer.
The workers’ compensation liability at year end was assessed by McMahon Actuarial Services assuming a discount rate ranging from 2.1% to 4.1% over the next 10 years (2011: ranging from 4.7% to 5.8% per annum) and a future wage inflation rate of 4% per annum over the next 10 years (2011:4% per annum over the next 10 years).
The actuary has advised that no allowance was made for asbestos related claims (2011: nil). Liabilities for such claims prior to July 1996 were vested to the Crown. Post 1996 exposure to asbestos is low, highly uncertain and, therefore, cannot be quantified with any reliability.
14.6 Public liability claims The public liability claims provision recognises claims against RailCorp that arise from personal injuries or property damage occurring on its premises or involving its assets.
Any claim recoverable from RailCorp’s insurer is also recognised as a receivable or disclosed as a contingent asset, depending on its probability of settlement.
Refer Notes 6 and 19.
The liability at year end was assessed by management. The likely amount to be settled was assessed on the basis of past experience. The likely timing of settlement was assessed by reviewing individual claims. The liability is inherently uncertain due to disputes over the existence or quantum of individual claims.
14.7 Legal claims The legal claims provision recognises claims against RailCorp arising from prosecutions or fines in relation to legislative or contractual breaches or other matters.
The liability at year end was assessed by management by reviewing individual claims. The liability is inherently uncertain due to disputes over the existence or quantum of individual claims.
14.8 Airport Line asset replacement The Airport Line asset replacement provision recognises RailCorp’s contractual obligation to fund the replacement of major track and tunnel assets on the Airport Line, by the line’s maintenance contractor during the term of the contract to 2030. Any unused balance of the provision remaining in 2030 will be shared equally with the maintenance contractor.
The liability at year end is the unused portion of the contractually-specified maximum sum to be provided. The quantum and timing of payments are inherently uncertain as they are based on unpredictable future claims by the maintenance contractor. This provision has been discounted to a present value that reflects the time value of money.
14.9 Quarry restoration The quarry restoration provision recognises RailCorp’s legal obligation to restore quarry sites when operations cease.
The liability at year end was assessed by an independent expert undertaking site inspections to estimate the minimum cost of the necessary restoration work. The liability is inherently uncertain due to the time likely to elapse before the restoration is required.
88 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 14 Provisions (continued) 14.10 Land and buildings remediation provision
This provision is comprised of $31.8m (2011: $31.5m) for remediation of asbestos and $33.6m (2011: $32.8m) for remediation of contaminated land.
In response to the identification of asbestos contamination in a railway station in March 2006, RailCorp initiated a program of hazardous materials surveys to identify the full extent of contamination and remedial action required in stations.
The program has since been extended to encompass other hazardous materials and operational buildings including signal boxes, depots and maintenance centres as well as rolling stock.
RailCorp will undertake incident management and remediation funded by this provision out to 30 June 2017. 14.11 Ballast disposal provision The ballast disposal provision recognises RailCorp’s legal obligation in relation to the disposal of non- recyclable landfill and materials arising from its ballast recycling operations.
The liability was assessed at 30 April 2012 by management after investigation of stockpiles at the Chullora site. The liability is inherently uncertain due to the quantum and timing of future disposal. 14.12 Redundancy A provision has been established for the cost of RailCorp’s voluntary redundancy program. The program is
expected to reduce 750 non-front line positions by June 2013. Financial Statements
Note 15 Contributed equity 15.1 Contributed equity Parent and Parent and Consolidated Consolidated Note 30.6.2012 30.6.2011 $000 $000 Contributed equity at start of year 13 715 719 13 600 268
Net assets contributed by Government 15.2 931 296 115 451
Contributed equity at end of year 14 647 015 13 715 719
15.2 Net assets contributed by the Government Parent and Parent and Consolidated Consolidated 30.6.2012 30.6.2011 $000 $000 Assets transferred Cash assets 105 851 - Property, plant and equipment (net) 825 445 115 451
Total net assets contributed 931 296 115 451
Certain work-in-progress and assets constructed for RailCorp by the former Transport Construction Authority have been transferred and/or vested to RailCorp by Transport for NSW during the year totalling $828.8m. In addition, RailCorp transferred one parcel of land to the former Transport Construction Authority for $0.8m and four parcels of land to the State Property Authority totalling $2.6m. Refer Notes 5.4 and 9.2.
The net transfers/vestings have been treated as equity contributions by Government and are recognised as direct adjustments to contributed equity.
Financial Statements 89 Notes to the Financial Statements for the year ended 30 June 2012
Note 16 Reserves
The Hedging Reserve recognises the cumulative gains or losses on hedging instruments used for existing cash flow hedges. The movements during the year were:
Parent and Parent and Consolidated Consolidated 30.6.2012 30.6.2011 $000 $000 Hedging Reserves Balance at start of year (11 863) (13 814) Net gain/(loss) in forward foreign exchange 994 (2 573) Net gain/(loss) in commodity swaps (4 481) 4 524 Reserve transferred from retained earnings - - Balance at end year (15 350) (11 863)
Asset Revaluation Reserve Balance at start of year 8 242 368 3 638 229 Increase/(decrease) as a result of revaluation 694 4 606 315 Reserve transferred (to)/from retained earnings (17 509) (2 176) Balance at end of year 8 225 553 8 242 368
Total reserves 8 210 203 8 230 505
Note 17 Retained earnings
Consolidated Parent 2011-12 2010-11 2011-12 2010-11 $000 $000 $000 $000
Retained earnings at start of year 835 962 832 230 835 932 832 230 Surplus for the year 419 034 22 487 419 032 22 457 Superannuation actuarial gains/(losses) (345 091) (20 931) (345 091) (20 931) Transfer of reserves to/(from) retained 17 509 2 176 17 509 2 176 earnings Retained earnings at end of year 927 414 835 962 927 382 835 932
Note 18 Expenditure commitments 18.1 Expenditure commitments Parent and Parent and Consolidated Consolidated 2011-12 2010-11 $000 $000 Operating leases Within 12 months 62 874 102 393 12 months or longer but not longer than 5 years 54 277 120 490 Longer than 5 years 13 701 41 263
Total operating leases 130 852 264 146
Total property, plant and equipment (including 491 267 752 771 intangible assets)
Rolling stock PPP contract commitments are detailed in note 18.4
The expenditure commitments include any associated Goods and Services Tax. Related input tax credits of $56.6m (2011: $92.4m) are expected to be recoverable from the Australian Taxation Office.
90 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 18 Expenditure commitments (continued) 18.2 Minimum lease payments committed under non-cancellable operating leases Parent and Parent and Consolidated Consolidated 30.6.2012 30.6.2011 $000 $000 Within 12 months 62 785 99 720 12 months or longer but not longer than 5 years 54 277 120 490 Longer than 5 years 13 701 41 263 Total committed 130 763 261 473
Minimum lease payment commitments include any associated Goods and Services Tax. Related input tax credits of $11.8m (2011: $23.8m) are expected to be recoverable from the Australian Taxation Office. 18.3 Restated Stations Agreement Claims made against RailCorp by the Airport Link Company Limited (ALC) were settled in October 2005 when RailCorp and ALC entered into a Restated Stations Agreement. RailCorp has a commitment to pay a capped amount on the basis of an agreed proportion of train fares generated by the Airport Line stations business. As at 30 June 2012 the outstanding commitment due to be paid from the capped amount is nil (2011: $6.1m). In March 2011 RailCorp and ALC varied the agreement whereby RailCorp will pay ALC the Station Access Fee it previously charged to customers at Green Square and Mascot stations. Financial Statements 18.4 Rolling stock PPP contract commitments Reliance Rail, as the successful proponent of the rolling stock PPP, has been commissioned to: • Design, manufacture and deliver 626 carriages, together with four simulators. • Design and construct a maintenance facility at Auburn; and • Provide through life support for the trains, the maintenance facility and the simulators over a period of 30 years.
Payments for the above are being made via a series of Standard Availability Unit (SAUs) payments by RailCorp to Reliance Rail. The SAUs ramp up progressively as each set becomes available for passenger service. The SAU payments are inflated at CPI.
The sets will be progressively available for passenger service as each set achieves practical completion. Overall, the total payments to be made by RailCorp to Reliance Rail, including milestone payments and financing costs, over the term of the project are estimated to be $9,753m (2011: $9,749m) in nominal dollars.
The RailCorp agreement with Reliance Rail constitutes a finance lease (Refer Note 2.5(ii)). These assets and associated finance lease liabilities are recognised on completion and delivery of the assets.
The Auburn Maintenance Facility (AMF) reached practical completion on 18 June 2010. The lease liability, inclusive of accrued interest, at 30 June 2012 was $245.7m (2011: $229.9m).
The Simulators reached practical completion on 30 September 2010. The lease liability, inclusive of accrued interest, at 30 June 2012 was $4.2m (2011: $3.9m).
Nine sets of the rolling stock achieved practical completion during 2011-12 (2011: One set achieved practical completion) resulting in an addition to leased rolling stock of $214.2m. An associated finance lease liability of $214.2m was also recognised. Milestone payments made in respect of design and development of the rolling stock are applied on a pro-rata basis to the rolling stock lease liability at the rate of $0.5m per set. The lease liability, inclusive of the application of the milestone payment and accrued interest, at 30 June 2012 was $238.1m (2011: $23.3m).
Financial Statements 91 Notes to the Financial Statements for the year ended 30 June 2012
Note 18 Expenditure commitments (continued) 18.4 Rolling stock PPP contract commitments (continued) In addition to the capitalisation of the leased assets above, at practical completion project-related expenditure is allocated to the associated fixed assets. These capitalised expenditures are depreciated in line with the fixed asset to which they relate.
Interest of $21.3m (2011: $17.0m) has been accrued in the current year in respect to the finance lease liability for the rolling stock, maintenance facility and simulators.
No milestone payments were made in 2011-12 (2010-11: $12m) to Reliance Rail. These payments are interest free advances pending delivery of the associated asset upon which event those advances are applied against the finance lease liability.
The commitment under this contract is as follows (excluding GST):
Parent and Parent and Consolidated Consolidated Note 30.6.2012 30.6.2011 $000 $000 Finance lease liabilities Within 12 months 20 035 3 741 12 months or longer but not longer than 5 years 157 740 64 515 Longer than 5 years 1 253 080 730 422 Total minimum lease payments 1 430 855 798 678 Less amounts representing finance charges (942 865) (541 598)
Present value of net future minimum lease payments 487 990 257 080 (Included in the financial statements as Borrowings)
Classified as: Current 13 13 663 2 361 Non - Current 13 474 327 254 719 Total 487 990 257 080
Other PPP contract commitments Within 12 months 107 018 20 388 12 months or longer but not longer than 5 years 843 161 823 911 Longer than 5 years 7 372 332 8 106 135 Total other PPP contract 8 322 511 8 950 434
Note 19 Contingent liabilities and contingent assets
Contingent liabilities are possible obligations arising from past events whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events.
Conversely, they are present obligations arising from past events which are not recognised because it is uncertain or not probable that resources will be required to settle the obligation or the amount of the obligation cannot be reliably measured. However their probability of settlement is not remote.
Contractual and other claims against RailCorp arise in the ordinary course of operations. The existence or quantum of each claim is usually in dispute and the outcome cannot be measured reliably.
RailCorp has certain obligations under the contract for the rolling stock PPP and the NSW Government guarantees the performance of those obligations. However, there is no expectation that those guarantees will be exercised.
RailCorp by virtue of its operations has a range of possible contamination in land and buildings. RailCorp is engaged in an ongoing process of identifying necessary remediation of land and buildings the final amount of which is contingent on further investigation and cannot be accurately calculated at the date of preparation of these Financial Statements. Land and buildings remediation, where there is a legal or constructive obligation to undertake remediation and the cost of which can be reliably estimated has been provided for. Refer Note 14.10.
92 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 19 Contingent liabilities and contingent assets (continued)
Contingent assets represent matters that are unconfirmed (pending the occurrence or non-occurrence of an uncertain future event), or not reliably measurable or unlikely to be settled. However, their probability of settlement is “probable” but not “virtually certain”.
Contractual and other recoveries represent claims made by RailCorp against others in relation to contractual breaches and insurance claims in relation to other matters. The existence or quantum of each claim is usually in dispute.
Note 20 Financial instruments 20.1 Financial instruments RailCorp and the controlled entity hold the following financial instruments:
Consolidated Parent 30.06.12 30.06.11 30.06.12 30.06.11 $000 $000 $000 $000 Financial assets Cash and cash equivalents 77 609 15 034 77 467 14 925 Trade and other receivables 141 844 145 737 141 809 145 721 Derivative financial assets 816 4 735 816 4 735 Total financial assets 220 269 165 506 220 092 165 381
Financial liabilities
Trade and other payables 581 309 444 929 581 148 444 851 Financial Statements Borrowings 124 939 457 489 124 939 457 489 Finance Leases 487 990 257 080 487 990 257 080 Derivative financial liabilities 16 166 16 598 16 166 16 598 Total financial liabilities 1 210 404 1 176 096 1 210 243 1 176 018
20.2 Financial risks The operational activities of RailCorp expose it to a variety of financial risks: credit risk, liquidity risk and market risk (including currency risk, interest rate risk and commodity price risk in respect of distillate and electricity purchases). A risk management program focuses on financial performance and seeks to minimise potential adverse effects from financial market price movements. RailCorp uses derivative instruments to hedge financial exposures. Derivatives are exclusively used for hedging purposes, i.e. not as trading or other speculative instruments. Methods used to measure risk include sensitivity analysis in the case of interest rate, foreign exchange and other commodity price risks, and an ageing analysis for credit risk.
Risk management is carried out under approved policies. RailCorp’s Treasury Management Policy establishes a prudential framework covering policies, best practice internal controls and reporting systems for the management of financial risks within RailCorp’s operation. The policy covers specific areas such as foreign exchange risk, interest rate risk, commodity risk, credit risk, use of derivative financial instruments and investment of excess funds. The RailCorp Treasury Management Policy is approved annually.
The primary objective of this policy is to achieve management of all financial risks in strict compliance with internal policies and guidelines within the broad framework of the NSW Treasury Management Policy (TPP07-7). Accounting for Treasury Instruments is in accordance with NSW Treasury accounting policy, Accounting for Financial Instruments (TPP08-1).
RailCorp Treasury identifies, evaluates and hedges financial risk in close cooperation with RailCorp’s operating groups. Treasury instruments approved for the management of financial risk are in accordance with the Public Authorities (Financial Arrangements) Act 1987. 20.3 Market risk Market risk relates to fluctuations in the fair value of future cash flows of financial instruments because of changes in market prices. This applies to RailCorp’s foreign exchange, interest rate and commodity price hedging instruments.
Financial Statements 93 Notes to the Financial Statements for the year ended 30 June 2012
Note 20 Financial instruments (continued) 20.3 Market risk (continued) Sensitivity analysis on market risk is based on price variability taking into account the economic environment in which RailCorp operates and the time frame for assessment, that is, until the end of the next reporting period. The sensitivity analysis is based on financial instruments held at the balance date. The analysis assumes that all other variables remain constant.
