MELBOURNE METRO Business Case Commercial in Confidence

Cabinet in Confidence Melbourne Metro 1 Commercial in Confidence Options Assessment

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MELBOURNE METRO

Business Case

Cabinet in Confidence

Commercial in Confidence

December 2011

Version 2.1

Cabinet in Confidence Melbourne Metro Commercial in Confidence Business Case

EXECUTIVE SUMMARY

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Table of Contents

EXECUTIVE SUMMARY ......................................................................................................................................... 7

PART A – DESCRIBING THE BUSINESS NEED................................................................................................. 13

1 How the investment aligns with government policies ............................................................................. 13

1.1 Overview ............................................................................................................................................. 13 1.2 Victorian Government strategic and policy framework ........................................................................ 14 1.3 Local Government policy context ........................................................................................................ 21 1.4 Commonwealth policy context ............................................................................................................ 24 1.5 Summary of MM contribution to government policy and strategy........................................................ 26

2 Describing the existing and future situation ............................................................................................ 28

2.1 Overview ............................................................................................................................................. 28 2.2 Existing land use structure .................................................................................................................. 29 2.3 Existing transport context.................................................................................................................... 36 2.4 Population growth and housing........................................................................................................... 40 2.5 Industry and employment.................................................................................................................... 43 2.6 Sustainability of urban form................................................................................................................. 54 2.7 Public transport patronage.................................................................................................................. 58 2.8 Rail network capacity and performance .............................................................................................. 65 2.9 Summary of business need................................................................................................................. 83

3 Summarising the business need and investment drivers ....................................................................... 85

3.1 Introduction ......................................................................................................................................... 85 3.2 Definition and evidence of the problem............................................................................................... 85 3.3 Timing considerations ......................................................................................................................... 87 3.4 Other occurrences of the problem....................................................................................................... 87 3.5 Investment logic .................................................................................................................................. 87 3.6 Project vision, goals and objectives .................................................................................................... 90

PART B – DEFINING THE BEST SOLUTION TO ADDRESS THE NEEDS......................................................... 92

4 Options assessment ................................................................................................................................... 92

4.1 Strategic options ................................................................................................................................. 92 4.2 Corridor options assessment .............................................................................................................. 94 4.3 Melbourne Metro default scheme........................................................................................................ 96 4.4 Station location and alignment options assessment ........................................................................... 97 4.5 Updated MM scheme........................................................................................................................ 113 4.6 Arden Urban Renewal Precinct intervention options......................................................................... 115 4.7 Property acquisition and development around new metro stations ................................................... 120 4.8 Vertical alignment options ................................................................................................................. 121 4.9 Station access and mobility options .................................................................................................. 124

5 Scope of preferred scheme...................................................................................................................... 131

5.1 Scope definition process ................................................................................................................... 131 5.2 Peer review process.......................................................................................................................... 134


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5.3 MM tunnel ......................................................................................................................................... 137 5.4 MM stations....................................................................................................................................... 143 5.5 South Kensington tunnel portal – Sunbury........................................................................................ 151 5.6 Northern Loop, Frankston loop and Cross-City Metros ..................................................................... 151 5.7 Tram integration works...................................................................................................................... 152 5.8 Property acquisition........................................................................................................................... 153 5.9 Property acquisition and development around new metro stations ................................................... 157 5.10 Arden urban renewal precinct ........................................................................................................... 159

6 Project interfaces, future proofing and complementary programs ...................................................... 162

6.1 Introduction ....................................................................................................................................... 162 6.2 Precursor projects............................................................................................................................. 162 6.3 Future proofing.................................................................................................................................. 162 6.4 Interdependent projects .................................................................................................................... 166 6.5 Complementary projects and programs ............................................................................................ 166 6.6 Detailed project interfaces................................................................................................................. 170

PART C – BENEFITS AND IMPACTS ................................................................................................................ 172

7 Benefits, operating plan, patronage & land use impact ........................................................................ 172

7.1 Overview ........................................................................................................................................... 172 7.2 Outputs, benefits and key performance indicators ............................................................................ 172 7.3 Concept of Operations ...................................................................................................................... 181 7.4 Rolling stock deployment strategy .................................................................................................... 191 7.5 Patronage impacts ............................................................................................................................ 193 7.6 Land use impacts.............................................................................................................................. 207

8 Risk assessment....................................................................................................................................... 211

8.1 Risk assessment process ................................................................................................................. 211 8.2 Key risks ........................................................................................................................................... 214 8.3 Risk modelling................................................................................................................................... 218 8.4 Operational risk management ........................................................................................................... 219

9 Project cost................................................................................................................................................ 220

9.1 Overview ........................................................................................................................................... 220 9.2 Cost estimate methodology............................................................................................................... 223

10 Economic assessment ............................................................................................................................. 227

10.1 Overview ........................................................................................................................................... 227 10.2 Key assumptions and parameters..................................................................................................... 231 10.3 Costs................................................................................................................................................. 231 10.4 Transport benefits and network impacts ........................................................................................... 232 10.5 User benefits..................................................................................................................................... 233 10.6 Externalities ...................................................................................................................................... 235 10.7 Residual value .................................................................................................................................. 236 10.8 Arden transport benefits.................................................................................................................... 237 10.9 Wider economic benefits................................................................................................................... 237 10.10 Sensitivity tests and conclusion ........................................................................................................ 241


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11 Environmental assessment...................................................................................................................... 243

11.1 Overview ........................................................................................................................................... 243 11.2 Preliminary environmental benefits ................................................................................................... 243 11.3 Preliminary environmental impacts ................................................................................................... 245

12 Social assessment .................................................................................................................................... 252

12.1 Overview ........................................................................................................................................... 252 12.2 Human capital benefits...................................................................................................................... 252 12.3 Other social benefits ......................................................................................................................... 256 12.4 Specific urban development benefits ................................................................................................ 256 12.5 Social impacts of tunnel construction................................................................................................ 259

PART D – DELIVERY ARRANGEMENTS .......................................................................................................... 260

13 Stakeholder engagement ......................................................................................................................... 260

13.1 Stakeholder engagement strategy .................................................................................................... 260 13.2 Stakeholder framework ..................................................................................................................... 261 13.3 Stakeholder consultation results ....................................................................................................... 263 13.4 Stakeholder consultation next steps.................................................................................................. 267 13.5 Technical and operational stakeholders............................................................................................ 268

14 Delivery strategy ....................................................................................................................................... 270

14.1 Procurement strategy........................................................................................................................ 270 14.2 Planning approvals............................................................................................................................ 276 14.3 Planning process to support property acquisition.............................................................................. 279 14.4 Detailed project development phase schedule.................................................................................. 280 14.5 Construction schedule....................................................................................................................... 282

15 Project governance................................................................................................................................... 285

15.1 Overall governance........................................................................................................................... 285 15.2 Project team...................................................................................................................................... 287 15.3 Reference groups.............................................................................................................................. 290

16 Funding requirements .............................................................................................................................. 292

16.1 Phase 1 – Project Development........................................................................................................ 292 16.2 Phase 2 – Pre-construction............................................................................................................... 292 16.3 Phase 3 – Implementation ................................................................................................................ 293

17 Lessons learned and innovation ............................................................................................................. 295

17.1 The Tunnelling Joint Code of Practice .............................................................................................. 295 17.2 Victorian projects............................................................................................................................... 295 17.3 Interstate projects.............................................................................................................................. 299 17.4 International projects......................................................................................................................... 301

18 Public interest issues and Transport Integration Act ............................................................................ 304

18.1 Overview ........................................................................................................................................... 304 18.2 Public interest ................................................................................................................................... 304 18.3 Principles .......................................................................................................................................... 304 18.4 TIA Objectives................................................................................................................................... 309


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19 Recommendation...................................................................................................................................... 312

20 Bibliography .............................................................................................................................................. 313

21 Acronyms and Glossary of Terms........................................................................................................... 317

APPENDIX CONTENTS

APPENDIX 1 – RETAIL OFFER

APPENDIX 2 – DETAILED STAKEHOLDER MATRIX

APPENDIX 3 – PROJECT RISK REGISTER

APPENDIX 4 – DETAILED PROJECT COST SCHEDULES

APPENDIX 5 – DETAILED ECONOMIC ANALYSIS CASHFLOWS

Version Purpose Date

1.8 Issued to Commonwealth Sept 2011 1 December 2010

2.1 Final December 2011

TRIM REFERENCE NUMBER: TRIM/WORK/08/1513 – FOL/10/1025 – DOC/10/87361


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Foreword

“Forecasts indicate that, a decade from now, metropolitan Melbourne could potentially

become Australia’s largest city, with over one million people commuting to the central city

every day. In fact, the share of trips into central Melbourne by public transport is up from 52%

in the late 1990s to 65% in 2007, demonstrating the importance of the rail network in providing

access to central Melbourne.

“The Metropolitan Rail Capacity Upgrade Program will lead development of a world class rail

transit system, facilitating the comfortable, safe and efficient movement of residents, workers

and visitors. This is also in line with Council’s policies regarding improved public transport

access in support of more sustainable and efficient outcomes.

“The Melbourne CBD has grown while the core of our heavy rail system, the City Loop, has

been confined within the limits of the Hoddle grid. Today the central city effectively extends

from St Kilda Road, up through Southbank to the historic CBD, across to Docklands and north

to the burgeoning Carlton/Parkville university and research precinct. The Melbourne Metro 1

project will add services to the expanded central city area and relieve the pressure on St Kilda

Road/Swanston Street tram services.

“Melbourne’s future success rests largely on our ability to establish a knowledge economy of

global relevance. Our education sector is already a world leader and major economic

contributor; biotechnology and medical research are significant growth industries. The

Melbourne Metro 1 will physically connect our bio-medical research and university precincts in

St Kilda Road and Parkville/Carlton, and provide daily access for thousands of students,

teachers, and researchers: it is foundation infrastructure for future growth.

“The Metropolitan Rail Capacity Upgrade Program is essential for the growth and

development of a sustainable Melbourne and a thriving central city. Above ground, it will act

as a powerful catalyst for urban development and renewal in districts around new stations.

Greater urban density, which includes a mix of uses such as entertainment and cafés, retail,

residential, and commercial activity, all contribute to the economic stability, safety, and

sustainability of the city.”

Robert Doyle

Lord Mayor, City of Melbourne

Regional Rail Link & Melbourne Metro 1 Project Plan: Progress

Report for Infrastructure Australia, October 2009


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EXECUTIVE SUMMARY

This document presents the preliminary business case for implementation of the Melbourne Metro

(MM) project, including a full appraisal of the need, benefits, costs, risks and indicative delivery

arrangements to underpin pre-implementation funding submissions. The scope of the project to

concept stage is articulated. It follows the comprehensive options assessment report (March 2010),

which established the preferred alignment and station locations for MM and a draft pre-construction

business case for MM1 (December 2010). This business case therefore reflects the results of ongoing

investigations during 2011 and the latest refinement of the scope of the project. It will be updated and

refined as part of the pre-construction phase.

Separate submissions are being made to the Commonwealth for pre-construction ($130 million) to

permit the detailed development and early works) and to the Victorian State Government for corridor

protection ($100 million). The State is also pursuing investment in rolling stock and associated

stabling, power and overhead upgrades to enable the service plans of this and other investments

to be delivered.

The project

The Melbourne Metro (MM) project is the critical enabler of a metro-style rail system in Melbourne,

which is needed to maintain Melbourne’s liveability in the face of strong population growth, decreasing

access to jobs and services, a poorly performing and congested transport system and declining

productivity growth. The rail tunnel from South Kensington to South Yarra, and accompanying

surface works, will dramatically increase transport capacity to central Melbourne, improving

accessibility to Melbourne’s knowledge economy and facilitating inner urban renewal through a major

development precinct in North Melbourne.

The project was conceived as part of a seven-stage metropolitan rail capacity upgrade program to

address Melbourne’s transport and land use needs. Stages 1 to 4 of that program are fully funded and

construction is either well underway or completed. This includes Regional Rail Link (Stage 4).

The program previously envisaged delivery of the Melbourne Metro in two stages, with Melbourne

Metro 1 (MM1) as Stage 5. The Department of Transport has undertaken significant engineering, rail,

environmental, patronage, economic and land use investigations on Stages 5, 6 and 7, being MM1,

Melbourne Metro 2 and Melton Rail Upgrade. Based on these investigations, the metropolitan rail

upgrade plan includes refined definitions of Stages 5, 6 and 7 as indicated below (Figure E1).


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Figure E1: Updated Metropolitan Rail Upgrade Plan

Stage 5 - Melbourne Metro (MM) (this business case) - a new rail tunnel from South Kensington to

South Yarra, with stations and alignment as per MM1, plus surface works, which lays the foundation

for ‘metro-style’ services across the metropolitan rail network (refer Figure E2) and addresses critical

rail capacity bottlenecks and operational issues in the inner city and on lines serving most of

Melbourne’s growth corridors.

The project unlocks capacity for fourteen additional train services in the peak hour across

Melbourne’s north-west and three extra services on the Frankston and Sandringham lines. Further

passenger capacity uplift will be provided through longer trains on the Sunbury - Dandenong Metro.

The previous MM2 default “long” tunnel from Domain to Caulfield along Dandenong Road is made

redundant by the considerably more cost-effective “short tunnel” extension of MM1 along Toorak

Road, joining Dandenong rail corridor east of South Yarra station. The additional capacity that the

MM2 long tunnel option provides between Caulfield and South Yarra is no longer required for the

foreseeable future. Further, detailed investigations around possible stations along the MM2 tunnel

corridor options found no scope for major urban renewal, hence this is not a factor in selecting MM2

alignments.

The Melbourne Metro concept has also been refined and optimised by incorporating significant value

engineering opportunities analysed during 2011. Key improvements, in addition to the extension to

South Yarra, include a higher (shallower) vertical alignment and simplified interchange with Flinders

Street Station.


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Figure E2: Melbourne Metro rail system schematic

Stage 6 - Dandenong Rail Capacity (DRC) Program – staged investment to address critical

capacity issues on the corridor including provision for operational and timetable changes, longer

trains, signalling and power upgrades, road-rail grade separations and trackwork. These investments

will need to be progressively implemented over the next decade, commencing in the next two years. It

is assumed that with the long lead and construction timeframes for MM, a significant component of

the DRC works will be completed by MM opening. It is assumed that longer (9-car) trains will be

operating by MM opening; hence longer platforms will be required on the Sunbury corridor as part of

MM scope.

While MM has strong economic performance on its own, the DRC investments permit future benefits

of MM and are included in the economic analysis of the ultimate MM scheme. DRC works will

integrate and allow for the future connections to the Port of Hastings and the proposed future rail line

to Rowville, which is currently envisaged to connect to DRC at Huntingdale.

Stage 7 and beyond - the Metropolitan Planning Strategy (MPS), incorporating an integrated

transport strategy and refined rail priorities, is currently being prepared. The need or priority for MM

and DRC will not change, as urban development patterns for the next ten to fifteen years are already

largely set. The effects of the MPS will begin to reshape Melbourne’s urban form, and hence influence

the rail priorities, beyond this timeframe.

Feasibility studies are underway for upgraded or extended rail lines to Rowville, Doncaster and

Melbourne and Avalon Airports. The sequencing and staging of metropolitan rail upgrades beyond


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MM and DRC will be determined following these feasibility studies and in the context of the MPS. MM

is compatible with these initiatives.

Why should Governments invest in this project?

Investment in this MM is warranted because it addresses fundamental needs of the city, aligns

completely with the strategic aims of all levels of government, creates major environmental and social

gains and delivers substantially higher economic benefits than its whole-of-life cost. The project is

ready to proceed to the pre-construction phase, which needs to commence as soon as possible. The

ten-year lead time for the project means the earliest delivery time is 2021, and while the Regional Rail

Link project will ease existing congestion, the transport system will again be congested by 2018.

The rationale for investment in the project is explained in detail in the business case in four parts.

The business need identified (Part A) shows that:

� the project is completely aligned with the Commonwealth, State and local government’s policy

and strategic aims;

� Melbourne’s population is growing faster than any other capital city in Australia.

� Its knowledge economy in the central area is now critical to the nation with jobs located in the City

of Melbourne having reached 500,000 - double the number of two decades ago; and

� Melbourne’s productivity growth, sustainability, liveability and accessibility to jobs and services is

declining due to inequitable growth patterns and growing road, tram and train congestion. Current

commitments to rail capacity enhancement will fail to meet future demand, resulting in chronic

overcrowding and unreliability of the public transport system.

The preferred solution (Part B) to address these problems principally comprises a nine-kilometre rail

tunnel between South Kensington in the west and South Yarra in the south-east connecting the

Northern and Caulfield rail groups and bypassing the key bottlenecks North Melbourne and

Richmond.

Thorough options analysis has been undertaken over several years to determine the optimum

solution, including assessment of strategic, corridor, alignment and project options. The analysis

concluded that the Melbourne Metro Rail Tunnel, in combination with surface works across the rail

network and interventions to facilitate intense employment-focused mixed use development in North

Melbourne, is the best way to address these problems.

The Melbourne Metro (MM) is one part of a staged rail capacity upgrade plan to meet the growth on

Melbourne’s train network in the short, medium and long term. The Melbourne Metro is a key part of

this comprehensive expansion of the rail network providing a critical link through the central area. It

adds the capacity needed to meet the expected demand for rail travel in the Northern and Caulfield

rail groups, which are currently the most congested parts of the network.

The overall impacts and benefits of the Melbourne Metro (Part C) confirm that it has major strategic

social, environmental and economic benefits, which more than offset the whole-of-life investment.


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The project delivers an additional 17 train services or capacity for approximately 25,000 additional

passengers in the peak hour in the peak direction. When subsequently complemented by works to

remove other capacity constraints on the network, such as in the Dandenong Corridor, the MM tunnel

will be able to carry more than 60,000 passengers each hour in each direction.

The project delivers savings of 8 million tonnes of greenhouse gases across the project life and

improves accessibility to a range of existing and emerging activity and employment centres in the

south-east, north and west. Its scale also creates the opportunity to create a more equitable urban

form and deliver major human capital benefits, particularly to the outer south-east, north and west.

The MM project’s initial estimated capital cost is $7 to $7.5 billion (real 2010/11), excluding rolling

stock and related works. The ultimate scheme has a benefit cost ratio of 1.6–1.8 and an NPV of

$5.6–$6.5 billion.

A project of this nature, scale and location will naturally include significant risks. Many of these risks

have been identified early and mitigated through the design process. The project team has also

undertaken a Gateway review and several technical peer reviews of the scheme (by an independent

panel of international experts). Significant value engineering activities have been undertaken to

address risks and issues raised by the peer reviewers.

The key risks, which continue to be mitigated as possible as the project proceeds, include:

� Geotechnical risks regarding knowledge of ground conditions, geology, hydrogeology and

construction method;

� Construction impacts and disruption, including work injuries and failure of major equipment on

critical path (eg TBM) during construction

� Scope creep resulting from stakeholder requirements and inter-dependent projects not

proceeding as expected

� Work packaging interface and management risk

� Market unable to support sufficient consortia/finance for multiple, competitive bids, resulting in

higher project costs or funding/delivery model design does not cater for market appetite

� Industrial Relations - delays due to industrial disputes, access agreements and difficulties in

achieving acceptance of new technologies/standards

The delivery arrangements for the project (Part D) indicate the project is ready to proceed to pre-

construction phases and to complete statutory approvals and protect the corridor.

The broader Melbourne community and stakeholders affected by the project have been engaged in a

variety of mechanisms to date. The project enjoys strong support from the community, local, State

and Commonwealth governments. Community responses to the alignment options and station

locations assessment showed that 93% of respondents are in favour the project. A staged program of

stakeholder engagement is about to commence to support the statutory approvals process. This

includes the establishment of a Community Reference Group and Key Stakeholder Reference Group.

A preliminary investigation into procurement strategies found that the tunnels and stations should be

packaged and delivered as a Public Private Partnership (PPP), with the design, build and maintain

model to be retained as the next preferred model (ie without private financing). Other works (eg

surface works) will be delivered using traditional delivery models.


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Preliminary work has been undertaken to identify, assess and quantify value capture mechanisms,

including examination of options for sources of funding and funding models for the project. This work

will continue in the next phase.

This includes over-station development, proceeds from uplift in state-owned land, Tax Incremental

Financing, rates levies, uplift in future public transport far receipts, reallocation of the CBD parking

charge, public transport ticket levy, further charges to landowners based on uplift in property values,

and road user charges / vehicle registration levies. This work is ongoing.

A governance structure has been established for the project’s development to date, which will

facilitate a smooth transition to the ultimate delivery structure. The project’s delivery method (including

resolution of risks to be retained and managed by the State) will need to be confirmed before the

governance structure for delivery is established. A preliminary resources plan and organisational

structure have been prepared to support the project’s progress through the pre-construction phase.

The statutory approvals process, including the environmental assessment process for the scheme

has commenced. This will assist in preparation of the project proposal for declaration under the Major

Transport Projects Facilitation Act (MTPFA). The MTPFA has been selected as the preferred statutory

approvals process (instead of the process defined in the Environmental Effects Act) principally

because timeframes are more certain and approvals are consolidated into a single integrated decision

to be made by the Minister for Planning.

Declaration of the project under the MTPFA is the first statutory step, planned to occur early 2012.

This will be followed by preparation of a Comprehensive Impact Statement including public exhibition

and assessment committee during 2012. It is proposed to secure statutory approvals by 2013.

Recommendation

This assessment of the MM project demonstrates that it will shape Melbourne’s development over the

next 20 to 30 years. It shows compelling economic, social and environmental benefits and justifiably

enjoys strong stakeholder and community support.

It is recommended that this business case be endorsed as a basis for considering the pre-

construction and corridor protection funding submissions.

It is recommended that Governments proceed with the next phases of development to enable a full

implementation business case to be prepared.


PART A – DESCRIBING THE BUSINESS NEED

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1 How the investment aligns with government policies

1.1 Overview

This section sets out the national, state and local government policies and strategies which provide

the basis for the development of MM and this business case.

The policies of the new State Government reinforce the strategic case for MM. Themes which support

MM include fixing capacity problems on the rail network, building for future growth, creating

opportunities for consolidated urban development and renewal, strengthening the capital city and

supporting growth corridors.

The key policy principles that underpin the decisions for the development of the transport system in

Victoria are enshrined in the Transport Integration Act 2010. The Act sets out a framework to ensure

the components of the transport system are considered together and that transport and land use

planning are addressed as one.

The Victorian Planning Provisions (VPP) set out the strategic land use and transport planning for

Victoria. The VPP recognises the importance of an effective transport and land use system in meeting

people’s need for access to both enhance their own quality of life and for communal benefit

associated with a growing economy and inclusive society. The recognition of faster than forecast

population growth in Melbourne and an historic shift of the focus of metropolitan growth to the north

and west was inherent in ongoing updates to the VPP. The MM project is essential to supporting the

development of a mature transport to support this urban expansion in Melbourne’s north and west,

and to connecting these growing areas with the employment opportunities and other activities in and

around central Melbourne.

Victorian planning policy is based on integration of land and transport, improving productivity and

making the best use of existing infrastructure. Facilitating urban consolidation and sustainable growth

patterns is a key land use objective. DOT has developed a seven-stage rail capacity upgrade program

in this policy context. The program will deliver capacity and performance upgrades to the transport

system to address congestion, meet population growth, enhance accessibility and improve the city’s

productivity. It contains initiatives that have either been completed, are committed and underway or

are planned for the future.

Planning for the rail network has hinged on creating a metro-style train system to allow frequent train

services day and night so as to meet the needs of an international city of five million people and

beyond. Metro rail systems are designed to run higher capacity trains from end to end of lines using

dedicated tracks. Unlike today’s rail network, the trains can run at higher frequency without interfering

with other routes. The focus is on simple timetables, frequent services and consistent stopping

patterns. MM is the key stage of the seven-stage plan to facilitate metro-style services.



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At a local government level, the City of Melbourne’s Future Melbourne Plan and Municipal Strategic

Statement (MSS) are the overarching transport and land use policy documents. A review of the MSS

is under way, and the draft of this review recognises MM as the most fundamental change in the

transport network for the municipality.

The key Commonwealth Government policy relevant to MM is provided through Infrastructure

Australia (IA) which is advising the Commonwealth Government on priority projects that increase

Australia’s productivity, diversify the economy, build on Australia’s global competitive advantages,

develop our cities, reduce greenhouse emissions, and improve social equity and quality of life. The

“develop our cities” and “increase Australia’s productivity” objectives are at the heart of the MM

project. The Commonwealth Treasury Intergenerational Report provides background on the mix of

long-term challenges Australia is facing.

This section concludes with a summary of how MM is contributing towards the achievement of these

various policies.

1.2 Victorian Government strategic and policy framework

1.2.1 Introduction

The policy context of Victoria’s new State Government will be subject to ongoing development to

better articulate the current Government’s policies as they emerge. The government’s transport and

planning agendas, and hence MM, will need to inform and respond to the ongoing refinement of

planning strategies:

� a new Metropolitan Planning Strategy to develop an outcomes-based model of metropolitan

planning for Melbourne which takes into account the provision of services and infrastructure.

� Population Strategy for all of Victoria to investigate new population corridors in regional Victoria

and the possibility of extending existing infrastructure in regional cities to help manage Victoria’s

population growth.

� Metropolitan Liveability Audit to understand the full capacity of Melbourne’s rail, tram, bus and

road networks to find the gaps and optimise its use.

� Acceleration of the provision of zoned land to ensure a 20-25 year supply of land in growth

corridors followed by a biennial review of the Urban Growth Boundary.

It is expected that, given the scale and metropolitan-wide impact of MM, its need will be undiminished

by refinement of long term planning strategies. The rail system will progressively reach capacity from

2015 onwards, whereas the timeframes for fundamental changes in settlement patterns are much

longer. For this reason, while changes to land use policies may slightly alter or delay the long term

benefits of the project, the need for the project is unchanged.

Although the MM project has been developed partly in the context of policies of the previous Victorian

Government, the project primarily responds to fundamental drivers. Some, but not all, of these drivers

are within the influence of governments. The current Victorian Government has announced various

policies relevant to MM and it is clear that these strengthen the case for the project overall, relative to

the strategic fit assessment for the project1.

1 Regional Rail Link, Melbourne Metro Rail Tunnel Stage 1: Project Plan for Infrastructure Australia (DOT, January 2009).



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Some of the themes emerging from the new Government’s policies which are relevant to and

reinforce the strategic fit of MM are:

� fixing capacity problems on the rail network – the rail system will progressively reach capacity

from 2015 onwards (refer section 3), which MM specifically addresses

� building for future growth – train patronage, population and employment are all clearly growing

significantly. While MM addresses existing and short term congestion problems, it provides

significant capacity for growth

� creating opportunities for consolidated renewal and development zones – MM is the

catalyst for significant urban development in North Melbourne and surrounding areas of the inner

west and provides the environment for urban development in accessible locations along rail

corridors

� strengthening the capital city – a focus on metropolitan Melbourne and improving the

productivity of the capital city by improving connections between the centre and metropolitan sub-

regions to the north east, south east and west

� supporting growth corridors – supporting the south-east, north and west growth corridors and

biennial reviews of the urban growth boundary. MM provides for growth in these areas and also

provides the environment in which more compact urban development patterns can be facilitated

along rail corridors.

It is clear therefore that the emerging themes and policies of the new government reinforce the

strategic case for MM.

1.2.2 Transport Integration Act

The Transport Integration Act (TIA) unifies the transport portfolio under the one framework – including

ports and marine and transport regulation. The new legislation strives to achieve both integration and

sustainability in economic, environmental and social terms. The new Act requires all transport

agencies to work together toward the common goal of an integrated, sustainable transport system.

It also means land-use agencies – including DPCD, municipal councils, the Growth Areas Authority

and Parks Victoria – will need to take account of the new Act when making decisions that impact on

the transport system.

The Act recognises that transport planning and land use planning are fundamentally the same thing,

whether it be in long term planning, operations, project design, development or delivery.

The key policy principles that underpin the decisions for transport and related projects are enshrined

in the Act. The Act sets the following vision statement for Victoria’s transport system:

The Parliament recognises the aspirations of Victorians for an integrated and sustainable

transport system that contributes to an inclusive, prosperous and environmentally

responsible State.

The Act sets a number of objectives for the transport system:

� social and economic inclusion

� economic prosperity

� environmental sustainability



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� integration of transport and land use

� efficiency, coordination and reliability

� safety, health and wellbeing.

The project goals and investment logic identified for MM in this business case align closely with these

objectives.

The Act also lays out decision-making principles, to be employed in making decisions affecting the

transport system:

� integrated decision making

� triple bottom line (social, economic and environmental) assessment

� equity

� transport system user perspective

� precautionary

� stakeholder engagement and community participation

� transparency.

These principles are strongly reflected in the project and the development of this business case.

Transport and land use agencies at multiple levels of government have come together to ensure

integrated and transparent decision making and a triple bottom line assessment is fundamental to the

evaluation of the project.

More detail regarding how the MM incorporates the principles and objectives of the Act is outlined in

the final section of this business case where public interest issues are examined by looking at the

Act’s principles and objectives.

1.2.3 Victorian Planning Provisions

The context and framework for spatial planning and managing land use in Victoria is outlined in the

Victoria Planning Provisions, and state and metropolitan policies are detailed in the State Planning

Policy Framework (SPPF).

The planning provisions set out an approach to manage Melbourne’s growth for the next 30 years in a

way that consolidates the city’s reputation as one of the most liveable, attractive and prosperous

areas in the world for residents, businesses and visitors. The level of growth envisaged was

approximately 620,000 additional households by 2030, to be accommodated through urban

consolidation and development of sites in established areas, greenfield sites and dispersed urban and

non-urban locations. This is currently being review as part of the Metropolitan Planning Strategy and

updated population and employment forecasts.

The SPPF includes three directions which are of particular note:

� A more compact city, which included an objective to ‘locate a substantial proportion of new

housing in or close to activity centres and other strategic redevelopment sites that offer good

access to services and transport’.



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� A more prosperous city included an objective to ‘strengthen Central Melbourne’s capital city

functions and its role as the primary business, retail, sport and entertainment hub for the

metropolitan area’.

� better transport links included an objective to ‘plan urban development to make jobs and

community services more accessible’.

These directions and subsequent actions have led to the definition of MM.

In recognition that population growth had been faster than originally forecast, the Victorian Planning

Provisions are now premised on a level of population growth that will see approximately 600,000

additional dwellings in metropolitan Melbourne over the next 20 years, rather than over a 30-year

period as originally envisaged. Setting clear boundaries for Melbourne’s growth is a key element of

managing growth, and this will manage outward expansion, facilitate achievement of a compact city,

protect non-urban areas and ensure ready access to infrastructure in the key transport corridors.

During this period, the number of jobs within the metropolitan area will also grow significantly, from

1.86 million to nearly three million. Many of the higher order jobs are expected to be located in

central/inner Melbourne and the spine towards Monash, whilst employment opportunities in the outer

and fringe areas will tend to be more dominated by retail, community service and industrial jobs.

The Victorian Planning Provisions, through changes to the UGB, also recognise the historic shift of

the focus of metropolitan growth to the north and west. While Melbourne has grown asymmetrically

towards the east since the late 19th Century, fundamental constraints to the last remaining growth

area in the east, Casey/Cardinia, mean that urban expansion will predominantly be to the north and

west in coming decades. The MM project is fundamental to supporting the development of a mature

transport network to the north and west to support this urban expansion and to connecting these

growing areas with the employment opportunities and other activities in central Melbourne.

1.2.4 Central Melbourne

As the pre-eminent higher order employment node in the state, central Melbourne generates

significant productivity due to the concentration of knowledge jobs and specialisation of industries and

employment. Employment in the City of Melbourne has doubled to 500,000 in the past two decades

and is predicted to continue to grow by a further 200,000 by 2031. MM will strongly contribute to

central Melbourne, enhancing this critical role, and providing opportunities for expansion of the ‘inner

core’ office market to be progressively taken up.

The inner Melbourne planning policy context of the project is shown in Figure 1-1.



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Figure 1-1: Inner Melbourne planning policy context

Source: (City of Melbourne, 2008)

1.2.5 Metropolitan Rail Capacity Upgrade Program

This section briefly summarises the fundamental policy drivers and integrated long term planning that

has been undertaken by DOT for the rail system, in collaboration with DPCD. In particular, it reports

on the seven-stage rail capacity upgrade program to deliver capacity and performance upgrades to

the transport system to address congestion, meet population growth, enhance accessibility and

improve the city’s productivity.



beyond. Metro rail systems are designed to run higher capacity trains from end to end of lines using

dedicated tracks. Unlike today’s rail network, the trains can run at higher frequency without interfering

with other routes. The focus is on simple timetables, frequent services and consistent stopping

patterns. MM is the key to make this happen.

As outlined above, Victorian planning policy is based on integration of land and transport, improving

productivity and making the best use of existing infrastructure. Facilitating urban consolidation and

sustainable growth patterns is a key land use objective. The Metropolitan Rail Capacity Upgrade

Program continues to be refined and developed in this policy context.

A staged approach to the delivery of Melbourne Metro was previously contemplated in the context of

the seven-stage metropolitan rail upgrade program. Melbourne Metro is the pivotal ‘metro-enabling’

component of this strategy which builds on precursor projects and initiatives (ie Stages 1 – 4), which

are fully funded and either underway or completed:



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� Stage 1 - service changes and new greenfields timetables to improve rail capacity and reliability

across the network (implemented)

� Stage 2 - Laverton and Westall Rail Upgrades (completed)

� Stage 3 - Craigieburn Train Stabling and Maintenance Facility (completed) and Sunbury

Electrification Project (underway)

� Stage 4 - Regional Rail Link (underway)

The Department of Transport has undertaken significant engineering, rail, environmental, patronage,

economic and land use investigations on Melbourne Metro 1, Melbourne Metro 2 and Melton Raul

Upgrade projects, which formed Stages 5, 6 and 7. Based on these investigations, the updated

Metropolitan Rail Upgrade Program (Figure 1-2) includes refined definitions of the latter three stages:

� Stage 5: Melbourne Metro (MM) – new rail tunnel from South Kensington to South Yarra plus

surface works to allow reconfiguration of the network to provide new segregated, metro-style lines

and substantially more capacity across the Northern and Caulfield Rail Groups

� Stage 6: Dandenong Rail Capacity (DRC) Program – staged investment to address intensifying

capacity issues on the Dandenong rail corridor including provision for longer trains, signalling and

power upgrades, road-rail grade separations and trackwork.

The sequencing and staging of metropolitan and regional rail upgrades beyond MM and DRC

Program (ie Stage 7 and beyond) will be determined following various rail feasibility studies and in the

context of the Metropolitan Planning Strategy (MPS). The MPS is currently being prepared and

incorporates an integrated transport strategy and refined rail priorities.

The need or priority for MM and the DRC Program will not change, as urban development patterns for

the next ten to fifteen years are already largely set. The effects of the MPS will begin to reshape

Melbourne’s urban form, and hence influence the rail priorities, beyond this timeframe. Feasibility

studies are underway for upgraded or extended rail lines to Rowville, Doncaster, Upgrading Regional

Passenger Lines (Melton-Ballarat and Bendigo), Melbourne and Avalon Airports. Further details on

the impacts and shortfalls in capacity that will remain after each of these initiatives is implemented are

provided in section 2.8.

The Regional Rail Line Upgrades and Regional City Program2, which aims to further strengthen

the economic and social integration of regional centres and metropolitan Melbourne, includes the

Upgrading Regional Passenger Lines project (duplication and upgrade of Melton-Ballarat and

Bendigo lines) and urban redevelopment initiatives on regional rail corridors at Footscray, Sunshine

and Toolern. This project (previously known as Melton Rail Upgrade) is currently on the Infrastructure

Australia pipeline at an “Early Stage”.

2 Stage 5 of the Regional Rail Development Program, which is the next stage to be delivered (Stage 4 is Regional Rail Link and Stages 1, 2 and 3 have largely been delivered).



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Figure 1-2: Updated Metropolitan Rail Upgrade Program

Indicative timing for the development and delivery of the six-stage program is shown in Figure 1-3.

Figure 1-3: Metropolitan Rail Capacity Upgrade Program – Indicative Schedule



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1.3 Local Government policy context

1.3.1 City of Melbourne

The need for effective and integrated public transport is a key tenet of the City of Melbourne’s Future

Melbourne plan. The plan targets an increase in the percentage of people who use public transport,

cycle or walk to work in the central city from 72% to 90% by 2020 and calls for a significant increase

in the capacity and quality of train, tram and bus services to accommodate this. Future Melbourne

also underlines the state’s planning provisions to channel new urban growth into transit-oriented

development focused around train and tram nodes. The City of Melbourne has been a key partner in

the development of the MM and has been working in an integrated way with DOT, DPCD and the MM

project team on the refresh of the city’s Municipal Strategic Statement (MSS).

The recently exhibited City of Melbourne draft Municipal Strategic Statement3 envisages varying

degrees of land use change as the municipality continues to grow and develop, whilst retaining valued

characteristics (Figure 1-4). It is intended that this will be achieved by “targeting growth and

development to transform the large parts of the City that are currently redundant, underutilised or

undervalued, enabling ongoing but more incremental growth and development in those parts of the

City that need to constantly renew their vitality, and maintaining the existing character in valued

established areas”.

The draft MSS introduces three new strategic land use framework areas:

� stable areas – those anticipated to experience the least growth and change due to physical and

planning controls

� ongoing change areas – primarily established areas predicted to undergo modest changes

� urban renewal areas – areas predicted to experience the greatest level of growth and

development, often including whole precincts. Urban areas of note for MM include the precincts of

Kensington/North Melbourne; Arden/Macaulay, North Dynon; Racecourse rail corridor; E-Gate;

City North and CUB. These areas are key locations of interest for MM and support its

implementation.

