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A Letter to the Herald That Didn’t Get Run

June 9, 2011

Kim Sanders ( Letters, June 8 ) is precisely wrong to say that in public private partnerships the state Labor government made the taxpayer bear loses and the private sector pick up profits.

Indeed the criticism of the Cross City Tunnel and the Lane Cove Tunnel were precisely the opposite. Parts of the media condemned the deals for being too ruthless with the private sector. With the Cross City Tunnel the state got a superb piece of infrastructure without investing a dollar. When original take-up was disappointing every cent of the losses was shouldered by the private sector consortium because the deal was so tight. The taxpayer was not required to put in a cent. The risk was entirely borne by the private sector (the project has now become profitable for its new owners).

I’m happy to bear the criticism that we were too diligent in protecting the taxpayer interest.

The criticism, however, is valid for the city to airport rail link, rushed into by Transport Minister Bruce Baird on the eve of the Fahey government’s defeat in 1995. Baird told parliament there’d not be a cent from the public sector. Because the contract was so shockingly bad my government was forced to pour $700 million into what should have been a purely private undertaking.

We learnt from that.

Bob Carr

7 Comments
  1. Jimbo permalink
    June 9, 2011 2:07 pm

    The Herald only publishes corrections where the errors are trivial (and therefore designed to imply that they take accuracy VERY seriously).

    In my experience, you’ll never get a run when you point out their journalists have got it plain wrong and just didn’t check.

    • Bob Carr permalink
      June 9, 2011 2:14 pm

      To be fair to The Herald I was correcting a comment in a letter to the editor.

  2. June 9, 2011 9:28 pm

    The biggest problem with the Cross City Tunnel is that shadow tolls weren’t used. The idea of the tunnel was to remove traffic from the city – therefore, it should have been free. People driving across the city should have been tolled, which can be done these days with CCTV and number plate reading software. That way, traffic in the city would have been reduced considerably (making Clover Moore a bit happier, plus about 100,000 pedestrians) and motorists would have had faster travel times.

    Why didn’t that option get off the ground?

    • Bob Carr permalink
      June 10, 2011 12:47 am

      Because our road priorities were the Pacific Highway and western Sydney. We did not intend to take $500m from the roads budget to build the tunnel but instead have the private sector do it and users pay for it . It immediately took 30,000 a day out of CBD streets – not what the consortium desired but use is now rising 10 percent per annum. The taxpayer did not contribute a cent and got $100 million up front from the consortium. It was a pure PPP and when initially it made losses the taxpayers did not have to put in a cent. No risk to then public. All loses to the private owners. Meanwhile the infrastructure is fabulous.

      • AlanDownunder permalink
        June 12, 2011 8:11 pm

        Couldn’t you have given the tunnel funders a right to toll CBD traffic instead of tunnel traffic?

        More broadly, have privatised roads retarded the onset of a rational demand-based congestion pricing of our road system? (which is, of course inevitable)

  3. Anthony Porter permalink
    June 9, 2011 9:58 pm

    I don’t believe the letters to the editor actually get to the editor’s desk. The letters that are published are chosen by some vassal. Given the declining readership of daily newspapers it is hardly worth the effort to write the letter, when you can publish it yourself on-line. On-line is cheaper too. It will not be too long before the dailies as we know them will be dead and buried. And a lot of those self serving drips that call themselves journalists will really have to practise journalism to earn a living.

    • Bob Carr permalink
      June 10, 2011 12:52 am

      I think the best writing in Australia occurs in newspapers.

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