Light rail affordable as ACT Budget moves into surplus from 2018

ACT Chief Minister Andrew Barr handed down the 2016/17 ACT Budget today and has advised that the ACT Treasury reports the ACT will experience a modest surplus in 2018/19 of $33 million and a stronger $66 million surplus in 2019/20. These budget surpluses coincide with the commencement of light rail services in 2018 and the first of the annual availability payments to the Canberra Metro consortium.

Stressing the affordability of light rail Chief Minister Barr said:
"We will be in a strong surplus position having paid for light rail," "All of that rubbish that has been put forward by the Opposition about the affordability of this project is completely destroyed by this budget [it's] very clearly funded".
"It is worth noting that I was the only state or territory leader able to get Tony Abbott to fund a light rail project in this country. I got Tony Abbott to fund an urban rail project."
Mr Barr said the capital component of the light rail project would be less than one per cent of the ACT budget.
"By the time the treasurer of 2037-38, who I promise you won't be me, gets up to deliver their budget, in the last full year of the light rail contract, the ACT budget is anticipated to be around $13.5 billion,"
"The final availability payment is $75.6 million, a tiny fraction of the territory budget.
"So this is an affordable project for the territory, and we have demonstrated in this budget that we can deliver the project and deliver budget surpluses."

He also repeated previous comments that the ACT government would commit to a second stage of light rail before the October Assembly election.
"People will know when they go to vote in October where we are taking the project next," he said.

Read more on the Chief Ministers comments about light rail affordability from the Budget announcement here.

The main ACT budget focus for 2016/17 would be:

• Renewal of public housing 
• More funding for hospitals
• Domestic violence funding  
• $100 million for road duplication

Specific public transport funding will be:

• $17 million for ACTION 
• $500,000 to engage local businesses along the light rail route from Gungahlin to Civic
• $43.8 million allocated over the forward estimates to "deliver existing transport services and meet increasing costs as identified in the ACTION review"
• $3 million will be spent to help introduce integrated ticketing for buses and light rail

Pre-budget public transport announcements included:

• $900,000 for a trial of electric buses
• $10 million for 20 new buses
• a Weston Creek-Molonglo-Civic direct bus service
• Wanniassa Park and Ride
• Woden Bus Station upgrades
• a free Civic Loop bus service

To pay for this there has been an increase in the territory's revenue to $5 billion from higher than expected GST revenue from the Commonwealth, and revenue from ACT land sales. Tax revenue has also increased with greater amounts raised than expected from payroll tax and stamp duty. Increased revenue would also come from:

• Rates to increase by 4.5% to 7% with apartment rates to be calculated differently and eventually match house rates. 
• Drivers licence fees to increase, but there will be a safe driver discount. 
• 6% increase in parking fees

Although the territory budget is in a very healthy position, debt will peak at a lower than anticipated amount of $2.9 billion in 2018/19 and expected to return to surplus in 2018/19. The deficit in 2015/16 was $232 million, halving the 2014/15 deficit of $407 million (largely from unfunded superannuation liabilities and the Mr Fluffy scheme).

With a wide range of expectations from all sectors of the community to consider, public transport has emerged well from this budget. 

Light rail will only succeed as an integrated public transport system with buses, active travel and Park and Ride working together. Investing in bus services where the demand is expected and can be met with the flexibility of buses is sound public transport policy, as is exploring more sustainable bus technology, and these investments are sensible. The government remains committed to a second stage of light rail, and is expected to announce that in the lead up to the October Assembly election. 

A healthy budget, with sensible and funded transport initiatives, is both responsible and responsive to community expectations and will be attractive to voters.  

The ABC Online reported on the ACT budget here
The ABC Online 'Budget at a Glance' is here
The Canberra Times reported on the ACT Budget here

This page will be updated over the next few days

As well as this website, the facebook group 'Light Rail for Canberra' carries frequent updates on Capital Metro and light rail related news.