3 Amendment C162 to the Melbourne Planning Scheme exhibited on 8/7/2010.



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Figure 1-4: City of Melbourne Growth Framework Plan

(Source: Draft Municipal Strategic Statement, City of Melbourne, July 2010)

1.3.2 Other municipalities

The relevant municipalities can be grouped into those in inner Melbourne, middle ring suburbs and

the growth corridors, as follows:

� Inner Melbourne: Cities of Port Phillip and Stonnington

� Middle Suburbs: Brimbank, Hobson’s Bay, Maribyrnong, Moonee Valley, Moreland (north and

west), Bayside, Glen Eira, Monash, Kingston, Greater Dandenong (south-east)

� Growth corridors: Hume and Whittlesea (North), Melton and Wyndham (West) and Casey and

Cardinia (South east).



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The local government areas are mapped in Figure 1-5. The local governments in Melbourne’s north,

west and south-east are supportive of initiatives to improve rail capacity, particularly between the

growth corridors and central Melbourne. This was reflected in submissions received in the

development of the Victorian Transport Plan, for example the City of Hume’s acknowledgement of the

strategic importance of the project: “The underground rail link provides opportunity for some of the

most congested sections of the network...to be freed up.”

Figure 1-5: Melbourne Metropolitan local government areas



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A review of policies of the relevant municipalities has indicated that these policies generally seek to:

� encourage housing and other activities in to highly-accessible locations

� encourage retail activity and employment diversity along corridors and at centres

� support housing in established areas along high capacity transport routes

� improve amenity and public realm in key locations

� develop transport interchanges.

These objectives are broadly consistent with MM. It is also likely that MM will assist with the

implementation of local policies (as well as regional and metropolitan).

In some specific locations, changes to local planning controls may be required in order to facilitate the

scale and nature of development commensurate with MM. This will occur as planning for future

development occurs, in conjunction with MM and in line with the Victorian Planning Provisions.

1.4 Commonwealth policy context

1.4.1 Council of Australian Governments

Victoria is not alone in meeting the challenges of a growing city. The Commonwealth Government

through the Council of Australian Governments (COAG) and Infrastructure Australia (IA) recognises

the importance of cities both for welfare of the population and for their contribution to the national

economy. The importance of cities in ensuring both quality of life and the national economic good has

been further supported by the release of the National Objectives and Criteria for Future Strategic

Planning of Capital Cities by the Council of Australian Governments (COAG, December 2009).

COAG’s objective is:

To ensure Australian cities are globally competitive, productive, sustainable, liveable and

socially inclusive and are well placed to meet future challenges and growth.

This objective is supported by nine criteria against which the appropriateness of city strategic planning

systems can be measured. The Victorian planning system is consistent with these criteria.

1.4.2 Infrastructure Australia strategic objectives

The Commonwealth has partnered with the Victorian Government to support the ongoing

development of the project through provision of development funding (for MM1). This Commonwealth

support has been the result of the project’s listing as a priority project by Infrastructure Australia (IA),

following their endorsement of the original strategic assessment. MM has been nominated as a

project of national significance not because of the scale of investment required but because of the

profound implications it has for Melbourne’s development and therefore the nation.

The Melbourne Metro project has been assessed against IA’s strategic objectives used to assess

proposals for Nation Building funding. These objectives are:

� expand Australia’s productive capacity

� increase Australia’s productivity

� diversify Australia’s economic capabilities

� build on Australia’s global competitive advantages



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� develop our cities.

The project addresses all of these objectives. In particular, the need to ‘increase Australia’s

productivity’ and ‘develop our cities’ (the second and fifth IA objectives) are at the heart of the project,

by enabling a new urbanism thorough provision of a quality public transport system that provides a

viable alternative to the private car and provides accessibility to a range of employment opportunities

and higher order facilities and services. By increasing accessibility to a wider labour pool and better

connecting Melbourne’s knowledge economy, the project’s agglomeration and productivity benefits

are very significant.

IA’s recent State of Australian Cities (March 2010) report noted that:

While Australian cities perform relatively well in terms of quality of life and other social

issues, they are confronted by significant challenges including population growth and

demographic change, transport congestion, living affordability, infrastructure development,

productivity growth, climate change and ecological sustainability. Australian cities will need

to respond effectively to these challenges in order to sustain the high quality of life enjoyed

by urban communities into the future, and remain globally competitive. …………

………In meeting growing local, state and territory demands, the Australian Government,

however, must ensure that taxpayer funds are allocated to deliver improved living standards

and quality of life for all Australians, as well as the national economic good, rather than

satisfying particular local demands.

Infrastructure Australia has previously designated the MM1 project as ‘ready to proceed’ in the

Transforming our cities category, indicating that the project meets all IA criteria supported by robust

economic analysis and has robust delivery plans.

MM2 is included separately in IA’s pipeline of projects as a project of ‘real potential’ (ie initiatives

which clearly address a nationally significant issue or problem and there has been a considerable

amount of analysis of potential solutions).

Defining Melbourne Metro as a more cost-effective extension of MM1 means that it remains eligible

for ‘ready to proceed’ status.

1.4.3 Intergenerational Report 2010

The 2010 Intergenerational Report published by the Australian Government Treasury in January 2010

states that Australia faces a complex mix of long-term challenges — an ageing and growing

population, escalating pressures on the health system, and an environment vulnerable to climate

change.

Decisions taken in the near term will impact on the wellbeing of future generations. Productivity-

enhancing reforms, particularly through nation building infrastructure and improving the skills base,

will grow the economy, improve living standards, and partly offset the fiscal pressures of ageing. With

an ageing population, productivity growth is the key driver of future economic growth. Australia’s

future economic growth therefore relies largely on productivity growth, with population growth and

employment participation likely to be a less significant influence on economic growth in the future.



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1.5 Summary of MM contribution to government policy and strategy

MM has arisen to meet the challenges set by the urban growth envisaged in the Victoria Planning

Provisions and the need for an integrated and sustainable transport system to support an inclusive,

prosperous and environmentally responsible State, as enshrined in the Transport Integration Act. MM

will do this by increasing the level of accessibility to key places, linking people with jobs in an efficient

and effective manner.

MM will deliver jobs closer to where people live, create a pipeline of supply of dwellings in targeted

urban renewal sites to contribute to a sustainable urban form, and enhance accessibility to a range of

urban activities through sustainable means. These outcomes will support a refined metropolitan

structure which will ensure Melbourne retains its liveability and productivity.

By increasing the level of accessibility to places, MM (including Arden Urban Renewal precinct) will:

� optimise urban renewal and redevelopment opportunities by creating environments where higher

density development can be delivered. This will include underutilised areas of inner Melbourne,

activity centres, and potentially other redevelopment sites along the rail corridor around new and

existing station sites

� provide opportunities for new communities in growth corridors to be anchored around high

capacity and high frequency public transport, providing access to a range of locations and

activities within the metropolitan area and region

� contribute to mixed use development extending out to the west of Melbourne where there is a

deficit of jobs and other activities by linking these areas with high capacity, high frequency

transport

� broaden the activities which can be easily accessed by public transport, particularly for existing

and the substantial additional communities to be developed in Melbourne’s west and north.

Existing clusters of activities will be easier to access, whilst new clusters of activity will be

supported along the corridor

� strengthen and expand the knowledge economy of inner Melbourne and CBD and catalyse an

urban activity corridor to link the central city towards the west, enabling faster growth in labour

productivity.

MM will play a pivotal role in increasing the connectivity between Footscray and the major institutions

and employment opportunities in central Melbourne, a major component of the agglomeration benefits

of this project. Connections will be enabled between central Melbourne, the western and south

eastern employment precincts, major educational and research institutions in Parkville and Monash

precincts and the Dandenong and Frankston activity centres, delivering significant productivity

benefits to Melbourne and Victoria.

MM is an enabler for the more efficient operation of the rail network, relieving the most critical

capacity constraint in the network and, in doing so, allowing more services to operate on the existing

tracks through the north and west of Melbourne and supporting the future extension of the network.

The process to develop the business case for MM strongly reflects the integration and sustainability

objectives and decision-making principles enshrined in the Transport Integration Act. Transport and

land use agencies have come together to ensure integrated and transparent decision making and a

triple bottom line assessment is fundamental to the evaluation of the project.



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The review of City of Melbourne’s Municipal Strategic Statement is taking MM as the largest single

change to the transport network. Through close working with DOT, City of Melbourne is ensuring that

its strategic plans best align with and leverage off this generational change.

MM addresses all of the IA objectives, particularly the ‘develop our cities’ and ‘increase Australia’s

productivity’ objectives, enabling a new urbanism through a quality, city-shaping public transport

system that provides a step-change in accessibility to employment and services. By increasing

accessibility to a wider labour pool and better connecting Melbourne’s knowledge economy, the

project’s agglomeration and productivity benefits are very significant. The 2010 Intergenerational

Report confirms that productivity is the fundamental driver of economic growth.

In summary, MM responds to the above policy imperatives by:

� supporting urban renewal and development in the inner areas of Melbourne, enabling more

people to live closer to employment and recreation opportunities

� supporting transit oriented development in the growing western suburbs of Melbourne and a

reduced travel footprint, by providing an enhanced rail system

� enabling more people to travel by rail, which reduces cost of living and is a relatively low-impact

mode for mass transit travel to the inner areas

� taking a transformational view to the development of the rail network, setting new benchmarks

regarding operational performance for future generations and environmentally sustainable design.



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2 Describing the existing and future situation

2.1 Overview

This section sets out the land use and transport context within which the need for and scope of MM

has been developed. All the evidence for the business need is provided in this section, which is then

summarised in Section 3.

Existing land use structure and transport networks in areas relevant to the project are described,

focusing particularly on inner Melbourne and the north-west of metropolitan Melbourne. The extent

and spatial distribution of population and employment growth envisaged over the next 20 years is

then presented. Recent trends in public transport patronage (particularly rail) are discussed, along

with the current operational performance of the rail system, and current problems of lack of capacity.

The section concludes with an assessment of the current performance of the rail network.

Melbourne is the nation’s fastest growing capital. Currently its population is four million people and is

expected to reach five million before 2030, more than a decade earlier than previously projected.

Most of Melbourne’s outward population growth is projected to occur in the north and west of the city,

with Melbourne’s west expected to nearly double by 2030. Growth in jobs and services in the medium

term is expected to be focused in the CBD and south-east, rather than in the north-west, which

already has lower than average job density.

Population growth, increasing rates of road congestion, petrol price rises and greater environmental

patronage awareness has caused a mode shift towards public transport. There has been an

unprecedented 70% growth in train patronage in the last decade and 50% in the last five years alone.

This has resulted in rail demand approaching the capacity of the network, particularly through North

Melbourne and around the City Loop. Only one track pair around the City Loop and between North

Melbourne and Flinders Street service all Northern Group services. This will be operating virtually at

capacity following completion of programmed initiatives. Richmond Station and access to the city

loop is similarly congested serving all lines in the Caulfield and Burnley Groups.

This lack of rail capacity and reliable rail performance will reduce the ability of employees to access

the major employment, service and education hubs of inner Melbourne and the south-east. It will also

impair employers’ access to a sufficiently diverse and deep pool of appropriately skilled employees. It

will also have an impact on the use of road capacity and hinder the efficient movement of freight.

The Victorian Government’s urban consolidation policy targets urban growth to occur in established

areas. There are significant opportunities to intensify inner urban development in North Melbourne but

higher density development in that area would lead to inefficiency in the transport system if it is not

served by high capacity public transport.

The congested state of the tram network and the growing importance of the knowledge economy

support the need to better service the key non-CBD centres of Parkville and St Kilda Road. These

centres are critical to the city’s growing knowledge economy and are served by congested tram

services on the St Kilda Road - Swanston Street corridor. This congestion highlights the need for two

of Melbourne’s more significant economic centres to be served by higher capacity public transport to

improve access and harness economic agglomeration benefits.



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2.2 Existing land use structure

2.2.1 Melbourne CBD and CBD fringe

Inner Melbourne comprises the local government areas of the cities of Melbourne, Port Phillip,

Stonnington and Yarra. This is a well developed and cosmopolitan urban area, the character of which

is summarised below. MM has the ability to enhance this area and underpin its further development

in a sensitive and appropriate way. Figure 2-1 shows the existing land use zones for the City of

Melbourne.

Figure 2-1: City of Melbourne existing land use zones

Inner Melbourne, particularly the Central Business District (CBD), forms the geographic, commercial,

employment and transport heart of the wider metropolitan area; there are over 750,000 workers and

visitors to the CBD each day, and this is projected to increase to over 1.2 million by 2030. The area is

largely divided into clear land use sectors with significant areas of parklands. The CBD is built on the

historic Hoddle Grid and now extends to the west and south to incorporate the mixed use suburbs of

Docklands and Southbank. It is within these suburbs that the major residential and employment

growth has occurred in recent years and where the greatest level of growth is predicted in the next



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decade. The precincts which are envisaged in the MSS review to have significant growth and change

are discussed and shown in section 1.3.1. These precincts align with MM.

Successive governments have allowed for and planned for the growth and expansion of central

Melbourne. Major initiatives included Southbank, Docklands and the Yarra cultural and sporting

precincts. This planning has not been limited to commercial activities, but also included cultural,

recreational, entertainment, sporting and institutional and educational facilities of state significance.

There has also been significant investment to ensure these activities also work at a human scale, for

example the inclusion of pedestrian and cycling infrastructure.

In the last 15 years, these activities have been complemented by significant efforts, particularly by

City of Melbourne, to attract housing. The central city is now effectively a self contained area in which

to work, rest and play.

As a consequence of these factors, the central city now extends from Melbourne University/Parkville

to St Kilda Junction and from the Sports and Entertainment Precinct to Docklands (Figure 2-2). This

central area is also complemented by significant metropolitan precincts at its edge: Lygon Street,

Bridge Road, Brunswick Street and Acland Street. In addition, a chain of parks and boulevards which

promote connections to south, east and north, and north-west has been developed. Complementary

commercial activity has spilled out of the central city to the inner east as far out as Hawthorn,

Camberwell and Malvern.

Figure 2-2: Inner city development past and future patterns

West of the CBD and Docklands is an extensive area currently dedicated to transport infrastructure

(port and rail) and industrial land uses. These current uses restrict movement and connections,

creating an effective barrier between the CBD and the Footscray CAD. This area includes the Port of

Melbourne and a freight and logistics precincts. It is predicted that by 2035, the Port of Melbourne,



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Australia’s premier container port, will be handling four times the number of containers that it does

today.

It is also evident that for a range of long-standing historical reasons, the central city activities have not

expanded towards the west. It appears that the historic constraints of swamps, noxious industry, port

and wasteland industrial activity have made locations such as Footscray ‘a bridge too far’ for higher

order investment and employment, despite Footscray being the same distance from the GPO as

St Kilda junction.

Major research, bio-tech and educational institutions are focused around Parkville and Carlton. To

the north and east of the CBD, the established areas of Parkville, Carlton, Fitzroy and East Melbourne

are characterised by heritage dwellings. To the northwest of the CBD, North Melbourne and

Kensington have predominantly small scale heritage residential uses and significant amounts of

industrial activities.

Employment corridors extend from the CBD along existing tram routes through inner Melbourne with

the most significant of these being along St Kilda Road to the south. Higher density residential and

commercial development along these corridors is being promoted as a means to more efficiently

utilise the city’s existing public transport infrastructure. This intensification of uses will provide a

greater diversity of employment, retail and entertainment opportunities as well as the ability to ‘live

more locally’ along existing public transport routes.

2.2.2 North-west metropolitan area

The northern and western parts of Melbourne have historically developed relatively slowly compared

to Melbourne’s east. This pattern of development is also reflected in public investment in transport

infrastructure. The current accessibility limitations in the west reflect the cumulative effect of this

historic slow growth and low investment in transport infrastructure. Figure 2-3 shows the planning

context for the north-west.

While the activities of a city are never equally dispersed, for some of the reasons described above,

the implications of this have greater significance as Melbourne moves from a population of four million

to five million and beyond. In particular:

� the north-west has a very narrow employment base with very limited activities in the growth

knowledge sector

� the north-west also has a considerably lower employment levels per capita compared to the

Melbourne Statistical Division (MSD), and also struggles to retain wealth, experiencing high levels

of escape expenditure for retail

� when the spatial distribution of production potential of Melbourne is examined, the most

productive areas are biased to the east, with the majority of west not included.

While the overall region is growing and diversifying, its economic structure remains narrowly focused

and is defined by industrial, logistics and population driven sectors. There are few higher order

centres, institutions and other assets. Various service sectors, including advanced business services

and retail, remain poorly represented in the region. This profile reinforces the blue collar emphasis of

the population base. The lack of higher order jobs, services and education opportunities in the north

and west also means that the regions are heavily reliant on inner Melbourne for these activities.

Gentrification has recently taken hold in the inner western arc between the traditionally wealthy

Williamstown and Essendon, including Yarraville, Footscray, Kensington, Flemington and Ascot Vale.



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These areas are generally characterised by heritage dwellings, and high levels of amenity and

accessibility.

In the north-west, the inner areas (Brunswick, Ascot Vale and Moonee Ponds) and middle ring

suburbs (Coburg, Pascoe Vale and Glenroy) continue to experience gentrification with higher density

dwelling activity and higher order employment activities beginning to emerge. Major open space

networks, including Maribyrnong River, Royal Park, the Moonee Ponds Creek and various smaller

reserves, contribute to the high amenity and desirability of these suburbs.

Some port and industrial land uses remain, particularly the industrial node at Laverton-Derrimut which

is designated of state significance. The evolution of this node has been heavily influenced by the

Western Ring Road which stimulated significant transport and logistics activities in the region. Other

areas which do not have the same road accessibility benefits are currently underutilised, and

combined with other planned infrastructure projects, are likely to represent opportunities for urban

renewal.

Regional demand for housing over time was sufficient to support development ‘jumping’ the industrial

node to suburbanise areas including Altona and Sunshine. Sunshine is now a growing activity centre,

providing access to a range of retail goods and services and with opportunities to capitalise on the low

intensity of land use within its centre at present.



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Figure 2-3: North-west planning context



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Beyond the Western Ring Road are newer suburbs of Cairnlea, Caroline Springs and Sydenham.

These areas currently form the edge of the existing metropolitan area in the north-west, with the

satellite towns of Melton (west) and Sunbury (north-west) located approximately 10 kilometres from

the existing urban edge. Recent changes to Melbourne’s growth boundary will close the gap with

Melton over the next 25 years and will also link the north western and western growth corridors. This

will result in improved internal connections and a more cohesive and coherent region.

The Melbourne Airport and surrounds will remain a ‘non-urban’ area and the adjacent business park

is one of the most significant employment concentrations in Melbourne, along with the major shopping

centres.

To the south-west, the Werribee corridor comprises the established areas of Werribee and Hoppers

Crossing, including Werribee town centre and Werribee Plaza, an enclosed mall-based shopping

centre which accommodates a substantial proportion of the area’s retail and commercial floor-space.

New master-planned housing estates such as Sanctuary Lakes at Point Cook and Caroline Springs

have been created in the growth corridors and these have attracted a more skilled and higher income

population to parts of the region.

Newer northern growth suburbs such as Broadmeadows, Craigieburn and Roxburgh Park (and as far

north as Beveridge with recent growth boundary changes) are served by Broadmeadows Central

Activities District. This is located in the southern area of this linear-based growth corridor.

2.2.3 South-east metropolitan area

The current (2011) estimated resident population of Melbourne’s south-east region is 1.6 million.

The Casey-Cardinia growth area is limited from continued outward expansion by both physical and

environmental constraints to growth, including the Koo Wee Rup swamp and floodplain, the foothills

of the Dandenong Ranges, and the Western Port ‘Ramsar’ wetlands. Long standing, bipartisan,

Government policy prevents expansion of areas set aside for urban development in the Mornington

Peninsula.

Analysis of household formation in the east and south-east regions demonstrates that historically new

households and upgrading households (second home buyers) have tended to move towards the

fringe growth corridors. When the eastern growth areas closed down in the 1990s, new households

form that region moved to the south-east.

The Casey-Cardinia growth corridor contains the only significant areas of broad-hectare development

land available in the east and south-east of Melbourne. Despite the prospect of diminishing broad-

hectare land supply, there will be ongoing demand for additional housing in the region, which if not

matched with supply, will introduce the option of locating in communities further east in Gippsland,

such as Warragul, La Trobe Valley, and Leongatha, or in the Mornington Peninsula. The Gippsland

communities are further from major sources of employment and locating there will incur unaffordable

commuting costs. The region outside the growth corridor has limited ability to absorb significant

amounts of new housing.

Given the historical household formation patterns of the area, it is unlikely that people will contemplate

moving to other regions of Melbourne.

Unlike the north-west, the inner and middle parts of the south-east corridor enjoy relatively good

employment accessibility. Monash is home to a knowledge industry precinct which includes Monash

University (Caulfield and Clayton), the Synchrotron and other R&D organisations, Telstra, CSIRO and



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other technology based firms. Additional knowledge based jobs can therefore be realistically attracted

to the area due to the high proportion of white collar employees living in the south-east, as well being

the locus of knowledge based businesses (including advanced service industries and advanced

manufacturing) which are already developing around Monash University.

The development trends to date suggest that the area between Caulfield and Monash is potentially

capable of attracting knowledge based employment that would benefit from fast links to the CBD. This

is in great part due to the sum of previous public and private investments in facilities and services

such as health, education, transport, recreation, civic and amenity many of which are of very high

quality and standing (such as Monash University).

Without investment in infrastructure which maintains accessibility to the south east, congestion is

likely to be a key influence:

“The Monash University will be heavily impacted by congestion with a very significant contraction in

the accessibility currently enjoyed by that area. This will impact on the firms located in the area in

terms of their labour productivity performance. Workers travelling in from the growth areas to the

Monash region will also be faced with extended travel times. At this point there are no proposed

transport projects which would alleviate the future congestion surrounding the Monash area.” 4

In addition to the knowledge industry precinct around Monash University, there is a significant

logistics and manufacturing centre at Dandenong South, a major employment area developing in

Cardinia, and a large industrial area with potential for increased levels of port associated activity

around the Port of Hastings (on Westernport Bay). The Port of Hastings is being planned for

development into Melbourne’s second container port in the medium term. These industrial and port

areas have considerable impact on the level of freight movement between the south east and the rest

of Melbourne as well as being notable employment locations.

Other significant employment locations in the south east include:

- Frankston Activity Area

- Springvale Major Activity Centre

- Dandenong South Industrial Area

- Moorabbin Airport.

While many sectors such as manufacturing require strategic allocations of land across the city,

continued strong growth in employment in the inner city and adjacent areas is expected into the

future. This is because Melbourne has developed rapidly into a post-industrial economy in which

agglomeration economies help drive firm efficiencies in knowledge based sectors.

4 SGS Economics & Planning, December 2010



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2.3 Existing transport context

2.3.1 Introduction

The rapidly growing suburbs in Melbourne’s west and outer south-east suffer from the impacts of a

less well developed transport network than elsewhere in the metropolitan area and hence the need for

significant enhancement. The middle and inner south-east has a much more established and denser

development pattern and supporting transport network. However it suffers from significant congestion

levels.

Inner Melbourne is the hub of the Melbourne metropolitan transport network, with the public transport

network focused around the CBD, key radial motorways connecting to and through the central area

and strategic freight links focused around the Port of Melbourne.

The transport network is experiencing strong growth in traffic across the metropolitan area. In

particular, the key corridors of the M1 (West Gate Freeway-Monash Freeway), North Melbourne and

Dandenong rail corridors experience significant congestion and no viable alternatives to these

corridors currently exist. The economic cost of congestion in Victoria is as much as $2.6 billion per

year (in 2007) and this could double within 15 years.

2.3.2 Public transport

Metropolitan train lines are currently assembled into four groups5 serving distinct geographical areas:

� Northern (incorporating Werribee, Williamstown, Sydenham, Craigieburn and Upfield lines in the

north and west)

� Clifton Hill (incorporating Hurstbridge and Epping lines in the north-east)

� Burnley (incorporating Lilydale, Belgrave, Alamein and Glen Waverley lines in the east)

� Caulfield (incorporating Pakenham, Cranbourne, Frankston and Sandringham lines in the

south-east).

Figure 2-4 shows the network in the inner area.

5 A fifth group known as the Cross-City Group comprising Werribee, Williamstown, Frankston and Sandringham line services was established in May 2011 as part of the implementation of a new greenfields timetable.



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Figure 2-4: Inner Melbourne public transport network

The outer areas of the north-west (Sunbury, Bacchus Marsh, Melton, Wallan) and south-east

(Warragul, LaTrobe Valley) regions are also served by V/Line regional services. The line from

Werribee in the south west of the region (including the Altona Loop) connects with the line from

Williamstown at Newport. The line from Sydenham passes through Sunshine and joins the Werribee

and Williamstown lines at Footscray. Craigieburn and Upfield lines to the north converge with other

Northern Group lines at North Melbourne. Work is currently underway to electrify and extend the

Sydenham line to Sunbury. All these train lines currently converge at North Melbourne, onto two track

pairs leading into the CBD. The four lines of the Caulfield Group progressively converge along the

Dandenong Rail Corridor, also joining the Burnley Group’s four lines at Richmond. This causes

unreliability and is a constraint on increasing the numbers of train services in the face of growing

demand.

Regional (V/Line) passenger services currently share tracks with metropolitan services as follows:

a. Sydenham to North Melbourne (Bendigo and Sunbury, Echuca and Swan Hill)

b. Sunshine to North Melbourne (Bacchus Marsh, Ballarat and Ararat)

c. Werribee to North Melbourne (Geelong and Warrnambool)

d. Craigieburn to North Melbourne (Seymour and Shepparton)

e. Pakenham to Southern Cross (Traralgon and Bairnsdale).

This is a further cause of unreliability and further constraint on increasing metropolitan train services.

The Regional Rail Link project will segregate V/Line services and eliminate the track sharing in a, b

and c above. A network of bus routes and limited tram routes also serve the north-west area.



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Inner Melbourne, particularly the CBD, is served by all train lines and all but three of the

27 metropolitan tram routes. Significant radial trunk bus services also connect the CBD to areas that

are not directly served by rail, such as Doncaster, complemented by local cross-town routes including

a high frequency bus service from North Melbourne provides access to Parkville and Melbourne

University.

Melbourne’s tram network has developed since 1885 into a $10 billon 247 kilometre double-track

network – the largest in the world. The tram network consists of a diverse mix of 27 routes providing

comprehensive network coverage across most of the 300 square kilometres of inner Melbourne, nine

of which are heavily concentrated on the St Kilda Road/Swanston Street corridor. St Kilda Road is the

spine of Melbourne’s tram network. With trams operating at headways of less than one minute in the

peak hour, this is the world’s busiest tram corridor. It is currently operating close to capacity.

Across the network average tram trip lengths are relatively short (in the order of 3–5 kilometres) with

work related trips only accounting for one in three trips.

2.3.3 Road

The north-west region is serviced by radial freeway connections to Geelong (Princes Freeway),

Bacchus Marsh/Ballarat (Western Freeway), Bendigo (Calder Freeway) and Craigieburn/Seymour

(Hume Freeway), as well as the Tullamarine Freeway serving the airport. These are linked by the

Western Ring Road. Inside the Ring Road, City Link and the Westgate Freeway provide access to

Inner Melbourne, the CBD and connect to the Monash Freeway providing access to the south and

east of Melbourne.

The south-east is serviced by the Monash Freeway and Princes Highway (Dandenong Road), which

traverses a well developed grid of arterial roads. Ten of these arterials form level crossings on the

Dandenong Rail Corridor between Caulfield and Dandenong, which have now become a constraint on

increasing train frequencies.

Inner Melbourne is served by high capacity arterial roads including Hoddle Street, Flemington Road,

Dynon Road, Victoria Parade, St Kilda Road, Kings Way and Royal Parade. Many of these main

roads carry both trams and buses as well as private vehicles, bicycles and freight vehicles.

Congestion on the major radial routes that connect the south-east and west to inner Melbourne and

the east is a particular concern, particularly for freight and business travel, especially given the

dependence on a small number of routes that cross the Maribyrnong River. These concerns gave

rise to the East West Link Needs Analysis (EWLNA) Study (The Eddington Report) and the proposal

for a new road connecting the Western Ring Road and the Eastern Freeway. The MM will provide an

additional transport link from the west into central Melbourne, helping to address this vulnerability.

2.3.4 Cycling and walking

Central Melbourne is characterised by very high pedestrian volumes, particularly in the CBD.

Swanston Street, for example caters for as many as 80,000 pedestrians per day. The presence of so

many people on the street creates a vibrant, active and economically healthy city. However it also

means that careful planning is needed so that the interfaces between pedestrians and other transport

modes are safe and efficient. For example, MM will result in more people entering and leaving

stations, crossing roads and linking to other modes such as tram, bus and bicycle.

High density bicycle infrastructure is provided in inner Melbourne compared to other parts of the

metropolitan area, and is well utilised, with the number of cyclists increasing significantly in recent



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years. In March of 2008, bicycles accounted for more than 9% of peak hour vehicle movements into

the Melbourne CBD. Growth in cycling is expected to continue.

2.3.5 Freight and logistics

The size of Melbourne’s freight task is increasing rapidly – and has been growing at a faster rate than

the economy and the population. Most of this freight is moved by road, and because a large share of

Victoria’s road freight transport relies on links through the metropolitan area, road congestion is a

significant issue. The city faces considerable challenges in reducing the impact of traffic congestion

on the freight task and ensuring that freight moves around Melbourne as efficiently as possible.

Freight traffic in Melbourne will continue to be concentrated around three key areas: the Port of

Melbourne and related industrial areas, the north, west and north-western corridor along the Western

Ring Road and around Somerton, and the south and south-eastern corridor, centred on Dandenong.

Freight hubs are becoming an important element in the metropolitan freight task and are increasingly

recognised as playing a key role in reducing congestion and managing the growing freight task. In

Melbourne, such centres are developing in and around Somerton and in Altona, Spotswood, the

Dynon precinct, Swanson Dock and Dandenong.

The Port of Melbourne is Australia’s leading container port and one of Victoria’s most important

assets – contributing more than $5.4 billion to the state’s economy each year and directly providing

jobs for more than 18,000 people. While it is unlikely that the size of the port will greatly exceed the

current 500 hectares by 2035, there will be significant increases in trade volumes of containers, Bass

Strait trade, new motor vehicles and bulk products. The Port of Hastings south of Dandenong is

planned to become Melbourne’s second container port in the future, which will change the patterns of

freight movement in Melbourne. It may cause additional pressures on the Monash Freeway and

Dandenong Rail Corridors.

Overall, around 80% of freight moving into the port is transported by road, generating around

1.2 million truck visits to the port each year. This has particular implications for local streets near the

port, the West Gate Bridge and the West Gate Freeway and associated road links to industrial areas

and logistics facilities in the west. Even allowing for existing initiatives, the significant growth in the

freight task will mean that truck traffic will still continue to grow significantly.

Managing the growth in urban freight – and the strong growth in trade through the Port of Melbourne –

raises many challenges for the city and its transport network. Among the issues holding back greater

freight efficiency in Melbourne are congestion along key freight routes, especially the M1 and the

Western Ring Road.

The Eddington Report paid particular attention to addressing the issues raised. Whilst the focus of

the team was on ways to improve the mode share for rail freight, it was noted that:

“Without action taken to improve management of the freight task, industry will face significant

additional costs from increased travel times and unreliable travel”.

MM has an important role in easing congestion, especially in inner Melbourne and more specifically in

the vicinity of the Port of Melbourne, by attracting car users which will release road space for trucks

and directly assist in managing the on-going freight task and support productivity.



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2.4 Population growth and housing

2.4.1 Metropolitan growth

Melbourne and Victoria are growing very quickly, with the State currently experiencing its third

population boom – bigger than the post-war migration boom and bigger than the Gold Rush of the

1850s. Over 2008/09 alone, Melbourne’s population grew by about 93,500 people (almost 1,800

people per week). Victoria in Future 2011 projections indicate that between now and 2031,

metropolitan Melbourne‘s population will grow by 1.3 million people to over 5.4 million. VIF2011

estimates that Melbourne‘s population will reach six million before 2040 at an average growth rate of

1.2% per annum.

To accommodate this growth, it is estimated that 612,000 additional dwellings will be needed between

now and 2031, with around half in Melbourne’s established suburbs and half in Melbourne’s growth

corridors. In total, this means that an average of around 30,000 dwellings will have to be constructed

every year. Growth corridors have been designated in the west (Wyndham, Melton), north (Hume,

Whittlesea) and south-east (Cardinia and Casey). Within the three growth corridors it is projected

(Victoria In Future 2011) that the north and west growth corridors will accommodate 70% of new

dwellings in all growth corridors, as outlined in Table 2-1.

Table 2-1: Projected distribution of dwellings in growth corridors: 2010–2031

Areas Existing

Dwellings (2010)

Projected Dwellings

(2031)

Distribution of New Dwellings

(2010–2031)

Growth

2010-2031

Established areas 1,273,000 1,595,000 322,000

(53%) 25%

Growth corridors 314,000 604,000 290,000

(47%) 92%

South-east 112,000 198,000 86,000

(14%) 77%

North 109,000 195,000 86,000

(14%) 79%

West 93,000 211,000 118,000

(19%) 127%

Total 1,587,000 2,199,000 612,000 39%

Outside of the growth corridors, VIF2011 predicts that different parts of Melbourne will experience

different population growth patterns. In particular, the middle suburbs will experience moderate rates

of growth through residential infill developments; while the inner city will experience strong growth,

driven by the trend for young people, as well as knowledge and specialised service workers, to be

attracted to the inner area. These are shown in Figure 2-5.

The whole south-east corridor is projected to grow by more than 600,000 people or 40% to over 2.2

million people by 2046. Almost half (46%) of this growth is expected to occur in the Casey and

Cardinia municipalities (or growth corridors), with Greater Dandenong and Kingston account for a



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further 17%. This growth is expected to be housed in around 300,000 new dwellings across the

region, 40% of which is expected to be accounted for in the growth corridor.

Figure 2-5: Projected growth by municipality (Victoria in Future 2011)

Population Change .2010 to 2031

200,000

100,000

20,000-20,000

-100,000

-200,000

2.4.2 Growth corridors

MM focuses on expanding rail capacity to the lines that service the growth corridors. It is estimated

that Melbourne’s south-east growth corridors will have land available for less than 20 years of

projected growth. As a result, these growth corridors which feed demand to the Dandenong rail

corridor are likely to play a limited role in accommodating outer urban growth after 2026, though the

corridor is currently congested – the potential for capacity increases are being examined as part of a

separate business case. The north and west growth corridors will become increasingly a focus of

Melbourne’s growth, and will continue to drive demand and therefore the need for additional

infrastructure on the Northern Group.

2.4.3 Middle suburbs

As well as the growth corridors in the northern and western parts of Melbourne, the established areas

will also need to accommodate additional dwelling and population growth. Activity centre locations,

as well as brown-field redevelopment opportunities, will need to be identified and planned in a manner

which reflects their important roles in providing a pipeline of dwelling supply for the city, and help

avoid the need for further expansion of Melbourne’s urban footprint. Central Activities Areas and

Principal and Major Activity areas will all play a role in accommodating such growth, as well as other

highly accessible locations.



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2.4.4 Inner Melbourne

While a large proportion of the catchment for MM lies in Melbourne’s south-east, north and west,

proposed new stations in the inner area will have a role in supporting the predicted substantial growth

in inner city residential development and enabling access to this development from the wider

metropolitan area.

Inner Melbourne, which includes the municipalities of Melbourne, Yarra, Stonnington and Port Phillip,

is expected in VIF2011 to grow by around 160,000 to more than 530,000 by 2031. Demand for inner

urban development and consolidation is predicted to remain strong. It will be a major growth area in

its own right, accommodating around 12% of total metropolitan population growth.

Figure 2-6 provides a spatial distribution by suburb of projected growth for the City of Melbourne for

the 15 year period to 2026 (assuming no government intervention to stimulate development). Of

particular significance to MM, are the additional 23,500 residents projected in the CBD and

Southbank.

The built form that is expected with these developments is likely to shape the demographics of the

population. The majority of new dwellings that are expected to be built in this period are apartments,

many of which are relatively small in nature (one and two bedroom). The apartment market has been

dominated by young singles, couples and students. Docklands is also expected to attract some older

households.



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Figure 2-6: City of Melbourne population growth projections by suburb (no intervention)

Source: City of Melbourne

2.5 Industry and employment

2.5.1 Metropolitan Melbourne

The distribution, scale and nature of industry and employment have significant impacts on the city,

metropolitan area and state economy. Providing opportunities where firms can establish, expand and

diversify is a key role for government in contributing to a productive economy which can support our

growing and ageing population. In addition to having broad economic benefits, it is important that jobs

and people are well linked. This provides people with wider choice and opportunity, contributing to

better matches between jobs and skills, as well as limiting time spent travelling to access

employment.

These two facets of industry and employment will be addressed in this section – the changing nature

of employment and the changing spatial distribution of employment.



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Changes in employment by industry

Melbourne has historically grown as a large industrial city with a strong manufacturing sector;

however globalisation and trade deregulation have had significant implications for the employment

profiles of many cities, including Melbourne. Productivity and employment growth trends indicate that

the transition towards the services sector will continue, and these sectors will play increasingly

important roles in both the scale of job growth (refer Figure 2-7) as well as the level of productivity

generated by the economy. Providing for service based industries is therefore central to the future

economic growth and productivity of Melbourne and Australia.

