Auckland City Rail Link will cost $1 billion more than expected

The Auckland City Rail Link will cost $1 billion more than expected.

City Rail Link Ltd (CRL) revealed on Wednesday the ambitious transport project will total $4.4 billion. The last estimate, made in 2014, was that it would cost $3.4 billion.

CRL chief executive Dr Sean Sweeney says the revised cost comes after a "rigorous and comprehensive review" of the project.

"No one could have foreseen the competitive pressures that have occurred in the construction industry over the past few years and the impact that has on costs, particularly for a project the scale and complexity of the City Rail Link."

He said the value of infrastructure in both Australia and New Zealand has skyrocketed in the last 18 months, from $80 billion to $230 billion.

Last year it was decided that the project's scope would be increased to accommodate longer nine-car trains at stations, Dr Sweeney said.

"Planning today for a city that will be much bigger in the future reinforces the benefits the City Rail Link City will deliver to the way people travel, work and live in Auckland."

Transport Minister Phil Twyford has blamed the previous National Government for the cost blowout.

"The re-costing exercise has shown that the last Government did not set aside enough money for inflation and cost escalation," he says in a statement. "On top of that, competition created by a surge in large-scale infrastructure projects throughout Australasia has driven up construction costs."

Twyford says the City Rail Link is an important infrastructure project for Auckland.

"Once complete, it will carry 50,000 people during peak times and will allow trains to run as frequently as every few minutes.

"The Government will match Auckland Council’s contribution and we're committed to seeing this project through."

Auckland Mayor Phil Goff says the inflated cost is an effort to "future proof" the City Rail Link to ensure it works for an expanding population.

"We won't repeat the mistake of the Harbour Bridge which was built at half of the size it needed to be, and had to have major additions made to it within eight years."

He says the additional $500 million cost to the Council will not mean higher rates for Aucklanders, nor will it involve breaching the debt to revenue limit on Council borrowing.

"It is unfair for Aucklanders to meet half the cost of the City Rail Link when no other part of the country has to do so, and I've argued that case to Government. The Government has refused to revisit the deal, saying that was what was agreed between the previous Auckland Council and National Government.

"However, Government has agreed to phase the timing of Council's contribution to enable it to work within the constraints of its budget."

Mayor Goff says the Council will tighten its financial management to be able to fund the City Rail Link, including disposing of some non-strategic assets such as parking buildings. The Governing Body of Council will make a decision around funding in May.

He says the City Rail Link is the biggest investment Council is making in transport infrastructure for the next few years, as it is "critical" in order to reduce Auckland congestion.

"The City Rail Link doubles the capacity of rail through Britomart and in peak hour will have the capacity to carry up to 54,000 passengers," he says, adding that it will significantly reduce travel time from West and South Auckland.

CRL has named Link Alliance as its preferred bidder for its C3 Contract to build underground tunnels and stations.

Perth-based engineering company RCR Tomlinson was set to build the underground network, but its Australian branch went bust in November 2018.