The Senate Rural and Regional Affairs and Transport References Committee Inland Rail: derailed from the start August 2021 © Commonwealth of Australia ISBN 978-1-76093-272-5 (Printed Version) ISBN 978-1-76093-272-5 (HTML Version) This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Australia License. The details of this licence are available on the Creative Commons website: http://creativecommons.org/licenses/by-nc-nd/3.0/au/. Printed by by the Senate Printing Unit, Department of the Senate, Parliament House, Canberra Members Chair Senator Glenn Sterle ALP, WA Deputy Chair Senator Susan McDonald NAT, QLD Members Senator Alex Gallacher ALP, SA Senator Malarndirri McCarthy ALP, NT Senator Gerard Rennick LP, QLD Senator Peter Whish-Wilson AG, TAS Senator Janet Rice (until 6.10.20) AG, VIC Senator Nita Green (from 12.6.20 until 16.3.21) ALP, QLD Participating Members Senator Pauline Hanson PHON, QLD Senator Malcolm Roberts PHON, QLD Senator Janet Rice AG, VIC Senator Murray Watt ALP, QLD Senator Anthony Chisholm ALP, QLD Senator Nita Green ALP, QLD Secretariat Gerry McInally, Committee Secretary Sarah Redden, Principal Research Officer Joshua Wrest, Acting Principal Research Officer Trish Carling, Senior Research Officer Michael Fisher, Research Officer Jason See, Administrative Officer Lewis Tremayne, Administrative Officer PO Box 6100 Telephone: (02) 6277 3511 Parliament House Fax: (02) 6277 5811 CANBERRA ACT 2600 Email: [email protected] iii Contents Members ............................................................................................................................................. iii Foreword ............................................................................................................................................ vii List of Recommendations ................................................................................................................. xi Chapter 1—Introduction and background ..................................................................................... 1 Chapter 2—Inland Rail business case, cost and competitiveness ........................................... 13 Chapter 3—Port and intermodal connectivity ............................................................................. 47 Chapter 4—Stakeholder engagement and consultation ............................................................ 81 Chapter 5—Inland Rail alignment and key concerns - Queensland ..................................... 105 Chapter 6—Inland Rail alignment and key concerns - NSW & Victoria ............................. 139 Additional comments by Coalition senators ............................................................................. 169 Dissenting report on Inland Rail from Senator Pauline Hanson .......................................... 173 Appendix 1—Submissions and additional information ......................................................... 177 Appendix 2—Public hearings and witnesses ............................................................................ 187 v Foreword The committee is generally supportive of the Inland Rail project. Its construction has the potential to provide significant benefit to rural, regional and urban communities — enabling a more efficient movement of freight across Australia and further diversification of the nation’s freight infrastructure. However, throughout the inquiry the committee has heard a number of fundamental concerns in key areas of the project. Business case The project is underpinned by Inland Rail’s 2015 business case. The original estimated cost of Inland Rail was $4.7 billion, which later became $9.9 billion. The Australian Government has now committed over $14.3 billion to the Inland Rail project, which is governed by an out-of-date business case and undermined by predictions that the project will exceed $20 billion. It is apparent to the committee that the original costings and allocated budget for Inland Rail was inadequate from the outset, and is a failure on behalf of the Australian Government and the Australian Rail Track Corporation (ARTC) to appropriately prepare, plan and implement Inland Rail. Whether Inland Rail’s 2015 business case remains valid in light of the substantial increase in capital required for its completion is a key question. It is the committee’s view that this substantive increase in the cost of Inland Rail alone warrants a review and update of the 2015 business case. The rationale for a business case review and update is further justified by the recent revelations that end-of-service parameters in Queensland are yet to be determined, and the appropriate alignments for some projects are yet to be finalised. The committee continues to be confused as to how a business case can be relied upon if the end point of the Inland Rail, and therefore the costs involved, are still to be decided. The committee’s concern about the cost of Inland Rail, driven by warnings that further cost blowouts may occur as the Inland Rail project progresses, warrants a dedicated oversight mechanism to be established throughout the project’s construction. vii 24-hour journey time The business case itself is premised on a 24-hour journey time between Melbourne and Brisbane to make it competitive with other modes of freight transportation. The Australian Government’s decision to establish a strict parameter of a 24-hour end-to-end journey time for Inland Rail has had a significant adverse impact on the communities along the proposed alignment. Whilst it is apparent that a 24-hour preference was made by business stakeholders (including rail, freight and logistics companies) as a means to make Inland Rail competitive, it has significantly restricted the ARTC’s ability to consider alternative alignments. This impact is clearly demonstrated throughout the report, which reveals that the interests of rural, regional and urban communities throughout Victoria, NSW and Queensland have been sidelined by an arbitrary time threshold established by the Australian Government. Future terminal strategy for Brisbane and South East Queensland It is the committee’s view that the management of the end-points of the Inland Rail project in Brisbane has been unacceptable. The committee cannot understand how the Inland Rail project’s intermodal terminal locations in Brisbane are yet to be determined, especially when the original location (Acacia Ridge) formed the basis of the 2015 business case, and the construction of the Inland Rail project has already commenced. It is a failure of the Australian and Queensland governments for this uncertainty to remain, despite over a decade of investigation into the Inland Rail corridor. In the committee’s view, Bromelton provides the best greenfield site for future expansion and a future logistics and freight precinct for the Brisbane and Gold Coast urban areas. The business case needs to be completed, independently reviewed and publicly released. These should then form the basis for strategic freight plans, and business cases for other new terminals, as well as identifying options for private and public investment. The committee also sees value in further consideration of an Inland Rail link to the Port of Gladstone as a means to further diversify Australia’s access to international markets and to enhance regional Queensland’s economy. The proposed Gladstone link, existing alongside the Toowoomba to Brisbane corridor, could potentially resolve many of the current limitations of Inland Rail in Brisbane, offering a viable alternative pathway for coal exports and reducing the freight import-export demand on Brisbane. A Port of Gladstone connection provides an opportunity to diversify and future-proof the movement of freight across Queensland, and will support regional Queensland’s economy. viii The committee supports the Inland Rail linking to the Port of Brisbane. However, it has serious concerns about whether this is currently achievable. The committee questions the rationale that the existing rail infrastructure between Acacia Ridge and the Port of Brisbane will adequately meet the projected demands of Inland Rail until 2040–41. Passenger network The committee is cognisant that any passenger network must operate alongside Inland Rail. As demonstrated by the Kagaru to Acacia Ridge and Bromelton project, the movement of freight by rail is severely hindered when sharing a rail corridor with the passenger network. Any future rail pathway between Toowoomba and Brisbane must be designed to ensure the seamless movement of freight without delay is maintained. The committee is supportive of the Australian and Queensland governments developing a business case for a passenger rail network alongside Inland Rail. The committee will remain engaged with the development of this business case and ensure the intention to future-proof this alignment is maintained. To foster ongoing transparency and community understanding of the status of the passenger network and how the network will operate alongside Inland Rail’s freight network, the committee calls for the release of the business case upon its completion. Community engagement Despite the committee’s support for Inland Rail, it holds real concern that the economic benefit may not be fully realised by many of the communities along the proposed alignment and recognises more needs to be done to garner broader support for the project. There is an unavoidable impact on some communities and landholders of major infrastructure projects like Inland