Report snapshot: Capital projects 2025

Objective

This report focuses on 9 major capital projects across the total state sector and provides insights into transparency, costs and governance arrangements. 

For the purposes of this report, we have defined a major capital project as an infrastructure project identified in the NSW Budget with total estimated costs greater than $100 million.

Key findings

There is limited public reporting of major capital project budgets, costs and timelines

There is limited public information on estimated total costs, delivery timelines, and changes to costs and timeframes for all major capital projects. 

Over 75% of transport projects did not have an estimated total cost in the NSW Budget Papers.

The estimated total costs of some projects have increased significantly

Sydney Metro’s estimated total cost for the Metro City & Southwest and Metro West projects is significantly higher than originally estimated. Sydney Metro advises this is due to increases in material and building costs, scope changes, industrial action, condition of legacy assets, and additional requirements in the Sydney CBD as part of the ongoing tunnelling and excavation. 

There is limited public information on the total costs of completed projects

There is no explicit requirement to publish the total costs of completed major capital projects. Publishing information on actual costs against budget is essential to promote transparency and accountability. 

The State wrote off $907 million of capital project costs over the past 3 years

The written off costs of capital projects represent expenditure that, for various reasons, will not result in a usable physical asset or improved service delivery. These write offs typically occur when projects are cancelled, significantly rescoped or discontinued after substantial planning and development costs have already been incurred.

There is limited integration of risk oversight at the enterprise level in multi-agency led projects 

In several cases, significant project risks were only recorded in the risk registers of the delivery agency and not reflected in the enterprise risk registers of the agencies that will ultimately own or operate the asset. This creates potential governance and accountability gaps, particularly for operational or asset performance risks that extend beyond the construction phase.

Infrastructure NSW (INSW) applies an investor assurance framework to provide scrutiny over capital projects

By embedding independent scrutiny into the lifecycle of major capital projects, the INSW Investor Assurance Framework seeks to reduce the risks of cost overruns, delays and project failure.

Recommendations

This report makes 5 recommendations for state agencies and NSW Treasury to implement to improve transparency and accountability, and to enhance project management for future capital projects.

Further information

Please contact Renee O'Kane, Chief of Staff, on 9275 7347 or by email.