20.3.1 Foreign exchange risk RailCorp is exposed to foreign exchange risk arising from currency exposures. Foreign exchange risk arises from contractual commercial transactions denominated in a foreign currency. The risk is measured using sensitivity analysis and cash flow forecasting.
The RailCorp Treasury Management Policy covers all elements of financial risk including foreign exchange risk. The policy requires 100% hedging of all material foreign exchange exposures.
Purchases involving foreign currency risk exposure that exceeds an aggregate of A$25,000, are required to be reviewed in advance of the signing by the Treasury section to assess the financial risk and formulate strategies to manage the risk. The Treasury section confirms a budget rate with project managers based on current forward prices and hedging strategies implemented. Counterparty risk is minimised by conducting all foreign exchange transactions with eligible counterparties (defined below under Note 20.4 Credit risk).
RailCorp’s foreign currency contracts outstanding at year end were:
Weighted Average Contract Value Exchange Rate Fair Value Maturity profiles 2012 2011 2012 2011 2012 2011 A$000 A$000 A$000 A$000 Contracts denominated in US Dollars (USD) Not later than 3 months 0.8327 0.8054 21 637 17 249 17 648 13 022 Later than 3 months and not later than 12 months 0.9620 0.8516 16 978 24 621 16 272 20 120 Later than 12 months 0.9181 0.8138 4 392 4 265 4 189 3 427 Total hedged US Dollar contracts 43 007 46 135 38 109 36 569
Contracts denominated in Euros Not later than 3 months 0.6446 0.6599 23 706 16 778 18 960 15 003 Later than 3 months and not later than 12 months 0.6774 0.6831 21 030 17 498 18 020 16 557 Later than 12 months 0.6600 0.6681 15 589 40 169 13 466 38 641 Total hedged Euro contracts 60 325 74 445 50 446 70 201
Contracts denominated in Japanese Yen Not later than 3 months 77.10 62.71 2 495 4 169 2 358 3 032 Later than 3 months and not later than 12 months - 76.92 - 9 960 - 9 211 Later than 12 months ------Total hedged Japanese Yen contracts 2 495 14 129 2 358 12 243
Contracts denominated in Korean Won Not later than 3 months 1073.10 1097.76 427 2 126 391 2 042 Later than 3 months and not later than 12 months - 1057.48 - 716 - 667 Later than 12 months ------Total hedged Korean Won contracts 427 2 842 391 2 709
94 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 20 Financial instruments (continued) 20.3.1 Foreign exchange risk (continued) Foreign currency contracts outstanding (continued) Weighted Average Contract Value Fair Value Exchange Rate Maturity profiles 2012 2011 2012 2011 2012 2011 A$000 A$000 A$000 A$000 Contracts denominated in Pounds Sterling Not later than 3 months 0.5880 0.6220 277 406 251 380 Later than 3 months and not later than 12 months - 0.5873 - 411 - 375 Later than 12 months ------Total hedged Pounds Sterling contracts 277 817 251 755
Contracts denominated in Swedish Kroner Not later than 3 months 6.1492 6.5213 24 177 21 170 Later than 3 months and not later than 12 months - 6.2686 - 1 160 - 1 085 Later than 12 months ------Total hedged Swedish Kroner contracts 24 1 337 21 1 255
Total hedged purchase 106 555 139 705 91 576 123 732
Foreign exchange risk sensitivity analysis Financial Statements
The following table shows the effect on Other Comprehensive Income at the reporting date of a 10% movement in exchange rates, with all other variables being held constant. All underlying exposures and related hedges are taken into account.
Although currency markets have been volatile in the current reporting period, a sensitivity of 10 per cent has been selected for use at the reporting date, as this is considered reasonable, based on the current Australian dollar (AUD) level and the historical volatility of the AUD against other currencies. Based on the value of the AUD at the reporting date as compared with the currencies below, adverse or favourable movements in the foreign exchange rates would result in an increase or decrease in the AUD fair value respectively.
Based on the financial instruments held at 30 June 2012, had the AUD spot price weakened / strengthened by 10% against currencies in which contracts are held, with all other variables held constant, the impact on Comprehensive Income is shown in the table below.
An adverse movement in exchange rates implies an increase in the AUD against the hedged currency. A favourable movement represents a fall in the AUD against the hedged currency.
Decrease of 10% Surplus Other Comprehensive Income Higher/(Lower) Higher/(Lower) 2012 2011 2012 2011 $000 $000 $000 $000 US Dollar - - (3 407) (3 246) Euros - - (4 474) (6 123) Japanese Yen - - (214) (1 082) Korean Won - - (36) (245) Pounds Sterling - - (23) (67) Swedish Kroner - - (2) (113) Total - - (8 156) (10 876)
Financial Statements 95 Notes to the Financial Statements for the year ended 30 June 2012
Note 20 Financial instruments (continued) 20.3.1 Foreign exchange risk (continued) Increase of 10% Surplus Other Comprehensive Income Higher/(Lower) Higher/(Lower) 2012 2011 2012 2011 $000 $000 $000 $000 US Dollar - - 4 164 3 967 Euros - - 5 468 7 484 Japanese Yen - - 261 1 323 Korean Won - - 44 300 Pounds Sterling - - 28 82 Swedish Kroner - - 2 138 Total - - 9 967 13 294
20.3.2 Commodity price risk RailCorp is exposed to a range of commodity price risks, principally from distillate and electricity purchases. Australian dollar costs under the supply agreements price mechanism are reflective of movements in Singapore Gas Oil prices and AUD/USD exchange rates. RailCorp Treasury Management Policy requires 100% of exposures be hedged in year 1, year 2 up to 60% and year 3 up to 40% hedged given the continuous nature of the exposure. RailCorp hedges its distillate exposure by entering into Singapore Gas Oil swap and USD forward contracts. RailCorp purchases its electricity under fixed price contracts. RailCorp’s policy for electricity hedging is similar to distillate operations however electricity hedging applies only to periods not under contract. 100% of exposures are required to be hedged in year 1. Up to 60% of exposures can be hedged in year 2 and up to 40% in year 3. Hedges are subsequently closed out once a fixed price contract is in place. At 30 June 2012 there were only commodity hedge contracts in place for distillate purchases.
Contract Value Fair Value Maturity profiles 2012 2011 2012 2011 $000 $000 $000 $000
Not later than 1 year Favourable 4 732 10 811 5 401 14 306 Non-favourable 12 001 2 882 10 961 2 527 16 733 13 693 16 362 16 833 Between 1 and 5 years Favourable 1 696 3 427 1 724 4 396 Non-favourable 1 702 - 1 674 - 3 398 3 427 3 398 4 396 Total commodity swap contracts 20 131 17 120 19 760 21 229
Commodity price risk sensitivity analysis
Based on contracts in place at 30 June 2012, had the Singapore Gas Oil spot price weakened or strengthened by 10%, with all other variables held constant, the impact on Comprehensive Income is shown in the table below
Index Change in unit Impact on Impact on Impact on Other Impact on Other price Surplus Surplus Comprehensive Comprehensive 2012 2011 Income Income 2012 2011 $000 $000 $000 $000 Distillate -10% - - (1 937) (2 033) +10% - - 1 937 2 033
Significant assumptions used in the commodity price exposure sensitivity analysis include reasonably possible movements in commodity price rates, determined based on a review of the last 2 years historical movements and economic forecasts.
96 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 20 Financial instruments (continued) 20.3.3 Interest rate risk
Interest rate risk refers to the market value of financial instruments or cash flows associated with the instruments fluctuating due to changes in market yields. RailCorp’s main interest rate risk relates primarily to borrowings and deposits on call with TCorp.
The PPP maintenance facility finance lease recognised on RailCorp’s statement of financial position is not exposed to interest rate risk. Amounts payable under the leasing arrangement are fixed, based on the achievement of certain milestones and key performance indicators by Reliance Rail. The interest rate charged on the lease liability is that which is implicit within the lease and will not be impacted by market interest rate fluctuations. Refer Note 18.4.
Investment
RailCorp invests in the TCorp 11 am Call Deposit. Funds are held for operational rather than trading purposes.
The TCorp 11am Call Deposit facility is designated at cost through the profit and loss. Therefore, any changes in price impacts on profit and loss (rather than comprehensive income).
Debt
RailCorp adopts a continuously diversified approach to managing its debt portfolio. Debt maturity is spread across the yield curve, comprising both short-term TCorp borrowing and long-term semi government
bonds. A neutral benchmark measures the performance of the debt portfolio. Financial Statements
RailCorp’s Treasury Management Policy requires a fixed/floating ratio where no more than 70% of the portfolio’s face value can be fixed rate debt or floating rate debt. Modified duration of the long-term debt must be between 2 and 6 years. The debt portfolio is managed through a restructuring facility offered by TCorp. Borrowings issued at variable rates expose RailCorp to cash flow risk.
Exposure to interest rate risk at year end is set out below:
PARENT Interest rate Principal amount 2012 2011 2012 2011 % % $000 $000 Financial assets Not later than 1 year Cash on hand - - 6 513 6 694 Cash at bank 3.42 4.65 8 170 3 572 Deposits on Call –TCorp Investment 3.45 4.70 62 784 4 659 Total Financial Assets 77 467 14 925 Financial liabilities Not later than 1 year Borrowings - 4.93 - (332 300) Finance Lease - - (13 663) (2 361) Between 1 and 5 years Borrowings 5.49 5.49 (80 017) (80 149) Finance lease - - (125 118) (47 842) Later than 5 years Borrowings 5.66 5.66 (44 922) (45 040) Finance Lease - - (349 209) (206 877) Total Financial Liabilities (612 929) (714 569)
Net Exposure (535 462) (699 644) Interest rate not applicable to Finance Lease
Financial Statements 97 Notes to the Financial Statements for the year ended 30 June 2012
Note 20 Financial instruments (continued) 20.3.3 Interest rate risk (continued)
Interest rate sensitivity analysis
Exposure to interest rate risk arises primarily through RailCorp’s interest bearing liabilities. A change of +/- 1% is used, consistent with current trends in interest rates, to measure RailCorp’s financial sensitivity to interest rate movements. RailCorp’s exposure to interest rate risk is set out below:
Index Change in Impact on Impact on Impact on Other Impact on Other yield surplus surplus Comprehensive Comprehensive 2012 2011 Income 2012 Income 2011
$000 $000 $000 $000 TCorp -1% (708) (82) - - investments and 82 bank deposits +1% 708 - -
If interest rates had changed by 1% the TCorp investments bank deposits would have moved by 1% and affected RailCorp’s profit and loss by the following.
Index Change in Impact on Impact on Impact on Other Impact on Other yield surplus surplus Comprehensive Comprehensive 2012 2011 Income 2012 Income 2011
$000 $000 $000 $000 Borrowings -1% 1 249 4 575 - - +1% (1 249) (4 575) - -
If interest yields had changed by 1% the market value of RailCorp’s debt portfolio would have moved in accordance with the weighted average modified duration for the portfolio. 20.4 Credit risk Credit risk arises where a debtor or RailCorp counterparty does not complete their obligations, resulting in financial risk to RailCorp.
Credit risk can arise from financial assets of RailCorp, including cash and cash equivalents, derivative financial instruments, deposits with banks and TCorp, as well as credit exposure to customers, including outstanding receivables and committed transactions. RailCorp holds bank guarantees for significant customers as well as property bonds for some leased premises. RailCorp has not granted any financial guarantees.
RailCorp’s credit risk policy is aimed at minimising the potential for counter party default. RailCorp uses the Standard & Poor’s rating system in assessing credit risk.
Credit risk associated with RailCorp’s financial assets, other than receivables, is managed through the sound selection of counterparties and establishment of minimum credit rating standards. The Public Authorities (Financial Arrangements) Act 1987 requires RailCorp to transact all debt management and investment activities with TCorp, which has a AAA credit rating from Standard & Poor’s due to their financial arrangements and obligations being guaranteed by the NSW Government.
RailCorp held $71.0m (2011: $8.2m) in cash at bank and investments at 30 June 2012. This was held with TCorp and Westpac Banking Corporation.
Derivatives
In relation to foreign exchange contracts and commodity swap transactions, RailCorp only transacts with counterparties with a Standard & Poor’s long-term credit rating of A+ or greater. RailCorp held $0.8m (2011: $4.7m) in derivative financial assets and $16.2m (2011: $16.6m) in derivative financial liabilities.
98 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 20 Financial instruments (continued) 20.4 Credit risk (continued) Further, no counterparty may have more than 50% of RailCorp’s total contract value in regards to foreign currency and commodity transactions.
RailCorp also holds “International Swap Dealers Association” Master Agreements with all counterparties which is an industry standard.
Trade receivables
The maximum credit risk exposure in relation to receivables is the carrying amount, less the allowance for impaired debts. Where necessary to support approval of a credit application for customers, security may need to be obtained in the form of an unconditional bank guarantee and/or security deposit.
RailCorp is not obliged to extend credit. RailCorp is not materially exposed to concentrations of credit risk to a single trade debtor or group of debtors.
Investments
RailCorp held funds on deposit with TCorp at 30 June 2012 which has been rated as “AAA” by Standard and Poor’s. The deposits at balance date were earning an average interest rate of 3.45% (2011: 4.70%) while over the year the weighted average interest rate was 4.29% (2011: 4.62%) on a weighted average balance during the year of $8m (2011: $10m). Financial Statements 20.5 Liquidity risk Liquidity risk refers to RailCorp being unable to meet its payment obligations when they fall due. RailCorp manages risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities and by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities.
Current investment powers allow RailCorp to manage liquidity through TCorp’s facilities. The bank balance is managed daily to a minimum set-off balance with surplus funds being invested in the TCorp 11 am Call Deposit or Hour Glass Cash Facility. Shortfalls in working capital funding are managed through TCorp’s Come & Go Facility. RailCorp’s bank accounts are on an account set off arrangement so funds are aggregated to allow flexibility.
Credit standby arrangements are shown at Note 5.3.
During the current and prior years, there have been no defaults or breaches on any loans payable. No assets have been pledged as collateral. RailCorp exposure to liquidity risk is deemed insignificant based on prior period data and current assessment of risk.
Liabilities are recognised for amounts due to be paid in the future for goods and services received, whether or not invoiced. If trade terms are not specified, payment is generally made no later than the end of the month following the month in which an invoice or a statement is received. The following table reflects the maturity band for all contractual obligations including the payment of principal and interest resulting from recognised financial liabilities at reporting date excluding the impact of netting.
