Source: ABC Ballarat Date: 09/02/2011 Time: 08:36 AM Program: Steve Martin Summary: Interview with Terry Mulder, Victorian Minister for Public Transport, regarding RRL project 're-profiling'. STEVE MARTIN: What does reprofiling mean when it comes to government funding? We got a rather curious press release from Anthony Albanese yesterday. Funds reprofiled to assist with flood recovery is the headline on this media statement. One of the projects where the funding has been reprofiled is the Regional Rail Link in Victoria, $500 million is going to be reprofiled. I had a chat about this in the studios yesterday and none of us really know what that means. Terry Mulder is with us this morning. He is the minister for public transport and with us Terry Mulder good morning. TERRY MULDER: Good morning Steve. STEVE MARTIN: Reprofiling, what does it mean? TERRY MULDER: Well I was told I was going to get reprofiled by the Federal Government in relation to the Regional Rail Project[sic]. What it means is the money that they had allocated, $3.2 billion towards a project, there's $500 million of that's being dragged out to the tail end out to 2015/2016 which means that the project will take a lot longer to complete. It will be more expensive but not only that we're also dealing with an issue whereby the former Labor Government under costed the project to the tune $880 million. So as an incoming government we're staring down the barrel of a $1.4 billion shortfall for the Regional Rail Project. STEVE MARTIN: How delayed will it be from these funding figures that you're talking about? TERRY MULDER: Well what has to happen now is that Treasury and Finance are sitting down with the Department of Transport and the Regional Rail Link Authority to work out what can be done with the project. There are a number of options, pushing the project out, you know, delays to the project. Others are what they call re-scoping to determine whether or not that they can take any of the features out of the project to get it back within budget. And then there is also the opportunity to go to the marketplace and say to the market this project is stressed, is there anything that the market can do in terms of innovation to bring the cost of the project down because $1.4 billion to a state budget - to a transport budget in its own right is untenable. STEVE MARTIN: Is the project going to survive Terry Mulder? TERRY MULDER: Well look I'm fighting as hard as I possibly can to get this project up and running. I fear that possibly there's going to be some delays and that's basically out of our control given what the Federal Government have done and given what we've inherited. It's an important project for Ballarat, Bendigo, Geelong. It's one that I've spoken about on several occasions to make sure that those regional centres would get a dedicated line into Southern Cross Station and untangle them from the metropolitan lines and provide additional services and that should have been done as priority when the fast train project was put in place, so I've been a great supporter of the project in that right but we have to face reality. As an incoming government we staring down the barrel of the transport portfolio over $1.4 billion black hole. So it's a matter of working with all parties to see whether or not we can put in place a process whereby we can proceed with the project, but you know, you'd have to be kidding yourself if you didn't believe there's going to be some delays. STEVE MARTIN: All right. The press release from Anthony Albanese says that this decision follows consultations with both the Victorian and New South Wales Governments, were you consulted, was it open and fair debate or were you told? TERRY MULDER: Look I think it's pretty much fair to say that we recognise that the Federal Government were going to cut programs in Victoria to help fund the flood recovery. The Regional Rail Project was the biggest project in terms of dollars allocated by the Federal Government for road projects across Australia and I knew that it was going to be hit, it possibly could have been harder. I argued as hard and as strong as I possibly could to limit the impact on the project and that's $500 million, I believe it's possibly going to be higher than that but we've put up as best a case and as best an argument as we could for the project, but nevertheless $500 million dragged out of a Victorian State Government transport budget is a lot of money. And as I say on top of that we're facing an $880 million dollar black hole because the former government didn't cost the project correctly in the first place. STEVE MARTIN: When this link is built or if it's built now, there seems to be that question in there as well in the mix, how much time would it actually shave for regional train travellers getting into the city? TERRY MULDER: Well it's more about reliability... STEVE MARTIN: Okay. TERRY MULDER: ...and more about punctuality and providing additional services and additional pathways, just not to Ballarat, Bendigo, Geelong but also some of those outer western suburbs areas, Wyndham Vale, Werribee, areas that are growing rapidly that don't have public transport links. So it's a multifaceted approach but most of all I think the issue as most people travelling from the regional areas would know that the minute you hit the metropolitan area if something goes wrong with the metropolitan train system it ricochets straight back down the line and it affects the regional services, so I was giving them certainty. There'll be some small savings in relation to time but the real issue is punctuality and reliability and additional pathways for trains. STEVE MARTIN: Minister can I ask this - there's been more floods again in Victoria just this last weekend, there's predictions of more rain to come, we don't whether that will cause additional flooding but there are costs that are mounting from all across our state almost very day it seems as more damage is uncovered and flood waters recede, are we going to see anymore reprofiling of projects in general by other state or federal do you think? TERRY MULDER: Well we're looking for the Federal Government for a lot of support in relation to the damage to infrastructure. I'd have to say my role in terms of rail and roads is a material matter to deal with. A lot of my colleagues are dealing with the interface of tourism, small business, mental health and a lot of the other situations that people are facing because of these events. I think somewhere in the order that there seems to be an estimate of around about $50 million to $60 million perhaps in roads and probably round about $10 million in rail but of course as the flood waters recede and further investigations are carried out, those figures continue to move around. But obviously we're facing an enormous task in terms of rebuilding. The major issue we want to make sure that we get addressed is as soon as we possibly can is to get the roads open even if they are open with speed restrictions and minor repairs until the sub-surface dries out and major structural repairs can be carried out. But it's an enormous task but as I say I'm dealing with basically infrastructure and it's a lot of money but it can be fixed. STEVE MARTIN: All right, from what you're saying and from the sort of stuff we're seeing around the State, it almost sounds like some other major projects may have to be scaled back or delayed just to cope with the bill as it emerges. TERRY MULDER: Well we've said all along that the projects that we took to the election, they're all going to be delivered, each and every one of those projects are going to be delivered. What we are facing is a number of projects that the former government have promised and we find within their budgetary arrangements, massive black holes and cost blow outs. Now I'm just not talking about the $880 million from the regional rail project, yesterday of course it was discovered that fare evasion had blown out to nearly $80 million a year, double since round about 2008. Not that's a hit against the transport budget again. Then we've got the strengthening of the Westgate Bridge, another cost blow out so we're uncovering as we move forward a whole host of hidden expenses, hidden costs - hidden cost blow outs that have got to be factored into what projects we can fund as we go forward. But as an incoming government we're committed to the projects that we announced prior to the election that people voted us in on and we're going to deliver them in this term of government. STEVE MARTIN: Terry Mulder thank you. TERRY MULDER: Thank you Steve. STEVE MARTIN: Terry Mulder, Minister for Roads and Public Transport and the reprofiling of this rail link - the Regional Rail Link.