Figure 2-7: Projected change in employment by industry (2006-2031)

Spatial preferences of the service sector

Service-based industries tend to cluster together because of the productivity benefits of proximity

(known as agglomeration). These benefits include better opportunities to build face-to-face

relationships and informal sharing of knowledge. This contributes to improved economies of scale and

scope, access to a deep and diverse pool of clients and skilled labour, technological and knowledge

transfer and innovation. Such interactions increase the productivity of companies and ultimately the

aggregate economic performance at a metropolitan, state and national level.

Government has played a significant role in providing opportunities for this sector to grow on the

fringe of the CBD through establishing the preconditions for major private sector investment (Figure

2-2). This has included tram, road and public realm investment in both Southbank and Docklands,

and the subsequent plentiful supply of relatively inexpensive land for commercial development. Whilst

these areas are readily accepted as new parts of the central city area of Melbourne, it is not

necessarily the case that all cities are able to provide significant quantities of supply in such prime



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locations. For example Sydney CBD is much more constrained and has not been able to achieve the

same outcome.

The sectors which benefit most from agglomeration show a high elasticity with respect to Effective

Job Density (EJD). The level of employment relative to the time taken by various modes to gain

access to that employment has been used to asses the EJD of existing areas. Figure 2-8 presents

the SLA level EJD pattern for Melbourne. Industries such as Accommodation, Cafes & Restaurants

and Personal Services show particular affinity with EJD, however, these are not necessarily the

industries which will drive Victoria’s future prosperity. Key growth industries for Victoria are the

Property & Business Services and Finance & Insurance. These are also large sectors in Melbourne’s

economy. These industries are also positively correlated with EJD and benefit from increased

densities of commercial activity and/or improved transport links. The relationship between

agglomeration, industry size and growth is shown in Figure 2-8.

The Hoddle Grid in the CBD has historically been the area with the highest EJD and therefore

provided opportunities for these higher order activities to co-locate for their mutual benefit and

subsequently expanded to St Kilda Road. The Parkville precinct, due to its knowledge industries, now

also plays a role in accommodating such organisations and activities. Major government

interventions have seen remnant industrial areas in Southbank and Docklands transform. The

attractiveness of these locations is easily explained by the map of Melbourne’s existing EJD

(Figure 2-9).

Whilst the inner commercial core (as defined by the Hoddle Grid, Southbank, Docklands and St Kilda

Road) will always retain some capacity to accommodate additional office and employment

investment, experience with locations such as Southbank and Docklands indicates that stimulating

such activity in new locations plays an important role in economic growth within a city. There is a key

role for government to create locations where the private sector can plan, deliver and invest to provide

employment opportunities.

Traditionally, Melbourne’s development has seen non-CBD jobs gravitate to the south-east in an area

roughly encompassed by a triangle between the CBD, Ringwood and Dandenong. This area was

generally accessible to the historical development corridors of Melbourne’s south-east.



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Figure 2-8: Agglomeration elasticity, industry size and industry growth, Melbourne

Figure 2-9: Melbourne effective job density, 2007-08



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Only certain areas in inner Melbourne, however, are capable of supporting new investment and

activity. These locations are largely determined by the market. Commercial investment choices are

strongly guided by historic ones, so it is likely that a large proportion of these job types will continue to

locate in areas that exhibit similar characteristics to that of the existing commercial core: that is, areas

of high EJD whether this is due to existing development or high transport accessibility. It is therefore

critical that Government identify locations where latent demand for such activities is present and focus

resources on activating such opportunities. Ultimately, this will result in further agglomeration of

employment, generating productivity benefits for the economy and contributing to retaining

competitiveness.

Ongoing congestion on the transport network also significantly impedes labour productivity,

particularly in the knowledge-intensive inner areas. Melbourne’s productivity growth has been falling

in recent years, in part due to increased congestion on its transport system (Figure 2-10). Productivity

is the cornerstone of future economic growth – accessibility of knowledge jobs improves business to

business interaction and the ability to attract more productive jobs to inner Melbourne, which in turn

drives agglomeration benefits and hence labour productivity. Business productivity is also affected by

efficiency of freight movement, which is strongly influenced by congestion.

Figure 2-10: Productivity Growth – Melbourne and Australia

Significant inner city employment growth in recent years has meant that employment in the City of

Melbourne has now reached 500,000, more than doubling in the past two decades. This growth has

been fuelled by the availability of competitively-priced inner city land in Docklands and Southbank and

has meant a greater diversity of businesses have been able to cluster in the city, driving more

demand, productivity growth and more productive jobs. The city’s amenity and vibrancy, driven in part

by residential growth in the CBD, has also been a key driver of attracting talent to the city and

informing business expansion decisions. Firms will continue to seek to capitalise on the innovation



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opportunities and agglomeration economies provided by the density of economic activity in central

Melbourne.

Demand for employment in this area is therefore expected to continue to grow strongly so long as the

central city retains it vitality, is accessible by public transport and land is available for commercial

development (refer Figure 2-11). The Melbourne Metro is therefore a key underpinning of economic

agglomeration, productivity and more productive jobs, given existing rail services will be over-crowded

in the future without MM, potentially resulting in knowledge jobs locating elsewhere (see breakout box

for Pearson case study). If service-based jobs, which benefit from agglomerating, were located

outside the central area, then productivity and international competitiveness would be reduced.

Rapid population growth in outer south-east, north and west growth corridors is expected to continue

without commensurate growth in employment in those regions, further exacerbating the already

significant geographic imbalance between population and employment growth. This will increase

cross-town travel between the north-west and south-east and radial travel to access central

Melbourne, intensifying growing congestion and unreliability on Melbourne’s public transport network.

Access from the outer north, west and south-east to economic activities in central Melbourne and

inner east is constrained by network capacity.

Figure 2-11: Forecast Spatial Changes in Employment (2006 – 2031)

It is clear that there is also an increasing need to better service the key knowledge economy centres

of Parkville and St Kilda Road. These areas are critical to the city’s economy, are and becoming part

of Melbourne’s central area and are continuing to grow. They are served by tram services on the St



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Kilda Road – Swanston Street corridor, one of the world’s busiest tram corridors and which continues

to experience strong growth. Services are nearing capacity and there is limited scope to provide

services. This congestion highlights the need for two of Melbourne’s more significant economic

centres to be served by higher capacity

public transport to improve access and

harness economic agglomeration benefits.

2.5.2 North-west

Those living in Melbourne’s north and west

currently have limited access to and choices

in employment. Current projections of

employment indicate that that this trend will

continue. The northern and western

municipalities in Melbourne are expected to

accommodate approximately 144,000 jobs

over the next 20 years and 203,000 over the

next 30 years. This represents only 23% of

employment growth in the metropolitan area,

compared to the 36% of new dwellings

projected to be located in the region over the

2006-2026 period. The manufacturing and

transport industries in the west which will

play a significant role in the provision of

employment are characterised by low

employment densities and are generally

lower skilled, resulting in lower levels of

wealth within the working population. Such

a narrow employment profile also has a

higher degree of risk; should reductions

occur in these sectors, there are limited

other sectors to support the population.

These areas are heavily reliant on inner

Melbourne for access to a greater diversity

in jobs, hence providing access to the major

concentration of jobs within central

Melbourne is critical.

Footscray CAD employment is currently

around 7000 and is projected to double by

2046 (exhibiting a similar trajectory to

Dandenong CAD). Broadmeadows CAD’s

short to medium term employment growth is

not projected to be significant; noting that nearby Moonee Ponds PAC is likely to be a more attractive

location for employment given its success.

2.5.3 South-east

The Caulfield Rail Group directly serves an area that makes up about half of Melbourne’s GMP and

9% of Australia’s GDP (includes Melbourne CBD/ LGA). In conjunction with the Monash Freeway and

PEARSON GETS TO THE HEART OF IT

Dionne Higgins scoured Melbourne’s inner suburbs to find

a new head office for Pearson Australia. The publishing

group’s chief operating officer wanted to bring together staff

from the main office in suburban Camberwell and another

facility in Port Melbourne.

She eventually settled on a refitted historic warehouse at

Docklands, and says attracting talent and the site’s

proximity to other businesses were key reasons behind the

decision.

When the company moved from Ringwood to Camberwell

10 years ago there was a noticeable shift in the talent on

offer. “They found a significant increase in the kinds of

people they were able to attract into the business,” she

says. “We’re expecting the same thing.”

A survey of Pearson staff revealed they came from all parts

of Melbourne and were increasingly using public transport.

The best way to provide them, and prospective employees

with an easy commute was to head for the heart of

Melbourne’s transport system.

“In the end that building and that location won us,” Higgins

says. “It’s right near Southern Cross (train station), it’s near

bike paths, it’s near trams, it’s near freeway exits.”

She concedes the purpose-built facility will cost more, but

Melbourne at least has lower rents than in other cities, such

as Sydney, where Pearson has offices in Frenchs Forest

and Surry Hills.

“There’s also a bit of a media hub down there,” Higgins

says.

Pearson joins Fairfax Media, Channel 7 and the Nine

Network in Docklands.

Australian Financial Review, 22nd

September 2011



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Princes Highway, the Dandenong Rail Corridor serves as the transport backbone to south east

Melbourne.

Around half of all new dwellings in the south-east are expected to be located in the Casey/Cardinia

growth area, and by the mid 2020s over half a million people will be living south of Dandenong.

Growth in jobs and services in these already under-serviced areas is not expected to keep pace with

population growth, and many new residents locating to the outer growth corridors will need to travel to

the CBD and inner south east to access employment, education and other services. Unlike other

areas of the rail network, there are numerous major centres of population, education and employment

located along the corridor. These include major shopping destinations at South Yarra and Oakleigh

(Chadstone), Monash University campuses at Clayton and Caulfield, and clusters of

technology/innovation and manufacturing organisations such as Telstra, CSIRO, and the Australian

Synchrotron in the Monash area.

The south east already has a strong presence of “knowledge” based employment, and is also home

to a highly skilled workforce, with 44% of existing residents having a bachelor degree compared to

29% nationally. An increasing number of new service-based jobs are expected to locate to the inner

south-east and destinations along the corridor, building off the corridor’s strong economic base.

These residents, particularly those employed in service industries, will drive demand for rail travel for

access to employment in the CBD and inner south east.

2.5.4 Parkville precinct

Parkville is a premier precinct in a national and international context for education, research, and

health care. It is home to the Royal Melbourne, Royal Women’s and Royal Children’s Hospitals, the

University of Melbourne, the Walter and Eliza Hall Institute of Medical Research, the Ludwig Institute

for Cancer Research, as well as a host of other research institutes and facilities. The sheer number

of life sciences research facilities and the comprehensive breadth of bioscience disciplines, is without

parallel in the southern hemisphere and is one of the few such concentrations of research excellence

worldwide.

Collectively, institutions in the precinct manage an annual research budget of $1.3 billion and engage

over 10,000 research staff and post graduate students. They have secured 26% of the National

Health and Medical Research Council (NHMRC) funding (part of the 41% of NHMRC funding

attracted to the State of Victoria) and created and commercialised numerous medical innovations,

including the bionic ear, colony stimulating factors, retinal imaging, discovery of Rotavirus, vaccines,

diagnostics, microsurgical instruments and antibiotics.

Building on this success, there has been recent and ongoing investment approaching $5 billion

around the Parkville Precinct to augment and construct new research infrastructure, build capabilities

in ICT as it pertains to the sciences and bring new partners into the Precinct. These investments

significantly expand the precinct’s capabilities to perform world-class research and are expected to

transform the precinct into the key southern hemisphere hub for the generation, storage, interrogation

and exchange of life sciences data and a major international player in health care, research and

training.

These investments include the new:

� Neurosciences facility under construction in Royal Parade will be a hub for the Howard Florey

Institute, the Mental Health Research Institute and neuroscience-related University research

(operational in 2011)



Page 51 of 321

� world-class Victorian Comprehensive Cancer Centre (to be built by 2015)

� Peter Doherty Institute for Infection and Immunity

� $100 million Victorian Life Sciences Computational Facility will give the precinct unequalled

computer capability in the life sciences

� $250 million Royal Women’s Hospital (opened in 2008).

Synergies and opportunities evolve constantly from the co-location of large numbers of high quality,

researchers and clinicians in the precinct in the faculties, hospitals, research institutes and specialist

medical practices. The centralised position of the Parkville precinct, adjacent to Melbourne CBD,

enables the precinct to take advantage of industry savvy, other tertiary institutions such as the RMIT

University, public transport accessibility, quality inner city housing, and a rich cultural and intellectual

environment.

The Parkville and Carlton area is also the focus of a number of major educational institutions,

including the University of Melbourne and RMIT University, which generate significant economic

activity for the nation. The universities and research institutes are expected to continue to develop

and expand around these existing nodes, continuing to draw users from across not only the wider

metropolitan area but also across the state, the nation and internationally.

Parkville employment is projected to grow steadily from around 14,000 currently to 19,000 in 2031.

The Parkville precinct is served by a series of north-south tram routes, including those that run via

Swanston Street and Elizabeth Street. It is not currently serviced by rail, however the southern part of

the precinct falls within the walking catchment of Melbourne Central station.

2.5.5 North Melbourne

North Melbourne is located immediately north of the Hoddle grid, and separated by North Melbourne

Station and the Northern Group lines from the neighbouring Docklands and E-gate site to the south

(Figure 2-3). The suburb of North Melbourne is characterised by a mix of residential and industrial

activities (on the western edge). VicTrack land in the south of the suburb accommodates rail stabling

and concrete batching plants and the area is surrounded by light industrial uses. Many of these

premises are in poor condition, offering opportunity for renewal.

The main retail and commercial area is centred on Errol Street. Errol Street also accommodates a

number of health and community facilities, and is an important centre for provision of professional

services. A tram service along Errol Street provides access to the city via Elizabeth Street, while

North Melbourne station provides rail access to the inner area.

2.5.6 Southbank and St Kilda Road

Southbank and St Kilda Road have undergone significant transformation in the past two decades.

The precinct is a focus for a number of business service industries, and is host to software, creative,

design, engineering and logistics firms. Companies such as Fosters, IBM, Herald-Sun and Exxon–

Mobil have now been established in Southbank.

Approximately 10,000 further education placements are located along St Kilda Road, offered by

private providers. Higher education is the fastest growing part of the education sector, with the

number of places expected to double in 10 years.



Page 52 of 321

Victoria’s premier arts precinct is situated around the northern end of St Kilda Road, including the Arts

Centre, the National Gallery of Victoria and the Victorian College of the Arts. In recent times, this

precinct has extended to include Sturt Street and the development of stronger links between the

St Kilda Road institutions and those in Sturt Street is a key priority for the enhancement of the

precinct.

The Southbank/St Kilda Road precinct is linked to the CBD by the St Kilda Road, Queensbridge and

Clarendon Street trams. Two bridges exclusively for pedestrians and cyclists are also available – one

of which provides direct access to Flinders Street Station.

2.5.7 Port & East- West Corridor Framework

The EWLNA report highlighted the many advantages of reconceptualising the boundaries of the CBD

in the port and inner west. Integration between Footscray and the CBD would ensure that the inner

west shares in the opportunities and benefits being generated by the central city’s growing and

changing economy. This approach would give Footscray the potential to leverage off its proximity to

the central city and reinvigorate the inner west (with spin-off effects for the west more generally) by

shifting away from the area’s traditional reliance on manufacturing, and rebalance Melbourne’s

geography of opportunity. This is an important part of the rationale for MM.

A process was therefore initiated in 2009 to develop the Conceptual Framework Plan for the Port and

Inner West precinct, now known as the “Port and East-West Corridor”.

The framework plan was a significant collaborative effort involving various divisions and agencies of

DOT including Freight Logistics & Marine, VicRoads, Linking Melbourne Authority, Port of Melbourne

Corporation together with the Department of Planning and Community Development (DPCD). This

has established a framework for infrastructure investment in the Port and East-West corridor for the

State and Federal Governments. This will in turn provide greater certainty for the private sector to

invest in infrastructure in the Port precinct. Its high level objectives are to

� support Australia’s trade growth and prosperity through:

> efficient port and freight systems

> extending capital city knowledge economy to the west

� facilitate integrated planning and delivery of transport and land use initiatives

� capitalise on opportunities in inner west to progress Commonwealth and State infrastructure and

planning policy objectives and maximise funding opportunities.

The plan facilitates infrastructure planning in the area, particularly for several of Victoria’s major

transport infrastructure projects, notably the East-West Link, Regional Rail Link, MM and a new

precinct to accommodate port-related freight and logistics activities. It will outline how the sequencing

of projects will influence the availability of land at what time and provide direction on future land uses.

The framework identifies the national economic value of these projects – individually and collectively,

defines the footprint of each project, demonstrate how they will be sequenced and quantify how they

will unlock increased trade capacity, jobs growth and urban development.

The framework to date has identified the functional mix required in this precinct to fulfil Victoria’s

planning and economic policies (ie port, freight and logistics, east-west links and mixed use,

employment and activity corridors). The process confirmed that these land uses can be

accommodated in the precinct.



Page 53 of 321

Decentralisation of non port-related freight activities from the Dynon precinct and redevelopment into

a linked, urban activity corridor helps to overcome the barrier between the CBD and Melbourne’s west

and extends capital city functions and the knowledge economy to the west, thereby access to higher

order jobs and increasing human capital development in the west.

The sequencing and dependency of activities and project in the precinct and outcomes are key parts

of the framework – this is shown in Figure 2-12. MM plays a significant part in stimulating

development in the precinct.

Each of the component transport and urban development initiatives in the precinct are critical in their

own right, though together, they produce higher benefits by:

� increasing the viability of the individual development areas

� assisting in accommodating projected employment growth in the City of Melbourne of

approximately 200,000 by 2031

� reducing pressure on inner transport infrastructure and reducing congestion and improving

amenity in the west

� strengthening the western transport and economic hub and second-order CBD functions aspired

to in Footscray CAA

� connecting Footscray and the west directly to the knowledge economies in Parkville and St Kilda

Road

� enhancing the prospects of key activity centres in the west such as Sunshine, Highpoint-

Maribyrnong Defence Site.



Page 54 of 321

Figure 2-12: Port & East-West Corridor – links, dependencies and outcomes

Metropolitan Intermodal

System (MIS)

Dynon BoulevardDynon/Port

International Freight Precinct

Regional Rail Link and

Melbourne Metro

Western Interstate Freight Terminal

(WIFT)

frees up Dynon land for

Relocate markets and non-port related freight activity from

Dynon

East-West road link Releases road

network capacity and unlocks

bottlenecks for port freight

• Efficient port truck access

• Improved inner city liveability

Local transport and open space

networks

Arden Station Precinct

Inner City Activities Growth

• Urban renewal• Inner city growth• Extension of knowledge

economy to the west

E-Gate

Docklands

Footscray CAA

Create central port hub of

MIS

Port

Truck Action Plan

Trade growth

Melbourne Markets relocation

frees up Dynon land for

Improve access

2.6 Sustainability of urban form

2.6.1 Greenhouse gas emissions

Victoria's annual greenhouse emissions are currently 122 megatonnes of emissions equivalent6

(Mt

CO2-e) which is 15% growth since 1990 and the highest per capita emissions in the world. While total

emissions fell by 2.5% between the peak of 2004 and 2007, they returned to 2004 levels in 2009.

Energy use is the source of over 80% of Victoria’s greenhouse gas pollution, with electricity and

transport representing the two largest sources. Despite its mandatory higher energy rating, new

(mostly outer suburban) housing stock emits on average 6% more carbon pollution than existing

homes due to larger houses. Combined with declining average housing occupancy, emissions from

new housing is growing 27% faster than population growth.

The transport sector is the biggest consumer of energy in Victoria accounting for 37% of all energy

consumed. At the household level, transport accounts for almost 50% of all household greenhouse

emissions (refer Figure 2-13). Transport and land use planning is therefore a central component of

any strategy to reduce greenhouse gas emissions.

6 State and Territory Greenhouse Gas Inventories 2009, Department of Climate Change and Energy Efficiency, Australian Government, April 2011



Page 55 of 321

Figure 2-13: Greenhouse Gas Emissions by Household Activity

(Source: Deakin University, AGO/CSIRO data, 2002)

Transport is the second largest source of greenhouse emissions after stationary energy, producing

16% of Victoria’s emissions, of which 90% comes from road transport. Transport emissions grew 25%

between 1990 and 2004, but declined to 18% growth on 1990 levels by 2009. After peaking in 2004,

emissions from road-based travel are returning to similar levels as in the early 2000s, while overall

Victorian transport emissions have been declining at approximately 0.8% per annum since that time7.

This is primarily due to the surging growth in public transport use and increased walking and cycling.

Maintaining Melbourne’s existing transport network into the future would increase today’s transport

emissions by more than 70% by 2031. Assessment undertaken by DOT confirms the importance of

the development of the transport network in reducing greenhouse gas emissions, with achievement of

the 2021 vision envisaged in the Public Transport Strategy maintaining constant emissions to 2021,

despite growth in services.

Outer suburban development is generally characterised by lower density housing with larger lot sizes,

larger houses, higher car ownership, higher establishment costs and longer distances to travel. For

example, residents in Melbourne’s south-east travelled an average of 17 kilometres to work compared

to the metropolitan average of 12 kilometres. It is generally poorly served by public transport, the

dispersed travel patterns in outer areas makes it difficult for public transport to serve and

infrastructure provision is struggling to keep pace with development. A high level of growth in outer

suburban areas therefore increases car dependence, transport system inefficiency, higher emissions

and higher living costs.

DOT has analysed transport energy consumption for the Melbourne region8 and found that the

highest trip efficiencies (measured by energy consumption and greenhouse gases emitted) were

found within the Melbourne CBD, followed by areas well-serviced by trams. While railway corridors

7 Emissions from road-based travel in Victoria, 1990-2009, Department of Climate Change and Energy Efficiency, National Greenhouse Gas Inventory 8 A Spatial Analysis of Future Macro-Urban Form. Greenhouse Gas Emissions and Transport Energy Outcomes for Melbourne, Jeremy Whiteman and Gavin Alford, Department of Transport



Page 56 of 321

have higher trip efficiency compared to non-railway locations, the overall trend is for trip efficiency to

decrease as distance from inner Melbourne increases. A DOT case study on the Shire of Cardinia

suggests there are 61% more emissions per trip than for an average trip in Melbourne.

2.6.2 Widening gap in liveability

People living in the outer areas of Melbourne find it harder to obtain quality jobs. Compared to inner

areas of Melbourne, there are very few jobs accessible within reasonable commuting times and fewer

high order jobs. Growth areas contain 20% of Melbourne’s workforce but only 13% of jobs. This

means that many resident workers in growth areas need to travel to employment; 81% of workers in

growth areas travel to work by car. The issues associated with employment in outer urban areas are

exacerbated by the lower levels of white collar and higher value jobs forcing people to travel for

employment.

Other liveability impacts apart from job accessibility include rising petrol prices leading to

disproportionate impacts on car dependent communities (particularly in outer urban areas) and low

income households, poor urban amenity resulting from car-based planning (roads, car parks and

noise pollution) and decreasing levels of physical activity as a result of increasingly high levels of car

travel, impacting on public health.

The interlinked issues of climate change and liveability therefore cause the greatest impacts in the

south-east, north and western growth areas.

The Casey-Cardinia growth corridor, for example, has a ratio of jobs to people of 2:10 compared to an

average of 4:10 for Melbourne. The area also has lower levels of educational attainment with only

59% of 20-24 year olds having completed year 12 or equivalent, compared to 75% of the same age

group in the Melbourne statistical division as at the 2006 Census. Similarly, only 10% of residents in

the area hold bachelor degrees or equivalent compared to 36% across the metropolitan area. There

are no higher, tertiary, or vocational education facilities in the area; the closest post-secondary facility

is the Monash Berwick campus.

Outer areas also experience higher levels of socio-economic disadvantage than inner areas. Family

incomes in south-east Melbourne, for example, are around 5% lower than the metropolitan average

and, with limited access to public transport and the need to travel further to access employment and

services; households in outer Melbourne spend three times more on fuel than inner Melbourne and so

are more vulnerable to rising costs.

These issues have a significant impact on affordability for outer urban households. The VAMPIRE

index9 calculates the level of household vulnerability to combined impacts of car dependence,

mortgages and incomes, and shows that the further a suburb is from the centre of the city the more

vulnerable it is. Melbourne is particularly affected, as it is ringed by a number of highly vulnerable

zones, including many of the outer suburban growth corridors. The extent of this vulnerability

worsened significantly between 2001 and 2006 (Figure 2-14).

9 Unsettling Suburbia: The New Landscape of Oil and Mortgage Vulnerability in Australian Cities, Jago Dodson and Neil Sipe, Griffith University Urban Research Program, Research Paper 17, August 2008



Page 57 of 321

Figure 2-14: Oil and mortgage vulnerability in Melbourne, 2001 and 2006

Reliance on cars in outer urban areas creates significant inequalities for lower income households,

ageing populations no longer able to drive and others who do not drive. Less time spent with families,

decreasing physical activity, noise pollution from cars and trucks, and physical space take up by large

car parks and roads, all have an impact on the social health of a community.

2.6.3 Land resources

Despite the introduction of targets to reduce the average residential lot size, new lots in outer areas

continue to consume large amounts of available land.

Urban growth continues to put pressure on land supply for housing. Despite policies targeting an

average gross density of 15 dwellings per hectare and a reduction in the average residential lot size

to 400-450m2, new lots in outer areas are being constructed at an average of more than 550m

2. Lot

sizes in inner urban areas are substantially lower and housing is higher density and more efficient.

Creating opportunities for inner urban development around mass rapid transit (Transit Oriented

Development or TOD) reduces pressure on land supply and the need for new infrastructure and

reduces the reliance on car-based travel. The proximity of housing, public transport and jobs can also

contribute to more affordable living through reduced transport costs.

A recent analysis of 17 residential TODs in the USA showed TOD housing generated approximately

half the number of car trips than conventional housing; TOD households owned half as many cars as

other households; and TOD commuters used public transport two to five times more often than other



Page 58 of 321

commuters. The study also showed that the location of jobs and access to regional jobs next to transit

and the proximity of stations to work were critical factors in influencing use of public transport use.

Evidence on land use and driving patterns shows that compact development can reduce the need to

drive between 20 and 40%, as compared with development on the outer suburban edge with isolated

homes, workplaces and other destinations. Further, that smart growth could, by itself, reduce total

transportation-related CO2 emissions from the current trends by 7 to 10 percent as of 205010

.

Modelling undertaken by DOT11

suggests that in a scenario where future growth is directed to inner-

city, ‘transport-rich’ areas of Melbourne, including the CBD, transport related emissions would be 12%

lower than the base case (ie continued urban development according to current (2008) patterns, with

no change to existing policy or implementation programs).

2.7 Public transport patronage

2.7.1 Recent train patronage trends

Rail patronage has been growing from a low point of 89 million trips in 1980/1981 to an expected 238

million trips in 2010/2011. This growth sees Melbourne’s rail network carrying the highest number of

passengers in its history.

Importantly, compared to previous peaks in the 1940s and 1950s passengers are being carried much

greater distances as the metropolitan area has significantly expanded over the last 60 years, further

increasing the transport task.

Market research shows this growth is driven by a number of factors including:

� population growth;

� growth in CBD activity (which is mainly accessed by public transport);

� rising fuel prices and road congestion; and

� concerns over the environment and personal well being.

Demand for rail services continues to grow rapidly. The latest patronage figures shows that

metropolitan train patronage grew by 8.2% in the 12 months ended March 2011, indicating that high

patronage growth has resumed following the slowdown induced by the Global Financial Crisis. Total

metropolitan public transport patronage also grew by 4.7% to a total of 515 million passenger trips

taken in the year ended March 2011.

Growth over the last two years has averaged 5.9% pa (or 5.6% in the AM peak). As shown in Table

2-2, growth has been highest on the lines serving the urban growth corridors (ie the Caulfield Group

to Frankston, Pakenham and Cranbourne, the Northern Group to Craigieburn, Sydenham, and

Werribee and the Epping line). Passengers entering the CBD in the morning peak period have

increased by around 28,000 (30%) between 2004 and 2009.

10 Growing Cooler: The Evidence on urban Development and climate Change, Urban Land Institute, Washington, 2007 11 Transport and Stationary Energy and Greenhouse Gas Emissions Scenarios for Melbourne 2031, Jeremy Whiteman, Department of Transport, Australasian Transport Research Forum 2010 Proceedings, 29 September – 1 October 2010, Canberra, Australia



Page 59 of 321

Figure 2-15: Historical metropolitan rail patronage

Metropolitan Train Patronage since 1946

RecessionCredit Squeeze29 day strike

55 day strike Recession

Global

Financial

Crisis0

50

100

150

200

250

1940s 1950s 1960s 1970s 1980s 1990s 2000s 2010s

Financial year ended 30 June

Pa

ss

en

ge

r B

oa

rdin

g (

Millio

ns

)

8.6% per year

(CAGR) s ince 04/05

~1% per year

89 million trips

City Loop opens

183 million trips

Petrol rationing ends

Pre 2000's patronage peak

St. Kilda & Pt. Melb

lines closed

~3% per year

up 64% from

04-05

up 102%from

99-98

* 2010-11 forecast outturn based on quarterly trends prior to the GFC adjusted for calendar effects

238 million trips*

expected 2010/2011 patronage

Table 2-2: AM peak train patronage at city cordon, 2004-2009

Rail Group 2004 2009 Annual Growth

(2004-09)

Northern 22,528 35,735 9.7%

Craigieburn 7,545 11,416 8.6%

Sydenham 5,691 9,793 11.5%

Upfield 2,197 3,388 9.1%

Werribee 4,285 7,482 11.8%

Williamstown 2,811 3,656 5.4%

Clifton Hill 13,385 16,412 4.2%

Burnley 26,285 29,936 2.6%

Caulfield 28,232 36,658 5.4%

Network 90,430 118,741 5.6%

Source: DOT Load Surveys, 2004-2009

2.7.2 Tram patronage

Twenty-four of the 27 tram routes in Melbourne connect radially to the CBD. The St Kilda Road

corridor is served by nine routes. All St Kilda Road routes terminate on Swanston Street at

Melbourne University in Parkville, except for Routes 1 and 8, which run to East Coburg and Moreland

respectively. Table 2-3 shows both the number of trams and highest capacity utilisation for the

morning peak period. (Capacity utilisation is the ratio of the average load over the average maximum



Page 60 of 321

capacity). In total, there are currently 90 services north-bound and 93 south-bound in the two-hour

morning peak period. In the height of the peak, there is more than one tram every minute. Tram

patronage growth between 2003/04 and 2008/09 was 31%.

Table 2-3: St Kilda Road tram routes (9 routes) – AM Peak (7-9am, May 2009)

Northbound into CBD Southbound out of CBD

Route St Kilda Road

connection point Peak H’way (mins)

Frequency (per hr)

Capacity Utilisation

(%)

Peak Headway

(mins)

Frequency per hour

Capacity Utilisation

(%)

1 Southbank Blvd 8 7.5 99 8 7.5 71

8 Domain Rd 7 8.6 117 8 7.5 85

72 Commercial Rd 12 5.0 86 11 5.5 98

6 High St 10 6.0 100 11 5.5 91

5 Dandenong Rd 10 6.0 95 11 5.5 106

16 Fitzroy St 10 6.0 63 9 6.7 86

64 Dandenong Rd 10 6.0 110 12 5.0 118

3 Carlisle St 11 5.5 89 11 5.5 122

67 Brighton Rd-Glenhuntly Rd

11 5.5 100 12 5.0 103

Total 56.0 53.5

Notes: (1) The scheduled 2-hour AM peak frequency and scheduled number of vehicles at route level provided by PTD/Franchise Relationships Branch

(2) The capacity utilisation is for a rolling hour at max load points for 2 hr am period south of Flinders St provided by PTD Information Services “YARRA TRAMS LOAD STANDARDS SURVEY 2009” conducted in May 2009

2.7.3 Factors in recent public transport patronage growth

The recent surge in patronage has led to a re-consideration of long held assumptions regarding the

drivers for public transport patronage growth. It has long been considered that public transport

patronage will largely follow population growth, and that public transport mode share will decline with

rising real incomes and levels of car ownership, unless major changes are made in relative travel

costs between modes to encourage a mode shift. With recent patronage growth far outstripping

population growth, attention turned to the underlying factors driving this change.

Market research conducted over a number of years helped identify the major influences resulting in

these changes in travel behaviour. Figure 2-16 suggests that petrol price increases were the major

factor in 2006 and 2008. But across the period covering 2006 to 2010, the research identified a

number of other important factors, some of which are not captured directly in existing modelling

approaches. Increasingly strong attitudes towards personal health and fitness – and since 2008,

concerns for the environment – were seemingly driving a small but significant shift away from private

vehicle travel. Whilst these attitudes were certainly not influencing everyone in the community, the

strength of these attitudes may have been enough to drive the patronage surge well over and above

what would otherwise have been expected based on existing modelling frameworks.



Page 61 of 321

Figure 2-16: Major reasons for reducing car usage (2006-2009)

12%13% 13%

21%

7%

14%

9% 8%7%

15%

51%

4%

13%

4%

9%

24%

58%

15%

7%

2%

26%

21%

7%8%

20%

16%

8%8% 7%

20%

17%

8%

0%

10%

20%

30%

40%

50%

60%

70%

Petrol prices Parking Costs Health &

Fitness

Lack of parking

availability

Car running

costs (excl

petrol)

Retired /

Travelled Less

Changed Jobs Environmental

Concerns

2006

2008

2009 (Feb)

2009 (Aug)

Note: Proportion in each year sums to more than 100% as respondents could nominate one or more reasons for reducing car travel

2.7.4 Overall travel demand

The projected growth in metropolitan population, and associated employment growth and anticipated

economic growth and the resulting increase in personal incomes will in turn increase the overall

demand for travel. Over the next 20 years, these factors are expected to contribute to motorised

travel demand growth (person trips) of up to 26%. This increased demand will not be evenly spread

geographically across the road and public transport networks. Travel demand is likely to increase

most in the growth corridors and the inner city given the likely land use patterns described above.

The increased demand may also not be distributed between modes in the same proportions as today.

In 2007, 10.8% of all daily motorised person trips are taken by public transport across the

metropolitan area12, rising to 16.5% in the morning peak period. For trips to and from Melbourne LGA

the public transport mode share is higher – around 50% across the day. Over the next 20 years it is

projected that with continuing investment in improving public transport services, the mode share in the

metropolitan area will change to 14.2% in 2021 and 15.5% in 2031.

12 VISTA (2007). This mode share is based on the percentage of total motorised journeys from origin to ultimate destination.

Mode share is usually quoted as a percentage of each motorised trip stage which equates to a current (2007) PT mode share

of 13.3%.



Page 62 of 321

2.7.5 High level metropolitan patronage forecasts

In 2008, DOT developed high level patronage forecasts for all public transport modes using its

elasticity model. This model uses established relationships between population and public transport

usage, combined with the expected impacts due to changes in those factors that are known to

influence travel demand, where measurable. The factors specifically included changes due to:

� population and economic growth (specifically growth in population generally and employment in

the CBD)

� travel costs (specifically fuel prices, parking policies and public transport fares)

� service provision

� road and public transport infrastructure (especially road congestion and public transport service

quality).

A specific allowance was also made for changes in community attitudes, including around health and

fitness and environmental concerns, drawing on the market research results.

The 2008 DOT forecasts are shown in Table 2-4. These forecasts are based on the following

assumptions:

� demand unconstrained by supply

� an average growth trend over a period of time, not for individual years which will be higher or

lower based on market conditions

� long-term trends in key drivers of patronage (discussed above).

While the average forecast growth over the periods shown in Table 2-4 is notionally linear, year-on-

year growth will vary around this average. Due to uncertainties in the longer term forecasts,

conservative estimates that mirror population growth have been adopted beyond 2021/22.

Table 2-4: Forecast annual public transport patronage growth (DOT elasticity model)

Mode 2008–2011 2012–2021 2022–2031

Train 9.6% 7.1% 1.3%

Tram 4.8% 4.1% 1.3%

Bus 3.8% 3.4% 1.3%

Total 6.8% 5.6% 1.3%

Patronage estimates in 2010 reveal that there has been a recent slowing of patronage growth on all

three modes, in the wake of the Global Financial Crisis. Rail patronage in particular has dropped

marginally below the forecast 2010 level, but has still grown from 2009. These forecasts were

re-confirmed by DOT in early 2010 and are assumed to apply for the short and medium term futures

(to 2021). Longer range planned patronage growth is assumed to follow population growth.



Page 63 of 321

2.7.6 Train patronage forecasts

Patronage forecasts have been prepared taking into account population and employment forecasts

and other factors influencing people’s travel behaviour. Over the next decade, growth in daily rail

patronage is anticipated to continue at an annual rate of 7.9% pa.

Growth in peak travel to the CBD grid is expected to be lower at 5.4% pa with growth being higher in

the off peak and in counter peak directions. The highest rates of city bound AM peak growth (over 6%

pa growth) are anticipated to continue to be on train lines servicing the existing growth corridors

including the Werribee, Sydenham (Sunbury), Craigieburn, Pakenham, Cranbourne, Epping and

Upfield lines (see Table 2-2).

Overall these forecasts anticipate inbound train loading at the city cordon to increase from 118,000 to

more than 250,000 passengers in the AM peak period by 2031. Of the 130,000 additional

passengers, around 55,000 are from the Northern Group and 31,000 on the Caulfield Group, if there

were sufficient capacity on the system to carry these loads (i.e. an unconstrained demand).

The unprecedented 70% growth in train patronage in the last decade and 50% in the last five years

alone has resulted in rail demand approaching the capacity of the network. This has highlighted the

limitations of key system bottlenecks such as North Melbourne and the city loop. Currently around

20,000 metropolitan rail passengers on 31 train services travel through North Melbourne railway

station in the morning peak hour. Demand is predicted to more than double by 2021 and rise to

around 55,000 by 2031.