Financial Statements 99 Notes to the Financial Statements for the year ended 30 June 2012
Note 20 Financial instruments (continued) 20.5 Liquidity risk (continued) Carrying Contract Less than 1 Between 1 Over 5 PARENT Amount Cashflow year and 5 years Years $000 $000 $000 $000 $000 30 June 2012 Financial assets Cash and cash equivalents 77 467 77 467 77 467 - - Trade and other receivables 141 809 141 809 107 040 4 886 29 883 219 276 219 276 184 507 4 886 29 883 Financial liabilities Trade and other Payables (581 148) (581 148) (581 148) Borrowings (124 939) (155 659) (7 152) (96 587) (51 920) Finance lease liability (487 990) (1 430 855) (20 035) (157 741) (1 253 079) (1 194 077) (2 167 662) (608 335) (254 328) (1 304 999) Derivatives Forward exchange contracts outflow (91 576) (106 555) (86 574) (19 981) - Forward exchange contracts inflow - - - - - Commodity swap contracts outflow (19 761) (20 131) (16 733) (3 398) - Commodity swap contracts inflow - - - - - (111 337) (126 686) (103 307) (23 379) - 30 June 2011 Financial assets Cash and cash equivalents 14 925 14 925 14 925 - - Trade and other receivables 145 721 145 721 116 517 2 417 26 787 160 646 160 646 131 442 2 417 26 787 Financial liabilities Trade and other payables (444 851) (444 851) (444 851) - - Borrowings (457 489) (501 206) (340 261) (106 385) (54 560) Finance lease liability (257 080) (798 679) (3 741) (64 516) ( 730 422) (1 159 420) (1 744 736) (788 853) (170 901) (784 982) Derivatives Forward exchange contracts outflow (124 636) (140 819) (96 385) (44 434) - Forward exchange contracts inflow 904 1 114 1 114 - - Commodity swap contracts outflow (22 441) (18 025) (14 598) (3 427) - Commodity swap contracts inflow 1 212 905 905 - - (144 961) (156 825) (108 964) (47 861) -
100 RailCorp Annual Report 2011–12 Notes to the Financial Statements for the year ended 30 June 2012
Note 20 Financial instruments (continued) 20.6 Fair value compared to carrying amount The fair values of financial instrument assets and liabilities are determined as follows: • the fair value of financial instrument assets and liabilities with standard terms and conditions and traded in active liquid markets are determined with reference to quoted market prices; and • the fair value of other financial instrument assets and liabilities are determined in accordance with generally accepted pricing models based on discounted cash flow analysis.
RailCorp considers that the carrying amount of financial instrument assets and liabilities recorded in the financial statements to be a fair approximation of their fair values, because of the short-term nature of the financial instruments and the expectation that they will be paid in full.
The fair values of most of the contractual financial assets and liabilities are the same as the carrying amounts.
RailCorp uses various methods for disclosing the fair value of financial instruments by valuation technique: • Level 1 - Derived from quoted market prices in active markets for identical assets/liabilities. Quoted market price represents the fair value determined based on the quoted prices on active markets as at the reporting date without any deduction of transaction costs.
• Level 2 - Derived from inputs other than quoted prices that are observable directly or indirectly using valuation techniques with only observable market inputs and prices, commodity swap contracts and foreign exchange contracts. Financial Statements
• Level 3 – Derived from valuations techniques that include inputs for asset/liabilities not based on observable market data. RailCorp currently does not have these financial instruments. Level 1 Level 2 Level 3 $000 $000 $000 Fair Value at 30 June 2012 Financial assets Foreign exchange contracts - 120 - Commodity swap contracts - 696 - TCorp investments - - Total financial assets - 816 -
Financial liabilities Foreign exchange contracts - 15 098 - Commodity swap contracts - 1 068 - Total financial liabilities - 16 166 -
Fair Value at 30 June 2011 Financial assets Foreign exchange contracts - 271 - Commodity swap contracts - 4 464 - TCorp investments - - - Total financial assets - 4 735 -
Financial liabilities Foreign exchange contracts - 16 243 - Commodity swap contracts - 355 - Total financial liabilities - 16 598 -
Financial Statements 101 Notes to the Financial Statements for the year ended 30 June 2012
Note 21 Joint venture RailCorp has a participating 50% interest in the AK Car Joint Venture which operates an inspection railcar as a jointly controlled asset. The venture commenced on 1 February 2006. The aggregate amount of RailCorp’s assets employed in the joint venture at 30 June 2012 is $0.5m(2011: $0.6m).
Note 22 Events occurring after reporting date
RailCorp entered a lease on 5 August 2012 transferring the management and operation of the Sydney Metropolitan Freight Network to Australian Rail Track Corporation Limited until 2064. It will result in the de- recognition by RailCorp of associated land and Infrastructure assets with a written down value of approximately $150m in financial year 2012-13.
(End of audited financial statements)
102 RailCorp Annual Report 2011–12 Financial Statements
Financial Statements 103 104 RailCorp Annual Report 2011–12 Enterprise risk management Internal audit and risk management The effective management of risk remains central to the achievement statement of RailCorp’s Strategic Objectives and to efficient management of RailCorp, and has continued to For the 2011–2012 financial year for Rail Corporation mature during the year. The New South Wales organisation’s approach to risk I, Rob Mason, am of the opinion that Rail Corporation management remains focused on the New South Wales has internal audit and risk proactive identification, assessment management processes in place that are, in all material respects, and ownership of all business compliant with the core requirements set out risks, and the implementation in Treasury Circular NSW TC 09/08 Internal Audit and of treatments to control them, Risk Management Policy. mitigating negative impacts and locking in opportunities. I, Rob Mason, am of the opinion that the Audit and Risk Committee for Rail Corporation New South Wales During the course of 2011-12 the is constituted and operates in accordance with the RailCorp Strategic Risk Register independence and governance requirements of Treasury has undergone scheduled Circular NSW TC 09/08. The Chair and Members of the Audit quarterly reviews, the Audit and and Risk Committee are: Risk Committee participated in Financial Statements a strategic risk workshop, the • G. Fletcher – Independent Chair (three-year term Enterprise Risk Management risk of appointment with effect from 1 July 2010) ranking criteria were reviewed and simplified, and the Enterprise Risk • E. Crouch – Independent Member (three-year term Working Group was established to of appointment with effect from 1 July 2010) ensure effective communication • B. Blood – Independent Member (three-year term of risk management best practice, of appointment with effect from 1 July 2010). initiatives and information across the organisation. These processes provide a level of assurance that enables the senior management of Rail Corporation New South Wales The continued provision of formal to understand, manage and satisfactorily control ERM training is helping the risk exposures. organisation to build its maturity and capability in risk management. This advancing maturity is reflected in the improved alignment between the enterprise risk profile and the RailCorp assurance framework, particularly in internal audit Rob Mason activities. Chief Executive Date: 31 October 2012 The Risk Management Information System, RailCorp’s data, analysis and reporting tool for risk, has been upgraded for future wider deployment across the organisation as appropriate.
To address the management of risks specific to major projects, the successful practice of embedding or providing risk specialist support to these projects has continued.
Financial Statements 105 106 RailCorp Annual Report 2011–12 Appendices
Appendix 1 About RailCorp
Appendix 2 Management structure
Appendix 3 Changes in Acts and subordinate legislation
Appendix 4 Work Health and Safety
Appendix 5 Privacy and Personal Information Protection Act 1998
Appendix 6 Human resources
Appendix 7 Equal employment opportunity
Appendix 8 Accessibility/disability plans
Appendix 9 Multicultural Policies and Services Plan (formerly EAPS) – Community Relations
Appendix 10 Consumer response
Appendix 11 Agreements within the Community Relations Commission
Appendix 12 Performance and numbers of executive officers Appendices Appendix 13 Government Information (Public Access) Act 2009
Appendix 14 Implementation of IPART fare determinations
Appendix 15 Investment management performance
Appendix 16 Liability management performance
Appendix 17 Annual Report 2011-12 production costs
Appendix 18 Consultants
Appendix 19 Overseas travel
Appendix 20 Land values and land disposals
Appendix 21 Funds granted to non-government agencies
Appendix 22 Credit card certification
Appendix 23 Research and development
Appendix 24 Major works in progress
Appendix 25 Payment of accounts
Appendix 26 Controlled entity and subsidary disclosure Appendices 107 Appendix 1: About RailCorp
RailCorp provides rail services Nature and scope of Rail infrastructure functions under the requirements of the operations RailCorp is to hold, manage, Transport Administration Act 1988. maintain and establish rail RailCorp has three primary functions infrastructure facilities owned by or The principal objectives of RailCorp conferred by Part 2 of the Transport vested in RailCorp on behalf of the under that Act are to: Administration Act 1988. These State. Rail infrastructure facilities functions are further governed • Deliver safe and reliable railway include stations, railway track, by the Rail Safety Act 2008. They passenger services in NSW in an associated track structures, over are also subject to the Passenger efficient, effective and financially track structures, cuttings, drainage Transport Act 1990, which provides responsible manner works, track support earthworks that the terms and conditions under and fences, tunnels, bridges, level • Ensure that the part of the NSW which they are carried out are to crossings, service roads, signalling rail network vested in or owned be set out in a rail services contract systems, train control systems, by RailCorp enables safe and with the Director General of the communication systems, overhead reliable railway passenger and Department of Transport. power supply systems, power freight services in an efficient, and communication cables, and effective and financially The three primary functions are: associated works, buildings, plant, responsible manner. Passenger rail services machinery and equipment. The Act also requires RailCorp to: RailCorp is to operate passenger Metropolitan rail area access • Maintain reasonable priority and rail services and it has the ability to functions certainty of access for railway establish new, alter or discontinue passenger services services as required. RailCorp is to provide and promote access to its rail network, primarily to • Promote and facilitate access to Metropolitan, regional (Newcastle support rail freight services by third- the part of the NSW rail network and Hunter areas) and intercity party operators. RailCorp currently vested in or held by RailCorp services (South Coast, Southern provides 19 operators with access to Highlands, Blue Mountains and the metropolitan network, which also • Operate a successful business Central Coast) are operated through includes heritage and long-distance that performs at least as the CityRail network. CountryLink passenger operations. efficiently as any comparable provides affordable long-distance business and maximises the net passenger train and coach services worth of the State’s investment in to regional NSW communities and the Corporation the four capital cities in NSW, ACT, Queensland and Victoria. • Exhibit a sense of social responsibility by taking into CountryLink also manages all NSW consideration the interests of the country stations, trains, onboard community in which it operates staff, reservations, sales and marketing. The majority of non- • Conduct operations in compliance metropolitan rail infrastructure, with the principles of ecologically excluding stations and rolling stock, sustainable development is provided by the Australian Rail contained in Section 6(2) of the Track Corporation. Protection of the Environment Administration Act 1991
• Exhibit a sense of responsibility towards regional development and decentralisation in the way in which it serves the community.
108 RailCorp Annual Report 2011–12 Appendix 2: Management structure
In accordance with the Transport • Monitor compliance with Safety Committee Administration Act 1988, the affairs governance systems and evaluate of RailCorp are managed and the effectiveness of those systems The primary objective of the Safety controlled by the Chief Executive, Committee is to assist the Chief subject to direction from the • Consider strategic responses to Executive in discharging RailCorp’s Director General of Transport for performance issues and changes objective for the safety of railway New South Wales. in circumstances that impact passenger services (CityRail & delivery of the corporate plan CountryLink) and the part of the The RailCorp Executive supports rail network vested in or owned by • Provide a forum for the discussion the Chief Executive in the day- RailCorp, and of the passengers, and evaluation of risks and issues to-day running of RailCorp and in employees, contractors, third that have significant impacts on ensuring effective governance of party operators of non-passenger RailCorp’s operations the organisation. The Executive operations and the public who has collective responsibility for • Support the Chief Executive in the work on and use the network. functions related to organisational provision of advice to stakeholders The Committee includes an performance and strategy. independent member appointed by • Provide alignment between the Chief Executive. A number of Executive Committees the roles and responsibilities meet formally at least once a month in relation to RailCorp’s In discharging its charter the and the Executive meets every organisational/business plans Committee will: week, or as required. (including objectives, strategies, • Review and monitor the strategic programs and initiatives). direction of safety at RailCorp Executive Management Committee • Monitor and review the Finance and Delegation effectiveness of safety policies, The primary objective of the Committee systems and programs which Executive Management Committee are designed to meet legislative is to provide the Chief Executive The primary objective of the responsibilities and members of the Executive with Finance and Delegations Committee advice and direction in relation is to assist the Chief Executive in • Promote a proactive safety to the strategic development the exercise of his delegation of culture at RailCorp Appendices and implementation of RailCorp’s authority and to promote good • Monitor and review the objectives to ensure effective governance practices. corporate governance. performance of key programs In discharging its responsibilities the which identify and manage safety In discharging its responsibilities, Committee will: risks across operations the Committee will: • Make recommendations on items • Monitor and review key safety • Provide a forum for the above the sub-delegation limits related issues arising from the development of organisational/ to group heads for approval RailCorp Executive Management business strategy or commitment by the Chief Committee Executive • Review progress on the delivery • Provide advice to the Chief of organisational/business plans • Make recommendations on Executive on key safety issues items referred by the Executive • Review financial and operational • Monitor and review performance Management Committee for performance against through reporting relating to approval or commitment by the organisational/business plans the safety of infrastructure, train Chief Executive operations, counter-terrorism • Identify strategic opportunities • Make recommendations on items and WHS for improved performance referred by the Chief Executive for • Receive assurance that issues • Monitor policy, systems and approval or commitment by the arising from relevant safety audit programs across the organisation Chief Executive.
