Toll road giant Transurban to oversee WestConnex tolls rising at twice the rate of inflation
A CRUCIAL decision on the future of the WestConnex motorway means motorists will be slugged at rising rates until 2040 — but the NSW Government says it will be worth it.
Business
Don't miss out on the headlines from Business. Followed categories will be added to My News.
TOLL road giant Transurban will fork out $9.3 billion for control of the WestConnex motorway — but motorists will pay for it through higher tolls for decades.
Transurban and its winning consortium Sydney Transport Partners yesterday won the bidding war for the rights to operate the toll road for the next 42 years.
Tolls on the 33km motorway — which will cut 40 minutes travel time between Parramatta and Sydney Airport — are set to rise 4 per cent per year until 2040, about twice the recent inflation rate. After 2040 they will increase in line with the CPI until 2060.
NSW Treasurer Dominic Perrottet said the motorway would be worth it and toll charges for the next four decades will be regulated.
“WestConnex will be the Sydney Harbour Bridge for Western Sydney,” he said.
“This project means people will be able to travel from the west and southwest of Sydney with ease, spend less time in traffic, and get home to their families faster.”
The $16.8 billion project is 37 per cent complete, with the crucial M4-M5 tunnel, the Rozelle Interchange and the Iron Cove Link yet to be built.
The government, which will retain a 49 per cent interest in the road, will put the proceeds towards the final stage of WestConnex.
Transurban will now operate eight out of 10 toll road concessions in NSW and 16 out of 20 in Australia.
Its partners in the consortium are AustralianSuper, the Canada Pension Plan Investment Board and the Abu Dhabi Investment Authority sovereign wealth fund.
WESTCONNEX OFFERS WHITE NOISE MACHINES TO DROWN OUT NOISE
WESTCONNEX M4: WIDENED MOTORWAY STRETCH OPENS JULY 15
Competition regulator the ACCC initially raised concerns about Transurban’s market domination but gave the deal a tick on Thursday, which paved the way for it to beat rival IFM Investors.
Transurban chief executive Scott Charlton promised a good deal for motorists.
“We think it’s pretty exciting and we want to put our own touch on it, our plan is to lower fees here, provide better customer service and do everything we can to enhance customer experience here as well,” he said.
Mr Charlton said financial closure of the deal is expected in late September, subject to Foreign Investment Review Board approval.
“Over 70 per cent of our consortium partners are Australian, and today’s announcement is the accumulation of two years of work … with more due diligence done on WestConnex than any other project to date,” he said.
Deloitte modelling shows by 2031, 40 per cent of Sydney’s population is expected to live within 5km of the toll road.
Transurban will raise $4.2 billion through a rights issue and receive a further $600 million from its partners AustralianSuper and the Abu Dhabi Investment Authority to help pay for the acquisition.