Such increases cannot be sustained on the existing system (see below) and a significant uplift is

required in rail system capacity. Any short fall in system capacity will increase crowding and could

result in redirection of this growth to private vehicle travel with consequential impacts on congestion.

Changes to current urban development policies resulting from the new Metropolitan Planning Strategy

may influence the later year forecasts. These changes could affect, for example, location of

greenfields development, changing the balance between urban infill and greenfields development and

between metropolitan and regional centres. However, urban development is a long term proposition

and most of the development for the next 10–15 years is already in the early stages of delivery.

Table 2-5: AM peak forecast annual train patronage growth rates at city cordon

Rail Group/line Forecast Annual

Growth (2007-21)

Northern 7.8%

Craigieburn 6.6%

Upfield 6.1%

Werribee/Williamstown 8.5%

Sydenham (Sunbury) 8.5%

Clifton Hill 5.3%

Epping 7.0%

Hurstbridge 4.1%

Burnley 2.9%



Page 64 of 321

Rail Group/line Forecast Annual

Growth (2007-21)

Lilydale/Belgrave 2.9%

Glen Waverley 2.9%

Alamein 2.9%

Caulfield 5.4%

Pakenham/Cranbourne 6.3%

Frankston 3.6%

Sandringham 3.8%

Network 5.4%

Higher than average growth rates highlighted in bold

Source: DOT Travel Demand Forecasting, 2010

Network modelling results for the whole network without MM (known as the base case) are shown in

Table 2-6. The forecasts show the unconstrained demand (that is not constrained by the actual supply

of services) and are compatible with the DOT elasticity model forecasts, confirming that the strongest

growth will occur on the Northern Group.

Table 2-6: Modelled public transport network demand (unconstrained13

AM peak 2 hour)

Mode 2008 2031 PT Annual Average Growth

2008–31

Inbound rail load (at CBD cordon)

Northern Group 32,000 87,200 4.4%

Caulfield Group 37,000 68,200 2.7%

Clifton Hill Group 19,800 42,300 3.3%

Burnley Group 29,600 53,700 2.6%

Tram network boardings 98,800 220,500 3.6%

Source: Zenith 2010

2.7.7 Tram patronage forecasts

The tram network will also see strong demand growth, with tram forecasts for 2031 showing that there

will be a significant increase in tram volumes along the St Kilda Road corridor and tram loads to

Melbourne University will more than double. The introduction of MM has the potential to directly

address these issues on the tram network.

13 Measure of total system demand which is not ‘constrained’ by the capacity of trains. Constrained demand forecasts are generally used in this business case as they reflect patronage on the system.



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DOT’s high-level public transport forecasts indicate that tram patronage will continue to grow at

around 4.4% pa, suggesting that the congestion on tram services in St Kilda Road will worsen. A

number of improvements have been made to the St Kilda Road corridor in recent times to cater for

this predicted growth, including a new terminus at Melbourne University to reduce tram turnaround

times, a section of third track outside the Arts Centre to reduce delays caused by turning trams, and a

number of platform stops to improve loading and unloading times, including the recent additions along

St Kilda Road at Commercial Road, High Street and Union Street as well as traffic signal priority to

improve travel times and reliability for services south of Domain. Fifty new high-capacity trams (light

rail vehicles) are also being purchased and will progressively be strategically deployed across the

network from late 2012 to cater for anticipated demand on key routes, and replace ageing fleet.

2.7.8 Regional rail patronage forecast

In 2008, DOT undertook forecasts for V/Line services, using a methodology similar to that used for

metropolitan rail forecasts. A major difference in methodology was that each line and major market

segment (peak commuter, peak regional, rest of week and weekend) were examined separately.

Table 2-7 below provides a summary of forecast V/Line growth for each of the major corridors for the

peak period. All corridors other than the eastern corridor pass through the region serviced by the

Northern Group en route to the CBD. These forecasts do not take into account localised demographic

changes associated with specific developments (such as Caroline Springs) or changes to the urban

growth boundary.

Table 2-7: V/Line growth rates 2008-2021

Period / Sector Total Geelong Ballarat Bendigo Seymour Traralgon

Peak – Commuter 7.2% 7.4% 7.9% 6.5% 7.2% 6.8%

Peak – Regional 6.6% 6.8% 6.6% 6.5% 6.8% 6.7%

Peak – Total 7.0% 7.4% 7.3% 6.5% 7.0% 6.8%

2.8 Rail network capacity and performance

2.8.1 Introduction

The above sections set out the current and forecast increases in patronage of the rail network. A

detailed review of the likely demand increases for each rail corridor has been compared to the

existing operating conditions and line capacities and has found that the current Melbourne rail system

will soon be at a point where more trains cannot be run on key lines.

This comparison has enabled the timing of and location of capacity constraints across the

metropolitan and regional network to be identified. This work has led to the development of a staged

upgrade rail capacity upgrade program (as discussed in section 0 above) that delivers capacity

incrementally, linked to need, while progressively moving towards a modern metro-style of operations.

The following sections summarise the analysis that has been undertaken and explain the initiatives

from the seven-stage program that are underway or already committed and the capacity and service



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outcomes delivered as a result of those initiatives. The shortfall in capacity that will remain after these

initiatives and the impact of that capacity constraint on the operation of the network will be identified.

This section discusses all parts of the metropolitan network but focuses in more detail on the Northern

Group of lines (Craigieburn, Sydenham/Sunbury, Upfield and Werribee/Williamstown) as the MM

project is focused on improving capacity and reliability on those lines.

2.8.2 Projected rail system shortfalls

The majority of Victoria’s rail network was built to serve patterns of travel and overall demand quite

different from today. The metropolitan network still comprises significant sections little changed from

their original construction as rural branch lines which now serve extensive areas of urban

development.

A ‘metro’ style operation, akin to those adopted in many of the larger cities of the world, is proposed

for Melbourne’s rail system to accommodate these patronage growth forecasts. The transformation of

the network is seen as a long term objective to be achieved through a program of initiatives, including

changes to operating practices as well as investment in upgraded and new infrastructure.

To this end, a number of projects have either been completed or are at various stages of

development, including Regional Rail Link (RRL), Sunbury Electrification Project and Laverton Rail

Upgrade. RRL will provide regional rail services with a dedicated line delivering increased capacity for

both regional and metropolitan trains across the 2 hour AM peak including:

� Werribee 33%

� Craigieburn 44%

� Sydenham-Sunbury 50%

� Geelong 100%

� Ballarat 14%

� Bendigo 20%

However, by 2021 it is expected that passenger demand will exceed the available capacity by 40

peak hour trains (see Table 2-8 and Figure 2-17). The shortfall is expected to grow to more than 70

trains in the peak hour by 2031. These shortfalls are greatest on the Northern, Clifton Hill and

Caulfield groups.

Table 2-8: AM peak hour capacity* shortfalls on Melbourne’s rail network (≥≥≥≥10 trains highlighted)

Line

Capacity following

committed projects

Demand 2021

Shortfall 2021

Demand 2031

Shortfall 2031

Northern Group

Werribee & Williamstown

13 20 7 23 10

Sunbury (& Melton) 13 25 12 31 18

Craigieburn 12 16 4 19 7



Page 67 of 321

Line

Capacity following

committed projects

Demand 2021

Shortfall 2021

Demand 2031

Shortfall 2031

Upfield 4 6 2 7 3

Total (Northern) 42 67 25 80 38

Clifton Hill Group 18 26 8 30 12

Burnley Group 35 34 - 40 5

Caulfield Group

Cranbourne & Pakenham

16 22 6 27 11

Frankston 16 17 1 20 4

Sandringham 12 9 - 11 -

Total (Caulfield) 44 48 7 58 15

Metropolitan Total 139 175 40 208 70

* assuming 900 train capacity planning standard

Figure 2-17: Rail patronage and existing capacity by corridor

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Load standard

Crush capacity

In addition, the existing CBD stations also have limited capacity to handle the expected 2021 demand

leading to significant crowding on platforms and on escalators.

The capacity constraints on the Northern Group are related to the need to merge all four lines

servicing the northern and western suburbs into two lines inbound from North Melbourne. With the

current signalling system and 2016 (post-RRL) operating plan, a total of 16 trains would be able to



Page 68 of 321

operate on the Craigieburn-Upfield lines, 13 on the Sunbury line and 13 trains on the Cross-City

metro (Werribee–Frankston). This provides a total capacity of 37,800 passengers per hour from the

northern and western suburbs (average loading of 900 passengers per train). The combined capacity

of the Northern Loop and Cross-City metros would not meet the combined patronage on the

Werribee/Williamstown, Sunbury, Craigieburn and Upfield lines from 2015 onwards. The capacity of

the Caulfield Group is also limited by the City (Caulfield) Loop and Cross-City metro – the Dandenong

corridor is anticipated to reach rail operational capacity by around 2018 when 18 trains will be

operating in the peak one hour.

In addition to capacity issues, only 76% of AM peak trains on the Northern Group currently arrive

within five minutes of schedule in the peak direction. This is expected to improve to 87% with the

completion of RRL in 2014, but will decline again as patronage and crowding increases.

DOT’s estimated peak hour growth rates for individual lines confirms that lines operating within the

Northern Group will experience the highest rates (average of 10.5%) compared to the metropolitan

average of 7.1% pa.

The MM project specifically targets the Northern and Caulfield Groups, which have experienced the

highest levels of growth in recent years along with the highest levels of crowding and is forecast to

continue to grow more strongly than the rest of the network as the population in this catchment grows

substantially. Overcrowding has eased slightly on the train network in the period 2008–2010,

coinciding with an increase of 40 daily services in the peak periods provided over that time. Peak

period load breaches (trains carrying more than 798 passengers in the six hours that constitute the

AM and PM peak) have decreased from 89 in 2008, to 70 in 2009 and 58 in 2010 for the annual

October survey.

Longer-term estimates rely on more complex (four step) modelling of future land uses, the transport

system and behavioural changes. Two four-step network models, MITM and Zenith, were used to

provide forecasts for the project. The DOT model was used to provide a benchmark for the more

detailed forecasts from the strategic network models.

2.8.3 Metropolitan rail capacity upgrade program



beyond.

Metro rail systems are designed to run higher capacity trains from end to end of lines using dedicated

tracks. Unlike today’s rail network, the trains can run at higher frequency without interfering with other

routes. The focus is on simple timetables, frequent services and consistent stopping patterns.

Key steps planned towards the creation of a metro train system in Melbourne include:

� introduction of new larger trains

� upgrades to signalling

� construction of new tracks where required to increasingly separate V/Line trains from metro trains

and to expand the capacity of the heart of the rail system, enabling all lines to carry their full

capacity of trains.

The improvements and upgrades have been planned as a seven stage program as discussed above

in section 1, with MM forming stage 5. MM is the pivotal ‘metro-enabling’ component of the program,



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which builds on precursor projects and initiatives (ie Stages 1 – 4), which are fully funded and either

underway or completed.

2.8.4 Committed projects 2010–2012

The metropolitan rail network is undergoing significant alterations over the next two years with further

operational changes, greenfield timetables and new infrastructure works. These are all shown in

Figure 2-18. These initiatives will result in improved peak hour services on all metropolitan lines

except for the Alamein/Blackburn and Belgrave/Lilydale services where patronage growth is not

expected to require increased capacity in this period. Additional shoulder peak services will also

operate on most lines to encourage more people to make their trips outside the peak period so as to

achieve a better balance of train loadings, a process known as peak spreading. During this period a

start will be made on separating the operation of the individual lines out from the line groups and

creating new independent metro lines, a process known as sectorisation. The first line to be created

is the Cross-City Line from Werribee to Frankston. The benefits of these changes and projects are

outlined in Table 2-9.

Figure 2-18: Key initiatives to be implemented between 2010 and 2012

Footscray

Burnley

Laverton

Werrib

ee

Geelong

Ballarat

Ringwood

Lilydale

Pakenham

Traralgon

Camberwell

Blackburn

Melton

Sunshine



Page 70 of 321

Table 2-9: Benefits of works implemented 2010–2012

Project Benefit

Laverton turn-back Enables increased service frequency and reliability on Werribee corridor

Electrification to Sunbury Enables increased service frequency and reliability on Sunbury corridor

Craigieburn upgrades works (second electrified platform, new stabling and

maintenance facility)

Enables increased service frequency and reliability on Craigieburn corridor and provides dedicated stabling and

maintenance facility on Northern Group

Establishment of through running from Werribee to Frankston (Cross-City Group)

Delivers improved inner core capacity by optimising the utilisation of through suburban (direct) lines from North Melbourne to Richmond via Flinders Street and removing

conflicts between Dandenong and Frankston lines

Reduced number of peak crew changeovers at Flinders Street Station (some platforms)

Enables improved throughput at Flinders Street to allow additional trains to operate on Caulfield, Clifton Hill, Cross-

City, Northern Groups

Westall turn-back and stabling Provides opportunity to run short starter trains on Dandenong corridor

Drop-on drivers at Sandringham Enables higher service frequency to operate on Sandringham line

City Loop dwell time management Enables increased service frequency through Northern and Caulfield loops

2.8.5 Committed projects 2013 to 2015

Even with the above initiatives, the Northern Group lines will continue to be constrained by the mixed

operation of regional and suburban trains on the corridors as well as the at grade conflicts over

Franklin Street junction (between North Melbourne and Southern Cross). This situation is

exacerbated by the patronage growth from regional centres, in particular from Geelong, and the rapid

growth on the Werribee, Sydenham (Sunbury) and Craigieburn metropolitan lines. The construction

of the Regional Rail Link (RRL) will provide a dedicated link to Southern Cross Station for regional

services, eliminating these conflicts, and freeing the electrified lines for growth in metropolitan train

services.

The South Morang Extension Project which extends the rail line from Epping to South Morang will

commence during this period. This project will also include duplication of the single line section from

Keon Park to Epping, enabling a higher service frequency to operate on that corridor.

The full sectorisation (independent operation) of the Frankston and Dandenong lines is also planned

for this period resulting in the removal of remaining Frankston services from the Caulfield loop. This

will be required to enable the Cross-City Group to function effectively at high service frequencies and

enable additional Dandenong services to operate.

These initiatives are all shown in Figure 2-19.



Page 71 of 321

Figure 2-19: Key projects implemented between 2013 and 2015

-

Newport

Williamstown

CranbourneFrankston

Glen Waverley

BelgraveAlamein

Sandringham

Greensborough

HurstbridgeEpping

Reservoir

South Morang

Clifton Hill

Dandenong

Watergardens

Sunbury

Bendigo

Broadmeadows

Craigieburn

Seymour

Upfield

Flinders Street

Parliament

Richmond

South Yarra

Southern

Cross

North

MelbourneFlagstaff

Melbourne

Central

Caulfield

Manor Lakes

Keon Park

Regional:

Regional Rail Link

Clifton Hill:

Duplication Keon Park

to Epping and extension

to South Morang

Cross-City:

Removal of all Frankston

services from City Loop

All Groups:

Removal of all crew

changeovers at Flinders Street

2.8.6 Capacity by 2016 after committed initiatives

The planned network configuration, operating arrangements and service frequencies by about 2016

after implementation of these initiatives are shown in Figure 2-20. Post completion of RRL, Bendigo

regional trains will continue to share tracks with metropolitan trains on the Sydenham / Sunbury

corridor as far as Sunshine.

By 2016 following the implementation of RRL (and earlier initiatives), it is planned that a total of 42

services would operate from the Northern Group of lines in the peak hour. This represents an

additional 11 services in the peak hour compared to the October 2010 timetable (a 40% increase in

capacity). As all of these services cannot be run into the loop, to operate this level of service

specified, it is planned to run some extra services on the direct route from North Melbourne to

Flinders Street. The diversion of Geelong services onto RRL enables additional Craigieburn

metropolitan services to merge with services from Werribee at North Melbourne and run to Flinders

Street as part of the Cross-City Group. It is currently planned that around 2014 services from

Craigieburn would split between the Cross-City Group (running direct to Flinders Street) and the

Northern Group (running via the City Loop).

Table 2-10 lists the expected service frequencies in operation by the end of 2016 as well as the

available capacity (capacity shortfall by line also shown on Figure 2-21). The table also lists the

constraints to further increasing the capacity. It shows little or no opportunity will exist to add extra

services beyond 2016 on the Northern Group.



Page 72 of 321

Figure 2-20: Planned network configuration and planned peak hour frequencies by 2016

6

6

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1614

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8

Table 2-10: Planned capacity in 2016 and line constraints

Line Service

frequency 2016

Capacity 2016*

Constraints

Northern Group

Werribee & Williamstown

14 14 Line capacity constrained in the inner area by the need to merge with Craigieburn line trains on the cross city metro

Sunbury 13 13 Line capacity constrained in the inner area by the need merge with Upfield and Craigieburn services running via

the City Loop

Craigieburn 12 12

Line capacity constrained in the inner area by the need to merge with Werribee services on the cross city metro and the Sunbury and Upfield services running via the City Loop

Upfield 3 3 Line capacity constrained in the inner area by the need to merge with Sunbury and Craigieburn services running

via the City Loop

Total 42 42



Page 73 of 321

Line Service

frequency 2016

Capacity 2016*

Constraints

Clifton Hill Group 18 18 Line capacity constrained in the inner area by City Loop signalling, approach to Flinders Street and at grade

junction at Clifton Hill

Burnley Group 30 35 -

Caulfield Group

Cranbourne & Pakenham

15 15 Corridor capacity constrained by road-rail crossings and signalling capacity

Frankston 14 14 -

Sandringham 8 12 -

Total 39 44

Figure 2-21: Rail patronage and capacity by corridor – following implementation of committed projects up to and including RRL

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2.8.7 Regional services

The existing and proposed V/Line regional services in 2016 after implementation of RRL are shown in

Table 2-11 below. Bendigo services will continue to share tracks with Sunbury metropolitan services

between Sunbury and Sunshine even after RRL is implemented. Seymour and Traralgon services

will also share tracks with metropolitan services.



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Table 2-11: V/Line services (peak two hour)

V/Line Service Current 2012 2016 (RRL)

Ballarat (via Sunshine) 3 3 4

Bacchus Marsh (via Sunshine) 4 5 5

Bendigo (via Sunshine) 4 4 5

Kyneton (via Sunshine) 1 1 1

Geelong (via Werribee/Sunshine post RRL) 8 9 12

Seymour (via Craigieburn) 3 3 3

Traralgon (via Dandenong) 4 4 4

2.8.8 Reliability

As well as improving capacity to meet anticipated patronage growth, the suite of projects developed

for the upgrade of the network has been developed to improve the reliability of all services. A gradual

step-up in reliability is anticipated with the implementation of each project. As shown in Table 2-13,

reliability on the Northern Group is expected to increase from 76% currently to 87% in the peak period

following the implementation of the committed projects up to and including RRL. (Current franchise

agreements call for a reliability of 88% on time to four minutes 59 seconds for the total of services

provided each week.) Given the forecast continuing growth in patronage, reliability is likely to decline

rapidly after 2016 if no further projects are delivered to avoid train over-crowding, as train

overcrowding has a significant impact on station dwell times and hence on-time running performance.

Table 2-12: AM peak period Northern Group reliability (on time to 4 minutes 59 seconds)

Current (average January to June 2010) 76.3%

Delivery of committed projects up to and including RRL (2016) 87.3%

Reliability and punctuality on the Caulfield Rail Group is poor. In March 2011, only 66.9% of

Pakenham Line services ran on-time. This figure deteriorated further in April 2011 to just 56.9%. This

drop in performance was also reflected on the Cranbourne line, with average monthly punctuality

figures of 75.0% and 69.2% for March and April 2011 respectively.

The existing physical and operating constraints on the group mean that the Dandenong rail corridor is

already running above its practical operating throughput capacity during the busiest peak hour, and

has recorded capacity utilisation levels above 90% for the overall peak period for the last 3 years. As

more passengers crowd on to train services, there will be a corresponding decrease in service

performance.

Additional services on the group will further worsen reliability and punctuality in the busiest periods.

Adding additional services in shoulder peak periods (where current operations are still within practical

limits) will leave less room for recovery in the timetable, and is likely to exacerbate the impact of

delays as they occur.



Page 75 of 321

2.8.9 Capacity and demand post 2016

The likely shortfall in capacity on each line group in 2021 and 2031 is demonstrated in Table 2-13.

The shortfalls are based on:

� capacity provided in 2016 following the implementation of the committed projects and the revised

operational plan (ie Stages 1 to 4 of the Metropolitan Rail Capacity Upgrade Program);

� the demand in the busiest section of a line, not necessarily the city cordon point;

� indicative representation of the capacity shortfall as the service demands shown for 2021 and

2031 do not necessarily represent the planned future service plan as future projects would seek

to meet the capacity shortfall through a combination of increasing frequency and increasing train-

carrying capacity.

� six-car trains in operation with a planning capacity of 900 passengers per train (ie capacity of the

new trains currently being introduced to the network). Consideration is being given to the use of

nine-car trains.

Table 2-13: AM peak hour capacity and demand in 2021 and 2031 (six-car/900 train capacity planning standard)

Line

Capacity following

committed projects

Demand 2021

Shortfall 2021

Demand 2031

Shortfall 2031

Severity of shortfall

Northern Group

Werribee & Williamstown 13 20 7 23 10 HIGH

Sunbury (& Melton) 13 25 12 31 18 VERY HIGH

Craigieburn 12 16 4 19 7 MEDIUM

Upfield 4 6 2 7 3 LOW

Total 42 67 25 80 38

Clifton Hill Group 18 26 8 30 12 HIGH

Burnley Group* 35 34 - 40 5 MEDIUM

Caulfield Group

Cranbourne & Pakenham 16 22 6 27 11 HIGH

Frankston 16 17 1 20 4 LOW

Sandringham 12 9 - 11 - NONE

Total 44 48 7 58 15

Metropolitan Total 139 175 40 208 70

(*) Additional capacity can be created on the Burnley group by operating additional services direct to Flinders Street

This capacity-demand comparison shows significant future capacity shortfall on a number of corridors

and severe shortfalls on the Sunbury (and Melton), Werribee/Williamstown, Clifton Hill and



Page 76 of 321

Cranbourne and Pakenham corridors. As a result, there is a need to focus on improving capacity on

the Northern and Caulfield groups initially with a secondary need to improve capacity on the Clifton

Hill Group.

Northern Group

The capacity constraints on the Northern Group are related to the need to merge all four lines

servicing the northern and western suburbs into two lines inbound from North Melbourne. With the

current signalling system and 2014 operating plan a total of 22 trains would be able to operate

through the Craigieburn-Upfield lines and 20 trains would be able to operate on the Cross-City Group.

This provides a total capacity of 37,800 passengers per hour from the northern and western suburbs

when utilising trains with an average loading of 900 passengers per train. The combined capacity of

the Northern Loop and Cross-City metros would not meet the combined patronage on the

Werribee/Williamstown, Sunbury, Craigieburn and Upfield lines from 2015 onwards. The results on

an individual line basis are discussed below:

� Werribee/Williamstown – the implementation of committed projects on these lines will enable

demand growth to be met until around 2015 on the basis of an average loading of 900 per train.

Thereafter, significant overcrowding will occur without further capacity enhancements.

� Craigieburn – demand on the Craigieburn line is likely to be met until around 2016 with the

implementation of the committed works on the basis of an average train load of 900.

� Upfield – demand growth on the line will also be met up to around 2016.

� Sunbury line – demand inbound from Sunshine can be met until 2016, provided electrification

and upgrades to the Melton line are not implemented before that date. The combined demand

from an upgraded Melton line and Sunbury will exceed the capacity of the shared section from

Sunshine.

Caulfield Group

Over the past five years, the number of metropolitan passengers travelling on the Dandenong rail

corridor has grown by 50%, with 30% of this growth occurring in peak periods, far outstripping

population growth in the region. Although rail patronage growth on the Dandenong rail corridor slowed

over 2008-2009 (as it did across the rail network) coinciding with the Global Financial Crisis, the

corridor still recorded average AM peak growth of 5% per annum in train loads arriving at the city

cordon over the last five years. Patronage growth across the metropolitan rail network again picked-

up in the last year, with total patronage growing by 8.2 percent in the 12 months ending March 2011.

The unprecedented levels of patronage growth experienced on the corridor since 2004 have been the

cause of consistently high levels of overcrowding, despite the regular introduction of new peak period

train services. During this period, average capacity utilisation levels have frequently reached over

90% in the morning peak (7-9:30am), indicating very high levels of overcrowding on many peak

services. Increasingly overcrowded train services are causing prolonged dwell times, which contribute

to progressive deteriorations in reliability and overall service quality.

The following network constraints limit capacity on the Caulfield Rail Group, and will restrict the ability

to cater for future growth:

� City Loop & Interchange Stations - Dandenong and Frankston train services share a single

track pair in the City Loop. The loop has a finite throughput capacity, and in recent years some

Frankston services have been removed from the loop during peak periods to accommodate more



Page 77 of 321

Dandenong services. As more peak period Dandenong services are added, Frankston services

will be progressively removed from loop operation. This places additional pressure at key

interchange locations such as Richmond, which are already extremely congested during peak

times, as passengers seek to transfer to loop services.

� Service Patterns - currently there is a mix of stopping and express services operating in peak

periods on the Dandenong lines. These service patterns facilitate better load spreading along the

corridor, and provide a faster journey for those travelling from outer areas like Pakenham and

Traralgon. However, running a mix of express and stopping operating patterns takes up more

space in the timetable than running a single uniform operating pattern, and presents an

operational constraint to achieving maximum train throughput. Some express services have been

progressively slowed in recent years to make better utilisation of corridor capacity.

� Rolling Stock - the existing rolling stock operating on the Dandenong line is limited to 6-car trains

with a passenger carrying capacity of 798 passengers (current load standard). The physical and

dynamic characteristics of the existing rolling stock (e.g. breaking and accelerating performance,

and dwell time performance) are also operational constraints.

� Congestion at Level Crossings - congestion on the road network has reached critical levels at

several of the ten road-rail level crossings located on the trunk section of the Dandenong line

between Caulfield and Dandenong. Without mitigating measures, it is not possible to increase rail

service levels without worsening existing level crossing congestion.

� Signalling Headways - the Dandenong line is signalled for 3 minute headways, which implies a

theoretical maximum throughput of 20 trains an hour. The practical operating throughput capacity

is 80% of the theoretical maximum, or 16 trains per hour. Operations above this level will cause

progressive deteriorations in service quality. Connecting lines, such as Frankston, Pakenham,

Cranbourne and Sandringham have lower signalling headways

These issues are being considered as part of the Dandenong Rail Capacity Program, though with the

implementation of the Cross City Metro (Werribee-Frankston), the capacity of both the Caulfield and

Northern Groups are being considered in a systematic way.

2.8.10 Train loadings

The current train load standard is 798 passengers per train. The current MTM Franchise Agreement

defines that a load breach occurs when the average load in a rolling hour exceeds the load standard.

Figure 2-22 shows the likely impact on Northern Group load breaches in the AM period between 2014

and 2024 with the implementation of the committed works only. Even with the provision of the

committed infrastructure it is forecast that each of the four corridors will have at least one load breach

per rolling hour in 2014 with the number increasing rapidly thereafter.



Page 78 of 321

Figure 2-22: Forecast load breaches on Northern Group (AM Peak)

0

2

4

6

8

10

12

14

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

To

tal

Loa

d B

rea

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s (N

ort

he

rn G

rou

p)

Werribee/Williamstown Craigieburn Upfield Sunshine

Whilst the number of load breaches can be used to assess the number of over-crowded trains, the

level of train loading is not assessed. Therefore, it is also useful to consider the rolling hour average

load in the same time period. Figure 2-23 shows the predicted average load on each of the Northern

Group lines in each rolling AM peak hour in 2020 with the implementation of the committed works

only.

It can be seen that in the event of no further infrastructure being provided, all Northern Group

corridors will have increasingly significant over-crowding (that is an average load exceeding 900

passengers per train) in three of the four rolling hours with people on the Werribee and Sunbury lines

left behind on platforms in the critical peak hour under normal operations (trains running to timetable).



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Figure 2-23: Forecast rolling hour train load in 2020 (AM Peak) – Northern Rail Group

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Figure 2-24: Load breaches on the Dandenong Rail Corridor (AM Peak)



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Figure 2-25: Load breaches on the Frankston line (AM Peak)

Figure 2-26: Load breaches on the Sandringham line (AM Peak)

2.8.11 Next stages of the rail capacity program

The next stage of the metropolitan rail capacity upgrade program must address, among other things,

the above looming capacity constraints. Based on various investigations in the past two years, the

next two stages envisaged are as follows:

Stage 5 - Melbourne Metro (MM) - new rail tunnel from South Kensington to South Yarra with

stations and alignment as per MM1, plus “surface” works to unlock capacity for fourteen additional

train services in the peak hour across the Northern Rail Group and three extra services on the

Frankston and Sandringham lines. MM lays the foundation for ‘metro-style’ services across the

metropolitan rail network and addresses critical rail capacity bottlenecks and operational issues in the

inner city and on lines serving most of Melbourne’s growth corridors.

The MM project scope has been thoroughly reviewed during 2011, which has resulted in the previous

two-stage tunnel (MM1 and MM2) being revised to a shorter single-stage tunnel (MM), enabling the

full benefits to be realised more quickly and improving value for money.



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The previous MM2 default “long” tunnel from Domain to Caulfield along Dandenong Road is made


Road, joining Dandenong rail corridor east of South Yarra station. The additional capacity that the

MM2 long tunnel option provides between Caulfield and South Yarra is no longer required for the

foreseeable future. Further, detailed investigations around possible stations along the MM2 tunnel

corridor options found no scope for major urban renewal, hence this is not a factor in selecting MM2

alignments.

Figure 2-27: Melbourne Metro rail system schematic

Stage 6 - Dandenong Rail Capacity (DRC) Program – staged investment to address critical

capacity issues on the corridor including provision for operational and timetable changes, longer

trains, signalling and power upgrades, road-rail grade separations and trackwork. These investments

will need to be progressively implemented over the next decade, commencing in the next two years. It

is assumed that with the long lead and construction timeframes for MM, a significant component of

the DRC Program works will be completed by MM opening. It is assumed that longer (9-car) trains will

be operating by MM opening - longer platforms will therefore be required on the Sunbury corridor as

part of MM scope.

While MM has strong economic performance on its own, the DRC investments permit future benefits

of MM and are included in the economic analysis of the ultimate MM scheme. DRC works will

integrate and allow for the future connections to the Port of Hastings and the proposed future rail line

to Rowville, which is currently envisaged to connect to DRC at Huntingdale.



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Stage 7 and beyond

The Metropolitan Planning Strategy (MPS), incorporating an integrated transport strategy and refined

rail priorities, is currently being prepared. The need or priority for MM and the DRC Program will not

change, as urban development patterns for the next ten to fifteen years are already largely set. The

effects of the MPS will begin to reshape Melbourne’s urban form, and hence influence the rail

priorities, beyond this timeframe.

Feasibility studies are underway for upgraded or extended rail lines to Rowville, Doncaster,

Melbourne and Avalon Airports. The sequencing and staging of metropolitan and regional rail

upgrades beyond MM and DRC Program will be determined following these feasibility studies and in

the context of the MPS. The compatibility of MM with these initiatives is discussed in section 6.3.5.

A key outcome of MM is to increase inner area rail capacity to support the continued expansion of the

rail network to meet growth. The MM has been planned to allow for additional services to growing

areas such as Melton, which is one of several options to become part of the ultimate Melbourne Metro

scheme. The Melbourne Airport Rail Link could also become part of the MM. It is assumed that the

Upgrading Regional Passenger Lines project (including upgrades to Melton / Ballarat and Bendigo

lines) is part of the ultimate MM scheme for the purposes of the economic appraisal of MM.

The number of extra services enabled by each stage of the rail capacity program is outlined in Figure

2-28.

Figure 2-28: Additional train services provided by Metropolitan Rail Capacity Upgrade Program



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2.9 Summary of business need

With the ongoing growth in inner city employment and population growth in northern and western

regions of Melbourne, it will simply not be possible to provide sufficient capacity on the Northern rail

group to service the projected demand. The City Loop and inner core network will not be able to

accommodate the required number of trains, leading to chronic congestion and unacceptably low

reliability. This will mean that residents of the northern and western regions, which are reliant on the

inner city and inner east for jobs and services, will be increasingly cut off from economic opportunities.

The Eddington report identified these major problems with east-west connectivity across the city.

Without development of inner urban sites, urban growth will continue to intensify the need for outer

suburban growth. The inner west has several industrial sites which could be developed into mixed use

commercial and residential development, though the intensity of this development is limited by the

site’s accessibility. Providing a step-change in public transport service has the capacity to unlock

development sites and catalyse intense inner-urban development.

Outer suburban development also contributes to higher infrastructure costs and developments tend to

be larger, more inefficient and contribute more greenhouse gas emissions than inner city

development. Sparser public transport service provision in outer areas also results in higher car-

dependence and higher living costs.

There are significant opportunities to intensify inner urban development in North Melbourne but higher

density development in that area would lead to further congestion if not served by high capacity public

transport, hence the intensity of any redevelopment is limited by the site’s accessibility. There is also

a strong need to support proposed growth in activity centres and to catalyse more intense

development around stations to make better use of increasingly accessible land. Providing a step-

change in public transport service has the capacity to unlock development sites and catalyse intense

development.

Demand for rail services in these corridors is growing rapidly. Population growth, increasing rates of

road congestion, petrol price rises and greater environmental awareness has caused a mode shift

towards public transport. This unprecedented 70% growth in train patronage in the last decade and

50% in the last five years alone has resulted in rail demand approaching the capacity of the network.

This has highlighted the limitations of key system bottlenecks such as North Melbourne, Richmond

and the City Loop. For example, currently around 20,000 metropolitan rail passengers on 31 train

services travel through North Melbourne railway station in the morning peak hour. Demand is

predicted to more than double by 2021 and rise to around 55,000 by 2031.

There are currently only two metropolitan track pairs at North Melbourne, one around the city loop and

one direct between North Melbourne and Flinders Street, used by all Northern Group services.

Services through North Melbourne are limited to 42 services per hour if there are no further

interventions beyond currently committed works, resulting in significant ongoing overcrowding.

Only 76% of AM peak trains on the Northern Group currently arrive within five minutes of schedule in

the peak direction. This is expected to improve to 87% with the completion of RRL in 2016, but will

decline again as patronage and overcrowding increases.

Ongoing congestion on the transport network also significantly impedes labour productivity,

particularly in the knowledge-intensive inner areas. Productivity is the cornerstone of future economic

growth – accessibility of knowledge jobs drives agglomeration benefits and hence labour productivity.

Freight productivity will also be threatened by road congestion, particularly in the port precinct. Freight



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movements are projected to continue to grow significantly into the future, at up to three times faster

than population growth.

Other problems include the increasing need to better service the key non-CBD centres of the

knowledge economy in Parkville and St Kilda Road. These areas are critical to the city’s economy and

are continuing to grow. They are served by tram services on the St Kilda Road – Swanston Street

corridor, one of the world’s busiest tram corridors and which continues to experience strong growth.

Services are nearing capacity and there is limited scope to provide services. This congestion

highlights the need for two of Melbourne’s more significant economic centres to be served by higher

capacity public transport to improve access and harness economic agglomeration benefits.



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3 Summarising the business need and investment drivers

3.1 Introduction

The preceding sections have outlined the project’s policy context and the existing and future transport

and land use context. This gives rise to the business need and the problems that the city faces

without action.

The problems which this project seeks to address is based on the logic that infrastructure provision

dictates the level of service that can be provided. This in turn defines the level of accessibility offered,

and this ultimately influences land use patterns.

This section summarises the problems and business needs addressed by the overall Melbourne

Metro (MM) project in an investment logic framework.

3.2 Definition and evidence of the problem

3.2.1 Melbourne’s population growth is outstripping its ability to maintain liveability

Melbourne is the nation’s fastest growing capital city. Currently its population is 4 million people and is

expected to reach 5.5 million before 2036 at an average of growth rate of 1.5% per annum for the

next ten years. To accommodate this population growth, it is estimated that 612,000 additional

dwellings will be needed by 2031, with around half in Melbourne’s established suburbs and half in

Melbourne’s growth corridors.

This growth has led to:

� Demand outstripping housing supply in certain locations, which increases house prices. Lack of

mass rapid transit services and land availability in established areas are examples of constraints

on intensity of development, so the choices for new housing are largely limited to lower density

housing in growth corridors until supply constraints are mitigated.

� Rapid growth in public transport demand, resulting in system unreliability and severe congestion

on tram and train networks and ongoing congestion on road networks, particularly on transport

routes in the inner city and the west. This is affecting the city’s productivity, particularly for freight

movement, which is expected to continue to grow at up to three times faster than population

growth.

� Melbourne is also shifting towards a knowledge based service economy, particularly in central

Melbourne where growth in knowledge jobs is most evident and service sector employment is

predicted to continue to increase significantly. Inner Melbourne’s ability to meet this growing

demand will become increasingly limited over the next 10–15 years as the pipeline of commercial

development in Southbank and Docklands gets used up. Other locations accessible by high

capacity public transport will be required to provide a logical next step for commercial investment

into the long term.

Evidence of the expected population and housing growth patterns and the consequences are

provided in section 2.4. Overall travel demands and rail patronage growth projections related to this

growth are explained in section 2.7.



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3.2.2 Current commitments to rail capacity enhancement will fail to meet future demand

and will cause chronic overcrowding and unreliability of the public transport system

The majority of Victoria’s rail network was built to serve patterns of travel and overall demand quite

different from those occurring today. The metropolitan network still comprises significant sections little

changed from their original construction as rural branch lines which now serve extensive areas of

urban development. Transformation of the rail system to metro style operations is required to meet

future demands. The transformation involves operating changes and investment in upgrades and new

infrastructure to permit segregated, end-to-end operations. Without this, train crowding and track

congestion will cause unreliability and performance issues on the rail network.