Appendices 109 and investigation reports are or external party (subject to In discharging it responsibilities being actioned their legal obligation to protect the Committee will perform the information) following duties: • Take into account safety objectives relating to RailCorp as it sees fit. • Discuss any matters with the • Provide strategic oversight to external auditor or other external an enterprise wide approach parties (subject to confidentiality to the management of risk, Audit and Risk Committee considerations) including approval of principles, strategies and processes for the The Chief Executive has established • Request the attendance of any management of risk the Audit and Risk Committee in employee, including the Chief compliance with Treasury Circular Executive, at committee meetings • Evaluate significant enterprise NSW TC 09/08 August 2009. risks that threaten or may • Obtain external legal or other The Committee includes three threaten the achievement of professional advice, as considered independent members appointed RailCorp’s objectives necessary to meet its by the Chief Executive. responsibilities, at RailCorp’s • Provide direction on appropriate The objective of the Committee expense. risk management strategies and is to provide independent clear lines of accountability for assistance to the Chief Executive the management of risks by overseeing and monitoring Executive Risk Management • Monitor the effectiveness of controls RailCorp’s governance, risk and Committee and/or mitigation strategies to control frameworks, and its external manage significant risks accountability requirements. The primary objective of the Executive Risk Management • Approve principles, policies, The Chief Executive authorises the Committee is to oversee the strategies and processes for the Committee, within the scope of its strategic development and ongoing management of risk. role and responsibilities, to: implementation of RailCorp’s enterprise risk management • Obtain any information it framework for all categories of risk. needs from any employee and/
Appendix 3: Changes in Acts and subordinate legislation
Work Health and Safety Act diligence to ensure compliance by safety, to minimise those risks so far 2011 (NSW) the corporation with health, safety as is reasonably practicable. and welfare duties; and removes the Section 18 provides that in Date of commencement: right of unions to bring proceedings determining what is reasonably 1 January 2012 for an offence under the repealed Occupational Health and Safety Act practicable in relation to a duty to The object of this Act is to secure 2000 (NSW). ensure health and safety, means the health, safety and welfare of that which is, or was at a particular persons at work and to repeal the Section 17 of the Act provides for time, reasonably able to be done Occupational Health and Safety Act a duty imposed on a person to in relation to ensuring health and 2000 (NSW). The Act removes ensure health and safety requires safety, taking into account and the reverse onus of proof in work the person: weighing up all relevant matters health and safety prosecutions; including: replaces the provision that deemed (a) to eliminate risks to health directors and managers of a and safety, so far as is reasonably (a) the likelihood of the hazard or corporation to be guilty of offences practicable, and the risk concerned occurring, and committed by the corporation, (b) if it is not reasonably practicable (b) the degree of harm that might with a duty that officers of the to eliminate risks to health and result from the hazard or the risk, corporation should exercise due and
110 RailCorp Annual Report 2011–12 (c) what the person concerned (b) the provision and maintenance Made under the Work Health knows, or ought reasonably to of safe plant and structures, and and Safety Act 2011, the know, about: regulations cover matters such as (c) the provision and maintenance representation and participation, (i) the hazard or the risk, and of safe systems of work, and general risk and workplace management, hazardous work, plant (ii) ways of eliminating or minimising (d) the safe use, handling, and and structures, construction work, the risk, and storage of plant, structures and hazardous chemicals, asbestos, substances, and (d) the availability and suitability of major hazard facilities and mines. ways to eliminate or minimise the (e) the provision of adequate risk, and facilities for the welfare at work of workers in carrying out work for Occupational Health and (e) after assessing the extent of the business or undertaking, Safety Act 2000 (NSW) the risk and the available ways of including ensuring access to those eliminating or minimising the risk, the facilities, and Date of Repeal: 1 January 2012 cost associated with available ways of eliminating or minimising the risk, (f) the provision of any information, This Act was repealed by section including whether the cost is grossly training, instruction or supervision 276C of the Work Health and Safety disproportionate to the risk. that is necessary to protect all Act 2011 (NSW) with effect from 1 persons from risks to their health January 2012. Section 19 sets out the primary and safety arising from work carried The Work Health and Safety Act duty of care in relation to out as part of the conduct of the 2011, along with the Work Health persons conducting a business business or undertaking, and or undertaking. By subsection (1) and Safety Regulation 2011 (NSW), those persons must ensure so far as (g) that the health of workers and both commenced on 1 January 2012 is reasonably practicable, the health the conditions at the workplace to secure the health, safety and and safety of: are monitored for the purpose welfare of persons at work. of preventing illness or injury of (a) workers engaged, or caused to workers arising from the conduct of be engaged by the person, and the business or undertaking. Occupational Health and Safety Regulation 2001 (b) workers whose activities in Section 27 provides that if a (NSW) carrying out work are influenced or person conducting a business or directed by the person, undertaking has a duty or obligation Date of Repeal: 1 January 2012
under the Act, an officer of the Appendices while the workers are at work in the person conducting the business This Regulation was repealed by business or undertaking. or undertaking must exercise section 276C of the Work Health By subsection (2) a person due diligence to ensure that the and Safety Act 2011 (NSW) with conducting a business or person conducting the business effect from 1 January 2012. undertaking must ensure, so far as or undertaking complies with The Work Health and Safety Act is reasonably practicable, that the that duty or obligation. Maximum 2011, along with the Work Health health and safety of other persons penalty: is that fixed for an officer of and Safety Regulation 2011 (NSW), is not put at risk from work carried a person conducting a business or both commenced on 1 January 2012 out as part of the conduct of the undertaking for that offence. to secure the health, safety and business or undertaking. welfare of persons at work. By subsection (3) without Work Health and Safety limiting subsections (1) and (2), a Regulation 2011 (NSW) person conducting a business or undertaking must ensure, so far as Date of Commencement: is reasonably practicable: 1 January 2012 (a) the provision and maintenance This Regulation commenced of a work environment without risks (except for clause 164) on 1 January to health and safety, and 2012 to secure the health, safety and welfare of persons at work.
Appendices 111 Transport Legislation (c) Planning and investment (i) Safety Amendment Act 2011 (NSW) To ensure that good planning To provide safe transport services in informs investment strategies. accordance with a safety regulatory Dates of Commencement: 1 framework. November 2011; 31 March 2012; 1 (d) Coherence and integration July 2012 (2) Public transport agencies are To promote coherence and The object of this Act was to amend to determine their service delivery integration across all transport the Transport Administration Act priorities having regard to the modes and all stages of decision 1988 (NSW) to establish Transport Director General’s expectations making. for NSW and the Transport Service for service delivery established by a Statement of Expectations and to make further provision (e) Performance and delivery with respect to the administration issued annually to public transport of public transport in New To focus on performance and agencies by the Director General. South Wales with respect to the service delivery, based on a strong administration of the transport purchaser-provider model with clear services provided to the people of accountabilities for outcomes. Environmental Planning and New South Wales. Assessment Amendment (f) Efficiency (North West Rail Link) By this Act a new section 2B To achieve greater efficiency: Regulation 2012 was inserted into the Transport Administration Act 1988 (NSW) (i) in the delivery of transport Date of commencement: which provides: infrastructure projects, and 13 March 2012 (1) Public transport agencies are (ii) through improved coordination The object of this Regulation is to exercise their functions in a of freight, maritime and ports to amend Schedule 6A to the manner that promotes the following operations, and their integration Environmental Planning and objectives, which are the common into the transport system, and Assessment Act 1979 (NSW) objectives of public transport to make additional savings and agencies: (iii) by eliminating duplication of transitional provisions relating to the functions and resources, and North West Rail Link development, (a) Customer focus consequent on the declaration (iv) by outsourcing the delivery of of that development as State To put the customer first and design non-core services. the transport system around the Significant Infrastructure. The needs and expectations of the (g) Environmental sustainability amendment enables existing and customer. new requests for modifications to To promote the delivery of transport the deemed approval for the staged (b) Economic development services in an environmentally infrastructure application relating sustainable manner. to that project to be made and To enable the transport system to dealt with. support the economic development (h) Social benefits of the State (with a focus on freight To contribute to the delivery of transport systems). social benefits for customers, including greater inclusiveness, accessibility and quality of life.
112 RailCorp Annual Report 2011–12 Appendix 4: Work, Health and Safety
RailCorp made extensive audit cycle. The organisation was • the average claim cost was $9905 preparations in order to ensure granted a further three-year licence its readiness for effective as a self-insurer under the Workers RailCorp was subject to one implementation of the new Work Compensation Act 1987 (NSW). WorkCover investigation during the Health & Safety Act 2011 (NSW) on 2011-2012 financial year. 1 January 2012. The organisation’s More than 70 WHS committees The matter involved an incident that Work Health and Safety (WHS) are constituted across the occurred on 19 February 2012 when responsibilities are managed through organisation’s spread of workplaces, a contractor who was carrying out our Safety Management System. overseeing safety issues on a location-specific basis. Training work for Novo Rail on the Lidcombe WorkCover conducted its regular is provided for WHS committee to Granville Corridor Upgrade three-yearly audit of RailCorp chairs, who are also invited to an Project fell off a hi-rail excavator and in August 2011. The audit found annual forum. suffered injuries. RailCorp was the that the two Safety Management principal contractor for the upgrade System elements audited – risk Workers compensation claims are project. This matter is ongoing. management and process control managed through the Workers RailCorp was not the subject of a – were operating at an acceptable Compensation Services Division. WorkCover prosecution during the performance level under the Data extracted on 1 August 2012 for 2011-12 year. National OHS Self Insurers Audit the 2011-12 year indicates as follows: Tool. The audit team was of the • 1222 injury claims were accepted RailCorp runs comprehensive opinion that the organisation’s by RailCorp health and wellness programs for system performance was at a its employees throughout the year, level expected of a self-insurer, • 135 of those claims related to details of which are provided in and recommended that RailCorp journey injuries ‘Secton 02 Operational Performance continue on the standard triennial – People’ of this report. • 560 injuries were lost time injuries
Appendix 5: Privacy and Personal Information Protection Act 1998 Appendices
RailCorp did not receive any During the period, a new RailCorp held for employees and members of applications under Part 5 of the Personal and Health Information the public. This Procedure supports Privacy and Personal Information Procedure was implemented for the implementation of RailCorp’s Protection Act 1998 during the collection, protection, storage, use, Privacy Management Plan. 2011-12 financial year. amendment and secure disposal of personal and health information
Appendices 113 Appendix 6: Human resources
Exceptional movements in Industrial relations legislation, RailCorp Enterprise wages, salaries or allowances awards and agreements Agreement 2010
• April 2012: 3.5 per cent salary Terms and conditions of The RailCorp Enterprise Agreement increase for all employees employment of RailCorp’s 2010 identifies a range of reform covered by the RailCorp employees are governed by: initiatives that will deliver employee Enterprise Agreement 2010 related cost savings. These reforms • Executive Contracts are progressively being delivered • From 1 July 2011, the average during the life of this Agreement. increase for RailCorp managers • Fair Work Act 2009 on contract was 3.24 per cent, • Rail Industry Award 2010 subject to achieving specific Personnel policies and performance agreement targets.h • RailCorp Enterprise Agreement practices 2010 (expires 31 March 2014) The following new HR procedures became effective in 2011-2012:
Headcount as at 30 June 2012 1. Child protection in the workplace
2. Critical incident support Category groups 2009 2010 2011 2012 3. Employee assistance program Train operations 625 616 633 643 4. Flexible work practices Train crew 3235 3377 3467 3436
Station staff 2636 2358 2435 2442 5. Graduate programh
Presentation services 664 898 853 804 6. Personal and health information
Security 576 542 580 497 7. Transfers
Asset management 8. Work experience - Trades1 2475 2509 2470 2779 - Engineering2 1072 1255 1368 1424 9. Revised recruitment, selection and appointment procedure to 3 Corporate 3097 3433 3465 2950 include temporary vacancies Other/unattached4 192 10. Revised public interest Total 14,380 14,988 15,271 15,1675 disclosures and reports of other serious misconduct procedure 1. Includes 292 apprentices previously reported in corporate. to reflect the Public Interest 2. Includes 187 Engineering graduates/undergraduates. Disclosures Act 2010 3. Includes Safety and Environment, and graduates, interns and cadets (non-engineering). 11. Revised Code of Conduct to 4. Includes 171 unattached employees. reflect the changes to the public 5. Excludes employees identified as contractors. interest disclosures and reports of other serious misconduct procedure and the secondary employment and emergency services work procedure.
114 RailCorp Annual Report 2011–12 Appendix 7: Equal Employment Opportunity (EEO)
Trends in the representation of EEO groups1
EEO group Benchmark or target 2009 2010 2011 2012
Women 50.0% 18.4% 18.7% 19.2% 19.5%
Aboriginal and Torres Strait Islander people 2.6%3 2.2% 2.2% 2.1% 1.9%
People whose first language is not English 19.0% 27.6% 27.6% 27.9% 28.1%
People with a disability N/A 4 6.3% 6.1% 5.8% 5.6%
People with a disability requiring 1.1% (2011); 1.3% (2012) 2.1% 1.9% 1.8% 1.7% work-related adjustment5 1.5% (2013)
Trends in the distribution of EEO groups6
EEO group Benchmark or target 2009 2010 2011 2012
Women 100 94 96 94 95
Aboriginal and Torres Strait Islander people 100 84 82 82 83
People whose first language is not English 100 96 98 99 100
People with a disability 100 100 99 99 100
People with a disability requiring work-related 100 99 98 98 98 adjustment
1. Staff numbers are as at 30 June 2012. 2. Excludes casual staff. 3. Minimum target by 2015.
4. Percentage employment levels are reported but a benchmark level has not been set. Appendices 5. Minimum annual incremental target. 6. A distribution index of 100 indicates that the centre of distribution of the EEO group across salary levels is equivalent to that of other staff. Values less than 100 mean that the EEO group tends to be more concentrated at lower salary levels than is the case for other staff. The more pronounced this tendency is, the lower the index will be. An index more than 100 indicates that the EEO group is less concentrated at the lower salary levels. 7. Excludes casual staff. 8. Data about EEO groups (excluding women) are estimates based on responses received from employees who completed an EEO questionnaire. As at the time of reporting 49.86% of employees completed an EEO Survey questionnaire.
Appendices 115 Appendix 8: Accessibility/disability plans
More than $770 million will be including procurement, for these customers with different disabilities spent from 2011-12 to 2014-15 initiatives. and provide excellent customer on a Transport Access Program service to meet their needs. developed by Transport for NSW. The program is to provide: Through the course, participants The program is to deliver accessible, gain an understanding of RailCorp’s • Stations accessible to the modern, secure and integrated obligations as an organisation as disabled, ageing and parents with transport infrastructure where it is well as their own obligations under prams needed most. This includes station the Disability Discrimination Act. upgrades, better interchanges, • Modern buildings and facilities for They learn to identify the needs ferry wharf upgrades and new or all transport modes that meet the of customers with disabilities, the upgraded commuter car parks. needs of a growing population potential barriers to meeting these needs and strategies to overcome In April 2012, the NSW Government • Modern interchanges that support those barriers. Through practical allocated more than $100 an integrated network and allow activities and meeting with a guest million in the first round to fund seamless transfers between all speaker from one of the Disability improvements across the rail, bus transport modes sectors they begin to empathise and ferry networks at 35 city and with these customers and develop • Greater safety, including extra regional locations. the desire to provide the best lighting, help points, fences possible assistance. In May 2012, the government and security for car parks and announced the allocation of $170 interchanges, stations, bus stops The training runs five days per week million from Transport Access and wharves and is attended by 36 participants Program funds to build nine new each day. From September 2011, • Improved signage so customers commuter car parks to provide about 4000 station staff and train can more easily use public more than 1200 additional car crew have progressively been transport and transfer between spaces across the CityRail network. rostered to attend. By end of modes. June 2012 approximately 83 per Transport for NSW has begun cent of the targeted employees accessibility planning approval, land RailCorp has rolled out a Disability had attended the training and the acquisition, design development Awareness training program to training program is on target. and commercial processes, equip the frontline staff with the required knowledge and skills to be able to understand the needs of
116 RailCorp Annual Report 2011–12 Appendix 9: Multicultural Policies and Services Plan (formerly EAPS) – Community Relations
In 2011-12, RailCorp updated the Multicultural plan Marketing and promotions Multicultural Policies and Services Plan that was first prepared in Culturally and Linguistically Diverse The CityRail website contains 2010-11. This is a legislative areas were identified in the CityRail information in 12 languages, requirement under the Community and CountryLink networks and selected to reach commuters as Relations Commission and Principles an action plan developed for well as tourists and international of Multiculturalism Act 2000. future multicultural activities and students: Arabic, Simplified and outcomes for these areas. Traditional Chinese, Korean, Spanish, This plan contains all current Japanese, Vietnamese, German, multicultural programs and activities Thai, Nepalese, French conducted within RailCorp. It also Improved consultation and Burmese. proposes future activities which, if undertaken, will ensure that RailCorp has been consistently RailCorp is effectively contributing liaising with the Community Relations Communications to furthering the principles of Commission of NSW by requesting multiculturalism within NSW. advice and feedback on the RailCorp continued to support the development of the Multicultural Plan. 131450 translating and interpreting The Multicultural Plan was service, assisting culturally and developed in line with the linguistically diverse groups Multicultural Planning Framework Community language to receive service and other provided by the Community allowance scheme information in their own languages. Relations Commission of NSW. The plan contains a set of A 12-month pilot of the Community Letters used for the Digital Train actions, performance measures Language Allowance Scheme Radio System (DTRS) project were and outcomes for each activity, (CLAS) was launched in December translated into Arabic, Chinese ensuring that it acts as a planning, 2011. The initiative encourages staff and Greek to assist culturally and performance evaluation and to provide on-the-spot assistance to linguistically diverse groups in the benchmarking tool. customers in their own language. Bankstown area. Appendices Education
In October 2011, RailCorp assisted the Illawarra Multicultural Services and Illawarra Health Services to organise a program to educate refugees about how to travel on the network safely and effectively.
