Sydney CBD and South East light rail published - click to read now

Transport remains a key focus of the NSW Government's infrastructure priorities. These projects represent a major investment and financial risk for the State, and therefore robust planning is essential to ensure that projects deliver promised public benefits, and value for money for the state.

In December 2012, the NSW Government announced a light rail system would be built through the Sydney CBD to Randwick and Kingsford, at an estimated cost of $1.6 billion. The CBD and South East Light Rail (CSELR) project is a large capital works project, with potentially significant economic, environmental and social impacts for the State.

This audit will assess how well Transport for NSW ensured that the planning and procurement for the CSELR project achieved value for money within the parameters set by the NSW Government.

To answer the audit objective, the audit will focus on whether TfNSW ensured that:

  • project planning was robust
  • changes to the project scope and cost were justified and represented best value for money
  • appropriate probity and due diligence was undertaken in the tendering process.

Getting rail passengers to their destinations on time

A NSW Government priority is to maintain or improve reliability of public transport services over the next four years. On a typical weekday, trains deliver 44 per cent of employees in the North Sydney–Sydney CBD–Redfern employment spine to their jobs. The NSW Long-Term Transport Master Plan forecasts that rail patronage will increase by 26 per cent between 2012 and 2031. This growth will represent a significant challenge to getting rail passengers to their destinations in a timely manner.

This audit will assess whether rail agencies have plans and strategies to maintain or improve performance in getting the growing number of rail passengers to their destinations on time. The audit will focus on:

  • actions and plans to address any current performance shortcomings in getting rail passengers to their destinations on time
  • plans to get rail passengers to their destinations on time in future, in the context of predicted patronage growth
  • plans to improve communication to passengers to assist them to get to their destinations on time.

Delivering major projects – NorthConnex

The NorthConnex motorway is a nine kilometre tolled tunnel linking the M1 Pacific motorway at Wahroonga to the Hills M2 motorway at West Pennant Hills. The $3.0 billion project, consisting of a construction budget of $2.65 billion, in addition to land and project delivery costs, is funded through a public private partnership. The NSW Government and Australian Government will each contribute up to $405 million to the project. The public private partnership funding model for the project initially came to the NSW Government as an unsolicited proposal.

The NorthConnex motorway was the first infrastructure project assessed through the unsolicited proposal process, and is a major infrastructure project in NSW.

This audit, which was included on the performance audit forward program two years ago, follows on from the 2015–16 performance audit on the assessment and governance framework for unsolicited proposals in New South Wales. The audit on unsolicited proposals found that that there was a lack of clarity about what regard government gives other relevant procurement processes and approval requirements when forming governance arrangements for unsolicited proposals.

The audit will assess whether the process used to determine the NorthConnex funding model adequately considered value for money for taxpayers and road users.
The audit will answer two questions, each with its own criteria.
1. How did the assessment of the North Connex funding model ensure value for money for NSW taxpayers?
  • The processes used to estimate the initial project scope and budget were robust
  • The use of traffic modelling, including as part of negotiating tolling concessions, was consistent with best practice and government requirements
  • The process used to determine the NSW Government's contribution to the project cost was reasonable

2. Did the assessment adequately consider the overall impact of tolling arrangements to road users and the community?

  • The assessment considered the equity of tolling arrangements for road users
  • The assessment considered the impact of tolling arrangements across the metropolitan road network

Sydney region road maintenance contracts

Roads and Maritime Services (RMS) is responsible for the Sydney region road network, with over 2,600 kms of roads and associated road corridor infrastructure such as bridges, tunnels and drainage structures. This network is divided into three geographical areas: West zone, South zone and North zone.

RMS has outsourced road maintenance for the North zone through a Performance Specified Maintenance Contract (PSMC) since 1995.

In late 2013, RMS awarded separate road maintenance contracts for the West and South zones, with full services commencing in March 2014. By outsourcing road maintenance in these zones, the NSW Government aimed to improve the efficiency and effectiveness of road maintenance delivery.

The contracting out approach RMS adopted for the West and South zones, termed Stewardship Maintenance Contracts (SMCs), is based on an alliance model. The contract uses a mixture of fixed price, target cost and cost plus as payment mechanisms, depending on the predictability of the services involved. The SMCs, while still performance based, are broader in scope than the current PSMC as they include specific road and road infrastructure upgrades.

This audit will assess whether RMS has realised the expected benefits of outsourcing road maintenance for the Sydney Region West and South zones under Stewardship Maintenance Contracts.

We will address the audit objective by assessing whether:

  1. RMS’s decision to adopt the SMC model was justified
  2. SMCs include performance indicators and incentives which promote efficiency and effectiveness
  3. RMS collects high quality information on contractor performance and action is taken to correct performance deficiencies
  4. expected net benefits are being achieved.


  • Delivering major projects – Pacific Highway


  • North West Rail Link - Getting passengers to and from the city
  • Mobile speed cameras
  • Revenue risk for contracted transport services
  • Opal card – realising the benefits of integrated ticketing