To this end, a number of projects have been completed or are in development. However, by 2021 it is

expected that passenger demand will exceed the available capacity by 40 peak hour trains and 70

trains by 2031, with shortfalls particularly occurring on the Northern and Caulfield rail groups. In

addition, the existing CBD stations have limited capacity to handle the expected 2021 demand leading

to significant crowding on platforms and on escalators.

The capacity of the Northern Rail Group is limited by junctions around North Melbourne, the capacity

of the City (Northern) Loop and the cross city line from Southern Cross to Flinders Street. The

capacity of the Caulfield Group is limited in the first instance by constraints south of Caulfield but also

by the City (Caulfield) Loop and cross city line.

This is explained in detail in section 2.8.

3.2.3 Present urban development patterns will result in lower productivity and reduced

access to jobs and services

Around half of Melbourne’s growth is expected to occur in greenfields residential development in the

northern, western and south-eastern growth corridors. This level of growth in areas with poor existing

public transport access increases car dependence and inefficiency and reduced accessibility to

economic opportunities. Road congestion will reduce efficiency and constrain growth in the freight

task, reducing productivity.

Employment in central Melbourne has also grown significantly in recent years and is expected to

continue to grow in line with population. Employment has historically been concentrated in central and

south-eastern Melbourne and is likely to attract a significant proportion of future employment growth.

Rapid population growth in outer suburban areas is therefore expected to continue without

commensurate growth in employment in those regions, further exacerbating the already significant

geographic imbalance between population and employment growth. This will increase cross-town

travel between the north-west and south-east and radial travel to access central Melbourne,

intensifying growing congestion and unreliability on Melbourne’s public transport network. Access

from the north and west to economic activities in central Melbourne and the south-east is constrained

by network capacity.

This is explained in detail in section 2.5.

3.2.4 Climate change and higher energy costs will intensify the need for more efficient

urban living

Transport is the second largest source of greenhouse emissions after stationary energy, producing

16% of Victoria’s emissions, of which 90% comes from road transport. Transport emissions grew 25%



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between 1990 and 2004, but declined to 18% growth on 1990 levels by 2009, in part due to the rapid

growth in public transport patronage since 2004.

Outer suburban development is generally characterised by lower density housing with larger lot sizes,

larger houses, higher car ownership and higher establishment costs. It is generally poorly served by

public transport and infrastructure provision is struggling to keep pace with development. A high level

of growth in outer suburban areas therefore adds to car dependence, transport system inefficiency,

higher emissions and higher living costs.

While access to central Melbourne is characterised by high levels of public transport, walking and

cycling, the share of travel by sustainable modes drops off sharply outside the catchment of the city

loop, despite key areas such as Parkville and St Kilda Road attracting a density of trips that is

amenable to servicing with mass transit. In addition to exacerbating congestion in inner Melbourne,

this increases transport greenhouse emissions.

This is evidenced in detail in section 2.6.

3.3 Timing considerations

The problems outlined above will be increasingly manifested over the next decade, to the point that

the capacity shortfall on Melbourne’s rail network will reach 40 trains in the AM peak hour by 2021.

While reliability on the Northern Group will be boosted significantly by RRL, it will deteriorate as train

and track capacity limits are breached by patronage growth. The project is of a scale that requires

significant implementation lead times, in the order of 10 years from funding commitment to opening.

Part of the lead time relates to approvals, so it could be reduced if approvals are undertaken now. The

lead times suggest that the project will be needed well in advance of likely delivery.

3.4 Other occurrences of the problem

The city-shaping nature of this investment means that some or all of these problems are also partly

being addressed by other investments. Significant investment is planned or underway to transform the

rail into a metro-style system. As discussed in sections 1 and 2, this project is a critical part of this

sequenced strategy to address the land use and transport needs identified above. It also lays the

foundation for ‘metronisation’ of the whole metropolitan network and permits the efficient future

construction of other projects such as Melbourne Airport Rail Link, Rowville Rail Extension, Doncaster

Rail Extension and Upgrading Regional Passenger Lines (Melton / Ballarat / Bendigo).

Melbourne Metro also specifically addresses the need to manage population growth through more

urban development in established areas. This need is fundamental to the Government’s new

outcomes-based Metropolitan Planning Strategy, which will manage current challenges and consider

the impacts of Melbourne’s population growth in decades ahead to guide future planning and

investment.

In addition, the establishment of the Public Transport Development Authority will ensure that priorities

for expansion of public transport are identified and acted on.

3.5 Investment logic

Based on these problems and business needs, an investment logic map has been established for the

project (Figure 3-1), describing the service need and key problems that need to be addressed, and



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hence the strategic interventions or high-level objectives for the project. The high-level benefits or

outcomes achieved by the project are also articulated. The benefits of the scheme and key

performance indicators are articulated in section 7.2.

Table 3-1: Key problems and descriptions to address them

Problem/business need Description

Melbourne’s growth is outstripping its ability to cope

Congestion on tram, train and road networks

Inability to unlock inner urban development opportunities

Inability to accommodate significant growth in freight task due to congestion on the road network

Present urban development patterns will result in lower productivity and reduced access to jobs and services

Access from north and west to economic activities inner Melbourne and inner east constrained by network capacity, limiting labour productivity

Unsustainable levels of growth in outer suburban areas, adding to car dependence and inefficiency and reduced accessibility to

economic opportunities

Congestion on road network reduces efficiency and growth in freight task, reducing productivity

Climate change and higher energy costs will intensify the need for more efficient

urban living

Unsustainable levels of growth in outer suburban areas, adding to car dependence, system inefficiency, higher emissions and higher

living costs

The current commitments to rail capacity will fail to meet future demand and cause chronic overcrowding and unreliability of the public transport system

Increasing population growth in north and west and in employment in inner Melbourne increases rail demand

Train crowding and track congestion causes reliability and

performance issues on the rail network



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Figure 3-1: Investment logic map

Investor:

Facilitator:

Initial Workshop:

Version no:

Last modified by:

ASSETSNEEDED

PROBLEM

INVESTMENT LOGIC MAPMelbourne Metro

CHANGESSTRATEGIC

INTERVENTIONS

Hector McKenzie

Terry Wright

February 2010

v 0.2

Chris Tehan

Melbourne’s liveability is

improved and shared40%

KPI 1: Train loadingKPI 2: Train & tram reliabilityKPI 3: Road congestionKPI 4: Urban development in established areas

Melbourne’s population growth is outstripping its ability to maintain

liveability20% Improve the

performance of Melbourne’s existing

rail system25%

Protect land corridor for new rail tunnel and underground

stations between Kensington and

South Yarra

Acquisition and consolidation of land and strata

Stronger Victorian economy

40%KPI 1: Commuter travel –reduced travel timesKPI 2: Agglomeration benefitKPI 3: Jobs in Melbourne LGA

Current commitments to rail

capacity enhancement will fail to meet future demand and will cause chronic

overcrowding and unreliability of the public transport

system50%

Increase the capacity of Melbourne’s rail

system50%

Increased access to jobs and services

10%KPI 1: Access to jobsKPI 2: Access to capital city functions

Present urban development

patterns will result in lower productivity

and reduced access to jobs and

services20%

Facilitate the effective use of land within Melbourne for

housing and employment

25%

Facilitate urban development in Arden precinct

and around new CBD stations

Development enabling

infrastructure and public realm

improvements in Arden precinct

Climate change and higher energy costs will intensify the need for more

efficient urban living10%

Transition to a lower emissions society

10%KPI 1: Proportion of travel by public transportKPI 2: Greenhouse gas emissions from transport

New rail tunnel between South Kensington and

South Yarra through CBD

including five new underground

stations

Additional rolling stock

Investor:

Facilitator:

Initial Workshop:

Version no:

Last modified by:

ASSETSNEEDED

PROBLEM

INVESTMENT LOGIC MAPMelbourne Metro

CHANGESSTRATEGIC

INTERVENTIONS

Hector McKenzie

Terry Wright

February 2010

v 0.2

Chris Tehan



KPI 1: Train loadingKPI 2: Train & tram reliabilityKPI 3: Road congestionKPI 4: Urban development in established areas

Melbourne’s population growth is outstripping its ability to maintain

liveability20% Improve the

performance of Melbourne’s existing

rail system25%

Protect land corridor for new rail tunnel and underground

stations between Kensington and

South Yarra

Acquisition and consolidation of land and strata


40%KPI 1: Commuter travel –reduced travel timesKPI 2: Agglomeration benefitKPI 3: Jobs in Melbourne LGA

Current commitments to rail

capacity enhancement will fail to meet future demand and will cause chronic

overcrowding and unreliability of the public transport

system50%

Increase the capacity of Melbourne’s rail

system50%


10%KPI 1: Access to jobsKPI 2: Access to capital city functions

Present urban development

patterns will result in lower productivity

and reduced access to jobs and

services20%



25%

Facilitate urban development in Arden precinct

and around new CBD stations

Development enabling

infrastructure and public realm

improvements in Arden precinct

Climate change and higher energy costs will intensify the need for more

efficient urban living10%


10%KPI 1: Proportion of travel by public transportKPI 2: Greenhouse gas emissions from transport

New rail tunnel between South Kensington and

South Yarra through CBD

including five new underground

stations

Additional rolling stock



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3.6 Project vision, goals and objectives

3.6.1 Vision

The Melbourne Metro Rail Tunnel Vision Statement and Design Objectives informs the development

and delivery of the project at the highest level. Developed in collaboration with a wide range of

project stakeholders, the vision statement establishes the overarching project vision and aims, as well

as an associated suite of design objectives and architectural principles.

The overarching vision for MM is:

a Metro system which delivers a high quality user experience, shapes Melbourne’s growth

and identity, connects people with important destinations and is enjoyed by all of Melbourne’s

residents and visitors.

The project aims cited are those set out and in the objectives of the Transport Integration Act (2010).

The vision statement notes that the design of Melbourne will be guided by the Victorian Government

Architect’s Good Design Principles for transport projects, and that consultation highlighted the

following principles as being particularly important to the design of MM:

� provide the highest quality travel experience for all users

� provide an efficient and functional Metro rail service

� provide an enduring contribution to Melbourne’s growth and identity.

The vision statement will be continuously refined through stakeholder and community engagement

and feedback, to ensure that it reflects the Victorian community’s vision and aspirations for MM.

3.6.2 Goals

Based on this vision, the overarching goals for the development of the transport system in Victoria

and the rail system in Melbourne are:

1. To provide Victorians the best transport network in Australia, so that people can spend less time

commuting and more time with family and friends.

2. To give people living in Melbourne’s growth corridors more transport options by expanding public

transport links, including major rail extensions, into growth corridors.

3. To create a modern metro-style train system with frequent train services day and night to meet the

needs on an international city of five million people and beyond.

The MM tunnel from Dynon to Domain is the catalyst for transforming Melbourne’s suburban rail

system into a modern mass transit metro network and contributing to these goals.

Specific goals for this project:

� avoid unacceptable congestion on Melbourne’s busiest rail corridors and associated traffic

corridors, including the West Gate Freeway and Footscray, Dynon and Ballarat Roads

� promote the growth of knowledge-based, nationally important industries in Melbourne

� drive rapid urban consolidation along transport corridors

� provide for long-term extensions of the rail network.



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3.6.3 Objectives

As shown in the investment logic map, to address the key problems, three strategic interventions are

proposed. The high-level strategic interventions are supported by specific objectives as outlined

below.

1. Improve the performance of Melbourne’s rail system

> reduce crowding on the rail system through additional rail track capacity through inner

Melbourne on the Northern and Caulfield Rail Groups

> improve punctuality and reliability of the rail system by sectorising the Northern Group

services so that the Sunbury/Watergardens, Craigieburn, Upfield, Werribee/Williamstown,

Sandringham, Frankston, Pakenham and Cranbourne lines can operate independently as

metro lines with homogenous service patterns.

2. Increase the capacity of Melbourne’s transport system

> reduce crowding on the rail system by providing additional rail track capacity through inner

Melbourne on the Northern Group

> reduce congestion on road system by diverting more travellers to rail system

> reduce congestion on tram network by diverting tram users to train where appropriate

3. Facilitate the more effective use of land within Melbourne for housing and employment

> provide enabling interventions and infrastructure to facilitate urban renewal in underutilised

land in North Melbourne area

> improve accessibility of north-western and south-eastern areas of Melbourne to increase the

stock of human capital in those areas

> contribute to rebalancing the social and economic equity within Melbourne, and in particular

improving access to employment and services for those in Melbourne's north and west and

outer south-east

> utilise the very significant potential growth projected for central Melbourne to reshape the city.

A key consideration is that this growth is effectively tied to the central area of Melbourne, as

described above and so therefore it is not feasible to suggest or plan for it to be located in

outer suburban locations

> ensure Melbourne and Victoria retain their competitive economic advantage by providing

supply of relatively inexpensive and well located land for commercial development in central

Melbourne

> provide for opportunities for dwelling development within Melbourne's established areas

> improve rail service quality in the north-west and south-east to encourage more intense

development around railway stations.


PART B – DEFINING THE BEST SOLUTION

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PART B – DEFINING THE BEST SOLUTION TO ADDRESS THE NEEDS

4 Options assessment

4.1 Strategic options

The Department of Transport (DOT), in conjunction with the Department of Planning & Community

Development (DPCD) and central agencies, has considered a number of responses to the key issues

of managing population growth, addressing transport system congestion, improving accessibility to

jobs and services and reducing the environmental impacts of growth. This process began as part of

the East-West Link Needs Assessment Study14

which identified that an east-west rail tunnel under the

CBD linking Footscray and Caulfield was, among a suite of solutions, an essential infrastructure

initiative for Melbourne to deal with those specific problems. This has since been confirmed from the

strategic planning processes undertaken within DOT and DPCD. As part of these processes, high

level strategic options were identified to address these issues, some of which have been or are

currently being implemented.

The strategic options fall into three broad categories:

� reduce demand (for the services);

� improve productivity (of the assets and other resources); and

� increase supply (of the assets and other resources).

The scale of the problems and business needs identified suggests that a suite of interventions,

including a major increase in supply, is likely to be required. The interventions in each category

identified as having potential to address the problems and business needs are listed and described in

Table 4-1.

Table 4-1: Summary of potential strategic options

Intervention type

Specific intervention Description

Nil response 1. Do nothing (base case) No changes

2. Transport congestion pricing Pricing strategies (such as road congestion pricing, early bird rail tickets, shoulder peak service incentives) to reduce

transport demand in peaks. Reduce demand

3. Curtail growth in outer

suburban areas

Planning instruments and/or legislation to limit new housing in outer suburban growth areas.

14 Investing in Transport, DOT (Eddington) 2008



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Intervention type

Specific intervention Description

4. Reconfigure network,

timetable & operations to

establish metro-style train

operations

Line sectorisation15

, new city loop operating strategies and timetables and supporting infrastructure to enable segregated, end-to-end, high frequency train operations.

5. Double-deck/longer trains

Introduce double-deck rolling stock or increase number of carriages and lengthen platforms to increase train-carrying

capacity.

6. Upgraded signalling

Upgraded lineside signalling and/or new high capacity in-cab signalling as required to enable higher frequency

operations.

Improve productivity

7. Facilitate inner urban

renewal and more intense

development around railway

stations

Planning instruments, land consolidation and enabling infrastructure to support intense urban development in

locations accessible to mass rapid transit.

8. New east-west rail tunnel

Underground railway through CBD linking Footscray and Caulfield to relieve overcrowding and cater for future growth, increase accessibility to jobs and services and

reduce road congestion to accommodate growth in freight. Increase supply

9. New east-west road tunnel

with CBD access

Underground road linking Eastern Freeway and Western Ring Road via Port of Melbourne and with CBD access points to increase city access by car and cater for future growth, increase accessibility to jobs and services and reduce road congestion to accommodate growth in freight.

A blend of the interventions 2, 4, 5, 6, 7 and 8 forms the clear preferred strategic option. By

themselves these interventions fail to fully address the scale of problems identified by this investment,

but do improve and maximise the benefits. This is explored in the hierarchical project options

assessment below. Interventions 3 and 9 do not address the specific problems identified for this

investment.

An upgrade of the existing signalling was identified as an important complementary measure to the

proposed infrastructure schemes rather than a substitute. Further work confirmed that signalling alone

has limited benefits in terms of additional capacity, though new signalling is recommended as part of

any capacity enhancement project to realise the maximum capacity uplift.

In the strategic assessment (see Regional Rail Link and Melbourne Metro Project Plan for

Infrastructure Australia, January 2009), three levels of option assessment were identified for the

preferred east-west rail link. The highest level considers network wide alternatives and then moves

through increasingly detailed elements of the project as shown in Table 4-2. The assessments

undertaken at each level are discussed below.

15 Dismantling the four existing rail groups by separating existing lines out from their rail groups and creating eight metro line groups which operate independently from each other



Page 94 of 321

Table 4-2: Option hierarchy

Level Objective Output Report/Process

Level 1: Corridor options

Identify and assess strategic corridor options

Preferred corridor option Project Plan for IA (January 2009)

Identify alignment options Scope of investigations to determine preferred alignment

Project Plan for IA (January 2009) Level 2:

Alignment options Assess alignment and station location options

Preferred alignment and station locations

Options Assessment Report (March 2010)

Level 3: Full business

case

Establish detailed costs and benefits for preferred option,

Assess detailed sub-options

Resolution of detailed sub-options of preferred overall option; preliminary design,

scope and cost estimate

This business case

This previous work also identified level 2 alignment options, the assessment of which is detailed in the

Options Assessment Report (DOT, March 2010). This business case progresses the preferred level 2

alignment and station locations option for MM which were endorsed by Cabinet in June 2010. It also

assesses the sub-options, such as specific station locations, station access and mobility, technical

and systems aspects and land use redevelopment.

A summary is provided in the following sections of the level 1 corridor options and the level 2

alignment and station location, layout and configuration of stations, platforms, station entrances and

tram interchanges; interchanges with CBD stations, and intervention options in Arden, along with

some of the detailed sub-options to the preferred scheme.

4.2 Corridor options assessment

The level 1 corridor options assessment investigated network-wide alternatives to identify the

preferred corridor for the new east-west rail tunnel scheme, both within a geographic sense as well as

within the context of the whole rail network. This work was completed in 2007-2008 and was

summarised in DOT’s submission to IA16

. This determined the preferred ‘default’ route as an east-

west rail tunnel via Parkville and St Kilda Road linking Footscray and Caulfield.

Four corridor options were identified to address inner core metropolitan rail capacity issues,

particularly the Northern Group. The four options considered were:

� Option C1 – New viaduct between Flinders Street and Southern Cross. This provides a new

track pair between North Melbourne and Flinders Street station by building a new viaduct. This

would enable Werribee and Williamstown trains to run through to Sandringham creating a more

efficient operation and additional capacity for other lines.

� Option C2 – Northern – Caulfield Rail Group Loop Connection. This would modify the

existing underground rail loop to effectively provide an additional track pair through the CBD to

Caulfield. This would allow all Frankston trains to run through to the Craigieburn/Upfield lines

without passing through Flinders Street Station.

16 Regional Rail Link & Melbourne Metro 1 Project Plan for Infrastructure Australia, DOT, January 2009



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� Option C3 – Northern – Burnley Rail Group Loop Connection. Similar to Option C2 this would

allow the Burnley group trains to operate through to Craigieburn/Upfield lines.

� Option C4 – New East-West Tunnel via Parkville. This (preferred) option is the Melbourne

Metro project.

Options C1, C2 and C3 include an additional track pair from Caulfield to central Melbourne to meet

long-term demand, which is an inherent part of Option C4. Options C1 and C2 include an additional

tunnel between Melbourne Central and Caulfield.

Figure 4-1: Melbourne Metro corridor options

These four options were assessed against multiple criteria, which determined that Option C4 was the

preferred corridor, principally because it delivered more additional train paths (55) than the other

options. Option C1 was not favored due to the major land use and community impacts around the

Flinders Street and Yarra River precinct. Options C2 and C3 were not preferred due to their significant

constructability issues. Option C4 also presents the opportunity to support urban redevelopment in the

inner west.

The alternative schemes were rejected either

� because they failed to address the forecast shortfall in capacity and failed to offer the same

potential to support the continued development of the inner metropolitan area; or

� presented major engineering challenges or long disruptions to the system.

Table 4-3 below summarises the reasons for rejecting the alternative schemes.



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Table 4-3: Summary of corridor options

Option Additional peak hour train paths

Comments

East-West Rail Tunnel

+55

- High delivery cost

- Provides additional station capacity

- Opens urban renewal and growth opportunities

Additional City Loop Tunnels

+24

- High delivery costs, major risks and significant interface issues

- High passenger impact from terminating Werribee and Williamstown services at Southern Cross

- Does not alleviate station capacity constraints

- Does not open new routes to heavy rail

New Southern Cross-Flinders

Street Viaduct +16

- Severe amenity impacts including partial demolition of Aquarium, Northbank Park, Conference Centre

- Does not alleviate station capacity constraints


‘Through Routing’ of City

Loop +20


- Severe disruption to existing services during construction period (including need to close city loop for periods of time, hence requiring increased redundancy in inner core rail system before this can be contemplated)

- Severe engineering challenges

- Bypasses Flinders Street and Southern Cross Stations

9-car operation +12

- Assessment ongoing

- Low cost

- Incompatible with loop stations included in MM

Other schemes have been proposed which envisage a full ‘metro’ system completely independent of

the existing rail network, and serving areas of Melbourne not currently served by rail. Such schemes

were not considered in this assessment because they do not address the existing and future

problems identified. The preferred scheme facilitates the operational and physical segregation of

existing rail lines to enable metro-style services to operate on existing lines, as discussed in the

following sections.

4.3 Melbourne Metro default scheme

Through the EWLNA, a default, two-stage scheme was proposed for MM, based on the preferred

corridor option, though the specific alignment and station location options within the corridor had only

been subject to limited examination.

The default scheme would create new metro services from Sunbury (and ultimately Melton upon

electrification and duplication) to the Dandenong corridor via the CBD and St Kilda Road. The new

line would utilise existing tracks from Sunbury (and Melton) to South Kensington before entering a

new rail tunnel from South Kensington to the Dandenong corridor. It would operate as a stand-alone

railway with no interaction with other suburban lines and would ultimately utilise a dedicated fleet of

metro trains all of which will be stabled and maintained on the line. Under the Default Scheme, new

stations would be built at:

� Parkville, Swanston Street North, Swanston Street South and Domain as part of Melbourne Metro

1

� Alfred, Windsor and Orrong Road as part of Melbourne Metro 2.



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This default scheme has been tested by considering alternative station locations within a broadly

defined study corridor.

The new line would be delivered in two stages:

� in the first stage (MM1) the new line would operate between Sunbury/Melton and a turn-back

station on St Kilda Road

� in the second stage (MM2) the line would be extended from St Kilda Road to the Dandenong

corridor where it will connect with existing track to Cranbourne and Pakenham.

The default scheme would also permit the establishment of independent metro services on all

Northern and Caulfield Group services.

4.4 Station location and alignment options assessment

4.4.1 Alignment and station location options assessment framework

The methodology used to assess the alignment and station locations consisted of three steps:

1. identification of alternative station locations within the study area

2. preliminary assessment of these options to create a shortlist

3. evaluation of the short-listed options.

Potential options were developed through review of earlier studies, including those in support of the

EWLNA, strategic long-term planning by the DOT, project team investigations, identification of city-

shaping opportunities with the Department of Planning & Community Development (DPCD),

workshops with staff from across DOT and discussions with key stakeholders.

Through this process, numerous variations to the default scheme were identified, each of which have

tangible differences in economic, environmental and social benefits and costs of delivery. These

options were subsequently distilled into a number of key decisions.

Possible redevelopment opportunities were reviewed within a broadly defined MM corridor

(Figure 4-2). Following an assessment of possible rail alignments, 14 station locations were identified

for consideration across five sub-areas. Further assessment of these study areas short-listed two

re-development opportunities: North Melbourne/Arden and South Melbourne.

In addition to these redevelopment opportunities, a number of key stations (Flinders Street,

Melbourne Central and Flagstaff) were identified as train/train interchange opportunities while St Kilda

Road locations (such as Domain) and Parkville were identified as key locations for train/tram

interchange. These major interchange points serve existing and planned development, providing

benefits in terms of reduced travel times and improved agglomeration.



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Figure 4-2: MM Corridor Study Area

The preliminary analysis of alignment and station locations enabled the identification of seven key

questions to be resolved through detailed options assessment. These decisions and option

combinations are summarised diagrammatically in Figure 4-3 and Figure 4-4, while Table 4-4

examines each of the decisions in detail, including the key considerations and influencing factors of

each decision and the interdependencies between decisions. The options were assessed with

consideration to the following aspects:

� accessibility to existing and planned land uses (including capital city function for CBD alignment

options)

� redevelopment potential

� rail operations

� tram network integration

� cost and risk

� economic impact

� environmental, social and heritage impacts

� stakeholder views.

Each option was assessed as to their impacts relative to the default scheme under each of the

criteria, rather than absolute impact.



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Figure 4-3: Station and alignment options



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Figure 4-4: Station and alignment option combinations



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Table 4-4: Decisions to be taken, key considerations and interdependencies

Decision Description Key considerations Interdependencies

A

To provide an Arden Station with associated

redevelopment or

not provide a station

(Default)

Redevelopment benefits triggered by a station

Patronage

Incremental cost and risk of a

station

Decisions B & C: Preferred location can only be achieved with a Grattan Street/Swanston

Street alignment

B

To locate Parkville Station in Grattan Street (Default) or

in Flemington Road

Access to existing and planned land uses

Tram network integration

Relative costs, risks and impacts

Decision C: Grattan Street location can only be achieved with a Swanston Street

alignment

C

To adopt a Swanston Street alignment (Default) or

a William Street alignment


Integration with the existing rail

network



Decision B: Grattan Street location can only be achieved with a Swanston Street alignment

Decision E: A station at Domain can only be achieved with a Swanston Street alignment

D

To provide one CBD station or

two CBD stations (Default)


Integration with the existing rail network

Ability to accommodate

passenger flows



Decision C: Only a Swanston Street alignment will allow for two interchanges with the

existing rail network

E

To provide a station in Domain (Default) or

a station in South Melbourne with associated

redevelopment

Redevelopment benefits triggered by a station



Decision E: A station at Domain can only be achieved with a Swanston Street

alignment

F

To allow for an MM2 extension via Dandenong Road (Default) or via Toorak Road, Commercial Road or

Balaclava Road


Patronage

Rail network operations



Decision G: MM2 station locations



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Decision Description Key considerations Interdependencies

G

To provide (or not provide) stations on default alignment

at:

Commercial Road (Alfred)

Windsor

Orrong North

or on other alignments at:

Jam Factory or South Yarra

(Toorak Rd)

Prahran (Commercial Rd)

Balaclava and Orrong South (Balaclava Rd)

Patronage and travel benefits



Incremental costs, risks and

impacts

Decision F: MM2 Alignment

4.4.2 Decision A – Arden Station

The default scheme did not include a station between Footscray and Parkville. This decision relates to

whether a station is provided or not in this location. Key factors considered in assessing this decision

include the urban redevelopment benefits triggered, patronage and the incremental cost and risk of a

station.

As highlighted above, four strategic locations were analysed and the Arden precinct was found to

have the best combination of urban development potential and location in regional and local contexts.

Various locations for a metro station have been identified and assessed in the vicinity of Arden Street.

This assessment recommended a preferred station site at the western end of Queensberry Street in

North Melbourne. This station would stimulate approximately 50 hectares of redevelopment, should a

station in this area be proven worthwhile.

Decision A summary

That an Arden Station be included in the project as it:

• would stimulate significant levels of redevelopment, potentially accommodating an additional

23,000 jobs, (or a quarter of inner Melbourne’s projected employment growth) 10,000 residents

and 12,000 students, equivalent to a CAD

• has the capacity to shape the urban structure of Melbourne by accommodating employment

growth in inner Melbourne and catalysing the North Melbourne to Melton employment corridor

• connects the CBD and Footscray via a corridor of urban activity and underpins the potential of

Footscray CAD and its role in accommodating city fringe commercial activities and capital city

functions

• generates patronage in the order of 9500 alightings and 2000 boardings in the 2046 AM peak with

the full scheme

• would revitalise an underutilised and dilapidated tract of government-owned industrial land in

inner Melbourne



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• would dramatically activate and improve access and mobility in North Melbourne and create

opportunities for supporting public transport links

• would add only $110 million to the cost of the default scheme, compared with an additional

$340 million in urban consolidation benefits

• is strongly supported by relevant stakeholders.

4.4.3 Decision B – Parkville Station

Two station location options were considered for Parkville:

� Grattan Street (around the intersection of Royal Parade)

� Flemington Road (between Grattan Street and Park Drive).

The Grattan Street Station is on the default Swanston Street alignment connecting to a CBD North

Station in Swanston Street that would be integrated with Melbourne Central Station and provide direct

access to RMIT University. The Flemington Road station location is premised on a William Street

alignment through the CBD, which would provide a direct link to high density housing and commercial

at the western end of Southbank.

Importantly, a station in Grattan Street would not allow for the William Street alignment to be adopted

due to the radius of curvature required for the railway and the desire to avoid major property

acquisition to the north of the CBD. As a result, Decision B is interdependent with Decision C, CBD

alignment.

The key factors considered in assessing this decision included access to existing and planned land

uses, tram network integration and relative costs and risks.

Decision B summary

That the Parkville Station be located in Grattan Street.

As the centre of the Parkville educational and biomedical precinct, Grattan Street is the natural

location for a new station, providing the greatest level of accessibility to the existing major attractors of

the hospitals and Melbourne University.

Grattan Street is demonstrably more accessible compared to Flemington Road, with 30,000 more

students, 70% more jobs and 45% more residents in the walking catchment. It also has a greater

capacity to provide relief to St Kilda Road tram congestion and provides a far superior outcome for

pedestrian movement. Grattan Street station has strong stakeholder support.

There are no technical or cost reasons for Flemington Road to be preferred over the default Grattan

Street location.

This recommendation is interdependent with Decision C. Given that Grattan Street is preferred, the

only reason why a Flemington Road location should be contemplated is if a William Street alignment

through the CBD were preferred, which could not be achieved with a Grattan Street station.

4.4.4 Decision C – CBD alignment

The default CBD alignment is via Swanston Street. Alternative alignments have been considered

along Russell, Elizabeth and William Street alignments, as shown in Figure 4-6. Key factors



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considered in reaching this decision include access to existing and planned land uses, integration with

the existing rail network, tram network integration and the relative costs, risks and impacts.

Preliminary assessments of Russell Street and Elizabeth Street alignments indicated that they would

be $430 million and $600 million more expensive than the default, respectively.

The Russell Street alignment also offered no major advantages compared with the default though it

does have less impact on trams and the busy Flinders Street Station precinct during construction and

it also enables the Grattan Street station to be located further east, better integrating with Melbourne

University and causing less impact on the hospitals. In addition to the higher cost, major

disadvantages of the Russell Street alignment are that interchange with the existing inner core

stations would not be possible (Flinders Street and Melbourne Central Stations would be 250 metres

from CBD metro stations on Russell Street), construction of the CBD south station would be more

disruptive to Federation Square and may limit future development opportunities to its east.

While Elizabeth Street still offers direct interchange with Flinders Street and Melbourne Central

stations, it precludes the possibility of Parkville Station being located in the strongly preferred Grattan

Street location, and it requires significant CBD land acquisition. It is an inherently riskier alignment

due to the flood prone area at the southern end of Elizabeth Street and would have impacts on the

existing Elizabeth Street subway at Flinders Street Station. The alignment south of the Yarra is highly

constrained through the Southgate area necessitating double stacking of tunnels.

These alignments were ruled out of further assessment on this basis, leaving the William Street

alignment as the only alternative to the default for detailed consideration.

The Swanston Street alignment proposes stations to the north of La Trobe Street and to the south of

Collins Street interchanging with Melbourne Central and Flinders Street Stations respectively. The

William Street alignment includes one station at La Trobe Street and a second on Queensbridge

Street, Southbank.

Investigation of a western CBD alignment via William Street was pursued at the request of City of

Melbourne on the basis that MM may serve new mixed use development and stimulate activity over

longer periods of the day in the western parts of the Hoddle Grid and around Queen Victoria Market. It

was also considered on the basis that it provided an alternative route to a metro station in South

Melbourne (Decision E).

Decision C summary

That the default Swanston Street alignment be adopted.

The William Street alignment would provide a less desirable network solution, with fewer services

able to interchange directly with the Metro. A single CBD station is also likely to be more expensive as

its footprint would be significantly larger.

A William Street alignment through the CBD would also cost an additional $470 million and would be

inherently riskier than the default due to poorer ground conditions and potential impacts on the

foundations of significant buildings.

Furthermore, a William Street alignment would preclude Parkville Station being located in its preferred

location in Grattan Street, it would require a less desirable Arden station location and the default

station at Domain would not be possible.

While a William Street alignment has some merit in supporting redevelopment and improving access



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to areas of the CBD and Southbank that are not currently well served by the rail network, the

significant passenger downsides and incremental costs compared to a Swanston Street alignment will

result in lower net economic benefits of the scheme.

4.4.5 Decision D – One or two CBD stations

The EWLNA identified one central station in the vicinity of Bourke Street, which could be situated far

enough south to (indirectly) interchange with Flinders Street Station. Two CBD stations interchanging

with Flinders Street and Melbourne Central along the Swanston Street alignment (the default) were

subsequently proposed. The option of providing one or two CBD stations has now been investigated

to a further level of detail.

A single CBD station could be located such that it provided interchange with either Flinders Street or

Melbourne Central Station or it could be centrally located in Bourke Street, without rail/rail

interchange.

Key factors considered in assessing this decision include access to existing and planned land uses,

integration with the existing rail network, ability to accommodate passenger flows, tram network

integration and relative costs, risks and impacts.

Decision D summary

That two CBD stations be provided.

A single CBD station would provide a considerably poorer outcome in terms of interchange with the

existing rail network, access to employment and other activities and relief to the tram network. It

would result in 15% fewer passengers using MM compared to the default arrangement of two CBD

stations, with people instead using the existing rail lines, trams and cars more. Not only does this go

against the strategic intent of the MM project and the metro style vision for the development of the rail

network, it would result in an incremental economic disbenefit approaching -$500 million (NPV). A

two-station solution has strong stakeholder support.

Furthermore, a single CBD station is likely to require dual platforms for each track in order to deal with

the significant passenger flows. The cost of a single station is estimated to be at least the cost of the

combined total of providing two CBD stations.

4.4.6 Decision E – Station at Domain or South Melbourne

The default alignment would follow St Kilda Road with a station at Domain. However much of the land

use around Domain is parkland, limiting both the existing catchment and opportunities for urban

renewal. Through investigations into redevelopment opportunities, an alternative station location in

South Melbourne has been identified. For the purposes of this comparison, Domain Station has been

assumed to be positioned under St Kilda Road between Domain Road and Toorak Road.

Three station locations were considered in the South Melbourne area:

� Kings Way (near Sturt Street)

� Sturt Street (not shown)



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� Moray Street (not shown).

This assessment has been based on the Kings Way location.

Current land uses in the Kings Way precinct of South Melbourne do not justify a station, as is the case

with Arden. However, the proposed location of a South Melbourne metro station and associated land

use changes presents a significant redevelopment opportunity. Furthermore, the South Melbourne

area has strong historical demand for both commercial office space and high density residential

development, owning to its proximity to the CBD.

The key factors influencing this decision therefore are redevelopment benefits triggered by a station,

access to existing and planned land uses and relative costs, risks and impacts.

Despite strong historical demand for both commercial office space and high-density residential

development in Clarendon Street, Southbank and St Kilda Road, and planning controls that allow for

commercial redevelopment to 10 and 11 storeys the current intensity of development in the Kings

Way precinct of South Melbourne is very low. This is largely due to the poor amenity and severance

caused by high volumes of traffic on Kings Way, severance caused by CityLink and fragmented land

ownership patterns in this area.

A South Melbourne metro station in Kings Way would provide a significant incentive for major

redevelopment of 15 hectares in its walking catchment.

More complex geology and deep foundations are expected to be encountered through Southbank and

adjacent to CityLink. This would make this option more costly and riskier compared with the default

alignment along St Kilda Road.

Decision E summary

That a station at Domain is preferred rather than South Melbourne.

A station at South Melbourne has significant redevelopment potential (additional 10,000 residents and

21,000 jobs by 2031) and would generate higher patronage than Domain, with 7000 extra alightings.

The NPV of urban consolidation benefits from redevelopment at South Melbourne is estimated to be

$300 million. South Melbourne also has higher patronage potential than Domain, indicating that it

would offer more travel economic benefits overall than Domain.

However, the default alignment is $810 million less expensive overall (including an estimated

$300 million to connect South Melbourne to MM2 or St Kilda Road) because it avoids the poor ground

conditions in South Melbourne and minimises the interaction with City Link infrastructure and other

major buildings and structures in this area.

4.4.7 Decision F – MM2 Alignment

Four alignment options between Domain and Caulfield have been considered and are presented in

Figure 4-5. The four options vary depending on the east-west connection between St Kilda Road and

the existing Caulfield to South Yarra rail corridor. They include:

� Toorak Road

� Commercial Road

� Dandenong Road (default)



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� Balaclava Road.

No significant city-shaping redevelopment opportunities were identified along any of the four options

that would influence the selection of the preferred alignment. There are significant constraints on

redevelopment including heritage requirements, and those infill opportunities which exist are being

actively developed or pursued for by the property market regardless of a new station being provided

in the area. The area is currently very well served by public transport including Sandringham rail

services and a grid network of tram and some bus routes (eg 605 City to Gardenvale).