Appendices 117 Appendix 10: Consumer response
Complaint issues logged in 2011-12 on the previous year’s total of 438 The feedback channel Web showed an increase from 26,632 in complaints for this symptom. Lodgement continues to increase 2010-11 to 29,219 issues for the year. in importance. The total number of This is an increase of 9.71 per cent on Ticketing was again the next-highest complaints logged via web channels the previous financial year’s totals. category, with feedback on online rose by 19.95 per cent, from 9287 in ticketing (889 complaints, up from 2010-11 to 11,140 in 2011-12. These increases were distributed 313 the previous year) contributing across the majority of KPI complaint to the increase in this KPI from 3585 For the first time, the number of categories. The only categories in 2010-11 to 4179 in 2011-12. Most of On-Time Running (OTR) complaints showing a decrease in complaints the online ticketing feedback relates logged via the CityRail and 131500 were Environment and Timetables. to difficulties ordering, exchanging websites, or via other email or registering tickets via the website. channels, eclipsed the number The KPI category Service, dealing logged via phone channels; 2017 with levels of comfort and On-Time Running showed an OTR complaints were logged via convenience experienced by our increase in complaint issues from web channels in 2011-12, up by 26.9 customers, was the greatest source 3330 in 2010-11 to 3924 in 2011-12. per cent from 2010-11’s total of 1589. of customer dissatisfaction. This This is an increase of nearly 18 per In comparison, the number of OTR KPI rose by nearly 9 per cent on cent on the previous year’s total. issues logged last year via phone the previous financial year’s totals, A number of critical operational channels was 1741. from 4926 to 5346. On-board incidents on the CityRail network temperatures were the biggest caused spikes in complaints which Compliments showed a welcome single cause of complaint in this contributed to this rise. increase on 2010-11’s totals, category, but numbers actually from 2290 to 3026 issues logged, fell in the last financial year. The Complaints logged under the up by 32.1 per cent on the previous unseasonably hot temperatures of KPI Staff was the fourth-highest year’s figures. the previous summer did not recur category, but the increase was in 2011-12 and complaints about minimal, from 3215 issues in 2010-11 onboard temperatures experienced to 3252 issues in 2011-12. an overall drop for the year from 1247 to 1092. Complaints by KPI and customer type 2011-12
The progressive replacement of KPI CityRail CountryLink Infrastructure Total non-air conditioned rolling stock will no doubt go some way to alleviating Claim 141 24 0 165 this cause of complaint, but our Cleanliness 1571 61 288 1920 passengers are still demanding immediate solutions to the Environment 208 4 1451 1663 problems of onboard comfort. Facilities 1766 60 136 1962
Complaints about replacement Information 2345 253 17 2615 bus services during periods of Internal Matters 171 15 46 232 trackwork continued to contribute to the increase in complaints for the OTR 3605 308 11 3924 KPI category Service. Trackwork Safety 1215 96 613 1924 bus complaints in this KPI rose from 542 to 615 in 2011-12, an increase Security 1358 115 17 1490 of over 13 per cent on the previous Service 4553 707 86 5346 year’s total. Staff 2720 437 95 3252 A total of 492 complaints were Ticketing 3214 965 0 4179 logged on the issue of unscheduled changes to train services, mostly Timetable 502 45 0 547 complaints of early departures. This Total 23,369 3090 2760 29,219 was an increase of 12.3 per cent
118 RailCorp Annual Report 2011–12 All issues received
Case source 2010-11 2011-12
Phone 131500 26,637 30,321
Web lodgement 15,600 18,389
Ministerial 1073 1394
Letters 1235 1135
Office of Environment and Heritage email 194 117
Minister's office 275 56
Other 31 17
NSW ombudsman 4 8
Total 45,049 51,437
All complaint issues received
Case source 2010-11 2011-12
Phone 131500 15,309 16,233
Web lodgement 9287 11,140
Ministerial 945 1130
Letters 645 544
OEH email 191 116
Minister's office 232 41
Other 20 8 Appendices NSW ombudsman 3 7
Total 26,632 29,219
All OTR complaint issues received
Case source 2010-11 2011-12
Web lodgement 1589 2017
Phone 131500 1612 1741
Ministerial 63 119
Letters 40 42
Minister's office 26 5
Total 3330 3924
NB - this is the first year that OTR complaints logged via web channels have exceeded those logged by phone.
Appendices 119 Appendix 11: Agreements within the Community Relations Commission
RailCorp’s Community Relations The unit also conducted a disability A total of $29,500 for 2011-12 was Unit aims to build and grow forum attended by more than 20 raised through the WGP for the sustainable partnerships and representatives of 14 peak groups. refurbishment of the CPU. relationships with community This forum continued the discussion groups. These ensure that RailCorp of ways in which information could The Department of Premier is able to conduct activities that are be better provided and included a and Cabinet announced it mutually beneficial for both itself familiarity session on board the then was developing a sector-wide and the community. new Waratah train. Workplace Giving Program in July 2011 that will aim to capture all NSW During 2011-12 the Community public sector employees. Relations Unit engaged in a number Developing partnerships with of activities to effectively develop This new WGP will be rolled out charities the organisation’s relationships with in 2012-13 to all NSW government clusters. key community stakeholders. Some The Community Relations Unit of the highlights are outlined below. played a key role in improving RailCorp’s social responsibility through its Workplace Giving Developing relationships with Developing relationships Program (WGP). community members with disabled and mobility A total of $156,911 for 2011-12 Community Relations actively impaired groups was raised through employee engaged with community members including residents, businesses Consultations were held with six contributions, which was donated to and schools, to inform them about peak disability groups within NSW 77 different charities and other not- trackwork, construction and other to determine their specific needs for-profit groups. RailCorp activities that affected them. and issues regarding the use of RailCorp continued to develop its public transport and the provision close relationship with the major A sponsorship procedure was of information about services. This charity partner, the Child Protection developed to help maximise the feedback was then used to update Unit (CPU) at the Westmead support that RailCorp provides to the CityRail boarding assistance Children’s Hospital. local community groups. brochure.
Appendix 12: Performance and numbers of executive officers
The total number of positions with package of $155,100 and above Chief Executive, CES Level 8, remuneration equal to or exceeding (including superannuation). Robert Mason, $533,820 Senior Executive Service (SES) Level 1 (total remuneration package Of the 370 positions, women hold Delivered 2011 Customer Charter $155,100) is 370. This compares with 44 (11.9 per cent ). This compares commitments, including 331 for the 2010–11 reporting period. with 39 (11.8 per cent ) for the improvements to passenger 2010–11 reporting period. information and ticketing, as well as Since the introduction of the train and station cleanliness. RailCorp Classification Structure in As shown below, there was a 2008 there has been an increase in total of 43 individuals in receipt of Successfully introduced a new the number of employees engaged remuneration equal to or exceeding CityRail timetable in October 2011, under contracts. This has therefore SES Level 5 (total remuneration which focused on easing crowding increased the number of employees package $241,251) throughout the and better matching train capacity that now have a total remuneration reporting period. As at 30 June with passenger demand. 2012, the number of people on this level of remuneration was 34.
120 RailCorp Annual Report 2011–12 Delivered on RailCorp’s obligations Group General Manager Director Reform and for the Rail Services Contract, Asset Operations, RL17, Business Performance, including high levels of performance Gavin Campbell, $405,600 David Callahan $378,683 in the areas of fleet availability, (Commenced 17 January 2012) operating costs and overtime. Accelerated the roll out of a comprehensive business Directed a review of RailCorp which Proactively engaged in support of improvement plan touching all partly informed the government’s the rail reform (Fixing the trains) aspects of the Asset Operations Fixing the trains announcement on program. Group. 15 May 2012. Subsequently led the implementation of the program. Worked with Transport for NSW to Led a safety program within the This includes the creation of two develop customer value proposition Asset Operations Group delivering new specialist organisations Sydney and associated improvement significant improvements across all Trains and NSW Trains within programs for future years. divisions. 12-18 months to improve customer Worked in partnership with Transport Developed and implemented a service delivery and organisational for NSW to support transport culture change program built on effectiveness. integration and improvement the foundation of an innovative The creation of a new subsidiary opportunities, including the transfer leadership development program. cleaning corporation with of portfolio significant projects to outsourced management and the Transport for NSW’s Project Continued progressively enhancing improved systems to improve the Division, and movement of staff to the overall asset condition across cleanliness of trains and stations. transport shared services. the rail network. A program of 750 voluntary Oversaw delivery of $1 billion in Continued to roll out a reform redundancies aimed at middle capital investment projects. program fundamentally changing the way key activities, such as management forms part of a push Saw Waratah trains in service on fleet maintenance, are carried to remove bureaucracy. the Airport & East Hills, South and out and ensuring benchmarked Transferring major procurement Northern lines, and also as weekend performance levels are achieved. projects and the Design Authority Olympic Park shuttle services, to Transport for New South with operational readiness and Supported the delivery of a large Wales to allow the new specialist infrastructure work commitments to range of important projects and organisations to focus on service support further roll out on schedule. initiatives improving customer service and efficiency of all delivery and maintenance.
Continued to proactively address RailCorp’s maintenance activities. Appendices probity issues, including leadership of culture and behavioural change Strengthened the business group’s Project Director PPP, RL13, programs. commercial and contracting Frederick Paton, $360,000 capability to begin the process of driving improvements in the way Led the ongoing procurement Chief Operating Officer, the Asset Operations Group works of 626 passenger cars for the Andrew Byford, RL18, with strategic industry partners. NSW Rolling Stock Public Private Partnership (PPP), the Simulators $422,850 (Resigned 8 October and the establishment of the 2011) Group General Manager Auburn maintenance facility and Achieved a growth in farebox Engineering and Projects, completion of related operational revenue of 17 per cent during the RL17, Ian McCullough, readiness and enabling works projects across RailCorp for the financial year. $388,150 (Resigned introduction of the Waratahs into 18 April 2012) Successfully established RailCorp’s passenger services. new centralised Security Monitoring Oversaw the introduction into Managed key project and external Facility. service of the seventh Waratah set. stakeholder relationships and the Completed the 2011 Customer Continued the delivery of traction government project governance Charter and the three-year substation upgrades. and reporting requirements to Customer Charter program. stakeholders.
Appendices 121 Led the financial, commercial, Group General Manager requirements. Established Executive technical and safety compliance Safety and Environment, Leadership Team to ensure the requirements for the project. RL15, Clare Kitcher, $338,850 project continues to meet its revised budget and schedule. Established and led the Achieved full rail safety accreditation implementation of the transition for operation of current and to-be- Member of Tender Evaluation of the project management from delivered Waratah trains. Committee for the award of a RailCorp to Transport for NSW $1.4 billion contract to manage heavy effective from 1 May 2012. Provided professional safety maintenance and logistics for 1050 support services to managers cars of RailCorp’s fleet of passenger Oversaw the completion of safety across RailCorp, through a team rolling stock. Led parallel commercial assurance activities to achieve the of competent safety practitioners, negotiations with two tenderers to accreditation variation from the driving a significant reduction in secure the best commercial terms. regulator for the operation of the lost time injury rates across the Waratah fleet in revenue service. organisation. Member of project leadership team for the Oscar Stage 3 and Oversaw the completion of 10 Delivered continuously improving 3A project for the delivery of trains through manufacturing, management systems to support outer suburban rolling stock. testing, commissioning and award the achievement of safe and Completed delivery of the Stage of practical completion and sustainable outcomes and safety 3 trains early and within budget. commencement of passenger and environmental accreditation Project received two project services into sectors 2 and 3. and licences. Implementing management achievement awards changes needed to meet the new by the Australian Institute of Project Work Health and Safety legislation Management in the category of Group General Manager requirements. Product Development. Finance and Corporate Services, Gary Pedersen, Delivered a sustainability blueprint and partnered with Transport RL16, $347,600 Director People & Change, Construction Authority to deliver RL16, John Cairns, $320,000 Achieved an unqualified Audit sustainability design guidelines. (Commenced 2 April 2012) Report for the year ended Provided technical expertise to 30 June 2011. replaced Director Human major capital projects, including Resources, RL16, Brian Managed financial performance North West Rail Link, in areas of Hartmann, $309,550 (Retired to bring RailCorp in better than safety risk, safety change/assurance 16 January 2012) operating budget in 2011-12. and human factors. Led the implementation of RailCorp’s Continued implementation of Produced and implemented 2010 enterprise agreement initiatives to enhance procurement (July 2012) new, nationally including the establishment of the procedures and processes. consistent work-on-track rules RailCorp enterprise agreement across the RailCorp network. steering group. Continued the implementation of a redesign of all financial policies, Led the drug and alcohol system, Championed RailCorp’s equity processes and systems to best education and testing regime. and diversity program, which has practice. been recognised with the following Achieved Chartered Fellow awards during the reporting period: Oversaw the ICT function accreditation with the Safety and continued repositioning Institute of Australia. • NSW Carer Friendly Employer of of ICT to a customer-focused the Year for 2011 function supporting key business imperatives. Director Special Projects, • Finalist in the Australian Human RL15, Louise Hart, $324,300 Resources Institute Inclusive Oversaw the RailCorp participation Workplace Award for 2012 in the Transport Corporate and Led turnaround of $200 million Shared Services reform program. capital project. Renegotiated • Finalist in the Deaf Australia Fair commercial terms and technical Go Awards for 2011. Contributed to the RailCorp reform specification to align with business program.
