Tram delays: Financial documents track slow roll out of light rail from Broadbeach to Burleigh

A contract is still to be signed for the latest Gold Coast light rail extension to Burleigh, leading to fears of further delays.

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A CONTRACT is still to be signed for the latest Gold Coast light rail extension to Burleigh – almost a month after it was revealed the route faced major delays.

Transport Minister Mark Bailey was grilled alongside TMR Director-General Neil Scales for more than three hours in Tuesday’s Estimates hearings.

The Bulletin in July revealed major delays were surfacing in the route roll out, according to city council financial documents.

Their report said the contract not being signed off meant further delays that would prevent the project from starting before the end of the year. 

Mr Scales blamed the Covid-19 pandemic for the delay in the contract being signed, saying: “We have not signed on the dotted line yet but we have awarded an $80m pre-works contract which is underway at the moment.

“So we are getting there,” he said.

“Covid-19 has disrupted not just this project but many others.

“I think the business case was done before Covid and before a couple of other light rail projects in Australia have not gone the way people have expected, so the contract was priced in risk in a totally different way.”

City council officers noted in reports that payment deadlines for the Broadbeach to Burleigh extension had been delayed to May, 2022.

Outside parliament Burleigh MP Michael Hart told the Bulletin: “The costing was done, a preferred tenderer appointed, you would have to assume they agreed to the pricing.

“If the light rail stage 3 contract hasn’t been signed, why wasn’t it put back to the market given the price has blown out 50 per cent?”

Mr Bailey has confirmed the delay to sign a contract would “impact the project’s initial timelines and final budget”.

Estimates hearings will continue later this week.

DOCUMENTS REVEAL MASSIVE DELAY TO LIGHT RAIL BUILD

MAJOR delays are surfacing in the roll out of light rail Stage 3, according to council documents.

Council financial papers to be presented to Wednesday’s water, waste and energy committee outline revised payment deadlines from the city to the state for the extension from Broadbeach to Burleigh.

The Southport rollout — the track being built in the CBD as part of the first stage now completed.

Officers note the payments were “$7.50m below forecast” and “project expenditure is tracking behind forecast due to an amended payment schedule from the state government”.

“The first $7.5m payment originally scheduled for May 2021 has been deferred to May 2022,” the report says.

The documents show Stage 3’s “Press and Leak Monitor System” was “$500,000 below forecast”.

“Project expenditure is tracking behind forecast due to delays in finalising the procurement activities required to proceed with installation of the equipment,” the report says.

While the finances are unlikely to be debated, council insiders say it shows concrete evidence of delays in the project.

The new Save Our Southern Gold Coast (SOSGC) group is concerned about a blowout in costs of the trams heading south.

The track being built in the first stage at the Southport CBD.

Members are asking if future costings include land resumptions and loss of business.

“There is no clear idea of the cost of Stage 4 Burleigh to Coolangatta that can’t be ascertained until the preliminary business plan is completed and that is not expected until 2022,” SOSGC leader Kath Down said.

“The reason Stage 3 – Broadbeach to Burleigh – has not started construction is the contract has not been completely signed off by the contractors which is causing further delay owing to the blowout construction costs putting the project under budget.

“There are many engineering problems associated in the ground, meaning Stage 3 is unlikely to start until the end of the year.”

The government is still finalising negotiations on the main contract for Stage 3. GoldLinQ has signed off on an early works agreement.

The delays in funding for Stage 3, which first surfaced in April for the 6.7km track, suggested the project could cost more than $1 bn, up from the original $709m.

The state’s contribution in the three-way funding with the council and Commonwealth has increased from $350m in 2019 to $553.95m.

The report was provided to councillors but there was no debate of the details.

A Transport and Main Roads spokesperson said the council’s contributions to the State were not required until the final construction contract was in place.

“As the Queensland Government has acknowledged, due to unprecedented economic and operational impacts of COVID-19, there has been some delay and additional cost since the business case was completed in 2018,” the spokesperson said.

“A high volume of rail infrastructure projects across Australia is also creating a high demand for skilled workers. All levels of government have made a strong commitment to delivering Stage 3.

“The project presents a great opportunity for local contractors, workers and suppliers to get on board and take advantage of the employment and economic prospects to be delivered as construction gets underway, including early work arrangements in place since June 2021.”

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