Smart cities stopped building motorways long ago, some of them never built them realizing they were hugely costly and did not solve their transport problems in the first place. In short the business case for the community as a whole simply did not stack up.
In Victoria the government has overcome this problem by constructing them in a way that makes them viable on a commercial basis by over- designing them and creating a monopoly situation in which alternatives are made more difficult, and passing the risk onto a third party like Transurban. Tolling companies require sweateners from the government to enable them to make these deals profitable (at the public’s expense ofcourse). In the case of the Westgate Tunnel project the sweetener was a ten year extension of hugely profitable tolling rights to City Link plus a significant contribution to the capital cost of the project.
The State government has attempted to use these strategies for the North East Link. Its original purpose was to act as the final link for a ring road but in order to make it more profitable for a toll operator It has grossly overdesigned it in a way that also promotes city bound traffic from Melbourne’s north east. As a result the cost of the project has ballooned. Despite these inducements the business case is so poor the private sector is reluctant to take it on. On this criteria alone the project is a dud.
But it gets worse. Both projects are propped up by biased traffic forecasts and distorted business cases to get them across the line (and garner federal contributions). These are based on business as usual projections that do not anticipate a covid induced recession. The State government now says it might build it themselves then run the tolling themselves (presumably at a massive loss). I rest my case – the project is a terrible dud.