Light Rail

Australian State Government Accuses Light Rail Contractor of Incompetence, Then Gives it Another Multi-Million-Dollar Contract

Sydney's light rail extension is a year behind schedule and almost $500 million over budget.


Bundit Minramun/

A near-8-mile light rail extension from Sydney's downtown to its eastern suburbs was supposed to be delivered by March 2019 at the cost of AUS$1.6 billion. Following a wave of scandals and setbacks, costs have swelled to a potential AUS$3 billon and completion will be delayed by more than a year.

The New South Wales state government has tried to shift most of the blame for this onto Acciona, the Spanish firm hired to construct the line. Officials have accused the company of turning downtown Sydney into a "war zone" and of purposefully delaying construction. And Acciona has certainly made mistakes—at one point in the construction it accidentally destroyed some AUS$500,000 in public art. The company and the government are now locked in a nasty legal battle over who should bear the costs of the project's extra work and added delays.

Naturally, the company had been awarded another contract in the same state. For AUS$8 million, it is supposed to build an entrance to an entry road to a rural hospital.

"I'm not happy about it," the state minister for transport, Andrew Constance, tells the Sydney station 2GB. New South Wales premier (akin to governor) Gladys Berejiklian—for whom Sydney's new light rail line was supposed to be a signature achievement—is likewise "not happy" about the new contract.

If we accept the government's line that Acciona is incompetent, wasteful, and deliberately sabotaging the multi-billion-dollar light rail project, then it's shameful that it was awarded another contract.

There is also the possibility that, whatever its public pronouncements, the New South Wales government does not actually consider Acciona's work to be substandard. (The company blames the problems on the government, saying it deliberately withheld key, cost-increasing information about the light rail extension until after the contract was signed.) But if that's true, that means the New South Wales government has been cynically demonizing Acciona to cover up its own failings.

Neither possibility inspires confidence that the government will be able to bring the AUS$2.1 billion light rail project to completion without further slip-ups or scandals.