122 RailCorp Annual Report 2011–12 Delivered e-learning modules for delivering significant savings and an externally funded budget of 167 training programs to 5801 improved customer services within $75 million, and a major periodic RailCorp staff through RailCorp’s the Asset Operations Group. maintenance budget of $37 million. new learning management system, My Learning Zone. Oversaw the implementation of Introduced the earned value Lean Six Sigma projects, which measurement system for projects Oversaw 27,626 new Rail Safety targeted both reliability and process being delivered by the division and Worker (RISI) cards distributed to improvements. used alliance methodologies to existing, verified card holders and commence the implementation of new applicants who met the identity The lead representative for the ‘Target Outturn Costs’ for larger and verification requirements prior current reform program, Fixing the more complex projects. to the cut over on 1 December 2012. Trains, for both Engineering and Planning and Asset Operations Actively championed and Delivered eight new HR procedures Group. introduced a lessons-learned culture which were published and have now within the division. replaced all previous SRA and RIC Enhanced stakeholder policies. General Manager communications and focused Infrastructure Maintenance, Led the delivery of health and project accountabilities by driving fitness programs and initiatives RL15, John Minchin, $294,650 in the introduction of Visual during 2011-12. Championed 5S methodology Management Centres. improvements to Civil Infrastructure Delivered a customer improvement As a Novo Rail Board member, depots resulting in greater program for the human resources actively managed the increasing efficiencies and safety. group based on the results of the Novo Rail Alliance outputs, which in inaugural HR Service Delivery Led the change team for the 2011–12 successfully delivered $169 Effectiveness Survey. outsourcing of lifts and escalators. million of work and successfully achieved all targets for critical Led the people and change Successfully delivered $210 million resource development. initiatives within the RailCorp of routine maintenance for track, reform program. signalling, electrical and stations. Group General Manager Drove the voluntary redundancy Actively managed the Infrastructure Strategy and Service program as part of the Minister Reliability Improvement Program. for Transport’s Fixing the Trains Development, RL15,
announcement in May 2012. Lead the introduction of the Vivienne King, $294,300 Appendices behavioural safety change plan, (Resigned 31 January 2012) Oversaw the reform of human Target Zero, into the division. resources through the Corporate Managed capital investment process. Shared Services Reform. Actively supported the improvement of leaders’ capabilities Progressed the Emu Plains Stabling with coaching support for the project. Design team fully mobilised General Manager Leadership Challenge. and progressing through detailed design phase. Maintenance Contracts and Commercial, RL15, Progressed the South Sydney Joseph Camilleri, $311,150 General Manager Projects, Freight Line project by completing RL15, Nigel Howlett, major works at Cabramatta Headed up the new Maintenance $294,500 Station and completion of Sefton Contracts and Commercial Division earth works and Leightonfield within Asset Operations Group. Led a team of 343 staff and 60 commissioning. contractors with an LTIFR of 1.48 Finalised the tender of the Level and a supply chain with an LTIFR Dunmore Loop Extension was 3 Maintenance Contract .Contract of 0.88. commissioned in December. Cable value in excess of $1 billion over route for signal completed 2011. seven years. Successfully delivered more than Signal panel work completed (95 106 programs with an allocated per cent) at Wollongong. Continued with the development of capital budget of $705 million, the short- and long- term initiatives
Appendices 123 Successfully implemented a Executive General Manager Coordinated RailCorp’s relationship modified CityRail timetable on 23 Commercial Services, RL15, with the Airport Link Company October 2011 to provide additional Aidan Hughes, $288,300 Pty Ltd. services for customers and create a (Resigned 26 January 2012) more efficient network. Managed the delivery of shared Engineering Technical Completed easy access upgrades services functions for RailCorp Director, RL13, Guy Collishaw, and accessibility improvements at including property services, $284,550 several stations. strategic procurement and supply and plant hire services. Continued the leadership of all Commenced project to grow engineering and technical aspects RailCorp secondary revenue. Facilitated the whole-of-business of NSW’s Rolling Stock Public responses to all recommendations Delivered the 2011-16 RailCorp Private Partnership (PPP) project. flowing from ICAC inquiries into Corporate Plan. The Waratah fleet operating in RailCorp. revenue service has grown to 10 sets with reliability and availability Led corporate projects which that has provided RailCorp with Chief Health Officer, RL12, had organisation-wide impacts satisfactory performance. Armand Casolin, $293,700 including auto log books for motor vehicles and plant hire services Developed and launched a national Management of minor defects improvement. training program and online learning associated with the Waratah fleet and working with Downer EDI Rail exercise for authorised health Formed the new Compliance and to reduce the total number by more professionals, which is endorsed Ethics Division responsible for than 60 per cent in the first year of by the Rail Industry Safety and implementing strategies to enhance operation. Standards Board, standardises the probity. induction provided to doctors who The technical team has continued undertake medical assessments of Represented RailCorp’s interests to support the review of design rail safety workers and creates a in the establishment of Transport changes to ensure that the sets national panel of authorised health Shared Services. continue to meet the contract professionals for use by industry. requirements. Engaged a manufacturer to Executive General Manager The team has been shaped and produce to order RailCorp’s colour Business Performance, RL14, prepared for the increased rate vision simulated test, which is Peter Crimp, $285,000 of delivery and introduction into known as the RailCorp Lantern. service of up to two sets per month. Achieved an unqualified Audit Delivered a program of drug and Report for the year ended 30 June Developed and prepared robust alcohol assessments for contractors 2011. processes for on-going inspections, who have had previous positive reviews and audits throughout the drug or alcohol tests. Managed the provision of timely design, procurement, manufacturing and relevant financial information to Managed RailCorp’s automated and testing processes to enable both internal and external users. external defibrillator (AED) RailCorp to identify opportunities or risks at the earliest point in the program, with 105 AEDs deployed Managed the preparation of project lifecycle. and four lives saved since 2009. RailCorp’s financial statements and the associated external audit Managed RailCorp’s employee arrangements. assistance and critical incident support programs and delivered Managed the financial budgeting, RailCorp’s health promotion forecasting and reporting programs including influenza processes. vaccination, quit smoking, City2Surf, JP Morgan Corporate Challenge, Co-lead of the baselining stream pedometer challenge, health fairs, of the initial phase of the RailCorp health e-learning and SafeSpine. Reform Program.
124 RailCorp Annual Report 2011–12 Operations Manager, RL13, operations at stations, tunnels and General Counsel, RL16, Tom Stuber, $284,550 in train stabling yards. Irene Rusak, $282,300 (Commenced 27 November 2011) Cleaning reform savings achieved to Revised RailCorp’s corporate Acted as General Manager the extent of $9.4 million in 2011-12. governance framework consequent Infrastructure Renewals for three on changes to governance by Security Monitoring Facility months. reason of legislative amendments successfully established. commencing 1 July 2011. Facilitated significant improvements Installation of 150 rubbish bins on in safety performance within the Provided strategic and legal advice key stations and platforms further division through engagement with and ongoing support to the Chief roll out for 2012. all levels of staff focusing on safety Executive and members of the behaviours, staff engagement and Completed the 2011 Customer Executive. targeted safety initiatives. Charter and the three-year Provided governance and Customer Charter program. Led the track works group of the secretariat support to the Executive division delivering a works program Oversaw CBD stations clean up Management Committee, the of $186 million. Restructured the operation. RailCorp Audit and Risk Committee track and civil groups to develop and the RailCorp Safety Committee. a more integrated approach to Introduced the six principles of Managed the provision of legal project delivery. customer service and oversaw their subsequent roll out to frontline staff. services to RailCorp.
Oversaw the Taking Back the Trains Managed the RailCorp internal General Manager intervention. investigations function. Infrastructure Renewals, RL15, David Foldi, $284,000 Provided administrative support to the internal audit function. Seconded to Transport for NSW General Manager Operations, during the reporting period. RL14, Support, Ian Hill, $282,550 General Manager Delivered North West Rail Link Chief Engineer, RL15, maintenance concept description, Developed the crew reform fleet strategy and interface program to deliver savings to Dimitrios Modrouvanos, management plan. help fund the 2010 Enterprise $278,900 Agreement. Worked on asset management, Provided engineering standards, Appendices maintenance strategies and Delivered annual recurring savings technical advice and annual asset engineering authority. of more than $5 million in sign- integrity reports for key asset classes. on, and in improvements to Led the development of the design Managed the RailCorp interfaces maintenance centre crewing, train authority concept within RailCorp. and relationships. preparation and scheduling. Led the development of the Led the review and development functions of the asset standards of train crew related initiatives to A/Chief Operating Officer, authority as a vehicle to reduce the noise impact of train RL15, Tony Eid $283,950 manage design authority for the operations at stations, tunnels and metropolitan railway network. Restructured network operations in train stabling yards. and created signal box operations. Established and managed the Maintained the crew workforce commencement of the engineering Contributed to the growth in and depot deployment plans to standards review initiative. farebox revenue over the financial efficiently minimise crew numbers. year. Established the implementation Developed and delivered the team within Transport for NSW Led the review and development removal of the two minute guard to introduce the asset standards of train crew related initiatives to workstation relocation time from authority. reduce the noise impact of train train timetables for 55 Central Coast services per week.
Appendices 125 Partnered with the Transport of a Surplus Heritage Assets Delivered full annual works program Projects Division of Transport for management study to guide within benchmark and operating NSW to improve engineering review management of disused expenditure of 2.2 per cent of and approval processes. non-operational assets. forecast.
Successfully managed RailCorp’s Achieved sustainable efficiency interests in relation to its not- savings totalling 2.3 per cent of General Manager Asset for-profit subsidiary Trainworks operating expenditure. Planning and Performance, Ltd and Trainworks in its first RL14, David Spiteri, $280,300 year of operation. Indicators Championed a people development include visitation target met, no culture focused on key critical Coordinated the delivery of the qualification by Audit Office and skills shortages with a developed $1 billion maintenance program for all board meetings attended in Succession Planning Program the operational assets plan. capacity as director. supported by established All maintenance works delivered. mentoring. Delivered successful public Oversaw the master schedule programs including the ‘Food to expansion to encompass Go’ exhibition and collaborative maintenance, capital works General Manager Rolling activities to celebrate the 50-year (major contributor to delivery of Stock, RL14, David Filipetto, anniversary of the Southern Aurora. capital program in 2011–12) and $273,000 external works, such as RTA Great Gained National Trust NSW Improved the safety culture, Western Highway road widening Heritage Awards in two categories improving lost time injuries (LTIFR) and Quakers Hill to Schofield – Conservation Moveable Heritage by 67 per cent in 12 months. Duplication. (Powder Van) and Regeneration and New Development (Trainworks). Successfully implemented the Further developed RailCorp’s Total rolling stock maintenance reform Asset Management System. Significant and diverse contribution program to the standards and to People strategy and reform Developed the Asset Management benchmarks established by the agenda including sponsorship, Plans and the Strategic Asset independent auditor. Steering committee and mentor/ Maintenance Plan for Operational support roles and leading corporate Successfully implemented the Assets for inclusion in the reform projects. engineering technical services Transport for NSW Total Asset reform and restructure in alignment Management Plan. with business requirements whilst Oversaw the expanded operations General Manager maintaining technical asset integrity. of the Trackwork Service Alliance Communications and Control Successfully delivered the Taking during its fourth year. Systems, RL14, Julian Back Our Trains program to Richards, $277,200 Developed a number of Initiatives remove graffiti and other effects of to reduce asset costs (such as Asset Led the division in improving safety vandalism from inside our trains and Simplification). culture, recording only one physical improving customer amenity. Lost Time Injury during the past Member of the RailCorp Actively sponsored 35 Lean Six 12 months. Reform Team. Sigma projects to tackle asset Improved system and network reliability issues and drive business availability to more than efficiency. Director Office of 99.9 per cent. Successful in securing Oscar Level Rail Heritage, RL14, Supported RailCorp’s internal 1 and 2 Maintenance activity back Marianne Hammerton, customers with their programs into rolling stock division. $278,000 including implementing the 2010 Continued to implement an interior timetable, wi-fi access at Circular Delivered priorities under RailCorp’s refresh program on the Tangara Quay, improved signal control Heritage Asset Management Fleet. Strategy (HAMS) including systems and passenger information establishment of Heritage Service system roll out in line with customer Provider Panel and completion charter commitments.
126 RailCorp Annual Report 2011–12 General Manager Professional investment selection and analysis, Initiated and equipped ‘Cleaning Services (until March 2012), investment trade-offs and structure Flying Gangs’ to provide scheduled A/Group General Manager of the portfolio. major cleans across stations in the network. Engineering and Projects, Management of the capital RL15, Philip Pearce $263,950 funding approval governance and Reduced graffiti tags reduced by processes, including leading the 55 per cent on walls of trains using Set up outsource of design reviews ongoing maturity and development patch painting. and $11 million design outsource of the capital funding approval contract. governance processes. Rationalised and reduced contracts in Presentation Services Division Benchmarking and reform of Led the annual total asset from approximately 70 to 14 to professional services under ‘Back to management planning activity, provide significant cost savings. the Future’ initiative including the development of the Introduction of initiatives to Delivered $980 million capital RailCorp Asset Strategy and the optimise equipment usage and projects to within 2 per cent of Strategic Capital Investment Plan improve staff utilisation and target by financial year end. submission to Transport for NSW. productivity machines to clean Awarded the Blacktown Main Managed the ongoing development escalators; scrubbing machines West signalling control system and management of the RailCorp for station platform cleaning; replacement contract. project management methodology, equipment to aid cleaning high delivering two releases throughout areas; individuals rather than pairs Automatic Train Protection System the year, as well as the development assigned to carry out train in transit renegotiated. and delivery of training to the cleaning; centralised rostering. project management community. Digital Train Radio delivery contract renegotiated. Managed the program of capital Commercial Director, RL13, project health checks and reviews Oscar Phase 3 delivered ahead of Stephen Kroon, $263,600 to deliver improved project delivery time and under budget. and outcomes. Provided relevant financial Transfer of major projects into budgeting, forecasting and Primary interface with Transport for Transport for NSW. reporting of the public private NSW on the Rail Capital Program. partnership (PPP) project to key Initiation of Asset Standards project and external stakeholders Authority.