Providing an additional rail service is unlikely to spur further redevelopment of significance over and

above that already being achieved by the market and the tram corridor land use intensification

initiative. There are however two strategically important destinations, namely South Yarra-Prahran

(Principal Activity Centre) and Alfred Hospital (Specialised Activity Centre), that would benefit the city

by being connected by MM2.

Figure 4-5: MM2 alignment options between Domain and Caulfield

An overview of patronage impact and cost of each option showed that variation in public transport

patronage compared with the default is relatively insignificant ranging from -2500 (Toorak Road) to

+2000 (Balaclava Road).

Construction of the MM2 default scheme is relatively straight forward, given the relatively wide road

reservations of St Kilda Road and Dandenong Road. However this option means that additional

capacity between Caulfield and South Yarra will be provided in advance of when it is needed (current

projections suggest this is not needed for the foreseeable future). This would be offset by

agglomeration benefits by serving the strategic Alfred precinct, which is able to be connected to other



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knowledge based precincts in Melbourne via a new metro station and provides marginally greater

relief to St Kilda Road tram services than the Toorak Road option.

The Toorak Road alignment is the shortest of the tunnel options considered (Domain to a new

junction with the Dandenong line in the vicinity of South Yarra), offering the significant advantage of

being able to stage capacity increases to match the demand requirements on the Dandenong

corridor. The option offers significant short-medium term cost savings of $2.5 billion17

compared to the

full default scheme, though will cost more ($300 million in real terms) overall in the long term if a

future pair of tracks in tunnel between South Yarra and Caulfield is required. However, the ability to

stage capacity to when it is required results in significant present value cost savings. Cost savings

could also be achieved if MM2 were undertaken in conjunction with MM1 as an MM1

terminus/turnback would not be required and there would be tunnelling construction efficiencies.

Construction impacts of this alignment are anticipated include more significant impacts on local

amenity and access due to construction vehicle movements, temporary road closures, as well as

noise and vibration compared to the default alignment. Impacts may also include property acquisition

of commercial buildings along Toorak Road and the existing corridor, as well as some residential

properties.

The Commercial Road alignment has similar construction and property impacts to the Toorak Road

alignment, both of which are constrained by narrow road widths, but over a substantially longer

length. In addition, the unfavourable grade-line of the existing rail corridor, and the close proximity of

the stations in this corridor section mean that the Commercial Road tunnel alignment is constrained

from joining existing tracks until nearly at Caulfield. Hence, the Commercial Road alignment does not

present the same staging opportunities as the Toorak Road alignment, and offers marginal if any

benefit compared to the default option along Dandenong Road. Land use studies indicate that given

that the area already has a high level of accessibility and urban amenity that the addition of a further

rail line is highly unlikely to catalyse any further substantial development over and above what is

already occurring along Commercial Road.

The Balaclava Road alignment involves more tunnelling and therefore greater cost for marginal

benefit compared to the default option along Dandenong Road.

Alongside Dandenong Road, Table 4-5 indicates that only the Toorak Road is worthy of short listing

based on the potential cost savings. The other two options will not progress to the next stage of

assessment as they do not present any material benefits compared to the Dandenong Road option,

but incur additional cost or engineering issues.

17 This cost saving assumes the default Dandenong Road alignment includes stations at Alfred, Windsor and Orrong. The cost savings of the Toorak Road alignment would also be diminished if a station were included on its alignment.



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Table 4-5: Short-listing of MM2 alignment options

Criteria Land Use New Metropolitan PT Trips Cost

Dandenong Road � �� -

Toorak Road � ��

Commercial Road - ��

Balaclava Road - ��

Assessment Criteria: � - Advantage; - Similar, � Disadvantage

Figure 4-6: Shortlisted MM2 alignment options - Toorak Road (preferred) and default

Further work has since been undertaken on these short-listed options as part of recent value

engineering and MM2 assessments and are summarised in Table 4-6. Details are contained in the

MM2 Alignment Options Assessment18

and the MM1 Extension study19

. It is clear that the Toorak

Road alignment is preferred, given its substantially lower cost and the ability for to be undertaken in

conjunction as part of MM1, thereby delivering broader network benefits earlier than the two-stage

tunnel. This is discussed further in section 4.5.

18 Melbourne Metro Two, Alignment Options Assessment, DOT, September 2011 19 MM1 Extension Study, Technical Advisor, November 2011



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Table 4-6: Assessment of MM2 shortlisted alignment options

Factor Toorak Road (Short Tunnel) Dandenong Road (Long Tunnel)

Network

Benefits

- Provides an east-west

connection via the MM

tunnel, and a through route

for high capacity trains from

the Dandenong Corridor.

- Relief to St Kilda Rd trams.

- Congestion relief to inner

core stations.

- MM1 and MM2 can be

delivered as a single project,

enabling network benefits to

be delivered at the outset

��

- Provides an east-west connection

via the MM tunnel, and a through

route for high capacity trains from

the Dandenong Corridor.

- Relief to St Kilda Rd trams.

- Congestion relief to inner core

stations.

- Provides additional track capacity

Caulfield-South Yarra (although not

needed in foreseeable future), and

potential stations along St Kilda Rd

and Dandenong Rd.

��

Patronage ��

Land Use

Opportunities None -

Minimal opportunities along St Kilda

Road and Dandenong Road (around

possible stations)

�

Economics

Provides a similar level of

benefits as the long tunnel at

significantly lower cost

��

Provides a similar level of benefits as

the long tunnel at significantly greater

cost

�

Risk

More significant implementation

and stakeholder risks associated

with narrow road reserve and

construction in a built-up

commercial and residential area

�

Easier than Toorak Road to construct

due to wide Dandenong Road corridor,

but higher impacts due to longer

alignment and more stations

�

Summary

Provides significant network,

patronage and strategic city

shaping benefits, with some

implementation and

stakeholder risks

7

Provides marginally greater network

and patronage benefits than the

short tunnel option

7

Cost - ~ $2.5 billion+ higher than Toorak Road

alignment

Decision F summary

Adopt the Toorak Road alignment for MM2

Recent investigations have confirmed Toorak Road as a feasible alternative to the default scheme

which provides similar benefits earlier and at a lower cost.



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4.4.8 Decision G – MM2 stations

The number and location of stations on MM2 is naturally dependent on the alignment selected

(Decision F). As shown on Figure 4-6 various station options were considered for each of the

alignments. These include:

Toorak Road alignment

� South Yarra

� Jam Factory

Dandenong Road alignment

� Alfred

� Windsor

� Orrong North

Issues considered in the assessment included:

� existing land use, redevelopment potential and urban consolidation benefit

� patronage

� network integration/tram impacts

� environmental, social and heritage

� stakeholder views

� technical engineering issues and cost

Detailed investigations around these possible stations found no scope for major urban renewal, hence

urban renewal is not a factor in the inclusion of stations on the corridors.

While none of the stations exhibited significant land use redevelopment opportunities, a station at

Alfred would enhance accessibility to a key medical precinct, linking it to Monash and Parkville

medical and education precincts. However these benefits are far outweighed by the significant

additional alignment costs of the three MM2 alignments which could accommodate a station at Alfred.

The relatively low patronage benefits provided by a station at South Yarra or Jam Factory do not

warrant the substantial additional cost of these stations ($500m and $850m respectively).

Decision G summary

Adopt no new station on MM2 Toorak Road alignment

Whilst benefits were evident at some of the stations, particularly at Alfred Station on the default

alignment, the benefits of the stations on the Toorak Road alignment were not significant and don’t

warrant their significant additional cost.

4.4.9 Summary of preferred station locations and alignment options

� The findings of this options assessment were that the only change that should be made to the MM

default scheme is to provide a station at Arden and to adopt the Toorak Road alignment for MM2

(Figure 4-7). This preferred scheme has the following benefits:



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� Arden Station will stimulate significant redevelopment, enabling more people to live and work

close to the city

� Parkville Station will be located in Grattan Street, central to Melbourne University and the

hospitals precinct

� Swanston Street is the most cost effective alignment and provides the best accessibility to key

CBD activities and a high level of integration with the tram network

� providing two CBD stations avoids the risks and costs associated with designing a station for a

very high passenger throughput and enables the best network solution for the broader train and

tram systems

� maintaining the default alignment along St Kilda Road and a station at Domain in favour of South

Melbourne avoids the substantial costs and risks associated with this technically challenging

environment.

� adopting the Toorak Road short tunnel alignment for MM2 avoids significant additional costs

associated with the default long tunnel alignment and enables Melbourne Metro to be undertaken

as a single stage, delivering network benefits earlier than the two-stage scheme.

Figure 4-7: Preferred MM concept



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4.5 Updated MM scheme

Based on the investigations undertaken during 2011 on MM1 and MM220

21

, and endorsement of the

Toorak Road short tunnel alignment, it is proposed to extend MM1 by approximately one kilometre to

South Yarra along the Toorak Road alignment. This refinement to the scheme enables the previous

two-stage tunnel (MM1 and MM2) to be delivered as a shorter single-stage tunnel (MM), enabling the

full benefits to be realised more quickly and improving value for money.

The MM2 default “long” tunnel from Domain to Caulfield along Dandenong Road is therefore made


Road joining the Dandenong rail corridor at South Yarra. Recent assessment by the project team of

the relative costs of extending MM1 via the short and (default) long tunnel schemes indicates a

considerable difference of at least $2.5 billion.

Delivering the project as one stage has significant advantages compared with a staged approach,

such as avoiding construction of a turnback at Domain, tunnelling construction cost savings, fewer

risks and community disruption will occur during a single construction period and is confined to a

considerably smaller area.

The refined MM scheme is shown in Figure 4-8.

20 MM1 Extension Study, Internal Working Document., Revision 01, Aurecon et al, 12 July 2011 21 Melbourne Metro Two, Alignment Options Assessment, V1.4, DOT, September 2011

Cabinet in Confidence Melbourne Metro Commercial in Confidence Pre-Construction Funding Business Case


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Figure 4-8: Preferred MM tunnel scheme



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4.6 Arden Urban Renewal Precinct intervention options

4.6.1 Introduction

Arden Station was included in the overall preferred option on the basis of the scale of land use and

redevelopment opportunities in its vicinity, and the strategic importance and role of such development

in assisting with restructuring of Melbourne’s west and delivering urban consolidation. It was also

recognised that, in addition to the provision of the station, there would be benefits generated by the

government playing a role in facilitating the precinct development. As has been the case in

Southbank, Docklands and in the future, E-Gate, intervention by the government ensures outcomes

are more closely aligned with the city’s long term needs rather than responding just to the market

forces of the day.

The redevelopment of Arden has already commenced. The City of Melbourne has updated its

Municipal Strategic Statement (MSS) taking MM in to account and nominating this area for urban

renewal. The next stage will require the preparation of a comprehensive structure plan for the area

which will provide an overarching framework for development.

This section summarises an initial assessment of options for the scale and nature of government

intervention to facilitate the desired urban development, in accordance with the overall MM objectives

and the specific objectives for Arden as outlined in section 3. Both the nature of the urban renewal

and interventions required to address these objectives will be refined as part of the next stage of MM

development.

4.6.2 Arden Urban Renewal Precinct concept

Arden forms a critical component of the Port and East-West Corridor Framework. This plan includes

an objective to extend capital city functions towards Melbourne’s west and take the first step in a long-

term strategy to connect Footscray CAD to Melbourne’s CBD via urban activity. Significant

commercial (office) activity needs to be attracted to the areas surrounding Arden Station to achieve

this objective. The Arden precinct also contributes to the social and economic benefits derived from

the improved accessibility delivered by the project (as described later in this business case).

Several principles are necessary to achieve the objectives of Arden:

� the need to develop a ‘place’ with a unique identity and distinctive urban structure and high

degree of exposure

� the need to provide an urban environment with high levels of amenity for workers, residents and

visitors

� the need to reinforce the accessibility of the commercial (office) core, through integration with the

proposed Arden metro station and the existing transport infrastructure in the area.

A development concept has been prepared which incorporates these principles (Figure 4-9). The

concept comprises the following elements:

1. Utilising the Arden metro station as the key hub of a new CBD fringe office precinct



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Figure 4-9: Arden Urban Renewal Precinct development concept

2. Creation of a core spine by extending Boundary Road south and linking it to the existing urban

arterials of Spencer, Victoria and Dynon Roads, improving both exposure and accessibility

3. Construction of landmark buildings comprising office and retail uses at gateway locations to the

precinct, to raise its profile

4. Provision of opportunities for significant new commercial developments, educational uses, retail

anchors and significant residential development

5. Development of the Boundary Road spine as a major urban boulevard with pedestrian scale

activity, including retail, dining and entertainment, supported by upper floor residential uses

6. Provision of high quality public spaces that link the Arden Metro station with street based activities



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7. Development of a green spine along the existing Moonee Ponds Creek corridor to provide passive

and active recreation spaces for current and future residents, as well as facilitating pedestrian and

bicycle connectivity to key surrounding areas including Kensington, E-Gate, the CBD, Flemington

and Docklands

8. Ensuring appropriate interfaces with existing heritage residential and mixed use areas to the east

of the precinct, through appropriate height gradients and design integration

9. Provision of a wide range of retail and community facilities to service the needs of the current and

future community.

This concept illustrates one development option for the area. Through the structure planning process

other options will be considered and an ultimate scheme will be developed.

4.6.3 Base case

The base case provides the reference against which each of the options is compared. The base case

is assumed to be that which would occur with no metro station or other government interventions or

investment. A metro station is considered a critical element of an intensively developed urban area,

and therefore the base case would comprise the following:

� The fundamentals of property development in the precinct would remain as they are at present.

This would result in:

> low-scale townhouse style development in the north of the precinct between Racecourse and

Macaulay Roads (approximately 1300 dwellings)

> retention of current land uses in the middle and southern parts of the precinct

> very limited employment growth in the precinct.

� In the absence of a station, there would be limited scope to consider large scale interventions in

the precinct, and as such, major infrastructure investment such as the Boundary Road extension

would not occur and VicTrack would retain ownership and operation of the southern site.

The implications of the base case are as follows:

� The opportunity to create a high value commercial office precinct, in close proximity to the CBD,

would be missed. Melbourne is expected to experience strong employment growth, especially in

the service sector. However, this growth is premised upon available and attractive commercial

supply. Therefore, the implications would include:

> some higher order jobs dispersing across the existing inner areas such as the CBD,

Southbank, Docklands, as well as fringe locations such as Hawthorn, Camberwell, Malvern,

etc

> in some cases, these jobs may not come to Melbourne. The steady supply of well located

land for commercial activity which Melbourne has enjoyed has generally ensured that the

price has not increased as dramatically as in other capital cities. Should this not continue,

prices are likely to rise, supply will dry up, and some investment/employment may go to other

parts of Australia or the Australasian region.

� The opportunity to realise infill residential development in close proximity to the CBD, would be

missed and the broader implication is that additional land on the fringe of Melbourne would be

required to accommodate the additional dwellings.



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� The contamination and flooding issues associated with the site are likely to be significant enough

to prohibit any meaningful mixed use or residential development occurring. In some instances,

residential development may occur in the northern portion of the site, (up to 1600 dwellings,

townhouse and three-storey dwellings).

� The opportunity to create a link with the west through the urban activity corridor will be missed,

and opportunities to attract higher order employment to Footscray would be less likely to occur, or

occur over a much longer timeframe.

� This would not address the ongoing issues associated with the imbalance in the west, and would

present a risk to the long term productivity, liveability and equity within Melbourne.

4.6.4 Intervention options

A suite of potential government interventions has been identified to deliver the pre-conditions to

enable the overall development concept to be realised. These intervention opportunities are primarily

capital works items that address critical development constraints, lessen private sector risk and

improve the financial feasibility of intensive development of the precinct.

Some level of intervention will be necessary to stimulate and bring forward commercial (office)

development in a location that is desirable from a strategic policy objective but not yet feasible (or at

best risky) for large scale private sector development.

The level of government intervention was assessed by considering three options. Each option

represents a different degree of government intervention, both in the specification and cost of

particular capital works items, as well as the overall number of items and their spatial distribution. The

list of interventions was initially prioritised to assist in forming the options. The priorities were

categorised into those interventions which are essential to achieve the objectives, those which are

likely to be needed but required further analysis of costs and benefits, while others were deemed

beneficial but not likely to be essential.

The scope of the three options is summarised below:

� Option 1 (low intervention) includes the Arden Station, the release of the VicTrack land for

development and the delivery of key interventions on Government owned land in the southern

part of the precinct around the station.

� Option 2 (medium intervention) extends the spatial extent of potential interventions to land

owned by the City of Melbourne in the middle section of the precinct. Option 2 also increases the

number of interventions, namely the construction of the linear boulevard to Macaulay Road,

Environmentally Sustainable Development (ESD) infrastructure and the extent of

decontamination, modern upgrade to Macaulay Station other government trunk infrastructure.

� Option 3 (high intervention) further extends the spatial extent of Government intervention to

private land in the north of the precinct. Option 3 further extends the proposed interventions such

as the scope of and extent of upgrades to existing public transport infrastructure. Option 3

includes all potential Government interventions identified for the Arden Urban Renewal Precinct

upgrades to Macaulay and Flemington Bridge Stations and more extensive acquisition.

The three intervention options and base case are estimated to deliver the development outcomes

shown in Table 4-7. University or tertiary enrolments don’t have a specific impact on the evaluation,

so they have not been identified at this stage for option, though it is assumed to be zero in the base

case.



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Table 4-7: Arden development outcome by intervention option

Base Option 1 Option 2 Option 3

Total housing yield 1,300 3,000 6,000 7,000

Total jobs yield 0 17,000 24,000 25,000

4.6.5 Preliminary option evaluation

Each option induces a range of economic benefits flowing from the differing levels of development22

.

This leads to improved agglomeration economies to business (via improved labour productivity) and

to households (via enhanced human capital development). The scale of development will also change

the area of productive agricultural land on the city’s fringe for new housing. With a reduced number of

dwellings being constructed on the city’s fringe there will also be a reduced need to provide new

infrastructure (roads, sewerage, social services etc) in growth corridors.

A summary of the economic performance of each option is provided below in Table 4-8. Option 2

provides the highest economic return.

Table 4-8: Preliminary economic performance of options (7% discount rate, $m)

Measure Option 1 Option 2 Option 3

Urban consolidation and labour productivity benefits (PV) 158.3 489.6 596.4

Costs (PV) 280.9 368.6 548.3

Benefit Cost Ratio 0.6 1.3 1.1

Preliminary financial analysis has been undertaken of the various options to determine the possible

financial outcomes in the development scenarios. While Option 1 provides the most favourable

financial return on a net present value basis, further analysis is required in the next phase to gain a

deeper understanding of the financial outcomes. For the purposes of this business case, Option 2 has

been assumed to best represent the optimum scenario overall.

4.6.6 Next steps

The above assessment implies that there is both an optimum level of development and corresponding

level of government intervention. During the next phase of development23

further investigations of

area will be completed in order to inform the ultimate structure plan. The structure planning process

itself includes significant engagement with stakeholders including the adjoining communities. During

the development of the structure plan DPCD will refine the interventions best delivered by government

and also develop an appropriate implementation strategy.

22 Arden Metro, Societal Benefits Assessment, SGS, 15 December 2010 23 Arden Urban Renewal Precinct, Working Paper (Draft), February 2011, prepared for incorporation into this business case



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4.7 Property acquisition and development around new metro stations

A detailed assessment of property acquisition issues, opportunities and constraints has been

undertaken to inform the selection of suitable sites for the new MM underground stations. This

includes sites for station entrances, emergency relief facilities (ERFs) and emergency exit points.

The Melbourne Metro Strategic Land Assessment was undertaken by DOT and involved ongoing

consultation with the cities of Port Phillip and Melbourne. Detailed land use and development data

was assembled on all properties within a 150 metre radius of proposed new MM stations, to evaluate

each property against a defined set of weighted criteria (see Figure 4-10 below). Criteria adopted

included technical, architectural and engineering requirements for stations, access and mobility,

acquisition risks, costs or constraints and opportunities for high quality over-site development.

The evaluation ascribed a property acquisition and development score to each site, to objectively

inform the selection of properties identified for acquisition and development in this business case.

Based on the weighted scores, sites were grouped and classified as follows:

� significant opportunity site

� opportunity site

� moderate site subject to some constraints

� poor site not suitable for MM purposes.

Figure 4-10: Strategic land assessment site evaluation matrix



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The assessment was coupled with technical and engineering project requirements to identify three

categories of land acquisition and development:

1. sites nominated for acquisition and redevelopment in the concept design presented in this

business case (offering the most balanced land acquisition, re-development and engineering

outcome)

2. alternative sites for station elements, should the sites identified in this business case be deemed

unsuitable for acquisition and re-development during later stages of project development (can

fulfil MM project requirements but less suitable and are not nominated for acquisition in this

business case)

3. sites which fulfil MM project requirements and also offer a strategic opportunity to contiguously

extend the quantum of acquisition to gain over-site development advantages (including

opportunities to consolidate small and /or lower quality land holdings).

The scope and cost estimates taken forward in this business case relate to category 1 sites only as

set out section 5.8. The merits of pursuing category 2 and 3 opportunities will be evaluated during

subsequent stages of project development. Key findings were:

� None of the identified sites were ranked as poor in terms of their suitability for land acquisition and

development, when assessed against the above evaluation criteria.

� Re-development of the identified sites will, in general, significantly improve the quality of

Melbourne’s urban environment by addressing current under development or poor quality

development on the respective sites. This in turn has the potential to add social, economic and

financial value to delivery of the Melbourne Metro project.

� Where sites have features requiring protection, such as high quality and/or protected heritage

facades, this is outlined in the concept design and reflected in any over-site development

assumptions.

� Based on the level of assessment undertaken, no residentially zoned properties are identified for

acquisition. The upper floors of one identified property are currently used for student

accommodation. A detailed examination of the requirements for this property has been

undertaken, leading to a recommendation that acquisition of the property cannot be avoided

without significant implications for the design and functionality of the CBD North Station entrance

proposed for the corner of La Trobe and Swanston Street. Further detailed property surveys will

need to be undertaken to determine whether other non-residential buildings are currently being

used for residential purposes.

All properties identified for permanent acquisition in this business case have over-site development

potential, with the exception of the Emergency Relief Facilities (ERF) at Domain and Parkville.

Alternative sites for the Domain ERF have been considered, however the benefits at this stage of

extending the ERF infrastructure to the viable alternatives do not outweigh the costs.

4.8 Vertical alignment options

The initial concept that underpinned the 2010 business case adopted a vertical alignment of the

tunnels in Swanston Street which passed underneath the existing Melbourne Underground Rail Loop



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(MURL) tunnels east of Melbourne Central 24

. This resulted in relatively deep and expensive station

boxes, with CBD North being 43m deep at track level. This option included a maximum grade of

3.5%.

Following the peer review, further detailed work was undertaken during 2011 to assess

constructability and feasibility of a shallower tunnel and stations along Swanston Street and to refine

the alignment and station configurations. A shallower (higher) alignment would result in a better

outcome for passengers and may provide cost savings.

The constructability assessment 25

showed that a high alignment was feasible, though the tunnels

would be more expensive to build and disruption would be more significant. The Yarra River crossing

would also present greater challenges and risks. Significant cost savings would be expected in

construction of the stations however.

A key result of the change in alignment is that the grade between CBD North and CBD South, a

distance of approximately 600 metres, has increased to 3.8%. Details of the high alignment

compared to the low alignment are shown diagrammatically in Figure 4-11.

Figure 4-11: MM vertical alignment options

The proposed high alignment allows MM tunnels to pass over the existing MURL tunnels. The key

advantage of this alignment is that it allows station depths (to platforms) to be reduced. Table 4-9

below provides details of the revised station depths (surface to rail), with CBD North approximately

33m shallower with the revised alignment.

24 Melbourne Metro 1 Concept Development Report, Technical Discipline Report 2, Underground Horizontal and Vertical Alignments, Aurecon, Otober 2010 25 Melbourne Metro High Alignment Options, Constructability Assessment, Evans & Peck, May 2011



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Table 4-9: Station depths with tunnel alignments

Station depth (m)

Station

Low Alignment High Alignment Difference

Arden 17.9 13.0 -4.9

Parkville 27.5 20.5 -7.0

CBD North 42.8 10.0 -32.8

CBD South 27.0 19.0 -8.0

Domain 15.6 15.6 0

This new alignment has therefore been incorporated into the latest concept and is reported in the

Concept Summary Report 26

. The benefits of the reduced station depths include:

� faster evacuation times

� better station amenity

� faster passenger transit times

� reduced vertical transportation

� lower operating costs

� lower capital cost

The improved access associated with the high alignment and shallower stations reduces passenger

walking time to surface at CBD North Station by around 90 seconds and CBD South Station by

around 60 seconds which represents an estimated combined NPV time savings of $239m over the life

of the project. The shallow alignment also saves in construction costs and avoids property acquisition

of a CBD building, by consolidating the ventilation facilities.

The constructability work addressed construction issues at the Yarra River crossing (including the

construction implications around Federation Square, Princes Bridge and Flinders Street Station) and

along Swanston Street.

Construction of the section of tunnel between CBD North and CBD South along Swanston Street is

likely to require a cut and cover tunnel which will impact the operation of the street. Mitigation

strategies available to reduce the impact and which are continuing to be assessed include:

� Staged construction to minimise areas of impact

� Relocation of trams during construction phase

� Early works packages to clear long lead items such as major utilities.

26 Melbourne Metro, Concept Summary Report, Aurecon et al, November 2011



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The Yarra crossing is proposed as an immersed tube construction due to the shallow depth of the

alignment. This method requires dredging of the river bed prior to floating into the place the

prefabricate tube sections. It is proposed to construct the tube sections on the south bank of the river

on east of the existing boat sheds. The review concluded that the proposed construction method was

feasible and subject to appropriate mitigation would be acceptable from an environmental

perspective.

It proposed to test the acceptability of the proposed construction method as part of the statutory

approvals process noting that there is trade-off between minimising the construction impacts with the

long term performance of the railway.

4.9 Station access and mobility options

4.9.1 Overview

It is critical that the new stations provided by the MM project are integrated with current and future

surrounding land uses. Station Access and Mobility (SAM) studies were therefore undertaken at each

station to inform both the station design and to identify complementary works.

The SAM studies identify for each new MM station:

� optimal station entrances and arrangements based on predicted passenger flows, their origins

and destinations

� works that will enhance access to and from each metro station including public transport

interchange facilities and improved walk networks

� impacts of the new metro stations on the surrounding area, particularly the existing transport

networks and mitigation works, and

� MM construction impacts and works to mitigate these impacts.

The integration of the stations and surrounds must support the delivery of the overall vision for a

vibrant inner Melbourne and the specific project objectives. SAM principles were derived from existing

transport and land use policies applicable to the surrounding area and to encourage public transport

use. The key principles identified were:

� walking is a priority mode and the street environment should encourage on-street pedestrian

activity with maximum walkability to and around inner area stations

� cycling is also an important mode, the station design must make provision for cycling and respond

to the needs of cyclists when planning streets and urban development around the stations

� consideration of all modes using the road network in an integrated and holistic fashion. The

SmartRoads classification reflects the appropriate priority for each mode and the strategic traffic

role that it must fulfil in the transport network. This has therefore been reflected in the MM SAM

planning. This includes appropriate access for emergency services and freight.

4.9.2 Station entrance options

The volume of boardings and alightings and access/egress modes are important determinants of

station entrance locations. These are shown below in Figure 4-12. Importantly a key consideration is



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the number of concourses to be provided at each location. Each of two CBD stations have been

provided with two concourses (at the north and south ends of the station) while the other stations

have been only provided with one (in the centre of the station).

Figure 4-12: AM peak 2046 full scheme station volumes and access-egress modes

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The following sections summarise the site specific considerations given to locating the entrances at

each of the proposed stations.

Arden

Nine potential station entrances were examined for Arden as shown in Figure 4-13. These were

assessed against the predicted distribution and volume of passengers across the precinct, which

shows patronage volumes and distributions. One station entrance was assessed as sufficient. A

location towards the western end, close to the proposed boulevard was deemed to provide the best

access given the external origins and destinations and the station arrangement. Supporting

pedestrian facilities at the surface have been identified to be provided in all directions as part of the

overall Arden redevelopment.

It should be noted that the preferred station entrance is dependent on the ultimate structure plan for

Arden and therefore the proposed location will be reviewed as part of ongoing planning for this area.

Parkville

Nineteen potential station entrance locations were proposed for the Parkville station by the various

stakeholders in the area. These were assessed using a multi-criteria analysis to optimise accessibility

and assessed against the predicted volume and distribution of passengers across the precinct

(Figure 4-14).



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Figure 4-13: Arden station entrance options and distribution of metro trips

Two main entrances on the east and west side of Royal Parade were identified as important in

meeting the expected demand from the university and biotech precincts respectively. In addition,

three special entrances were considered, notably the train-to-tram interchange in Royal Parade

(dependent on the location and design of the tram stop) and direct concourse access to the Victorian

Comprehensive Cancer Centre (VCCC) and the Peter Doherty Buildings (Figure 4-14). Direct access

to these new buildings is regarded as optional for the development proponents to consider as means

of providing segregated pedestrian access across Royal Parade and Grattan streets.

Figure 4-14: Parkville distribution of metro trips and preferred entrance options



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CBD North

Eleven potential station entrance locations were examined at CBD North to best serve the estimated

peak patronage movements (Figure 4-15), including interchanging with Melbourne Central Station.

Most CBD-destined metro passengers will walk to and from the station, rather than transfer to another

mode such as tram.

The preferred option for interchange between Melbourne Central and CBD North, which is required to

accommodate an estimated 2046 volume of 15,000 passengers in the morning peak with the full

scheme, is a subterranean concourse under La Trobe Street linking directly to the existing and

proposed concourses at each station.

Entrances 2 (north-west corner of Swanston and La Trobe Sts) and 8 (south-west corner of Swanston

and Franklin Streets) were assessed as the best primary entrances points accounting for passenger

flows and known constraints. Entrance 9 (south-east corner Swanston and Franklin Streets) would be

an alternative entrance to Entrance 8 if Franklin Street is closed to traffic east of Swanston Street.

The SAM assessment also suggests that direct connections to lanes and streets (Little La Trobe

Street and Stewart Street) could relieve possible pedestrian congestion at the proposed entrances.

These entrances were not deemed to be cost effective given the current design but should be further

considered as part of the ongoing design development.

An entrance at the south-east corner of La Trobe and Swanston Street (State Library) (Entrance 1) is

not proposed due to heritage considerations of this site. Consideration was given to a more direct

connection with the heart of RMIT University on the east side of Swanston Street (3, 4 and 5) but not

pursued to avoid disruption to RMIT’s main campus (Entrance 9 would serve this purpose). Minor

physical enhancements and traffic signal phasing prioritising pedestrian flows across Swanston Street

at La Trobe Street between RMIT may be required given the proposed entrances are located on the

west side of Swanston Street.

Figure 4-15: CBD North Station entrance options and distribution of metro trips



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CBD South

CBD South Station will operate as part of a large transit interchange, including major tram

interchanges on Flinders, Swanston and Collins Streets and the existing metropolitan train hub of

Flinders Street Station (FSS).

Twelve potential station entrance locations were examined at CBD South to serve the estimated peak

patronage movements (Figure 4-16), which critically includes interchanging with FSS.

A detailed examination of options for the interchange between CBD South and Flinders Street 27

was

undertaken, a critical component of CBD South given a predicted volume of 20,000 passengers in the

2046 two-hour morning peak (with full MM scheme). The option taken forward for the purpose of the

2010 business case was a ‘paid area’ subterranean concourse at the east end of Flinders Street,

providing direct connection to the existing Flinders Street platforms via lifts (escalators were not

considered feasible). During 2011, further options have been considered28

in the context of the

shallower (high) tunnel alignment. A simpler connection between the subterranean CBD South

concourse and the existing Flinders Street concourse is now proposed (refer section 5.4 for details

and sketches). This satisfies functional requirements.

The following entrances are the optimal locations:

� Entrances 3 (Swanston Street opposite St Paul’s) and 4 (City Square) are the recommended

primary entrances

� Entrances 2 (Federation Square) and 6 (Flinders Lane/St Paul’s) are also deemed to be desirable

to spread pedestrian demand to the east (less crowded) side of Swanston Street. Entrance 2 at

Federation Square would be important in handling event patronage.

At the rear of Entrance 3, there is provision for a future connection to the basement level of Port

Phillip Arcade and a subterranean concourse interchange linkage to FSS.

Significant volumes of metro passengers are expected to use the Collins Street tram stop. Direct

access to the south-west corner of Swanston Street/Collins Street was considered to better support

this interchange but is not proposed due to the impact and cost of land acquisition in that location.

27 Melbourne Metro 1 Concept Development Report, Technical Discipline Reports 7 (Architecture and Urban Design), 8 (Underground stations) and 9 (Station Pedestrian Analysis), Aurecon et al, October 2010 28 Melbourne Metro, Concept Summary Report, November 2011



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Figure 4-16: CBD South entrance options and distribution of metro trips

Domain

Domain Station supports the major commercial uses along St Kilda Road, Albert Road and Toorak

Road; Melbourne Grammar School and the Shrine/Botanical Gardens. It is also located adjacent an

existing major tram interchange, which will be relocated and integrated with the metro station.

Twenty-three potential station entrances (Figure 4-17) which also shows each entrance’s functionality

by the size of the dot) were examined on the basis of a metro station being located under St Kilda

Road in the vicinity of Bowen Crescent (governed by horizontal alignment of tunnel and station).

Patronage analysis predicts that (with the full scheme) Domain Station is predicted to carry

approximately 22,000 passengers through its access points during the 2046 morning peak two hour

period, of which 8000 will interchange with tram services.

The preferred entrance locations are at 17 (corner St Kilda Road and Bowen Crescent) and 16

(corner St Kilda Road and Bromby Street), providing the best match of functionality and passenger

distribution. An additional direct access to the new tram interchange above the station in St Kilda

Road is also proposed.



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Figure 4-17: Domain station entrance location options and functionality, distribution of metro trips



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5 Scope of preferred scheme

5.1 Scope definition process

5.1.1 Overview

The proposed scope of the MM project has been determined by identifying the minimum infrastructure

required to deliver the proposed ‘day 1’ service plan (14 additional services on the Northern Group

and 3 additional services on the Caulfield Group) and adding specific items required for future

services which are not cost effective to incorporate later (such as underground substations).

MM day 1 is a subset of the scope of the overall MM scheme, which is shown in Figure 5-1. The MM

day 1 scope is derived from the business needs and drivers, the patronage forecasts and operational

plan described earlier. These confirm the requirement to provide for an additional 14 trains per hour

on the Northern Group by around 2018, and indicate the requirement to provide for 16 x six-car trains

per hour between Sunshine and Domain on Day 1. The scope of works to enable these services to be

operated is based on the options assessment, engineering and other technical studies29

, taking

account of the comments resulting from the Peer Review Process described in this section.

The process to define the day 1 scope of MM for this business case was:

� to establish the precursor and interdependent projects and committed parallel DOT programs

� to define the works required to meet the business needs and deliver the operational plan on day 1

� to separate the works needed on day 1 into those proposed for inclusion in the scope of MM, and

those that are assumed to be included in other projects, or programs

� to define the works necessary for future proofing MM day 1 for future service upgrades, the future

construction of Dandenong Rail Capacity Program, Upgrading Regional Passenger Lines

(Melton), Melbourne Airport Rail Link, Rowville and Doncaster rail lines and the delivery of the

service plans associated with these projects.

MM has been scoped on the basis of scope of the relevant, key precursor projects currently being

delivered: Laverton Rail Upgrade, Sunbury Electrification Project, Craigieburn Stabling and

Maintenance Facility and Regional Rail Link. They form the starting point and basis for scope and

service plan for MM. The actual or latest proposed scope of works for these projects has been verified

in defining the scope of works for the MM business case.

29 Melbourne Metro Concept Development and Technical Discipline reports, Aurecon et al, November 2010



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Figure 5-1: High-level scope of ultimate Melbourne Metro scheme



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Rolling stock procurement is the subject of a separate but complementary business case. Rolling

stock procurement generally is critically interdependent with MM as it will provide the number of trains

required to operate services on day 1, as well as stabling and maintenance facilities and necessary

upgrades to traction power and overhead line equipment (OHLE) on all Northern and Caulfield Group

lines. The cost, maintenance and refurbishment of rolling stock associated with the delivery of the MM

service plan is included in the overall economic assessment for MM. It is assumed, conservatively, at

this stage that existing rolling stock types will be deployed on MM. Opportunities to reduce station box

sizes and tunnel diameter through deployment of a high capacity metro train, and hence construction

costs, will be pursued in the next phase.

The High Capacity Signalling (HCS) project is also the subject of a separate but related business

case. As this project includes Proof of Concept and a pilot program, it may not be ready for

deployment on MM, so it is assumed at this stage that HCS is not included in the MM Day 1 project.

However, if the concept be proved and piloted before completion of Melbourne Metro Rail Tunnel, it

may be considered for the MM project instead of lineside signalling. Lineside signalling upgrades are

also required across the Northern Group to facilitate the service plan. HCS is likely to be required to

enable the long-term service plan in any event.

Other parallel related programs including DDA Access to Public Transport, Metro Station upgrades,

Park and Ride, Metropolitan Bus Upgrades (rail station feeder services) and Separating Road and

Rail lines are assumed to address these specific issues in order of priority across the network. These

initiatives are therefore not included in the MM scope.

The MM Tram Plan is a complementary strategy of route changes to capitalise on the tram patronage

and service benefits caused by MM. Tram integration works in the immediate vicinity of new stations

are included in the MM scope. This is discussed further in Section 6.

