The body established by the Liberal Government to provide independent oversight of major infrastructure projects conducted a risk analysis of the Torrens to Darlington upgrade project last year.

The so-called ‘gate 2’ assessment, delivered in October 2021, gave the project an amber rating, meaning there were “major issues and/or risks identified with appropriate mitigation measures provided”.

The rating means that Infrastructure SA does not believe the project is “likely” to be successfully delivered – nor “in doubt” – but rather “feasible”.

It indicates: “Successful project delivery appears feasible. Major issues and/or risks identified with appropriate mitigation measures provided.”

The analysis was provided to the previous State Government as a cabinet document, meaning the current Government cannot access the analysis in that form. However, a summary was provided to the incoming Labor administration as part of official department briefings.

Infrastructure Minister Tom Koutsantonis has delayed the Torrens to Darlington upgrade pending a review of the $9.9 billion project. He said in June that the project design had serious deficiencies and he wouldn’t be surprised if there was a substantial blowout in the cost.

He said at that time that revised costings and a new reference design would be delivered within weeks, but InDaily understands that timeframe has slipped to the end of August.

InDaily asked Koutsantonis whether the project in its current form had been put through Infrastructure SA’s quality assurance framework, introduced in 2020.

A Government spokesperson replied this week, saying: “Under the former Government, Infrastructure South Australia (ISA) has conducted a Gate 2 Review of the Torrens to Darlington section of the North-South Corridor, under its Assurance Framework.

“Despite the claims from the former Liberal Government that this project was shovel-ready, we have learnt that ISA review provided this project with an amber rating – which indicates major risks have been identified with the project.

“This includes potential insufficient contingency allowance and low escalation rates in the project, meaning cost pressures remain a substantial threat to the delivery of the project within the overall budget.

“In line with our election commitment, we are going back, doing the work that should have been done in the first place, in order to get this project right and ready for market.”

InDaily asked to see the Infrastructure SA review but we were told it was a cabinet document – provided to the previous Government – so could not be made public.

Opposition infrastructure spokesperson Vincent Tarzia said the amber rating did not mean delivery of the project as envisaged by the Marshall Government – including its costings – was unrealistic.

“While the project was classified with an amber rating, the review confirmed costings were achievable and – despite changes in the market – potential risks could be managed by experts with experience in delivering world-leading projects,” he told InDaily.

“That’s why it’s baffling Labor supported the axing of project head Susana Fueyo Suarez after the report confirmed the timeline for completion was reasonable and possibly conservative.

“Unfortunately, the report can no longer be relied upon because of Tom Koutsantonis’ promise to rip up the design, meaning the viability of the project – and potential number of homes to be demolished – has changed.”

The 10.5 kilometre Torrens to Darlington upgrade is the final and most complex section in the North-South road corridor upgrade.

The current design envisages “a combination of tunnels, lowered and ground-level motorways, as well as overpasses and underpasses at key intersections”. The new road will bypass 21 sets of traffic lights between the River Torrens and Darlington.

However, despite its impressive-sounding credentials, it seems unlikely the project will deliver a net benefit to the community on the spend, which seems likely to end up well above $10 billion due to escalating construction costs.

The marginal benefit of the project has been hiding in plain sight, with an Infrastructure Australia analysis of the business case published in February finding that the upgrade proposal had a benefit-cost ratio of 0.7. Any number below one means that the costs outweigh the benefits.

“This is largely because the project is the final and most complex section of the North-South Corridor,” the assessment found. “The BCR increases to 0.9 and the NPV (net present value) to -$357 million when urban development benefits are included, and further increases to 1.2 and the NPV to $990 million when WEBs (wider economic benefits) are included.”

A State Government spokesperson said that despite this BCR assessment, the project would have benefits.

“While any increase in costs will have an impact on this project’s BCR, this project is the final section of the 78-kilometre corridor.

”The project will reduce congestion, increase average travel speeds, and reduce stop/start travel across the network. Shifting away from slower and less efficient travel will result in a net reduction in greenhouse gas emissions.”

The Infrastructure Australia assessment also assessed the benefit-cost ratio of the entire North-South corridor project at 1.31.

However, a new transport lobby group in South Australia is questioning the overall benefits of the project.

Jennifer Bonham from the Transport Action Network said that if the benefits to the community were borderline at $9 billion, then it was likely to be in negative territory after the anticipated cost blowout.

She questioned the claimed community benefits, particularly a predicted reduction in greenhouse gas emissions due to smoother traffic flow.

“We would reduce emissions significantly more if we made it possible for people to travel by greenhouse gas-efficient modes – like public transport integrated with first/last mile modes.  It is not clear how or where they have accounted for the Scope 3 emissions generated by the infrastructure or the urban heat sink that will be created by more road infrastructure.

“I’d like to know how they calculated the benefits for pedestrians and cyclists given the plans I’ve seen limit east-west crossing points and there has been no provision for a north-south dedicated bike route.”

Bonham, a UniSA researcher, said she also didn’t see any reference in the Infrastructure Australia analysis about how the project would help people who don’t own or have access to a car, “let alone those who can’t afford to run the car they do own”.

“It also doesn’t seem to acknowledge the displacement costs for people and businesses who might have to locate on the urban fringe because they can’t get housing in the area they previously lived.”

She said she would like to see a similar benefit-cost analysis for public transport as a mechanism to reduce congestion in the corridor

“A North-South rail connection has been on the transport agenda for almost 60 years and yet it remains unfunded.

“We should be looking at how to decarbonise the transport sector – not encouraging more people to drive.”