within the government’s project Appendices General Manager Customer Initiating transfer of chief engineers governance and reporting Service – Northwest, RL15, staff to ASA. framework. William Cowan, $264,350 Developed strategy for Sydney Managed financial performance to Cleaning Reform Project key Trains Engineering and Systems bring the PPP fleet in line with its achievements included the achieved Integrity in RailCorp reform. capital budget in 2011–12. saving of $9.4 million in 2011-12, with Introduction of ‘Lead the Future’ forecast recurring annual savings of Managed the provision of updated leadership development. $13.0 million from 2012-13. bank guarantees and alignment of RailCorp insurances with the PPP Removed the equivalent of 134 insurance arrangements. full-time positions through the more General Manager Enterprise efficient allocation and scheduling Provided due diligence advice Portfolio Management of station and train cleaning staff. in regard to refinancing and Office, RL14, Sandra Halpin, restructuring of the PPP company. $265,000 Increased the weekday in-transit and turnaround cleaning of Maintained and updated the Managed the 10 Year Capital suburban cars in service from an PPP accounting model, enabling Investment Portfolio of more than average of 1677 to 3250 cars per day RailCorp to meet its statutory $1 billion annually, in a period to reduce litter on trains in service. disclosure requirements. of record annual capital spend, including total capital planning,
Appendices 127 Developed and implemented the General Manager Customer most notably the renewal of PPP contract management system Programs and Performance, Roseville rail bridge through and procedures to administer the RL13, Paul Passmore, innovative project delivery. payment mechanism of the $260,450 (Resigned 1 February PPP contract. Alliance Board Member for the 2012) Track Service Alliance with John Analysed and provided financial Holland Group to deliver a Developed the Customer Charter advice in negotiation of PPP significant turnout renewal program. for 2011-12. Responsible for the contract variations. commission of the Security Driver of reform initiatives within Delivered certification and Monitoring Facility and its set up. Infrastructure Renewals focusing validation of requirements for Initially seconded to Transport on leadership and capability payment under the PPP contract. for NSW’s Customer Experience development, a culture of Division then appointed accountability and commercial Managed external and internal permanently. business reform, as well as lead for audits conducted in regard to the the people and change stream for PPP project. the RailCorp reform program. General Manager, Infrastructure Renewals, Track Works Manager, RL13, RL15, Tanya Johnstone, Deputy General Counsel, Bryant Croucher, $260,850 $260,000 RL13, Heather Oswald, Seconded to lead a multi-discipline Led a significant improvement $258,750 team, and responded to an in safety performance within the Managed the day-to-day operations expression of interest and then a Infrastructure Renewals division, of RailCorp’s legal practice. response to tender to the Australian focusing on safety behaviours, staff Rail Track Corporation for the engagement and targeted safety Provided timely advice to senior Southern Sydney Freight Line initiatives. managers and line managers track construction contract. All relating to commercial contracts Led RailCorp’s infrastructure milestones met. and disputes, insurance law, construction team, comprising employment and industrial law, Led the master schedule, demand more than 1050 staff members, anti-discrimination legislation and planning and strategic track in partnership with the rail supply administrative law. possession team. Optimised industry, to safely deliver more than resource allocation, improve 1000 projects valued at $315 million Managed the services provided to efficiencies and access to support our rail infrastructure RailCorp by external legal service opportunities for routine, major modernisation program. providers and monitored their periodic and capital project delivery. Management of commercial expenditure. businesses producing turnouts, Implemented changes to possession welded rail, signalling equipment, Ensured the professional management and project interface ballast quarrying and heavy plant development requirements for all safety processes. operations with a total turnover of legal staff were met. Led the team responsible for the $200 million per annum. review of major capital projects Successfully delivered major deliverability during the early General Manager Emergency projects including commissioning stages of a project life cycle to Preparedness, RL13, Ronald of the Solar 3 bi-directional ensure critical internal resources Creighton, $257,850 (Retired signalling between Como and and access are available, leading to 3 January 2012) Sutherland, commissioning of efficiency improvements. duplicated line between Quakers Provided expert information and Hill and Schofields, Dunmore loop advice on train customer safety extension, Traction Supply Upgrade during emergency situations with substations commissioning, regard to passenger detrainment overhead wiring modernisation, procedures, train and tunnel track upgrading, turnout renewals emergency equipment and fire and the bridge renewal program, dynamics simulation and testing.
128 RailCorp Annual Report 2011–12 Managed RailCorp incident Commercial Manager, RL14, Delivered the annual known safety management framework and Frank McCormack, $251,100 risk performance reporting incident control system for incident management. Achieved Lost Time Injury Led a significant review of the Frequency Rate of zero. safety risk register delivering Managed and maintained Safety continuous improvement to the Management System Element Provided second-in-charge support understanding of the known 15 – Incident Management and to the General Manager Projects, risk profile. Emergency Response. including acting in that capacity for three months of the year. Managed the development and Executive Manager, Gateway training of senior management Provided project support functions & Strategic Program, RL12, teams to meet the incident control for the management of $770 system requirement. million of capital, major periodical Peter Stokes, $247,100* maintenance and external works. Established the Program Managed RailCorp emergency Management Office for Planning response capability through the Led the recruitment of 72 positions & Programs Division Transport for joint RailCorp/emergency services to support delivery of the allocated NSW. exercise program. works programs. Developed and implemented a Managed RailCorp business Introduced new target out-turn cost framework for the governance and continuity governance. process and governance regime to increase certainty of planned oversight of the planning pipeline outcomes. activities within Transport for NSW. General Manager Business Increased project management Supported the organisational re- Services, RL14, Steven certification competencies to design of the investment programs Beasley, $251,750* 35 per cent. branch within the Planning and Programs Division. Delivered operational business Provided alliance leadership team support shared services function to membership for the Kingsgrove to Project managed the development RailCorp 1.6 per cent below budget. Revesby Quadruplication project. and implementation of the investment portfolio management Contributed to all aspects of the Provided client oversight of the framework to support the Transport Shared Services vision Novo Rail Alliance, which achieved operational establishment of the and strategy including leadership $150 million of product out-turn, investment programs branch. of motor vehicle consolidation and Appendices and the development of critical purchasing card extension early technical resources. * On assignment to TfNSW. benefits projects.
Contributed to the procurement, A/General Manager time capture to pay and auto log General Manager, Risk, RL13, book projects. Jamie McDonald $247,450 Professional Services, Peter McGregor, $246,000 Increased internal customer Delivered an improving enterprise (commenced 5 March 2012) satisfaction rating from 85 per cent risk management system to support in 2010-11 to 92 per cent in 2011-12. the organisation’s needs. Delivered engineering designs and engineering services for $1.162 Provided timely and accurate KPI Achieved accreditation to introduce billion capital investment program reports to the business. Waratah trains into passenger and $700 million renewals/major service for testing, commissioning periodical maintenance activities. Implemented a case management and operation into revenue service. model to workers compensation Utilised external design review services. Provided professional technical panel, increasing capacity for expertise to major capital projects design reviews. * On assignment to TfNSW. in areas of safety risk, safety change/assurance, human factors Managed prioritisation process with and enterprise risk. Novo Rail and TPD on key projects to reduce design review cycles.
Appendices 129 Successfully grew in-house responsible for more than Oversaw the management of the engineering design capability. 40 projects. Tangara Refresh, where a total of 54 by four-car sets have been Commenced the organisational and Managed the successful delivery refreshed, which represents 50 per transport reforms required within and entry to service of 44 Oscars cent of the Tangara fleet. Total value the Professional Services Division. during 2011-12 and the completion to date is more than $55 million. of the Stage 3 delivery of the cars. Managed the prototype trial of the In 2011, accepted two awards for Internal Emergency Door Release Program Manager, Rolling the Oscar Stage 3 project jointly detailed design for fitment to the Stock Projects, RL13, with UGL Rail, namely the NSW Millennium and Oscar fleet. Barry Lovat, $245,600 Australian Institute of Project Management (AIPM) Achievement Completed the XPT fleet Delivered a successful rolling stock refurbishment program valued at projects program of $159 million more than $42 million. capital and $38 million of major Award for Product Development periodic maintenance. and a National AIPM High Manages a staff of 65 employees Commendation Award for Product and contractors, who are Development.
Appendix 13: Government Information (Public Access) Act 2009
Background Discussion • 506 informal requests for information. Under section 125(1) of the RailCorp continues to actively Government Information (Public open government information to There were 661 decisions regarding Access) Act 2009, RailCorp is the public through the release of release of information, comprising: required, as a NSW Government information proactively, informally • 146 decisions in regard to formal agency, to report annually on and in response to formal access access applications (the subject details and outcomes of access applications. of Tables A, B, D, E, F, of Annexure applications received during ‘A’ below) the relevant period. Statistical The following summary details informal requests for information information is provided in the • 10 decisions regarding and access applications received form required by schedule 2 of the consultation Government Information (Public or processed during the reporting Access) Regulation 2009. period. • 505 decisions on informal release of information. Under clause 7 of the Regulation, A total of 654 applications were the report may be tabled in received, comprising: As required under clause 7 and RailCorp’s Annual Report. schedule 2 of the Regulation, • 138 formal applications (the Annexure ‘A’ to this report provides subject of Table C of Annexure ‘A’ The following report is provided in statistical information regarding below) respect of the 12 month period formal access applications and 1 July 2011 to 30 June 2012. • 10 matters referred to RailCorp for details RailCorp’s proactive release consultation program.
130 RailCorp Annual Report 2011–12 Analysis • Publication of a wide range of • MainTrain Contract and Oscar data and information regarding project The reporting period saw a the delivery of passenger rail slight reduction in requests for services by RailCorp on its • Rail development and systems government information received website and in other forms projects including new rail links (654) when compared to the and infrastructure planning previous year (702). • Regular review by RailCorp’s business units of information held • Emergency preparedness and The number of formal access that may be of interest to the planning updates applications received (138) public • Progress reports on RailCorp’s represents a 13 per cent reduction drug and alcohol testing when compared to 2010-11 (159). • Consideration by the GIPA office of frequently requested program Of the 146 formal access information for proactive release • Digital Train Radio System determinations made in the period, updates 145 were decided within the During the reporting period, RailCorp reviewed its program by; statutory or agreed timeframes. • Details of new programs, For those applications where it • Assessing information published intiatives, trackwork, service was found that the information on its website changes and events. requested was held by RailCorp, 89 per cent of determinations granted • Identifying new project and plan 2. Number of access applications full or part access. information to ascertain material received – Clause 7(b) which may be of interest to the Additionally, in accordance with During the reporting period public section 8 of the GIPA Act, RailCorp RailCorp received a total of 138 released government information in • Assessing newly created formal access applications, which responding to 505 informal requests information for proactive release includes withdrawn applications, during the period – a number but not invalid applications. comparable to the prior year. • Examining requests for information received and 3. Number of refused applications reviewing information detailed for Schedule 1 information – in RailCorp’s disclosure log, Clause 7(c) providing feedback to business Annexure A – Obligations During the reporting period, units regarding potential future under the GIPA Act RailCorp refused a total of eight proactive release.
formal access applications because Appendices 1. Review of proactive release As a result of this review, RailCorp the information requested was program Clause 7(a) released the following information information referred to in Schedule 1 to the GIPA Act. Of those In accordance with section 7(3) of proactively: applications, two were refused in the GIPA Act, RailCorp conducted a • Updated passenger statistics, full, and six refused in part. review of its program to proactively service performance indicators release information that can be and data, including on-time- 4. Statistical information about made publicly available. Under the running information and access applications - Clause 7(d) Act this review must be undertaken benchmarking reports and Schedule 2 at least once every 12 months. • Information on new projects and RailCorp’s program for the plans including: proactive release of information involves: • RailCorp’s Rolling Stock Public Private Partnership project
Appendices 131 Table A: Number of applications by type of applicant and outcome* Access granted in full Access ingranted part Access full in refused Information held not Information already available to Refuse deal with application to Refuse confirm/ whether deny information is held Application withdrawn
Media 10 2 6 7 0 0 0 2 Members of Parliament 0 0 0 1 0 0 0 0 Private Sector Business 6 3 3 3 0 0 0 2 Not-for-profit organisation or community group 2 1 0 1 0 0 0 0 Members of the public (application by legal representative) 26 8 0 3 0 0 0 0 Members of the public (other) 36 9 4 8 1 0 0 2
* More than one decision can be made in respect of a particular access application. If so, a recording must be made in relation to each such decision. This also applies to Table B.
Table B: Number of applications by type of application and outcome* ccess Access granted in full Access ingranted part A full in refused Information held not Information already available to Refuse deal with application to Refuse confirm/ whether deny information is held Application withdrawn
Personal information applications* 48 8 2 5 0 0 0 0 Access applications (other than personal information applications) 31 10 11 17 1 0 0 5 Access applications that are partly personal information applications and partly other 1 5 0 1 0 0 0 1
* A personal information application is an access application for personal information (as defined in clause 4 of Schedule 4 to the Act) about the applicant (the applicant being an individual).
Table C: Invalid applications
Reason for invalidity No of applications Application does not comply with formal requirements (section 41 of the Act) 2 Application is for excluded information of the agency (section 43 of the Act) 0 Application contravenes restraint order (section 110 of the Act) 0 Total number of invalid applications received 2 Invalid applications that subsequently became valid applications 2
132 RailCorp Annual Report 2011–12 Table D: Conclusive presumption of overriding public interest against disclosure: matters listed in Schedule 1 to Act
Reason for invalidity Number of times consideration used* Overriding secrecy laws 0 Cabinet information 1 Executive Council information 0 Contempt 0 Legal professional privilege 7 Excluded information 0 Documents affecting law enforcement and public safety 0 Transport safety 0 Adoption 0 Care and protection of children 0 Ministerial code of conduct 0 Aboriginal and environmental heritage 0
* More than one public interest consideration may apply in relation to a particular access application and, if so, each such consideration is to be recorded (but only once per application). This also applies to Table E.
Table E: Other public interest considerations against disclosure: matters listed in table to section 14 of Act
Number of occasions when application Reason for invalidity not successful Responsible and effective government 22 Law enforcement and security 9
Individual rights, judicial process and natural justice 16 Appendices Business interests of agencies and other persons 7 Environment, culture, economy and general matters 0 Secrecy provisions 0 Exempt documents under interstate Freedom of Information legislation 0
Table F: Timeliness
Number of occasions when application Reason for invalidity not successful Decided within the statutory timeframe (20 days plus any extensions) 141 Decided after 35 days (by agreement with applicant) 4 Not decided within time (deemed refusal) 1
Total 146
Appendices 133 Table G: Number of applications reviewed under Part 5 of the Act (by type of review and outcome)
Decision Decision Reason for invalidity varied upheld Total Internal review 1 1 2 Review by Information Commissioner* 0 0 0 Internal review following recommendation under section 93 of Act 0 0 0 Review by ADT 0 0 0
Total 1 1 2
* The Information Commissioner does not have the authority to vary decisions, but can make recommendations to the original decision-maker. The data in this case indicates that a recommendation to vary or uphold the original decision has been made by the Information Commissioner.
Table H: Applications for review under Part 5 of the Act (by type of applicant)
Reason for invalidity Number of applications for review Applications by access applicants 2 Applications by persons to whom information the subject of access application relates (see section 54 of the Act) 0
Appendix 14: Implementation of IPART fare determinations
In January 2012, the government increased CityRail fares by an average of 5.4 per cent in line with cost of living increases for 2010 and 2011. This was less than the 10.6 per cent increase allowable under IPART’s maximum fare determination. The NSW Government said it would not implement the full IPART recommendation because of its commitment to not increase fares unless services improved.