Future projects are planned on the basis of future demands. It is assumed that nine-car trains will be

in operation on the Dandenong rail corridor by MM opening to satisfy demands on the Dandenong

corridor. Platform extensions at stations between Footscray and Sunbury are therefore included in the

MM Day 1 scope. Upgrades to traction power and overhead line equipment will be required in the

future on surface lines to facilitate future service plans – these are assumed to be included in the

Rolling Stock procurement program, but are included in the MM economic analysis.

Also MM permits the future or parallel construction of the Dandenong Rail Capacity Program,

Upgrading Regional Passenger Lines (formerly known as Melton Rail Upgrade), Melbourne Airport

Rail Link, Rowville and Doncaster rail lines and the delivery of the service plans associated with these

projects

The MM scope framework is summarised in Table 5-1. Further details on all these interfaces are

provided in the next section.



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Table 5-1: MM scope framework

Precursor Projects (starting point and basis for MM scope and service plan)

• Regional Rail Link

• Laverton Rail Upgrade

• Westall Rail Upgrade

• Craigieburn Train Stabling and Maintenance Facility

• Sunbury Electrification Project

Critical Interdependent Project

(needed to be delivered to achieve the MM service

plan)

• Rolling stock procurement including associated stabling and maintenance facilities and power and overhead upgrades on Sunbury, Werribee, Craigieburn, Upfield and Dandenong lines

Melbourne Metro (subject of this business case)

Twin rail tunnels from South Kensington to South Yarra,

including:

• Rail systems (track, power, overhead, ICT etc)

• Lineside signalling30

• New underground stations at Arden, Parkville, CBD North, CBD South and Domain (DDA compliant) with platform lengths for nine-car trains

‘Wider Network’ Northern and Caulfield Group surface works, including

• Lineside signalling upgrades – Paisley to Werribee, Broadmeadows to Craigieburn, Upfield line

• Re-signalling Calder Park to Sunshine

• Platform extensions for 9-car trains – Footscray to Sunbury

• Second platform at Upfield

• Upgrade turnback at Essendon

• Brighton Beach Platform 1 Upgrade

• South Yarra Crossovers

Arden Urban Renewal Precinct interventions

Part of Ultimate MM Scheme (required to enable future benefits of MM)

• Dandenong Rail Capacity Program, including operational changes, longer trains, grade separations, signalling & power upgrades

• Upgrade Regional Passenger Lines (duplication and electrification of Melton line, Sunshine rail-rail grade separation, stabling and duplication of sections of Ballarat and Bendigo lines) - assumed for the purposes of this business case to be included in the ultimate MM project

Parallel programs

(assumed to address issues in order of priority

across the network and are therefore not included in

the MM scope)

• DDA Access to Public Transport

• Separating Road and Rail lines

• Metro Station upgrades

• Park & Ride

• Metropolitan Bus Upgrades

Complementary Program

• MM Tram Plan (route changes to capitalise on

the tram patronage and service benefits caused

by MM. Tram integration works in the immediate

vicinity of new stations are included in the MM

scope)

Future Projects (allowed for in MM to permit their efficient future construction and delivery of their service plans)

• Rowville Rail Link

• Doncaster Rail Link

• Melbourne Airport Rail Link

• Avalon Airport Rail Link

5.2 Peer review process

The technical advisor (TA) employed on the MM project completed a concept design of the project

based on the preferred alignment, a risk plan, a program for the delivery of the project and a cost plan

to inform the business case. Given the critical nature of this work a Peer Review of the TA’s work was

arranged. An international panel of seven experts experienced in the design, construction and

30 High Capacity Signalling is the subject of a separate business case and submission to Infrastructure Australia. It includes Proof of Concept and pilot line program. Should the concept be proved and piloted before completion of Melbourne Metro Rail Tunnel, it may be considered for the MM project instead of lineside signalling.



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operations of underground metro rail projects was assembled including representatives of a major

Australian construction company. The Peer Review brief included the following:

� to independently, critically and constructively review the work undertaken by the TA

� to determine if the work was prepared in a professional manner consistent with the current stage

of the project development

� to be satisfied that the design is capable of development to a detailed design

� to be satisfied that it can be constructed, commissioned within the cost plan and program

� evaluate whether the cost plan, program and the risk assessment is realistic, sufficient and not

excessively conservative.

The Peer Review team was extensively briefed by the TA and the DOT team and participated in risk

workshops with the DOT and the TA formed to assess the value of both inherent and contingent risks.

The project documents prepared by the TA were also reviewed.

The Peer Review team concluded, inter alia that

..the proposed project is buildable and that the work to date has produced a robust solution in

most aspects.

Overall, the Peer Review has found no fatal flaws with the concept design, but considered the

preliminary overall project budget to be ‘inadequate’, particularly indirect costs. The Peer Review has

found that while the direct costs total for MM is appropriate, there are differences in indirect costs,

DOT costs and contingency allowances. The estimates also need better integration with the concept

design and construction program. The project team has therefore adopted a risk-based approach to

these items and has incorporated a budget contingency for these overheads in the final estimate

included in this business case.

The Peer Review Team also identified that the interface of MM with rolling stock type and HCS is a

critical issue to be resolved. As both of these issues are significant risk areas for MM, it was decided

to adopt a conservative approach and assume existing rolling stock types and existing lineside

signalling would be deployed on MM, thereby avoiding these significant risks (eg migrating from the

existing lineside signalling system to an in-cab signalling system on the existing parts of the network

in a Victorian context). However they do provide a significant opportunity for value engineering and

improved outcomes on the project. The prescribed initial design basis using X’Trapolis trains drives

tunnel size and platform requirements, which would be substantially smaller and more economic for

an industry standard metro train, thus the design basis using X’Trapolis trains will be reviewed in the

context of the overall rolling stock procurement program.

The project team has considered the Peer Review Team comments and has incorporated them as

shown in Table 5-2.



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Table 5-2: Response to peer review issues

Peer review identified issues Response by MM project team

Improved operator (MTM) input to define all metro operational aspects and requirements in more detail. This will give more clarity on proposed operational philosophy, control of operations and emergency events and how the metro system is designed to respond

MTM is currently engaged with the MM in a series of workshops to coordinate the interfaces between the project and MTM. MTM will have a critical function at project completion given their role as ARO hence it is essential that all project documentation meets their safety plan prior to MM going to market

Rolling stock configuration and the implications for the project

The 2010 business case was initially framed on the basis that standard high capacity metro trains would be available for Day 1 operations. The uncertainty around rolling stock procurement and the connection to the Dandenong rail corridor increasing requirements for rolling stock travelling through the tunnel at Day 1 has led the project team to include existing rolling stock types in the business case.

This issue continues to be examined.

High Capacity Signalling The business case was initially prepared on the basis that HCS will be available for Day 1 operations of MM. An interface working group has been established to coordinate the two projects. It has since been determined that the risk to project completion that HCS presents should be avoided by specifying existing lineside signalling technology. This can be reviewed during value engineering in future years.

Shallower vertical tunnel alignment This has been examined in detail during 2011 and a shallower vertical tunnel alignment has now been adopted (refer section 4.8). An implication of this change is that tunnel gradients now reach 3.8% over short distances – existing rolling stock types can manage these

gradients.

Significantly more geotechnical investigation project wide to reduce risk, particularly around currently

inferred geological interfaces

More geotechnical investigation to prove the viability of station cavern

excavation

Additional geotechnical investigation is now underway.

Spoil disposal strategy – spoil disposal costing presents a case study of additional work required, in that it is often a high cost item and the quantum of spoil is primarily a function

of tunnel diameter and station depth

Geotechnical consultants and a constructability advisors have been appointed to work with the TA to advise on these issues – this work is

continuing.

Construction program, in particular development of details related to systems ‘fitout’, commissioning and bringing the line into service (‘operational readiness’)

Robust project programs will continue to be developed in the next phase of the project development - some areas require additional definition to provide an optimal outcome. The constructability advisor has prepared an updated program to reflect the construction method for the high alignment.



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Peer review identified issues Response by MM project team

A major issue is the proposed interchange at Flinders Street Station and CBD South, which is currently not viable in the view of the Peer Review Team. The challenge is, however, not

insurmountable

A simpler and more effective interchange has now been incorporated into the design in the context of the high alignment. This provides sufficient capacity for movement between CBD South and Flinders Street. Existing congestion at Flinders Street will be the subject of the design competition being run for the redevelopment of the station.

Cost plan The Peer Review has now been provided with an updated version of the cost report by the TA. There is agreement on direct costs however the Peer Reviewer has recommended greater allowance for indirect costs, design and corporate overhead and profit. The project team has adopted a risk-based approach to these items and has incorporated risk contingency for these overheads.

A second peer review has been undertaken31

in October 2011 to review the revised concept, which

notes and endorses progress achieved on the first review. Preliminary key outcomes of that review

are:

� the proposed modifications to the scheme during 2011 results in a project definition that is

appropriate for the current stage of development and is capable of being designed, constructed

and brought into operation within current Australian and international safety expectations

� High Capacity Signalling should be implemented for MM Day 1 operations, noting the significant

overlay issues with V/Line and freight trains on the surface network;

� There are likely further construction cost savings, amenity and brand benefits if procurement of

high capacity metro trains (HCMT) could run on MM from Day 1. The staging of procurement of

HCMT is related to decisions on timing retirement of Comeng trains and the need to respond to

current network demands.

� Provision of an expert “shadow operator” is suggested to fully detail and confirm the operational

requirements of MM.

A number of other areas were highlighted where improved definition would provide greater confidence

on overall project duration and cost. These areas continue to be examined.

5.3 MM tunnel

5.3.1 Overview

The primary element of the project is a 9-kilometre 6.2-metre diameter pair of tunnels from a portal at

South Kensington (between South Kensington and North Melbourne stations) to South Yarra

(immediately east of South Yarra station, as shown in Figure 5-2 and Figure 4-8.

The diameter, horizontal and vertical alignment of the tunnels is designed for existing rolling stock

types operating at speeds up to 80 kilometres/hour, with an absolute minimum speed of

50 kilometres/hour. The tunnels are also designed to meet the safety and emergency evacuation

requirements of the NFPA 140, which is in general use as the international standard.

Five new underground stations are to be constructed along the alignment at Arden in North

Melbourne, Parkville, CBD North (which provides interchange with the existing Melbourne Central

31 Melbourne Metro Peer Review, Supplementary Report, October 2011 (draft)



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underground loop station), CBD South (which provides interchange with the existing Flinders Street

Station) and Domain. The stations are between 10 and 20 metres underground, and will be

connected to the surface with banks and escalators and lifts. They are designed to be ‘step free’ and

fully DDA/DSAPT compliant. The station platforms are designed for the eventual operation of

220 metre long trains (nine-car X’Trapolis trains – shorter platforms are likely to be required if high

capacity metro trains are adopted). Platform screen doors are not included in the Day 1 scope as

HCS is required for this.

Figure 5-2: Preferred MM scheme

5.3.2 Horizontal and vertical alignment of tunnel

The horizontal and vertical alignments of the tunnel are shown in Figure 5-3 and Figure 5-4. The

portal at South Kensington is located on the northern side of the existing rail corridor, and in between

the main metro tracks to/from the CBD. The metro tracks from South Kensington Station descend

into the tunnel, but a flat junction is provided with the existing metro tracks running towards North

Melbourne Station to permit them to be used if the tunnel is out of operation for any reason. The

horizontal alignment of the tunnels continues in an easterly direction to the proposed Arden

underground station located under VicTrack land west of Laurens Street/Queensberry Street

intersection in North Melbourne. The vertical alignment follows a 2.5% gradient and levels off at a

depth of about 13 metres below ground level at Arden station.

From the portal, there is initially a twin track section of ‘cut and cover’ tunnel which later splits into two

single track bored tunnels as far as Arden Station. From Arden Station, there will be twin bored

tunnels will be driven using Tunnel Boring Machines (TBM) as far as the proposed Domain Station.

Cross passages between the tunnels would be at regular intervals (around 240 metres) to provide for

emergency evacuation. Shafts for the same purpose and also for ventilation are provided where

distances between stations exceeds around 760 metres.

From Arden station, the line curves to the north and then to the east, rising on a 3.5% grade to a

proposed station at Parkville, located about 21 metres under Grattan Street at the intersection of



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Royal Parade. After Parkville Station, the alignment curves south and descends on a 2.5% grade

passing under the Melbourne Underground Rail Loop (MURL) tunnels to join Swanston Street at the

intersection with Franklin Street. To achieve this alignment, speed over this section is restricted to

70 kilometres/hour and then 50 kilometres/hour just before CBD North Station. CBD North Station

which provides interchange with Melbourne Central is located at a depth of 10 metres under

Swanston Street between Franklin and La Trobe Streets. The line then continues under Swanston

Street, to the CBD South Station located at a depth of 19 metres north of the Yarra River and largely

north of Flinders Street.

From CBD South, the alignment has two gentle curves to avoid the deep piled foundations of the

Alexandra Avenue Underpass but generally follows St Kilda Road to a terminal station at Domain at a

depth of 16 metres. It rises on a 3.5% grade to pass over the City Link Burnley and Domain tunnels,

and then stays generally level, passing over the South Yarra main sewer just before Domain station.

Figure 5-3: MM tunnel horizontal alignment overview

Figure 5-4: MM tunnel vertical alignment overview



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Geology

Preliminary geotechnical, hydrogeological, contamination and survey investigations have been

undertaken to inform the vertical and horizontal alignment selection. The Geotechnical Advisor has

undertaken a desk study during 2011 which builds upon the work undertaken by the Technical

Advisor in 2010. Separate reports, have been produced for the geotechnical, hydrogeological and

contaminated land aspects of the project32

. The desk study incorporates additional available

subsurface information, provides a revised geological model along the proposed alignment and

presents an updated risk assessment. The geological model and risk assessments have been used in

the development of the latest alignment.

Production of the geological model and risk assessment has highlighted areas where additional

geotechnical investigation is expected to lower the project geotechnical risk. It has also helped to

define suitable methods of geotechnical investigation.

A geological model has been developed and updated for the purposes of the Concept Development.

Further extensive investigations are underway for the reference design and subsequent stages of the

project to ensure that conditions are adequately understood and risks are appropriately managed.

The general geology of Melbourne consists of a Silurian Basement with overlying Tertiary and

Quaternary sediments and basalts. The Melbourne area is a part of a greater structural zone called

the Melbourne Trough and through the Silurian and Devonian Periods a significant geological event

occurred.

Vast amounts of muds, silts and sands, thousands of metres thick, were deposited in the trough.

During later tectonic events the sediments in the trough were lithified, folded, faulted and intruded with

dykes, sills and granite bodies. The Melbourne basement rock is called the Melbourne Formation.

A hiatus in depositions occurred until the Tertiary where deep and widespread sediments and basalt

flows were laid down in a newly formed Port Phillip Basin. A major geological structure cuts through

Melbourne on a south-east to north-east direction is called the Melbourne Warp. The Melbourne Warp

defines the boundary of the Yarra Delta. The Yarra Delta is a low depression that is central to Port

Melbourne-South Melbourne area and the surrounding Yarra River and the Maribyrnong and Moonee

Ponds Creeks. Rising and dropping seawater levels throughout the Quaternary Period saw significant

quantities of sediment comprising gravels, sands, silts and clays, as well as a basalt flow down the

paleo-Yarra River, in to the Yarra Delta.

The MM tunnel commences in the west in a section of the Yarra Delta between the Maribyrnong and

Moonee Ponds Creeks and remains in the delta until east of Arden Station. Below Queensberry

Street the tunnel vertical alignment will pass from the Yarra Delta into the Melbourne Formation. The

alignment will continue in Melbourne Formation through Parkville, CBD North and CBD South

Stations. Below the Yarra River the alignment well cut through the Yarra Delta again and pass back

into Melbourne Formation in the vicinity of Queen Victoria Gardens. The alignment rises to pass over

CityLink and it also passes into Brighton Group. For the remainder of the alignment to Domain, the

alignment passes either through Melbourne Formation or Brighton Group. The tunnel’s geological

long section is presented in Figure 5-5.

32 Golder Associates, 2011



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Figure 5-5: MM tunnel geological long section



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The hydrogeological interpretive report33

presents a preliminary numerical hydrogeological

modelling, based on limited data and discusses high level groundwater issues associated with the

proposed alignment. The modelling considered a fully tanked system whereby the stations tunnels are

sealed against groundwater inflow, and a situation whereby the stations are considered to be drained

(with the exception of Arden Street). The risk register has been updated to incorporate the findings of

this work.

There is strong potential for contaminated soils and groundwater to be encountered along the

proposed alignment, presenting a potential risk to the project that at present has been assessed as

medium to high, based on available information. These risks have also been updated in the updated

risk register.

5.3.3 Signalling

New lineside signalling is assumed for the MM tunnel, while the existing lineside signalling will be

upgraded at several locations on the Northern Group to accommodate the Day 1 operating plan:

� Sunbury line: Calder Park to Sunshine;

� Werribee line: Paisley to Werribee upgrade;

� Broadmeadows line: Broadmeadows to Craigieburn

� Upfield line

Any upgrades to the Dandenong rail corridor is part of the Dandenong Rail Capacity Program. This is

on the basis of the following key findings and outcomes of the signalling investigations on the existing

wider network:

� the capacity of the majority of the existing signalling infrastructure on some parts of the Northern

Group is insufficient to meet the proposed MM Day 1 Concept of Operation

� the condition of the existing signalling infrastructure on all parts of the network except , particularly

in the inner area bounded by Sunshine to Caulfield is suitable for Day 1 functional requirements

Between the tunnel portal and Sydenham, the system will have the capability to deliver 16 trains per

hour to be operated on Day 1. Between Sunshine and Sunbury, the signalling system will naturally

support the operation of V/Line and freight services on metro tracks.

The scope of signalling works will be examined very closely in the next phase, in particular the merits

and risks of introducing High Capacity Signalling (HCS) from Day 1. It is likely that HCS will be

required to deliver the ultimate service plan and acceptable reliability levels in the future, though

lineside signalling is acceptable for Day 1 operations.

5.3.4 Traction power and Overhead Line Equipment (OHLE)

Traction power infrastructure and OHLE will be provided in the running tunnels for the operation train

operations at a frequency of 24 200 metre-long trains per hour. It is not deemed cost effective to

stage this provision (ie to provide power capacity for Day 1 operations of 16 trains per hour), and then

later construct further substation capacity underground for ultimate operation of 24 trains per hour.

This will be confirmed during the next stage of design.

33 Golder Associates, 2011



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5.4 MM stations

5.4.1 Context

The stations must protect, rejuvenate or expand important centres and precincts, celebrate and

protect significant city buildings, spaces and connections and provide appropriate public domain at

each station entrance (Figure 5-6). The Melbourne Metro aims to create a unique place and identity at

each location, which exhibit differing environments as discussed below. Together, they must support

the delivery of the vision for a vibrant inner Melbourne.

Figure 5-6: MM stations – urban context

Arden must integrate within a mixed use urban renewal site which has great potential to create a new

community and employment centre. It has an opportunity to become the precinct centre in the form of

open space, while retaining opportunity for air-rights development above the station.

Parkville sits at the nexus between academia and health – the University of Melbourne campus to the east with the medical and hospital precinct to the immediate west.

CBD North should integrate with the existing city fabric – the

retail heart at Melbourne Central, State Library, RMIT and

the existing Melbourne Central Station.

CBD South is located within a civic and historically

significant part of Melbourne, requiring an intervention into

City Square, and connections into the iconic Flinders Street

Station, the tram network and Southbank.

Domain is close to the Royal Botanic Gardens and Albert

Park, a parkland environment with many large public

gatherings and events throughout the year. It is situated on

St Kilda Road, an iconic boulevard of commercial and residential properties.

A summary of the MM underground stations and their characteristics are described in Figure 5-7.



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Figure 5-7: MM underground station characteristics and design parameters



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< Arden station in North Melbourne is

located on VicTrack land to the west of

under VicTrack land west of Laurens

Street/Queensberry Street intersection

in North Melbourne. It supports the

development of the Arden Urban

Renewal Precinct, which is currently

being investigated34

. The station will

have an island platform, four

entrances at street level and a single

ground level concourse.

Parkville station is located under

Grattan Street, at the intersection of

Royal Parade. The design proposes

an island platform and a single ticket

concourse under the junction of Grattan Street and Royal Parade. The concourse is served by three

entrances located on the north side of

Grattan Street and on a widened footway,

one either side of Royal Parade, servicing

the Royal Melbourne Hospital precinct and

the Melbourne University, and one to directly

serve a proposed new tram super-stop on

Royal Parade. No elms will be damaged in

the construction of this station.

The Parkville station concept provides future

proofing for a potential North-South tunnel

from Clifton Hill.

CBD North station is located under

Swanston Street between Franklin and

La Trobe Streets. This station has an island

platform and provides interchange within the

paid concourse of the existing Melbourne

Central underground loop station, and tram

services in Swanston Street (Figure 5-8).

The patronage at this station warrants a

concourse and entrance at each end of the

station. The north entrance is located on the

southwest corner of the junction of

Swanston Street and Franklin Street and the

south entrance on the northwest corner of

the junction of Swanston Street and La

Trobe Street.

34 Arden Urban Renewal Precinct Development Working Paper, February 2011



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Figure 5-8: Concept for CBD North Station

CBD South Station is located north of the Yarra River and largely north of Flinders Street. Current

design provided an interchange with platforms at FSS. There is an opportunity to design the

interchange within the paid concourse of the existing Flinders Street Station, and the tram services in

Swanston and Flinders Streets. It has two main entrances to surface. The northern entrance is

located in City Square on the eastern side of Swanston Street, and a southern entrance on the

western side of Swanston Street adjacent to the Young and Jackson Hotel. Two additional entrances

to surface radiating out from the southern entrance box are located on the footpath outside St Paul’s

Cathedral on the eastern side of Swanston Street and also in Federation Square within the ‘Western

Shard’ structure which sits over the visitors centre. Figure 5-9 shows the concept for the station.

Figure 5-9: Concept for CBD South Station (long section)



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The station works exclude any major upgrading of Flinders Street Station, which are the subject of a

separate study (refer Section 6 for further detail). The initial concept for this interchange did not fully

resolve a feasible scheme which could accommodate the pedestrian flows and ‘access for all’

requirements. A more holistic approach to the station design was considered appropriate.

A simpler Flinders Street concourse connection was therefore developed during 2011 (refer Figure

5-10), following the peer review of the scheme. Some further refinement will be necessary but overall

the concept is feasible and meets all functional requirements and accounts for the shallower tunnel

alignment and revised CBD South station concept.

Figure 5-10: Concept for CBD South Station Interchange with Flinders Street Station

Domain Station is located under St Kilda Road between the junctions with Domain and Toorak

Roads. The station will have an island platform (Figure 5-11). The station has three entrances to a

single subsurface concourse towards the centre of the station. Entrances are located in Bromby

Street on the east side of St Kilda Road, Bowen Crescent on the west side, and one which will

provide direct access to a tram super-stop in St Kilda Road. The No. 8 tram would be rerouted from

Park Street-Domain Road to Toorak Road to provide passenger access to the station via this tram

super-stop. The super-stop will take over the functions of the current Domain interchange which

would be removed.



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Figure 5-11: Concept for Domain Station (ground level plan)

5.4.2 Station access & mobility

The Station Access and Mobility (SAM) studies identified supporting measures which should be

included in the scope to support the station. These were categorised as follows:

� MM-induced measures – those SAM works which are required to support MM or address impacts

of MM and are otherwise not being implemented under other programs or projects such as

Swanston Street upgrade

� supporting measures for any surrounding redevelopment (ie Arden interventions – refer

Section 5.9)

� other recommended transport measures in the vicinity of stations that should and can only be

considered in a precinct/corridor master-plan

� any measures that would be delivered via other ongoing programs or projects from any source.

The supporting measures included in the scope of the MM include:

� reinstatement to the standard required (with any appropriate relocation) of the underlying access

networks that pre-existed (or are likely to pre-exist) prior to MM-construction (footpaths, cycling

facilities, tram stops/interchange points, bus (including Nightrider facilities (where still required)),

traffic ways, taxi ranks, goods loading areas

� provision of sufficient new or additional access and mobility measures for the station to be

established commensurate with its scale allowing for future demands.

The assessment of a relatively localised suite of supporting measures for all stations cannot and has

not been viewed in isolation of wider road network implications. The effects of Swanston Street

closure have already been anticipated and a reconfiguration and upgrade are being delivered by City

of Melbourne – MM works will be coordinated as appropriate to minimise re-work.



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The surrounding transport networks and the impacts of any road network reconfigurations at Arden,

Parkville and Domain need to be better understood and quantified through strategic network

modelling in advance of the refinement of any specific design measures in collaboration with

VicRoads, DPCD and City of Melbourne. The SmartRoads classification will be an important guiding

framework, as it reflects the appropriate priority for each mode and the strategic traffic role that it must

fulfil in the transport network, including appropriate access for emergency services and freight.

Particular SAM issues at each station are summarised below.

Arden Station (Queensberry Street)

Wider supporting measures have been cognisant of proposed precinct planning for the area.

Any services (eg the existing bus service from North Melbourne Station to Parkville) that may be

made redundant by the introduction of MM may be re-routed for greater network effectiveness. No

additional tram services serving the area were considered warranted in the Arden redevelopment

interventions.

Parkville Station (Grattan Street)

A new tram interchange in Royal Parade integrated with the station complement new network

demands. The surrounding walking and cycling network will be linked into the station surrounds.

Some new or enhanced physical connections will be created. Traffic flows on both Grattan Street and

Royal Parade will be reappraised to facilitate efficient ongoing network connectivity. Provision will be

made for additional bicycle facilities to meet new station-oriented demand.

CBD Stations

Key MM scope items will include:

� creation of sufficient train-to-MM interchange between the proposed stations and their closest rail

linkage points

� reinstatement of Swanston Street tram stops to be established during the Swanston Street

redevelopment by the City of Melbourne

� provision for additional bicycle facilities.

Ongoing upgrading of the walking and cycling network is anticipated across the city fabric in addition

to new or relocated tram network connections to William Street. Some tram stop rationalisation will

also be ongoing. All of these works will be delivered by separate programs.

Domain Station

A new tram interchange in St Kilda Road, integrated with the new metro station and with appropriate

track and route adjustments to facilitate these will complement new network demands.

The walking and cycling network adjacent the new station will be linked into the station surrounds with

provision for new bicycle facilities at the station. Some new or enhanced physical connections will be

created. Traffic flows on both St Kilda Road will be reappraised to facilitate efficient ongoing network

connectivity.

Ongoing upgrading of the walking and cycling network in the broader precinct will be part of wider

precinct planning.



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5.4.3 Construction impacts and responses

It is proposed that MM stations will be constructed using cut and cover methods. Where construction

is anticipated to be on existing streets (at all sites except Arden Station), the total construction site will

be segmented to lessen impact and to maintain acceptable arrangements for pedestrians, bicycles,

trams and other vehicles. There is an opportunity to use initial road closures or partial closures to

facilitate new patterns of travel and movement in the areas surrounding new stations. Tram services

can be maintained by moving them across the road pavement consistent with segmented excavation

movement or relocated to alternative routes – this continues to be examined by the constructability

advisor. Once the cavern is excavated and supported, services can be restored over the cavern.

The volume of construction-based truck traffic, particularly that carrying spoil, will be a significant

factor in this area during construction that could impact the wider road network and the community

closer to the site. This will require comprehensive construction traffic management planning.

All ambulance and emergency services access to the hospitals and medical facilities at Parkville will

need to be maintained during construction.

Figure 5-12: Construction method



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5.4.4 Retail offer

An assessment of the market potential for retailing in each of the MM stations has been undertaken35

– an overview is provided in Appendix 1. The MM concept plans show the ultimate retail space

available in each MM station. This provision is marginally less than the sustainable maximum

calculated floorspace. Retail space within the stations can initially be provided at a level less than the

ultimate and expanded over time to sustainably accommodate increases in demand. This will

encourage strong initial retail performance and link ongoing provision to actual patronage growth.

Total estimated revenue from in-station retail outlets, vending machines, ATMs, data/telecom and

advertising is more than $13 million per annum (2011 prices).

5.5 South Kensington tunnel portal – Sunbury

5.5.1 Track work

No upgrades to track speeds are proposed. No work to upgrade track beyond works included in the

MTM asset upgrade program is proposed. Limited track work is proposed to connect the tunnel with

the existing metro tracks at the portal in South Kensington. These works are consistent with the

scope of the precursor Sunbury Electrification Project and Regional Rail Link projects. The at-grade

connection to independent goods lines at Sunshine will be maintained. The signalling system will be

designed to support continued freight movements to and from the corridor.

5.5.2 Signalling

Section between Calder Park and Sunshine will be re-signalled.

5.5.3 Traction power and overhead line equipment (OHLE)

Upgrades to permit the operation of 16 HCMT per hour on Day 1 are included in the HCMT Project.

Provision in the design has been made to allow for further upgrades to 24 trains per hour as part of

the Melton Rail Upgrade Project.

5.6 Northern Loop, Frankston loop and Cross-City Metros

5.6.1 Craigieburn line

The following works are included for the Craigieburn line to facilitate the creation of the Northern Loop

metro and an extra four train services per hour to be operated from Craigieburn:

� reconfigure the track work at Essendon to enable trains to start from Platform 2

� upgrade and extend Platform 3 to 155 metres to enable it to be used by metro services from

Craigieburn

� signalling upgrades for Day 1 between Broadmeadows and Craigieburn to deliver re-occupation

times of no more than 150 seconds and ability to operate V/Line and freight trains.

Any upgrades of traction power and OHLE required to deliver the train services are part of the HCMT

project.

35 Metro Melbourne Retail Advisory, Colliers International, November 2010



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5.6.2 Upfield line

The following works are included for the Upfield line to facilitate the creation of the Northern Loop

metro and an extra two train services per hour to be operated from Upfield:

� second platform is provided at Upfield

� upgrade of existing line side signalling.

Any upgrades of traction power and OHLE required to deliver the train services are part of the HCMT

project.

5.6.3 Werribee line

To facilitate the creation of the Cross-City Loop metro and an extra five train services per hour to be

operated from Werribee, an upgrade of the existing lineside signalling system between Paisley

(Altona Junction) and Werribee to deliver re-occupation times of no more than 150 seconds is

included in the MM scope.

Any upgrades of traction power and/or OHLE required to deliver the services are part of the HCMT

project.

5.6.4 Sandringham and Frankston lines

An additional three peak hour city-bound services will be enabled on Sandringham and Frankston as

part of the MM Day 1 concept of operations. Additional surface works are required to enable these

services to operate:

� Upgraded platform and facilities at Brighton Beach to enable turn-backs

� Cross-overs are required at South Yarra to enable trains to turn back at South Yarra.

� stabling at North Melbourne (part of rolling stock procurement)

No works are required on the Frankston line

5.7 Tram integration works

Based on patronage impacts and tram re-routings identified in the Melbourne Metro Tram Network

Plan (Section 2), the supporting tram infrastructure scope to support each metro station includes:

� Parkville Station – island tram platform stop in Royal Parade, north of Grattan Street. The

platform stop has an entrance into the station concourse at its southern end

� CBD North Station – accessible tram stop as per City of Melbourne endorsed scheme

� CBD South Station – accessible tram stops in their existing or planned locations

� Domain Station – island tram platform stop relocated from north of Domain Road to south of

Domain Road just north of Bowen Crescent with an integrated entrance to the station concourse

at its southern end.

The requirement to terminate trams at the Domain tram interchange is to be eliminated through the

complementary tram plan by linking the William Street tram (Route 55) to Domain Road (Route 8)

trams (not part of MM scope). This reduces the footprint required for the tram interchange and

improves the efficiency of the tram network.



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As the current Domain tram interchange site is too constrained to be able to be redeveloped to

include an integrated metro station entrance, the existing tram interchange north of Domain Road will

be relocated south of Domain Road above the new Domain metro station (the preferred site with

respect to the vertical and horizontal alignments of the tunnel and station).

5.8 Property acquisition

This section describes the assumptions behind the proposed property acquisition and the scope

associated with MM.

5.8.1 Permanent property acquisition assumptions and scope

The project has been designed to minimise private property impacts and associated disruption.

The horizontal alignment of the new rail tunnel is largely contained under Crown land, generally road

reserves and parkland. Similarly, the station boxes are proposed to be located under road reserves

or within industrial land owned by VicTrack. Permanently occupied Crown land will need to be

reserved for transport purposes.

In several locations where road reserves or parkland are not available, adjoining freehold properties

will need to be acquired for a range of permanent structures such as station entrances, emergency

egress routes, the tunnel portal and emergency relief shafts.

Tunnel depths along the alignment vary due to rail geometry and factors such as station depths,

existing infrastructure, surface topography, Melbourne Underground Rail Loop and CityLink. The

project proposes to acquire stratum to construct the tunnel. The stratum is assumed for the purposes

of the property acquisition to be defined by:

� the design width of the tunnels

� a margin of one metre above the designed top of the tunnel

� the centre of the earth (unless the title is depth limited – see Figure 5-13).

The margin of one metre above the top of the tunnel is intended to allow flexibility as the design is

refined, avoiding the need for further property acquisition processes to change the envelope post-

approval. A significant contingency is also included in the acquisition costs to allow some flexibility in

the width and depth of the stratum required.



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Figure 5-13: Stratum property acquisition envelopes

Where the top of the tunnel is 6.9 metres or more below existing building footings, it is assumed there

is a sufficient level of cover to allow tunnel construction without affecting the property above. In these

cases, the project will only acquire the stratum.

Where the distance from the top of the tunnel to the existing building footings is less than 6.9 metres,

it is assumed that the project will acquire the whole relevant property title.

As the alignment runs through parts of Melbourne which have been developed for a long time, the

majority of titles impacted were alienated from the Crown prior to 1891 and are not depth restricted

(ie they run to the centre of the Earth).

Some 10 titles on the proposed alignment are depth-limited with Crown land below the lower limit of

these titles. In these cases, the freehold strata will be acquired and the Crown land will need to be

reserved for project purposes.

Table 5-3 provides details of the number of private properties that will be acquired for MM for

permanent ground level structures and stratum. The table also shows the area of Crown land that will

be permanently reserved for these purposes.



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Table 5-3: Summary of properties to be permanently acquired/reserved by type

Property numbers or area

Property type

By parcels By occupancies

Residential (whole properties) 36

56 61

Residential (part properties) 0 0

Residential (strata) 291 293

Business (whole properties) 44 110

Business (part properties) 8 8

Business (strata) 174 175

Parkland or Public Domain 15,295 sqm 15,295 sqm

Road Reserves (permanent closures) 6,022 sqm -

Table 5-4 describes the Crown land parcels that will be permanently affected by the project.

Table 5-4: Summary of Crown land affected by project

Description of land parcel Location Project use

3 No. parcels along City Link/Moonee Ponds Creek

Area bounded by West Melbourne Terminal Station, Arden Street rail Sidings, Arden Street and Dynon

Road

Strata reservation for rail tunnel

Small parcel for emergency relief shaft

Southern corner of Grattan Street and Flemington Road, Parkville

Emergency relief shaft

Melbourne University Square Car Park

Southern side of Grattan Street between Berkeley and Barry Streets, Parkville

Stratum reservation for rail tunnel

Parkland – Lincoln Square Bounded by Swanston, Bouverie and Lincoln Square North & South Streets,

Carlton


City Baths Bounded by Franklin, Swanston and Victoria Streets, CBD


10 No. reserves for verandas?

Various locations along Swanston Street within CBD

Strata reservation for rail tunnel and/or station box

4 No. reserves for Princes Walk and Yarra River

Immediately to east of Princes Bridge, CBD


3 No. parcels of parkland – Alexandra Gardens

Bounded by St Kilda Road, Alexandra Avenue and Capital City Trail, opposite Arts Precinct


36 These properties comprise a residential tower in La Trobe Street and a small apartment building in St Kilda Road.



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Description of land parcel Location Project use

3 No. parcels of parkland – Queen Victoria Gardens

Bounded by St Kilda Road, Alexandra and Linlithgow Avenues – opposite

Arts Precinct


Alexandra Park Immediately to east of St Kilda Road, above City Link tunnels


2 No. parcels for City Link Tunnels

Immediately to east of St Kilda Road below Alexandra Park


2 No. parcels of parkland – Kings Domain/Shrine

Bounded by St Kilda Road, Birdwood Avenue and Domain Road

Strata reservation for rail tunnel/station box

2 No. parcels of parkland – Fawkner Park

Bounded by and immediately to the south of Toorak Road, South Yarra

Strata reservation for rail tunnel, emergency egress and at-grade use

for construction sites (temporary)

Strata beneath road reserves

Various along alignment Generally strata reservation for rail tunnel, station boxes

5.8.2 Temporary occupation of land

MM will also require sites for temporary uses, such as construction set-down and site amenities at

each new station, entry/exit points for tunnel boring machines, a licensed site for dealing with

contaminated spoil and a site for a concrete batching plant to provide concrete for the project.

This land may be either freehold or Crown land leased for the five-year duration of construction.

Where the land is Crown land, it will be reinstated and returned to its former use at the end of the

project.

Table 5-5 summarises the number of properties and the amount Crown land required for construction

purposes. The 17,830 square metres of parkland to be occupied is a portion of Fawkner Park

immediately to the south of Toorak Road. There will also be occupation of various roads including

Grattan Street, Swanston Street, St Kilda Road and others that will be identified as further design

work is progressed.

