The Transmission Gully interim review has found serious flaws at the planning stage of the 27km highway, “undermining” the successful completion of the four-lane motorway north of Wellington, according to Infrastructure Minister Grant Robertson and Transport Minister Michael Wood.
Grant Robertson said the review found the public-private partnership (PPP) established under the last National government lacked the proper rigour and consideration.
The review was focused on how the project was awarded for the agreed price, whether the price was realistic, and whether the risks then identified were appropriately considered.
When announcing the review in August last year, the government said Transmission Gully would open by September 2021 but will cost another $208m to build, taking the cost to $1.25bn. Originally the project’s cost was put at $850m, but Covid lockdowns set it spiralling upwards.
At that point in 2020 the government was said to have “slammed” the delays and increased costs.
But hey – remember that Phil Twyford had already had three years as Transport Minister to expedite the project . Yet all he did was order a review.
So given that history, how does it look for the Auckland $6bn Light Rail project?
Michael Wood stepped into the Transport portfolio after PM Jacinda Ardern recognised Twyford might do better in some other portfolio (she gave him Disarmament, confident he can’t do much harm there because there’s not much to disarm).
Wood, meanwhile, is “reviewing” the Light Rail plan.
Perhaps when he has finished that review, he will come up with a report to earn the same sort of headline as Transmission Gully got from the Dominion-Post this morning: “Gully flawed from the start”.
But the fact is the review of the Transmission Gully work concedes that any project on this scale is likely to be “fraught”.
And the financial settlement Waka Kotahi reached with the contractors last year acknowledged that the COVID-19 pandemic and the resulting disruptions and delays were outside the control of CPB HEB; they were not something they could have reasonably anticipated.
The inability to access the work site during COVID-19 Alert Level 4, the loss of productivity at Levels 3 and 2, border restrictions, and pushing the work programme into the winter season, had all contributed to increased costs and delays for the project.
Wood should be reflecting on the complexity of the Gully project as he gets to grips with the Light Rail scheme. There are 27 bridges, including one that is 230 metres in length, as well as 534 hectares of ecological mitigation areas and 27km of stream remediation along the Gully route.
The review, while critical of parts of the partnership process, stopped short of saying a PPP is necessarily incompatible with a project like Transmission Gully.
The review identified a lack of transparency around how key PPP decisions were being made, less than ideal consenting risk management, a non-PPP scheme design used in the PPP procurement, and the price set far too low from the beginning.
Robertson said this obviously was not a recipe for success and he has called for a revision of PPP guidance to make sure any future PPPs don’t encounter the same issues.
“There have also been other issues and cost overruns during Transmission Gully’s construction and Wellingtonians’ deserve answers. That’s why we’ve directed Te Waihanga to undertake a further review of the project after construction has been completed” .
Wood said the government is committed to learning the lessons.
“Waka Kotahi and Te Waihanga will implement the recommendations from the review. We are making sure taxpayers and future governments aren’t left with similar messes like the one we inherited”.
Taxpayers nevertheless may be left with some doubts on that score, given the Ardern’s government’s performance in wasting their hard-earned coin on (for example) the Pike River mine re-entry ($50m) or the Hamilton -Auckland commuter train ($82m).
And though Wellingtonians have waited a long time for a second road north out of the capital – a route up Transmission Gully was first mooted in 1919 – they’ll be relieved when it finally opens.