WHITE elephant infrastructure project Inland Rail is now not only set to cost more than $31.4 billion, it will never directly connect with either the Port of Brisbane or the Port of Melbourne.
Instead a damning review by Commonwealth Government appointed independent analyst Dr Kerry Schott says Inland Rail will be best served by the construction of major intermodal hubs at Ebenezer west of Ipswich in Queensland, and at Beveridge and Truganina on the outskirts of Melbourne.
From there, freight from double-stacked container trains will be shifted onto single stack trains or trucks.
The Schott report confirmed the poorly organised project is running massively over budget and significantly behind schedule with less than 16 per cent of the 1700km of track completed so far.
No track at all has been laid in Queensland, with ARTC still to receive environmental approvals from the Palaszczuk Government.
According to Dr Schott that delay has been exacerbated by initially poor-quality environmental impact statements prepared by ARTC that had not been capable of acceptance.
However, the report says Inland Rail needs to go ahead as it is important to meet Australia's growing freight task, improve road safety and to help decarbonise the economy.
It must also deliver about a 24 hour freight service if it is to be competitive with road freight, the report says.
Early estimates in 2016 had the cost of construction at about $9 billion, then $14.5 billion. In 2020 the project was projected to cost $20 billion with completion in 2027. ARTC now puts that figure at a staggering $31.4 billion.
However, Dr Schott said there was a lack of confidence in the current estimates, saying the cost of construction and time of completion were still to be fully assessed.
There was no recommendation in the report to substantially alter the proposed route on Inland Rail, meaning if built, the line will cross the Condamine River floodplain in Queensland.
The report gives the Albanese Government plenty of wriggle room on how it proceeds, increasing the uncertainty about the construction of the Queensland section of the project.
Dr Schott says the Commonwealth should take a staged approach to delivering Inland rail, prioritising its delivery from Beveridge in Victoria to Parkes, NSW.
This would increase resilience and improve supply chain productivity between Melbourne, Perth, Sydney, Newcastle, the Illawarra and Adelaide.
From there Inland Rail should progress north through to Queensland.
Constructing the Toowoomba to Ebenezer section was particularly challenging, given the scale of engineering required to bring trains down the range from Toowoomba, the report says.
Now, best estimates put the 1700km project as being completed in the early to middle part of the next decade if outstanding environmental approvals are received.
"Somewhat surprisingly the project has commenced delivery without knowing where it will start or finish," Dr Schott said.
She blamed the "astonishing" cost increases on basic failures in planning and project delivery by the Australian Rail Track Corporation and the former Coalition Government.
In her report, Dr Schott outlines 19 recommendations to improve the delivery of Inland Rail including the establishment of a subsidiary board of ARTC to oversee Inland Rail as a separate entity from the day to day work of ARTC, appointing substantive chief executive to manage the project, and using an independent specialist to review the design solutions developed by ARTC.
Infrastructure and Transport Minister Catherine King said as recommended an independent cost estimator and value engineer would be tasked to undertake detailed assurance work to determine the updated cost and schedule for the program.
"The Albanese Government is taking prudent and responsible action to rescue Inland Rail from the shameful state it was left in by the Coalition Government," Ms King said.
"Flagrant mismanagement of the project has led to the need for comprehensive change and a renewed look at the underpinnings of the project."
She said the mismanagement included ARTC not receiving an updated the statement of expectations from the former government since 2018, a document used by boards to ensure projects remained on track.
"This will be rectified shortly to give the necessary clarity and guidance to the ARTC board to effectively deliver the government's objectives," Ms King said.
NSW Farmers Inland Rail Taskforce chair Peter Wilson welcomed the Federal Government's commitment to continue the project despite the problems outlined in the Schott Report.
"The main goal of improving rail freight is still very much worth pursuing," Mr Wilson said.
"While it was disappointing to learn about the mistakes that have been made throughout the process, I'm hopeful this report can be used to get Inland Rail back on track.
"Ultimately we want to get food from farm gate to dinner plate quickly and efficiently, and Inland Rail will help us achieve this goal."
Interestingly, Mr Wilson pointed to a CSIRO report calculating a $10/tonne saving for freight on Inland Rail, produced four years before massive cost blow-out was revealed.
ARTC board chair Peter Duncan said ARTC noted the findings of the Independent Review and the government's response.
"(ARTC) ... is committed to working closely with the Australian Government to implement those recommendations," Mr Duncan said.
"We understand there is a high level of interest from staff, customers, contracting partners and community to understand the recommendations in more detail and we will work hard to provide more information in coming days."
