MELBOURNE METRO BUSINESS CASE BRIEFINGFebruary 2016

BACKGROUND

• Continuing population growth• Increasing demand on public transport• Changing economy – shift to central Melbourne

CHALLENGES FACING MELBOURNE

MEETING THE CHALLENGE OF POPULATION GROWTH

12.6

14.4

24

POPULATION GROWTH

Source: Plan Melbourne

POPULATION GROWTH WILL BE CONCENTRATED IN THE NORTH, WEST AND SOUTH EASTFigures indicate forecast population growth between 2011 and 2031.

POPULATION GROWTH WILL BE CONCENTRATED IN THE NORTH, WEST AND SOUTH EASTFigures indicate forecast population growth between 2011 and 2031.

WESTERN+420,000

NORTHERN+450,000

EASTERN+180,000

SOUTHERN+450,000CENTRAL

+270,000

AVERAGE GROWTH BY INDUSTRY 2001-2013(SIX LARGEST SECTORS)

NEW BUSINESS GROWTH

Source: Plan Melbourne

A CHANGING ECONOMY IS HAVING AN IMPACT ON WHERE PEOPLE WORK

A CHANGING ECONOMY IS HAVING AN IMPACT ON WHERE PEOPLE WORK

Over 500 businesses

250-500businesses

125-500businesses

51-125businesses

Professional

Manufacturing

NEW BUSINESSES 2001–2011

FUTURE RAIL NETWORK PATRONAGE

• Population growth• Inner city jobs• Road congestion• Parking costs• Environmental impacts

• Population growth• Inner city jobs• Road congestion• Parking costs• Environmental impacts

THE IMPORTANCE OF MELBOURNE’S CBD

• State’s economic and cultural hub –home to many iconic institutions, destinations

• Economy evolving towards inner-city produced, knowledge-based services

• Manufacturing relocating to the west of Melbourne

• CBD needs to continue to grow and realise its full job growth potential

“CENTRAL MELBOURNE IS SET TO BECOME AUSTRALIA’S LARGEST BUSINESS CENTRE WITH JOBSPROJECTED TO GROW TO ALMOST 900,000 BY 2051”

BUSINESS CASE RECOMMENDATION

Melbourne Metro: • Meets a pressing need to increase capacity of the metropolitan

rail network • Represents the best option identified to deliver the objectives of

rail investment • Is economically viable and backed by a strong strategic case • Is deliverable within the cost and timeframes proposed • Fits with the strategic policy objectives of Federal, State and

Local Governments • Delivers substantial social, environmental and economic

benefits• Is widely supported by stakeholders and the community

BUSINESS CASE RECOMMENDATION

• Benefit to Cost Ratio of 1.1• Benefit to Cost Ratio of 1.5 when

wider economic benefits are included

• Creates 3,900 additional jobs (net) across Victoria and 4,700jobs (net) nationwide at the peak of construction.

• Expected to increase Victorian GSP by $7 billion in present value terms

ECONOMIC CREDENTIALS

“A BCR GREATER THAN 1.0 INDICATES BENEFITS OUTWEIGHCOSTS FOR EVERY DOLLAR SPENT; MELBOURNE METRO WILL DELIVER A NETECONOMIC BENEFIT TO THE VICTORIAN COMMUNITY”

• Detailed financial model used to assess Melbourne Metro

• A $10.9 billion transformative infrastructure project for Melbourne and Victoria

• Rolling Stock - Government has committed $1.3 billion to build a new fleet of 37 HCMTs to operate on the Cranbourne / Pakenham Line.

COST

SCOPE

ACCESS TO STRATEGIC LOCATIONS

ARDEN

PARKVILLE

CBD NORTH

CBD SOUTH

DOMAIN

KEY BENEFITS

BENEFITS OF MELBOURNE METRO INCLUDE:

• Enhancing Melbourne’s liveability and Victoria’s prosperity by improving access to jobs, education, health, sport and culture

• Expanding the inner core of the rail network to meet demand in the growth corridors to the north, west and south-east of Melbourne

• More evenly distributing passenger flow and easingovercrowding in the inner core of the network

• Creating education and job opportunities in city’s inner west for Melbourne’s key population growth corridor to the north-west

• Improving access to the CBD and Parkville to support Victoria’s growing knowledge economy

BENEFITS OF MELBOURNE METRO INCLUDE:

• Upgrading rail capacity into and out of five existing and emerging national employment clusters (Parkville, Monash, Dandenong South, Sunshine, and East Werribee)

• Reshaping travel demand to enable a future opportunities for the tram network by moving services to the west of the CBD

• Relieving tram crowding and congestion on St Kilda Road and Swanston Street

• Improving capacity, reliability and punctuality for rail passengers

CAPACITY BENEFITS IN NUMBERS

• From day one of Melbourne Metro’s opening, 39,000 extrapassengers will be able to travel on the rail network during each peak period

• Capacity for around 12,000 of the extra 39,000 passengers delivered directly on the new stand-alone Melbourne Metro (Sunshine – Dandenong) line; remaining 27,000 uplift achieved on other lines – Upfield,Craigieburn, Werribee, Sandringham and Frankston

• Melbourne Metro will create different travel patterns for commuters, leading to a 20% decrease in crowding across existing CBD stations

NEXT STEPS

NEXT STEPS

• Environment Effects Statement – on exhibition• Procurement• Major early works (site preparations) in 2017 – subject to

planning approval• Major Works in 2018

QUESTIONS?