On the degradation of societal values I might be alone on this, but I think it looks good

Could Warragamba be the next Cotter Dam budget blowout?

February 28th, 2013 at 07:44am

It seems that, in the light of how much people liked the federal Coalition’s plan for dams across Australia, primarily in the north, Julia Gillard has taken notice of how much people like dams because they supply potable water, can supply electricity, and help to prevent flooding, and has decided that she needs a dam plan of her own…and seeing as she’s taking in the sights of western Sydney, it might as well be a plan for a dam which affects Sydney.

Enter Warragamba Dam. This dam provides the majority of Sydney’s drinking water, and helps to prevent flooding along the Napean River in the far-west of Sydney.

About 20 years ago there was a report which said that Warragamba Dam might fail in a really really bad flood and doom Sydney’s far-west. Well, good news, Julia has a plan.

Simon Benson, with a Daily Telegraph exclusive:

INSURANCE premiums for tens of thousands of western Sydney homeowners will be slashed under a federal government plan to finally raise Warragamba dam and prevent a potential $8 billion flood disaster.
Almost 20 years since the first warnings were given to the state government that Sydney’s primary water storage dam could fail in a major flood, the Commonwealth will provide the first funding to get it started.
Prime Minister Julia Gillard will announce $50 million a year in federal government terrorism re-insurance premiums will be diverted to flood protection across the country, with the plan to raise Warragamba dam by 23m listed as the major priority.

That, I’m afraid, is where the good news ends. That $50 million is just the tip of the iceberg and, as usual, Julia wants the states to do her bidding at their own expense.

The Commonwealth would initially provide $50 million to begin work and then provide increased funding over time if the O’Farrell government will also commit to the $500 million project which its own infrastructure agency has already identified as critical to the NSW economy.

(h/t Simon Benson. See more of Simon’s article in today’s Daily Telegraph at: http://www.dailytelegraph.com.au/news/prime-minister-julia-gillard-dams-sydney/story-e6freuy9-1226587250656#sthash.a3fkpaLO.dpuf)

This plan requires, in order federal government to be involved (and undoubtedly run it on their own terms), the New South Wales state government to cough up an unspecified amount which could very well be $400 million before the federal government even considers tipping in more money.

The federal government is broke because of Julia Gillard and her government. The New South Wales government is walking a tightrope to fix the budgetary mess left by over a decade of state Labor incompetence. Neither of them have the money to spare for this, and yet with federal Labor’s amazing track record of wasteful, untargetted spending (economic stimulus, Building the Education Revolution, coffee machines for National Broadband Network staff, etc), inability to even come close to balancing the budget, and difficulty delivering things on time (Building the Education Revolution again, and the National Broadband Network), one has to conclude that the phrase “increased funding over time” is accurate simply because this project will almost certainly turn out like everything else federal Labor has attempted while in government.

In fact, I think we can look at a similar ACT Labor project to see how this would turn out. The Cotter Dam expansion started in 2009 and, as ACT Senator Kate Lundy pointed out at the time, was supposed to take two years and cost $363 million.

The cost estimate is approximately $363 million for the dam and associated works, which includes construction, commissioning and alliance costs of $299 million, environmental and recreation mitigation costs amounting to $13 million and owner’s costs to ACTEW for project inception, planning, design, approvals and costs from now until completion of $51 million. It is expected to take two years to build.

(Kate Lundy press release “Cotter Dam extension starts”, November 23, 2009)

Delay after delay. Cost blowout after cost blowout. Only three days ago, on the 25th of February, 2013, was construction at a stage where it was safe to allow water to flow in to the expanded dam. A year and two months behind schedule…even more if you include the removal of the extensive amount of construction equipment. The last update on the cost of the project came in April last year when Actew Water said it would be $405 million, an announcement which came after a series of other intermittent cost blowouts.

It is good that Julia Gillard is giving serious thought to projects which could actually benefit people, although given the track record of Labor governments in recent times of having great difficulty in getting things done on time and on budget, I’m not sure that I would really want to entrust this to them, especially seeing as the $500 million expansion of Warragamba Dam was included in the Coalition’s plan:

Included in the list of dam projects, which the Coalition will consider, is a $500 million plan to raise Warragamba Dam in Sydney

.

I know who, when I’m faced with a choice of Labor or the Liberal/National Coalition, I would trust to get this done on time and on budget, and it certainly isn’t Labor.

Ideally, if this project is to go ahead, I would like to see one level of government take responsibility for it in its entirety so as to not have excessive inter-governmental red-tape get in the way, but given the way government budgets are placed, it probably will have to happen with input from the federal and New South Wales governments if it is to happen in the short term. That said, this seems like a low priority job compared to the benefits of building dams in northern Australia, so I hope it is not used as an election sweetener by both parties for votes in western Sydney, and that it is put on the backburner until government budgets are in a better position instead.

Besides which, one of the stated aims of the Warragamba project is to allow for the release of more land in western Sydney for residential development. Building dams in the north is supposed to, in part, alleviate the need to continue to expand Sydney at a rate of knots. It would be somewhat contradictory to run both projects at once.

Samuel

Entry Filed under: Canberra Stories,General News,Samuel's Editorials

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