Auckland City Rail Link: Phil Twyford blamed for 'biggest project blowout'

The Government and Auckland Council have been blasted after announcing the cost of Auckland's City Rail Link project had ballooned out by $1 billion.

National's transport spokesperson Paul Goldsmith said Transport Minister Phil Twyford has delivered "one of the country's biggest project blowouts" during the Government's supposed "year of delivery".

"Mr Twyford and his officials appear to have mismanaged what are now ever-increasing project costs. The Minister has ducked for cover and remained silent on the project blowout, but he's the first to pose for photo opportunities."

Twyford has blamed the blowout on the previous National-led government, saying the re-costing exercise "has shown that the last government did not set aside enough money for inflation and cost escalation".

He said on top of that, "competition created by a surge in large-scale infrastructure projects throughout Australasia has driven up construction costs".

But Goldsmith isn't alone in his condemnation. The New Zealand Automobile Association (AA) has also come out strong against the Government and Auckland Council's missed targets, saying the public "deserves better".

"No one's questioning the value of this project to the transport network, but what people want to know is: how much more is this going to cost us," AA spokesperson Barney Irvine said.

National's transport spokesperson Paul Goldsmith.
National's transport spokesperson Paul Goldsmith. Photo credit: File

"The cost of this project has jumped by nearly $2 billion from original estimates, and they haven't even started boring the tunnels yet."

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

Dr Sean Sweeney, CRL chief executive, said no one could have foreseen the competitive pressures that have influenced the construction industry over the past few years, which he says led to the increased costs.

Irvine said large-scale rail projects around the world are notorious for cost blowouts. He said none of what has been announced around CRL's new cost targets bodes well for the Government's ambitions for light rail in Auckland and Wellington.

"Whether it's light rail or any other big-ticket transport project, government agencies need to do a much better job of being open and clear around costs and benefits, and accountable when promises aren't delivered on."

He said the Government is "asking a lot of the public when it comes to funding these projects - it needs to hold up its end of the bargain".

Auckland Mayor Phil Goff said a significant part of the cost increase - some $250 million - reflected the need to future-proof the tunnels and stations. He also insisted the increased cost estimate would not involve higher rates for Aucklanders.

Funding of the CRL is met jointly by the council and the Government, and Goff said it's unfair for Aucklanders to meet half the cost when no other part of the country has to do so. He said he's raised the case with the Government.

Auckland Mayor Phil Goff.
Auckland Mayor Phil Goff. Photo credit: Newshub

"The Government has refused to revisit the deal, saying that was what was agreed between the previous Auckland Council and National government.

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

The Government agreed to pay half the cost of CRL in 2016, with Simon Bridges - who was Transport Minister at the time - signing an agreement with the council to commit to the deal. It was projected to cost $3 billion then.

Goff said the Governing Body of Council has been advised of options to meet the increased costs and will consider those options before making a decision in May.

CRL has already faced controversy, with the Australian engineering company set to build it, Perth-based RCR Tomlinson, going into administration in November last year.

A consortium of companies labelled the Link Alliance has been named as CRL's preferred bidder to build the underground tunnels and stations and a $75 million Early Works Contract.