The truth about costs and benefits of Gold Coast cruise ship terminal

THE cruise ship terminal is the Glitter Strip’s ultimate political gamble. New details from the business case break down how the $463.4 million will be spent. But the confidential report also reveals the cost of potential future expansion.

THE cruise ship terminal is the Glitter Strip’s ultimate political gamble.

THE economic and financial success of a CST will depend almost entirely on operators choosing the Coast to base vessels — and only if there is demand to visit here from the cruising public.

The business case shows the total spend will be $463.4 million. This includes almost $104 million for early works, the same amount to build the jetty and wharf and $232 million for the breakwater.

SECRET CRUISE SHIP TERMINAL REPORT REVEALED

But the confidential documents reveal a potential future expansion for a second berth on the north side of the wharf, which would add $38 million for extra walkways and jetty upgrades, and $25 million to extend the breakwater.

Across a 30-year period, the CST would have ongoing costs of almost $37 million, operational costs of $157 million and require refurbishment of $40 million.

The proposed Gold Coast Cruise Ship Terminal.

“The future demand for cruising is inherently uncertain, particularly considering the proposed CST would not begin operating until 2022,” the report says, in its introduction.

But Australia has the largest market penetration for cruising in the world, and the current levels were expected to grow further.

The Brisbane terminal would support and not inhibit that demand and “industry engagement has expressed the view that future market growth can accommodate both facilities”.

Consultants looked at a number of scenarios including as few as 20 vessels for a transit port in 2022 to a capped 212 annual visits in 2052.

They say a cost-benefit analysis presents a compelling case for the development of a CST.

“The positive impact of a Gold Coast CST on economic output is expected to range from $2.6 billion to $3.1 billion,” the report said.

The project would create up to 3600 full time jobs and provide up to $1.4 billion in value added to the economy.

“There is currently no committed finance to build the project,” consultants noted.

But they suggested the council had a significant cash balance of $780 million and could consider State and Commonwealth loans.

The success of the cruise ship terminal depends on operators coming to the Coast. Photographer: Liam Kidston.

The council’s level of debt indicated it could borrow from State Treasury without impacting on the city’s credit rating.

Consultants admitted the failure of multiple toll roads due to low patronage meant private investors would not take the risk on such large scale infrastructure.

“Unless cruise ship companies are prepared to sign up to long term agreements to guarantee usage of the facility over an extended period of time — 15 plus years — it is unlikely private finance will be available,” the report added.

Consultants said the business case had identified a design which would give the cruise industry the required confidence to use the facility.

Mayor Tom Tate will not give up on pushing for a CST. Photo: Steve Holland

“The Business Case has determined that while it is possible for a Gold Coast CST to generate a financial return in a limited number of scenarios, it is likely that the facility would represent a net cost to city over the term of analysis (30 years),” the report said.

But they said a home rather than transit port with a breakwater would generate new industry and jobs.

“It is recommended that the council notes the findings of the business case and approves that project to the project development stage,” consultants said.

Councillors, after going into closed session to review the report, considered ticking off an initial advice statement to the Government.

One of the many designs for a proposed cruise ship terminal at The Spit Main Beach

A section of the report which remained confidential showed the costs for the city to complete the project development phase would be between $7.4 million to $10.45 million.

The plan was for a design contractor to be appointed later this year enabling construction to start early next year and be completed by January 2022.

A division was called when councillors voted in May last year.

Those in support included Mayor Tom Tate, Deputy Mayor Donna Gates, Cameron Caldwell, Hermann Vorster, Dawn Crichlow, Gary Baildon, Gail O’Neill, Kristyn Boulton, Pauline Young and Paul Taylor.

Voting against were Glenn Tozer, William Owen-Jones, Peter Young and Daphne McDonald. Bob La Castra was absent.

The report’s findings and the vote marked the first major turning point in councillor support for the project.