Appendix 15: Investment management performance
In the year ended 30 June 2012, RailCorp invested surplus funds with NSW Treasury Corporation in 11am call deposits. The interest earned was 4.29 per cent on funds invested. During the same period, the comparable NSW Treasury Corporation 11am call deposit earned 4.29 per cent.
Appendix 16: Liability management performance
In the year ended 30 June 2012, RailCorp’s cost of funds was 4.91 per cent. During the same period, the benchmark cost of funds was 5.37 per cent.
134 RailCorp Annual Report 2011–12 Appendix 17: Annual Report 2011-2012 production costs
Project management and design services: $81,065.
The Annual Report is also available on the internet at www.railcorp.info
Appendix 18: Consultants
Consultant Projects Costs ($)
Contracts of $50,000 or more
Management services McLachlan Lister Pty Ltd Evaluation of Metropolitan Transport Plan 56,008
Organisational review Booz & Company (Aust) Pty Ltd Analysis of options for the Fixing the Trains program* 5,850,699 Headway Consulting Group WHS Safety Improvement Program Management for Asset Operations Group 498,053 Booz & Company (Aust) Pty Ltd Development of Commercial Options for Bathurst Rail Fabrication and Strathfield Equipment Centre 339,500 Miyow Pty Ltd Analysis of options for the Fixing the Trains program* 312,089 The Connolly Partnership Strategic Communication Advice 97,057 Ernst & Young Evaluation of Software Licence Management Initiative 97,051 Altura Partners Pty Ltd Business Strategy & Improvement Program 81,750
Total contracts of $50,000 or more (8 contracts) 7,332,207
Contracts of $50,000 or less** (6 contracts) 143,518
Total expenditure in 2011-12 7,475,725 Appendices
* Note that consultants were engaged by TfNSW but paid by RailCorp at the request of TfNSW ** Note that capital expenditure of $8,000 is included in contracts of $50,000 or less
Appendices 135 Appendix 19: Overseas travel
Officer name Date Destination Purpose of travel For the rolling stock PPP contract: to witness Waratah Richard Nabkey re-qualification testing on train A13 at Changchun Railway Peter Goodley 5-18 Aug 2011 China Vehicles Co. Ltd (CRC) For the rolling stock PPP contract: to review build quality standards and associated quality assurance documentation Andy Radford 20-29 Aug 2011 China of Waratah cars in progress at CRC
To witness factory acceptance testing of RailCorp’s Digital Daryll Lundie 2-17 Sept 2011 China Train Radio System To attend the International Suburban Rail Benchmarking Jamie Macdonald 7-11 Oct 2011 Hong Kong Group Membership (ISRBG) Conference Republic of To present at the 2011 Urban Environmental Accord Summit Chris Collier 11-13 Oct 2011 Korea in Gwangjy John Cumarasamy Switzerland To inspect and review early design stages for the $21 million Marco Diaz 14-27 Oct 2011 and Italy mechanised track patrol vehicle contract For the rolling stock PPP contract: to undertake quality assurance and compliance review of the Waratah train build at the CRC prior to the shipment of train cars from China to Peter Handel 15-24 Oct 2011 China Australia Production acceptance testing of 38 new ungraded ticket gates and individual components to update existing gates Terry Rowe installed at CityRail stations under CTS contract for the Ivan Kraitchev 21-30 Oct 2011 USA electronic ticketing system Attendance at ANZSOG residential program to complete Linda Harvey 29 Nov-3 Dec 2011 New Zealand sponsored Executive Masters in Public Administration To attend International Suburban Rail Benchmarking Group Anthony Eid 29 Nov-3 Dec 2011 Japan (ISRBG) management meeting Production acceptance testing of 64 new upgraded ticket gates and individual components to update existing gates installed at CityRail stations under contract for the Terry Rowe 24 Feb-4 Mar 2012 USA electronic ticketing system Quality assurance of integration testing of the development Ivan Kraitchev applications required for CityRail ticketing system and Roderick Smith 29 Mar 2012 UK Sydney ferry gates For the rolling stock PPP contract: to undertake quality assurance and compliance reviews of the Waratah train car build at the CRC manufacturing facility in conjunction with Downer EDI Rail and prior to the shipment of train cars Peter Handel 17-24 Mar 2012 China from China to Australia For the rolling stock PPP contract: compliance review of the Integrated Commercial and Fleet Management System software development at Mahindra Satyam’s offshore Joseph Reddy 17-27 Mar 2012 India offices
136 RailCorp Annual Report 2011–12 Officer name Date Destination Purpose of travel For the rolling stock PPP contract: technical reviews and inspections to determine the suitability of the details of design, build and manufacturing activities for the Guy Collishaw 18-25 Mar 2012 China Waratah trains For the rolling stock PPP contract: to witness the specialised Speedometer undergoing Factory Acceptance Testing and to ensure that the design meets the overall Ronald Pearson 30 Mar-7 Apr 2012 Finland contract requirement For the rolling stock PPP contract: to undertake quality assurance and compliance reviews of the Waratah train car David Kippist build at the CRC in conjunction with Downer EDI Rail and Peter Handel 21-27 Apr 2012 China prior to the shipment of train cars For the rolling stock PPP contract: to undertake quality assurance and compliance reviews (train appearance) of the Waratah train car build in conjunction with Downer Peter Handel 16-23 May 2012 China EDI Rail David Kippist For the rolling stock PPP contract: to undertake design John Cumarasamy 25 May-3 Jun 2012 Italy quality assurance and systems integration reviews International Suburban Rail Benchmarking Group Phase 2 Stephen Scott 27 May-3 Jun 2012 Norway annual meeting For the rolling stock PPP contract: to undertake manufacturing review of the Waratah train production, Guy Collishaw perform an audit of Halcrow China Team and Richard Nabkey 6-12 Jun 2012 China roll-out tablet based inspection For the rolling stock PPP contract: to undertake quality assurance and compliance reviews (train appearance) of Appendices the Waratah train car build at the CRC in conjunction with Peter Handel 13-27 Jun 2012 China Downer EDI Rail Melinda Bryde 29 Jun-8 Jul 2012 UK Liability and property insurance renewal
Appendices 137 Appendix 20: Land values and land disposals
Land use Value at 30 June 2012 Value at 30 June 2011 $ million $ million Land under stations and infrastructure, including residential and occupied land 3,838.8 3,833.0 Strata (airspace) leased to tenants 1.2 1.1 Surplus land (including land available for sale) 37.7 30.6 Total land owned or occupied – based on valuation 3,877.8 3,864.7
Appendix 21: Funds granted to non-government agencies
RailCorp paid the NSW Railway and Tramway Ex-services Association a grant of $750 during 2011-12, being an annual contribution to the association. The target group benefitting from the grant are ex-railway employees. The same amount was paid in 2010-11.
Appendix 22: Credit Card certification
Credit Card use in RailCorp has been in accordance with the requirements of the Premier’s memoranda and the Treasurer’s directions.
Appendix 23: Research and development
The Co-Operative Research Centre RailCorp has been involved in Under the Commonwealth for Rail Innovation (CRC) is a more than half of the 105 projects Agreement for the CRC, collaborative venture between the CRC board has commissioned RailCorp provides an annual leading organisations within the to date. Projects undertaken cash contribution of $285,000, Australian rail industry and a during 2011-12 cover a diverse a commitment of three full-time number of Australian universities, range of issues, such as track equivalent persons (FTEs) in and is supported by the worker protection technology, ‘staff-in-kind’ (time contributed Commonwealth Government. mentoring and coaching, driver in relation to the CRC by RailCorp route knowledge acquisition, personnel during the course of Research areas and topics are station access and design, rail noise, normal employment), and driven by the industry, carried out locomotive adhesion, rail defects, the equivalent of $570,000 by research experts, supported by and the development of a national ‘non-staff-in-kind benefit’. key industry personnel with the aim rail safety management program. of resulting outputs being adopted by the rail industry.
138 RailCorp Annual Report 2011–12 Appendix 24: Major works in progress
RailCorp has a wide range of works in progress at 30 June 2012 Cost to date Forecast completion including the following: $ million (year) Clearways 1816 2014 Waratah rolling stock - enabling and ancillary works 528 2014
Outer suburban cars - tranche 3 431 2013 Traction supply upgrade (Waratah A-sets) 255 2017 Digital train radio system 99 2015 Automatic train protection 69 2017 Lidcombe to Granville Corridor upgrade 76 2020 Appendices
Appendices 139 Appendix 25: Payment of accounts
Outstanding invoices by age at the end of each quarter
Quarter Current Less than Between Between More than (i.e. within 30 days 30 and 60 60 and 90 90 days due date) overdue days overdue days overdue overdue
$ million $ million $ million $ million $ million September 2011 27.3 2.1 0.3 0.0 0.3
December 2011 32.6 5.3 0.3 0.4 0.4
March 2012 26.2 1.5 -0.9 1.7 1.0
June 2012 60.0 4.3 0.7 0.7 0.1
Small business suppliers March 2012 0.4 0 0 0 0
June 2012 0.6 0 0 0 0
Accounts paid on time within each quarter
Measure Sept Dec Mar Jun
Number of accounts due for payment 67,319 54,419 53,958 53,961
Number of accounts paid on time 52,785 43,884 40,666 44,446
Actual % accounts paid on time 78.4% 80.6% 75.4% 82.37%
$ amount of accounts due for payment $700.6M $638.3M $640.4M $639.2M
$ amount of accounts paid on time $361.0M $394.0M $400.5M $416.2M
Actual % accounts paid on time (based on $) 51.5% 61.7% 62.5% 65.1%
Number of payments for interest 0 0 0 0
Interest paid on overdue accounts 0 0 0 0
Small business suppliers Number of accounts due for payment 202 711
Number of accounts paid on time 171 690
Actual % accounts paid on time 84.7% 97.1%
$ amount of accounts due for payment $0.5M $1.6M
$ amount of accounts paid on time $0.5M $1.5M
Actual % accounts paid on time (based on $) 92.0% 98.0%
Number of payments for interest 0 0
Interest paid on overdue accounts 0 0
* GST included
140 RailCorp Annual Report 2011–12 Appendix 26: Controlled entity and subsidary disclosure
Name Objectives Activities
Trainworks Limited Trainworks Ltd is registered as a • Encouragement of public ABN 59 147877 772 charitable institution to operate a knowledge of and access to the Trading as Trainworks cultural facility (museum) known collection of rail heritage assets and trademarked as Trainworks. located at Thirlmere Trainworks Ltd was registered It has its own independent on 15 December 2010 and governing board and management • Promotion and development of commenced operations on 4 April team and is required to apply all the exhibition and interpretation 2011. Trainworks Ltd is a subsidiary income and property to benefit of NSW’s rail heritage, through controlled entity of RailCorp with its rail heritage conservation and providing educational resources, a special purpose to operate the promotion objectives. programs, opportunities and rail heritage site at Thirlmere. It is a experiences to students and the company limited by guarantee and general community relating to the RailCorp is the sole member. items held at Thirlmere Operations • Generation of income to sustain Trainworks Ltd operates from the the collection, by responsible Purpose RailCorp-owned facility at Thirlmere utilisation of the assets, including NSW, which it occupies under charging of entrance fees and Trainworks Ltd was established a formal custody management retail sales; seeking sponsorships by RailCorp to meet RailCorp’s agreement. Trainworks Ltd or partnerships, and any other obligation to conserve and manage manages the site and controls appropriate form of commercial identified rail heritage assets of public access to the heritage hire or activity that can be offered the state of New South Wales not collection items on display there. on the site. required for the delivery of essential It receives limited interim financial daily commuter services. Creation support allocated from RailCorp’s of the company enables these Heritage Budget under a Funding obligations to be met separately and Member’s Deed. from RailCorp’s core business as an operating transport agency. Appendices
Appendices 141 Performance targets and measures for 2011-2012
KPI Target Actual
1 Achieve balanced Break-even $1874 break-even budget
2.1 Achieve visitation of 30,000 Museum visitors Museum visitors in the first 12 months of 26,383 20,494 operations and growth of 15 per cent per annum Special event visitors Special event visitors thereafter 14,203 10,682
2.2 Visitation revenue $895,673 $619,283
2.3 Visitor satisfaction 95% 97% (via voluntary exit survey)
3 Establish a market presence Establish social media as 51,582 unique website visitors and visibility via website and part of the Trainworks 338,326 page views media attention brand 130 – mainstream media articles
Facebook site created, with 443 likes and friends of fans reach in excess of 128,000
4 Establish essential business and All critical business, risk Next stage refinement of plans underway risk management systems management and safety (emergency preparedness, environment safety) systems in place
5 Establish key stakeholder RailCorp 1. Funding and members deed with RailCorp in relationships and develop place. cooperative partnerships on 2. Custody Management Agreement (re assets) site and within the local and with RailCorp in place. regional community NSW Rail Transport Draft Service Level Agreement between Museum Trainworks and NSW Rail Transport Museum developed and reviewed by respective boards.
Commentary: The first full year’s operating experience reflects the impact of a number of factors. Prolonged wet weather and economic conditions negatively impacted family discretionary spending, the events market and sponsorship.
Recognition came for Trainworks with a Highly Commended in the Tourist Attraction category and Judges Commendation Award for Tourism Business Excellence from the 2012 Greater Sydney Tourism Awards.
142 RailCorp Annual Report 2011–12 Index
Including Compliance Index
Index 143 Index
Index Page Index Page
Accessibilty/disability plans 23, 116 Government Information 130–134 (Public Access) Activities 15-46 Grants 138 Aims and objectives 108 Headcount by groups 114 Annual report production 135 Heritage 36-37 Budget 12 Independant auditor’s report 103–104 Changes in Acts 110 Index 143 Charter 108 Industrial relations 114 Committees 109-110 Internal audit and 105 Community relations 117 risk management statement Community Relations Commission 120 Investment management performance 134
Complaints 118-119 IPART 134
Compliments 118-119 Key performance indicators 15–46
Conservation 36–39 Land values and disposals 138 Inside front Consultants 135 Letter of submission cover Outside back Contact details cover Liability management performance 134 Co–Operative Research Centre for Rail 138 Multicultural policies 117 Innovation/Research & Development Organisation structure 9 Credit card certification 138 Overseas travel 136 Customer charter 21-27 Payment of accounts 140 Customer relations 21-27 Personnel policies & practices 114 EAPS 117 Price determination 134 Equal Employment Opportunity 115 Privacy 113 Events after reporting date 5, 9, 108 Recycling 38-39 Exceptional movements in wages, 114 salaries or allowances Review of operations 12-13, 15–46
Executive performance 120–130 Risk management 105
Executive positions 120–130 Subsidiaries 141-142 Female executive officers 120–130 Inside front Table of contents cover Financial statements 2011-12 47–102 Waste 38-39
Work Health and Safety 113
Works in progress 139
144 RailCorp Annual Report 2011–12 RAILCORP ANNUAL REPORT 2011–12
JB1866_12 ISSN – 1835-2928 © Rail Corporation New South Wales 2012
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