Table 5-5: Summary of properties to be temporarily occupied by type

Property type Property numbers or area

Residential (whole properties) 0

Residential (part properties) 0

Business (whole properties) 2

Business (part properties) 1

Parkland or Public Domain 17,830 m2

Road Reserves This information will be known when more detailed design work has

progressed



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5.8.3 Property acquisition costs

The costs of securing land for MM fall into a number of categories:

� acquisition of real property interests (both fee simple and leasehold)

� compensation of loss of possible development opportunities in some cases

� compensation for restraint of adequate access to adjacent properties

� compensation for severance

� solatium

� compensation for disturbance in business premises

� acquisition of native title rights and interests (assessed at zero for MM)

� compensation for reasonable costs incurred by property owners in the acquisition process

� DOT and claimants’ costs for legal services, survey, site investigations, due diligence, valuations

associated with the property acquisition process and stamp duty on replacement properties.

Compensation assessment and payment will be made in accordance with the provisions of Parts 3 to

6 of the Land Acquisition and Compensation Act 1986 (LACA).

The property acquisition costs for MM are outlined in section 9, and a detailed breakdown is shown in

Appendix 4. These costs have been developed from a comprehensive valuation exercise involving

the Valuer General37

.

5.8.4 Disposal of property rights and interests surplus to the project

It is expected that freehold interests, whether whole sites or air-rights will be offered to the market for

sale at the end of construction (refer following section for discussion of these opportunities).

Crown land temporarily occupied for the duration of MM construction will be re-reserved for the

purpose for which it was used prior to the project’s interest for example as parkland, road reserves.

5.9 Property acquisition and development around new metro stations

A detailed assessment of property acquisition issues, opportunities and constraints has been

undertaken to inform the selection of suitable sites for the new MM underground stations, as reported

in the options assessment section.

All properties identified for permanent acquisition in this business case have strong over–site

development potential. The over-site development will incorporate the required station element(s),

such as a station entrance for example, whilst also delivering an integrated development outcome

which adds value to MM and the wider urban environment.

A conceptual assessment of the development potential of each site has been undertaken by the

project team. The assumed development potential forms the basis of a residual land value (RLV) of

each site, prepared by the Victorian Valuer General. The RLV represents the estimated residual value

of the asset (ie the land) to the acquiring authority.

37 Estimates of Compensation for Land Acquisition, MM and MM2 Rail Project, Valuer General Victoria, October 2010



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Figure 5-14 and Table 5-6 below identify the sites nominated for acquisition in this business case and

the potential over-site development and its potential RLV. The Valuer General has estimated value of

the five oversite development rights/opportunities for MM at $73–87 million.

More detailed development concepts, feasibility studies and more refined residual land valuations will

be prepared during the project definition phase of the project, which includes the reference design.

Figure 5-14: Potential over-site development locations



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Table 5-6: Over-site development concepts and estimated residual land value

Site Key acquisition and

development parameters Preliminary over-site development concept

Estimated residual land

value

1 – CBD North Concept Design Station Entrance

(North)

Total properties: 2

Total area: 1379 sq.m

Max Height: 40 m

Zoning: CCZ1

Heritage facades may require protection

Mixed use 10 storey development incorporating CBD North Station entrance on the corner of Franklin and Swanston Street, Melbourne. Potential to incorporate institutional (RMIT) use

in development

$8–$9m

2 – CBD North Concept Design Station Entrance (South)

Total properties: 7

Total area: 3256 m2

Max Height: 40 m fronting Swanston Street. Unrestricted fronting La Trobe Street

Zoning: CCZ1

Mixed use development incorporating CBD North Station entrance on the corner of La Trobe and Swanston Street. 10 storeys fronting Swanston Street. 41 storeys fronting La Trobe street. Ground floor retailing. Upper floors residential

$34–$41m

3 – CBD North Concept Design Emergency Relief

Facility

Total properties: 5

Total area: 730 m2

Max Height: 40 m

Zoning: CCZ1

Heritage facades may

require protection

Mixed use development incorporating ERF proximate to the corner of Lt Lonsdale and Swanston Street, Melbourne. Four storeys. Ground floor

retailing. Upper floors residential

$10–$12m

4 – CBD South Concept Design

Station Entrance

Total properties: 3

Total area: 1175 m2

Max Height: 40 m

Zoning: CCZ2

Mixed use development incorporating CBD South Station Entrance proximate to the corner of Flinders and Swanston Street. 10 storeys. Ground floor retailing. Upper floors

residential

$14–$17m

5 – CBD South Concept Design Emergency Relief

Facility

Total properties: 2

Total area: 405 m2

Max Height: 40 m

Zoning: CCZ2

Protected heritage facades must be retained

Mixed use development incorporating CBD South ERF proximate to the corner of Lt Collins and Swanston Street, Melbourne. Existing heritage facades must be retained. Height consequentially limited to eight storeys. Ground floor retailing. Upper floors residential

$7–$8m

Total $73–87m

5.10 Arden urban renewal precinct

As identified in the options assessment section, the preferred option used as the basis of this

business case and to be taken forward for further assessment in the Arden urban renewal precinct is

the medium government intervention (option 2). The interventions will capitalise the provision of the

new Arden metro station and catalyse a new CBD-fringe mixed-use office precinct, comprising a

spine of commercial, retail and residential along a new major north-south boulevard (refer Figure

5-15). It will contain architecturally significant office buildings that act as the gateway to the Dynon



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urban activity corridor and will allow for the provision of best practice Environmentally Sustainable

Development (ESD), including a tri-generation power facility38

. The site is expected to accommodate

up to 6000 new dwellings and over 24,000 jobs with the proposed intervention option.

Figure 5-15: Indicative layout of redeveloped Arden precinct

The proposed interventions at this stage are envisaged to include:

� Road network development:

> extension of Victoria Street into the VicTrack site

> extension of Boundary Road (Central Boulevard) from Victoria Street to Arden Street, through

the Lost Dogs home and City of Melbourne Depot

� Public realm improvements:

> Public art and public realm installations

> Pedestrian link – Arden metro/North Melbourne Station

� Site preparation:

> Contamination mitigation – southern precinct

> Contamination mitigation – middle precinct

> Primary flooding and drainage works

� Trunk infrastructure delivery (non standard):

> ESD – Tri-generation distribution infrastructure

> ESD – Recycled water infrastructure (third pipe)

> ESD – Eco village WSUD initiatives

38 Gas-fired power generating facility, which uses excess heat generated for heating and cooling



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� Community facilities:

> Provision of community facilities (TBC)

> Central car parking facility (TBC)

� Public Transport Infrastructure:

> Station upgrade – Macaulay

� Land Acquisition and Site Consolidation:

> Central boulevard land acquisition – middle precinct

> Book transfer of southern precinct public land

> Rezoning of privately owned northern precinct to appropriate use(s)

� Project Management:

> General development facilitation fund

> Delivery agency project management funds



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6 Project interfaces, future proofing and complementary programs

6.1 Introduction

Further to the MM scope framework presented in the previous section, this section provides further

detail on how MM is integrated with other network infrastructure either already implemented, planned

seven-stage rail capacity upgrade plans or identified for the longer term. It also provides a brief outline

of the projects which are parallel and complementary to MM. The detailed project interfaces with MM

are also documented.

6.2 Precursor projects

6.2.1 Laverton Rail Upgrade

This project has enabled additional peak services to be introduced on the Werribee line that start and

finish at Laverton Station. The upgrade also provided track, platform and signalling infrastructure to

remove the bottleneck at the Laverton rail junction and at sections of single track in the Altona Loop.

This will help Werribee trains run more efficiently and reliably and to provide more express services,

thus introducing travel time savings.

Further signalling upgrades (and power upgrades as part of HCMT project) will need to be included in

MM scope to support an additional five peak hour services on the Werribee line for MM Day 1.

6.2.2 Sunbury Electrification Project

The Sunbury Electrification Project involves increased service provision with electrification works

between Sunbury and Watergardens. This includes stabling at Sunbury station. The project provides

five substations at 2MW rated capacity at sufficient chainage to support MM Day 1 operations.

6.2.3 Regional Rail Link

Regional Rail Link (RRL) project will provide additional capacity and reliability for Geelong services

through to Southern Cross Station with a rail corridor from Werribee to Southern Cross Station. The

current design will separate Melton, Ballarat, and Bendigo diesel services from the Sunshine to

Domain metro line and thus avoids the need for a rail grade separation at the South Kensington MM

portal. RRL project will also deliver road-rail grade separations at two locations along Anderson Road

on both Melton and Sunbury lines to improve safety and to reduce traffic congestion.

6.3 Future proofing

6.3.1 Future service plans

The Concept of Operations (CoO) indicates that a peak hour service of 24 x nine-car trains will

eventually be needed to cater for forecast passenger demand. This will require longer platforms and

increased traction power compared to day 1. As noted above, it is proposed to include platform

lengths for nine-car trains in the tunnel.



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On the wider network, it is proposed that platform lengths would be extended in accord with the

requirements in the CoO. Passive provision will be made for such lengthening in any wider network

surface works undertaken for MM for day 1.

Traction power for the eventual requirements is to be provided in the tunnel. On the wider network,

passive provision will be made for such traction power and overhead line equipment upgrades in any

works undertaken for MM for day 1.

6.3.2 Physical segregation of V/Line Passenger services and freight trains

The assumption made for MM (informed by rail simulation modelling) is that on day 1 there would

continue to be some use of metropolitan tracks by V/Line and freight services. Works to physically

separate these services can be provided after day 1 if/when this is considered necessary to achieve

acceptable reliability. This requirement could arise for example if the required reliability of the V/Line

and/or the metro services cannot be met at some time in the future with tracks being shared. Any

wider network surface works undertaken for day 1 will make passive provision only in the designs for

this potential future requirement.

6.3.3 New stations on the Sunbury line

Passive provision will be made for future stations at Calder Park, Holden Road and Jackson’s Hill in

any wider network surface works undertaken for MM on Day 1.

6.3.4 Dandenong Rail Capacity Program

The Dandenong Rail Capacity (DRC ) Program is a staged investment to address critical capacity

issues on the Dandenong rail corridor including provision for operational and timetable changes,

longer trains, signalling and power upgrades, road-rail grade separations and trackwork. These

investments will need to be progressively implemented over the next decade, commencing in the next

two years. It is assumed that with the long lead and construction timeframes for MM, a significant

component of the DRC works will be completed by MM opening. It is assumed that longer (9-car)

trains will be ready for operations by MM opening, hence longer platforms will be required on the

Sunbury corridor as part of MM scope.

While MM has strong economic performance on its own, the DRC Program permits future benefits of

MM, and is therefore included in the cost-benefit analysis of the ultimate MM scheme. Parts or all of

the DRC Program can still be delivered in advance of, after or in parallel with MM, but maximum

benefits are achieved for the rail network when both are completed.

The DRC Program works will integrate and allow for the future connections to the Port of Hastings

and the proposed future rail line to Rowville, which is currently envisaged to connect to Dandenong

rail corridor at Huntingdale.

6.3.5 Future network development

The Metropolitan Planning Strategy (MPS), incorporating an integrated transport strategy and refined

rail priorities, is currently being prepared. The need or priority for MM and the DRC Program will not

change, as urban development patterns for the next ten to fifteen years are already largely set.

The effects of the MPS will begin to reshape Melbourne’s urban form, and hence influence the rail

priorities, beyond this timeframe. Feasibility studies are underway for upgraded or extended rail lines

to Rowville, Doncaster Melbourne and Avalon Airports. The sequencing and staging of metropolitan

and regional rail upgrades beyond MM and the DRC Program will be determined following these



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feasibility studies and in the context of the MPS. The compatibility of MM with these initiatives is

discussed below.

� Upgrading Regional Passenger Lines (UPRL) (previously known as Melton Rail Upgrade) –

staged duplication, electrification and upgrade of the line from Sunshine to Melton and duplication

of sections of Ballarat and Bendigo lines to meet the growth occurring along these corridors.

Connecting the MM rail tunnel to the Dandenong rail corridor means that the operating plans on

the Sunshine rail corridor needs to match that on Dandenong. Both corridors are limited to 16

trains per hour without further works. Upgrading parts of the Melton rail line (ie components of the

overall Upgrading Regional Passenger Lines project) is one option to provide additional capacity

on the Sunshine rail corridor. It is assumed that nine-car trains will be operating on Dandenong

rail corridor upon opening of MM, meeting demand requirements on both Dandenong and

Sunshine rail corridors, though demands on the regional corridors will need to be met by the

progressive upgrading of those rail lines.

The Regional Rail Line Upgrades and Regional City Program39

, which aims to further strengthen

the economic and social integration of regional centres and metropolitan Melbourne, includes this

project, together with urban redevelopment initiatives on regional rail corridors at Footscray,

Sunshine and Toolern. This project is currently on the Infrastructure Australia pipeline at an “Early

Stage”.

This project includes duplication and electrification from Melton to Sunshine, including rail/rail

grade separation at Sunshine and upgrades to Bendigo and Ballarat lines. This project is

required to increase services through the MM tunnel to 24 trains per hour. The timing of the

implementation of the Melton project is the subject of ongoing investigation, but is expected to be

in the next decade. The Melton services would join MM at Sunshine. It is assumed that the

Melton Rail Upgrade Project (MRUP) scope will include rail/rail grade separation on down side of

Sunshine to enable up and down Bendigo services and down Sunbury services to cross up and

down Melton services. It is also assumed that the extra traction power and Overhead Line

Equipment (OHLE) requirements to increase services from 16 to 24 trains per hour between

Sunshine and the tunnel portal would be included in the scope of MRUP.

Indicative scopes and costs of URPL and DRC Program are included in the economic

assessment of the full MM scheme.

� The Rowville Rail Extension will ultimately add traffic to the Caulfield group of lines from

Huntingdale to the CBD. This will bring forward the need for additional capacity on this corridor.

The MM project provides additional inner city capacity for the Caulfield group, by-passing existing

bottlenecks of Flinders Street Station and the Underground Rail Loop and provides the

opportunity to introduce 9-car operation.

� The Doncaster Rail Extension will similarly require additional track capacity in to the CBD as the

existing Clifton Hill group is already close to capacity. Provision has been made for Parkville

station proposed in MM to include platforms serving a new line from Clifton Hill/Victoria Park via

the University and then through to the western side of the CBD.

� A Melbourne Airport Rail Link could be provided by an extension of one of the existing lines o

Melbourne’s north-west, as a lower cost alternative to establishing a new, dedicated line. MM

increases the capacity of all of these lines, potentially supporting this approach.

39

Stage 5 of the Regional Rail Development Program, which is the next stage to be delivered. Stage 4 is Regional Rail Link and

stages 1, 2 and 3 have largely been delivered.



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� Expanding the Port of Hastings will be dependent on the quality of the transport connections

through the south east and in particular the Monash Freeway. Managing congestion in the south-

east to allow the efficient movement of freight will be a key element of the land side transport plan

for the port.

� provides opportunities to introduce longer trains on the Dandenong rail corridor at a much lower

cost by avoiding the need for works at Flinders Street Station.

6.3.6 Flinders Street Station

The revised MM concept assumes a simpler connection between CBD South Station and the existing

Flinders Street Station, which meets MM passenger interchange, design and constructability

requirements. The updated scheme does not worsen existing conditions at Flinders Street.

There are a wide range of issues that currently affect existing Flinders Street Station and its

surrounds. Numerous studies have been undertaken to assess these issues and options for their

resolution. Discussions with stakeholders raised issues which include the need to:

� Establish the primacy of the transport functions objectives for the precinct

� Plan to ensure the Flinders Street Station functions as an efficient complex for the movement of

passengers and train operations

� Provide for safe and efficient transfers between tram and rail stations

� Maximise the attractiveness, security and accessibility of the station and its surrounds

� Decide on the future operational needs of the station offices against competing possibilities

� Provide for the restoration, maintenance and adaptive reuse of the existing state significant

heritage building

� Provide for alterations and new built elements that are sympathetic in the context of the existing

state significant heritage building

� Determine appropriate treatments for key pedestrian connections to the CBD, Southbank, and the

Sports and Entertainment Precinct

� Enable safe 24-hour public access between the CBD, Northbank and Southbank recognising the

station precinct currently represents a significant barrier to connectivity

� Identify other opportunities to develop the station for other reasons which don’t impinge on core

values/needs of the station or objectives of the State and City of Melbourne, including the

protection of Yarra River and Southbank from overshadowing

� Establish priorities, inter-relationships and timelines for mandatory and discretionary aspects of a

central station plan.

A design competition for the redevelopment of Flinders Street itself is being led by Major Projects

Victoria and is now underway. Among other things, the study will need to address these issues. The

MM interchange design will be an input to the overall design competition.



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6.4 Interdependent projects

6.4.1 Rolling stock procurement

The HCMT project is needed to achieve the MM service plan on the new metro lines (as outlined in

the network rolling stock procurement and deployment strategy in the section on operating plan and

patronage impact). A fleet of 29 HCMTs is currently envisaged to be required across the network to

allow HCMTs to exclusively operate on the Sunbury to Domain metro and achieve the required

frequencies across the network. It is being delivered in parallel with the MM project and is not

included in the scope of this project because HCMTs will be deployed across the network, not just for

Sunbury to Domain metro services.

The HCMT project will provide initial stabling for HCMT trains at Calder Park on the Sunbury corridor

(with provision for expansion to support MM), including signalling works to accommodate this. It will

also include a heavy maintenance facility for HCMTs. Sufficient traction power will be provided to

operate the required services, through upgrades to substations on the Sunbury corridor to South

Kensington and upgrades to other traction substations on the Upfield, Craigieburn and Werribee lines

to support the increased frequency of services on the Northern Group.

Details of the HCMT program are contained in DOT’s business case currently being developed.

6.5 Complementary projects and programs

This section outlines the details of complementary projects and programs which are being undertaken

in parallel with MM. They are not part of the scope of MM.

6.5.1 High Capacity Signalling (HCS)

A business case for the proof-of-concept (POC) of the HCS system is currently being prepared

independently of MM and is not included in the scope at this stage.

As discussed above, the timing of the implementation of MM and the service requirements means that

the concept signalling arrangement for the system must consider a new signalling regime. Selection

of a signalling system needs to consider the line-wide performance, signalling and control regime. A

business case for the scoping, proof of concept and type approval of a HCS system is currently being

prepared. Implementation of HCS in the tunnels and on the Sunbury surface corridor is not part of the

MM project, though will be considered in the next phase.

HCS POC is Stage 1 of a three-stage HCS program of works that will progressively transition the

existing coloured lights signalling system in the state to a modern HCS solution. This will equip the

State with a modern signalling infrastructure capable of supporting higher reliability and capacity in

the network.

The three stage HCS program comprises:

� HCS Stage 1 proof-of-concept (POC) – to be carried out over a 15-month period from

FY2012/13 to FY2013/14.

� HCS Stage 2 pilot line – deployment of the HCS solution on a metropolitan line over a 24-month

period in FY2014/15 to FY2015/16.

� HCS Stage 3 statewide – progressive deployment of the HCS solution across the metropolitan

and regional broad gauge rail network over several years commencing in FY2017/18.



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HCS Stage 1 POC will:

� establish if existing equipment/subsystems are compatible with the HCS solution

� investigate suitable implementation and migration strategies

� determine if HCS functions and performance will not only support existing operations but also

provide capacity and service reliability

� help establish if HCS solution costs conform to normalised industry models

� establish if the HCS solution will meet safety requirements.

Further details of scope are included in the HCS business case40

. While the POC and subsequent

piloting and statewide implementation is part of the HCS project, the MM scope includes HCS in the

tunnel and Sunbury corridor, hence HCS is critically interdependent and reliant on timely development

of HCS. Funding for the POC has been included in the MM pre-construction funding (the subject of

this business case), as outlined in Section 16 in the event that the HCS POC business case does not

proceed.

An Interface Control Working Group has been set up within DOT to coordinate interdependencies

between HCMT, HCS and MM to ensure critical path activities are articulated, and delivered in a

timely and an effective manner.

6.5.2 Melbourne Metro Tram Plan

MM interfaces extensively with Melbourne’s tram network – nine of the 28 routes in Melbourne

operate on the St Kilda Road/Swanston Street corridor which runs above the proposed MM

alignment.

The Melbourne Metro Tram Plan41

has been developed to identify a set of complementary

infrastructure, operational changes and other strategies to integrate Melbourne’s tram network with

MM.

Four of the five metro station sites are directly serviced by existing tram routes, with the fifth located

within 400 metres. The development of MM provides opportunities to integrate tram and metro

services, while also assisting metro with servicing the transport task.

Integrating metro and tram services widens journey opportunities by providing convenient access to

destinations located off the metro corridor, contributes to relieving tram crowding and congestion, and

provides opportunities to revise and simplify the tram network route structure.

Patronage impacts of MM on the tram network were discussed earlier in this report.

Given the above, provided that sufficient capacity is retained in Swanston Street to meet demand,

relocation of services into William Street and Clarendon Street is recommended. A tram link between

Domain Station and South Melbourne (Clarendon Street) would overcome local access barriers and

also contribute to reducing tram numbers in Swanston Street. To support the proposed MM project,

five tram route changes have been identified (Figure 6-1). These changes comprise:

� additional capacity between Parkville, William Street and St Kilda Junction by providing one new

route

40 Next Generation Signalling Proof of Concept business case, Department of Transport

41 AECOM, October 2010



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� a new link between Domain Station, South Melbourne and Southern Cross by diverting one

existing route from Swanston Street

� elimination of the requirement to terminate trams at the Domain tram interchange by linking the

William Street tram (Route 55) to Domain Road (Route 8) trams and rearranging two routes on

Swanston Street to maintain cross-city connectivity.

As part of the MM project, the existing tram interchange north of Domain Road is being relocated

south of Domain Road above the new Domain metro station. To access this new interchange, the

new Route 55-Route eight tram services will need to travel via Toorak Road instead of Domain Road.

This requires new tram tracks and a new platform stop to be laid on Toorak Road between St Kilda

Road and Park Street (refer Section 5).

The introduction of MM is estimated to save 60 trams (essentially along the St Kilda Road – Swanston

Street corridor), with an estimated capital value of $330 million. The tram saving is best understood

by potentially reducing the rate of new tram procurement to manage growth, however would need to

be considered in the context of replacing an ageing fleet.



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Figure 6-1: Proposed Tram Network post implementation of MM

6.5.3 DDA access to public transport

Works to be undertaken on the surface stations prior to the opening of MM are dependent on the

results of the network wide prioritisation process. This means there may be a marked difference

between the access provided in the underground and surface stations. Given that there is a

requirement on the State that all railway stations will be compliant with the Disability Standards for

Accessible Public Transport (DSAPT) by 2022, (with 90% compliance by 2017) it should be expected

that these upgrades would be complete by or within a few years of MM operations commencing.

6.5.4 Separating road and rail lines program (level crossing elimination)

In 2008, DOT developed a model to assess indicative benefits of grade separating all level crossings

in Victoria. The Level Crossing Prioritisation Model considered private vehicle travel time impacts,

tram and bus travel times and overall safety benefits that would be incurred at each location.



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The delivery of MM will alter the boom down time at a number of crossings on the Craigieburn,

Sunbury, Werribee and Upfield corridors. These impacts have been considered along with all other

likely changes at level crossings across Victoria as a result of service improvements. The overall

assessment enabled all crossings to be ranked in order of benefit delivered – informing which

crossings should be prioritised for grade separation.

The analysis undertaken demonstrates that whilst the MM project does affect the boom down times, it

does not materially alter the order in which level crossing will be prioritised as part of the Separating

Road and Rail Lines program. The Anderson Road level crossings on both the Sunbury and Melton

lines will be grade separated by the RRL project.

6.5.5 Metro station upgrades

With the additional patronage driven by the increase in services across the Northern Group, additional

pressure will be put on infrastructure at existing stations, including modal interchanges and park ‘n’

ride facilities. Whether or not works are undertaken on the surface stations prior to the opening of

MM will be dependent on the results of the network wide prioritisation process. This means it is

possible that no surface station will be upgraded prior to Day 1 and/or that there will be a marked

difference between the underground and surface stations.

The RRL project will upgrade Footscray Station and relocate West Footscray Station and is

considering relocating Tottenham Station.

6.6 Detailed project interfaces

Table 6-1 outlines the interfaces with other projects made during the concept development phase of

MM which significantly support the delivery of MM in other surface and station sections. Ongoing

planning work with the Accredited Rail Operator (MTM) will allow further provisioning to be made on

the surface works.

Table 6-1: Project interfaces

Project/activity interface

Initiative Benefit

RMIT University Ensure foundation pile design outside tunnel no-go zone, and/or can

accommodate MM

Preserve preferred alignment, minimise additional construction costs

Victorian Comprehensive Cancer Centre

Ensure foundation pile design outside tunnel no-go zone, and/or can

accommodate MM


Peter Doherty Ensure foundation pile design outside tunnel no-go zone, and/or can

accommodate MM


Sunbury Station – re-location of substation design to facilitate extension of platforms

To accommodate future nine-car train operations

Sunbury Electrification Project

Re-location of proposed Holden Street tie-station to north of Sunbury tracks

To provide for shunt roads to future stabling/maintenance facility



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Project/activity interface

Initiative Benefit

Provide five substations at 2MW capacity between Watergardens and

Sunbury

Provides minimum capacity for MM Day 1 operations along this section

Main Road Grade Separation and Station

rebuilding at St Albans

Station design such that platforms can be extended to 230 metres without a

change in grade

To accommodate nine-car length trains

Tottenham substation needs to be relocated for new RRL tracks

Opportunity to upgrade to 3MW capacity for MM Day 1 operation

Land to be reserved for future Sunshine substation

Sunshine Substation required for Day 1 MM operations

RRL tracks to be slewed at Middle Footscray station; Land acquisition on south-west corner of Victoria Street

Accommodate 17 metre platform extension down end to allow for 230 metre platform; opportunity with RRL property acquisition to provide

DDA compliant access solution

Regional Rail Link

Separate Melton, Ballarat and Bendigo diesels from metro services with at

grade track re-design

Improve reliability of service from Sunbury

Footscray CAD Land has been preserved to north of McNab Lane to provide for future

substation development

Tie station at Footscray will need to be upgraded to 3MW substation on Day 1

MM and two x 3MW for HCMT running


PART C – BENEFITS & IMPACTS

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PART C – BENEFITS AND IMPACTS

7 Benefits, operating plan, patronage & land use impact

7.1 Overview

The demand for rail is itself dependent on the level of service provided and therefore the demand

forecasting and service development has been conducted in an integrated and iterative process. This

section summarises the end result of this process and key findings relevant to this business case.

MM will provide the infrastructure to re-configure the Northern and Caulfield Groups into three fully

independent metro lines (sectorise) operating as follows:

� Northern Loop Metro: Craigieburn and Upfield services via the Northern City Loop tunnel

� Sunshine-Dandenong Metro: Sunbury services via the MM Tunnel to Pakenham and Cranbourne

� Frankston Loop Metro: Frankston services to the Caulfield City Loop tunnel

� Re-configured Cross-City Metro: Werribee and Williamstown services to Flinders Street via the

Cross-City line and through to Sandringham.

The operational and service plan identified for each of the four metro groups enabled by the

implementation of MM will be described in this section with an assessment of the associated capacity

and reliability benefits. The section also outlines the relationship with the Dandenong Rail Capacity

Program, which is part of the ultimate MM project.

The new rail services enabled by MM have been assessed to determine the impact on overall system

patronage. This assessment has been undertaken within a multi-modal transport model which

enables assessment of the redistribution of demand across modes and within modes. Importantly, it

was found that the increase in rail system capacity encourages a shift in demand from the road and

tram systems providing significant relief to the users of these modes.

7.2 Outputs, benefits and key performance indicators

7.2.1 Outputs

The key output for MM is the provision of extra services in the peak period on the Northern and

Caulfield Groups – with a target of an extra 17 services in the peak hour on day one. The actual

services it will be possible to operate after completion of MM are shown in Table 7-1 below.



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Table 7-1: Metropolitan train service delivery AM peak hour

Line Current Post RRL Post MM

Sunbury - Sydenham 9 13 16 (9-car)

Werribee/Williamstown 11 14 18

Craigieburn 9 12 16

Upfield 3 3 6

Total (Northern Group) 32 42 56

Pakenham / Cranbourne 15 16 16 (9-car)

Frankston 14 14 16

Sandringham 8 8 9

Total (Caulfield Group) 37 38 41

The key outputs after completion of MM (and the preceding four stages of the seven-stage

metropolitan rail plan can be summarised as:

� provision of 97 services on Day 1 (an additional 17) across the Northern and Caulfield Groups

(excluding all V/Line diesel services)

� major expansion of the metropolitan rail line capacity in the inner area to enable extra services to

be operated – capacity of 16 trains per hour through the MM tunnel on Day 1 with the ability to run

at least 24 trains per hour in the future

� increases in the train fleet to provide these services (as part of the overall rolling stock

procurement program outlined in separate business cases)

� increases in train service reliability on both the Caulfield and Northern Rail Groups

� to allow in the design of any interventions for the Rowville and Doncaster Rail Links, Melbourne

Airport Rail Link (MARL) and Upgrading Regional Lines (Melton-Ballarat and Bendigo lines).

MARL and Melton trains would be able to operate in the new tunnel if deemed appropriate and be

incorporated into the Melbourne Metro scheme

� to create a new type of rail service – a metro style service.

7.2.2 Benefits and key performance indicators

Four benefits of the project have been identified in the Investment Logic Map (Figure 3-1):

1. Melbourne’s liveability is improved and shared

2. Stronger Victorian economy

3. Increased access to jobs and services

4. Move to a lower emissions society

The key performance indicators (KPI) to measure the achievement of each these benefits are shown

in Table 7-3 below.



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The project will deliver four key benefits, as indicated in the Investment Logic Map in section 3.5.

These benefits will occur as a result of addressing the problems described in sections 2 and 3. Table

7-2 describes each of the benefits and how they link to and address the problems identified.

Table 7-2: Explanation of benefits

Benefit Description

Melbourne’s liveability is improved and shared

By increasing rail system capacity, the project will reduce crowding and improve on-time performance of train services. The project’s scale is such that it will also significantly reduce road congestion. Housing choice and accessibility to jobs for

residents in Melbourne’s west will also be improved by the Arden development.

These benefits will significantly improve the liveability of Melbourne.


Reduced commuter travel times, improving road freight productivity from reduced congestion, improving access to the key knowledge centres of Parkville and Domain and further enhancing CBD firms’ productivity will significantly strengthen Victoria’s economy. This project targets productivity, which is now the most influential factor in economic growth in Australia.


Access to jobs and services in Melbourne’s central area will be improved dramatically with more train services on lines serving the north, west and south-east

of Melbourne.


With higher public transport mode shares and reduced road congestion, greenhouse gas emissions will be reduced significantly.

Table 7-3: MM target key performance indicators (KPIs)

KPI

(measure)

Improved on-time performance (proportion of train services within 5 minutes of scheduled

arrival time)

Baseline 87% (Northern Group)

Source DOT train simulation modelling for post-RRL operations / Track Record

publication

Target 95%

Interim Target 93%

Reporting Forum Public Transport Development Authority

Start Date 1 year from project opening

Frequency Quarterly

End Date 5 years from project opening

Responsibility Chief Executive Officer, Public Transport Development Authority

KPI

(measure)

Reduced train crowding (number of services breaching load standard)

Baseline 12 load breaches in AM Peak on Northern Rail Group in 2017



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Source DOT patronage forecasts and operational planning / Track Record

publication

Target Zero load breaches in AM peak on Northern Rail Group

Interim Target -

Reporting Forum Public Transport Development Authority

Start Date 1 year from project opening

Frequency Quarterly

End Date 5 years from project opening

Responsibility Chief Executive Officer, Public Transport Development Authority

KPI

(measure)

Urban development in established areas (number of jobs, dwellings, enrolments in Arden

precinct)

Jobs Dwellings Enrolments

Baseline 4,000 120 0

Source Victoria in Future, 2008

Target 30,000 7,000 12,000

Interim Target (2031) 6,000 5,000 11,000

Reporting Forum ABS Surveys

Start Date 2025 2021 2021

Frequency Annual Annual Annual

End Date 2041 2041 2041

Responsibility DPCD / City of Melbourne

KPI

(measure)

Decongestion (reduction in number of car trips in AM peak)

Baseline 1,915,000

Source DOT MM network modeling / Victorian Integrated Travel Survey of Activity

Target 1,901,000 (14,000 reduction from base)

Interim Target NA

Reporting Forum TBD

Start Date 2011

Frequency Biennial

End Date 2031

Responsibility Michael Hopkins, Executive Director, Policy & Communications (PAC), DOT



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KPI

(measure)

Improved access to key economic centres (minutes saved by public transport accessing

Parkville and St Kilda Road)

Baseline Not applicable

Source DOT MM network modeling

Target 25 minutes saving to Domain

15 minutes saving to Parkville

Interim Target as above

Reporting Forum TBD

Start Date Upon opening

Frequency NA

End Date NA

Responsibility NA

KPI

(measure)

Employment productivity (Gross Value Added in a year)

Baseline To be determined as part of implementation business case

Source DOT MM Strategic Transport Network Modelling and Wider Economic Benefit

calculations

Target +$200m by 2031

Interim Target TBD

Reporting Forum TBD

Start Date 2011

Frequency Annual

End Date Ongoing

Responsibility Victorian Department of Treasury & Finance / DOT / DPCD

KPI

(measure)

Access to jobs (% increase in number of jobs within 60 minutes travel time in peak times by

public transport)

Baseline To be determined as part of implementation business case

Source DOT Strategic Transport Network Modelling

Target +5% by 2031

Interim Target -

Reporting Forum To Be Determined



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Start Date NA

Frequency NA

End Date NA

Responsibility Michael Hopkins, Executive Director, PAC, DOT

KPI

(measure)

Access to capital city functions (% increase in Melbourne’s population within 60 minutes travel

time of CBD)

Baseline To be established as part of implementation business case

Source DOT strategic transport network modelling

Target +30% by 2031

Interim Target -

Reporting Forum To be determined

Start Date NA

Frequency NA

End Date NA


KPI

(measure)

Greenhouse gas emissions (Greenhouse gas emissions savings on Melbourne’s transport

system)

Baseline To be calculated as part of implementation business case

Source DOT strategic transport network modelling

Target 8 MtCO2 net cumulative savings 25 years after opening (2046)

Interim Target To be calculated as part of implementation business case

Reporting Forum NA

Start Date NA

Frequency NA

End Date NA


KPI

(measure)

Increased use of public transport (Daily metropolitan public transport mode share)

Baseline 14% in 2021

Source VISTA / DOT strategic transport network modelling / ABS Journey to Work

data



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Target 16% by 2031

Interim Target 15% by 2026

Reporting Forum To be determined

Start Date 2011

Frequency Biennial

End Date 2031


7.2.3 Evidence of benefits delivery

The evidence that the benefits will be delivered by the project are summarised by the Key

Performance Measures for each of the benefits defined in the Benefit Map overleaf. The

comprehensive economic, social and environmental impact analysis, together with the operational,

patronage and land use impact analyses undertaken for the draft pre-construction business case

provides further detail on the KPIs and other impacts if required.

Further details on the baselines and targets for each KPI and the people responsible for their

reporting and achievement are shown above.



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Investor:

Facilitator:

Initial Workshop:

Version no:

Last modified by:

STRATEGIC INTERVENTIONS TARGET

Template version: 4.0

BENEFIT

Melbourne Metro DEPARTMENT OF TRANSPORT

MEASUREINVESTMENT KPI

Hector McKenzie

Version 0.3

Chris Tehan

Benefit Management PlanBenefit Map

Improve the performance of

Melbourne’s existing rail system

25%



Improved on time performance

Proportion of train services within 5

minutes of scheduled arrival time

95% on opening on upgraded lines

Reducedtrain crowding

Number of services breaching load

standardZero on upgraded lines

30%

40%

Increase the capacity of

Melbourne’s rail system

50%


40%

DecongestionReduction in number of

car trips in AM peak14,000 car trips

Improved access to key economic centres

Minutes saved on PT accessing Parkville and

St Kilda Road

25 minutes to Domain 15 minutes to Parkville

40%

10%



25% Increased access to jobs and

services10%

Access to jobs

% increase in number of jobs within 60 minutes

travel time in peak times by public transport

+5% by 2031 metropolitan-wide

Access to capital city functions

% increase in population within 60

minutes of travel time of CBD

+30% by 2031

60%

40%

Transition to a lower emissions

society10%

Greenhouse gas emissions

Greenhouse gas emissions savings on Melbourne’s transport

system

3 MtCO2e net

cumulative savings by 25 years after opening

Daily metropolitan public transport mode

share16% by 2031

80%

20%

Increased use of public transport

Urban development in established areas

Number of jobs / residents / enrolments

in Arden precinct

30%

6,000 jobs15,000 residents

11,000 enrolments by 2031

Employment productivity

Gross Value Added$200m increase in GVA

in 2031

50%

Investor:

Facilitator:

Initial Workshop:

Version no:

Last modified by:

STRATEGIC INTERVENTIONS TARGET

Template version: 4.0

BENEFIT

Melbourne Metro DEPARTMENT OF TRANSPORT

MEASUREINVESTMENT KPI

Hector McKenzie

Version 0.3

Chris Tehan

Benefit Management PlanBenefit Map

Improve the performance of

Melbourne’s existing rail system

25%



Improved on time performance

Proportion of train services within 5

minutes of scheduled arrival time

95% on opening on upgraded lines

Reducedtrain crowding

Number of services breaching load

standardZero on upgraded lines

30%

40%

Increase the capacity of

Melbourne’s rail system

50%


40%

DecongestionReduction in number of

car trips in AM peak14,000 car trips

Improved access to key economic centres

Minutes saved on PT accessing Parkville and

St Kilda Road

25 minutes to Domain 15 minutes to Parkville

40%

10%



25% Increased access to jobs and

services10%

Access to jobs

% increase in number of jobs within 60 minutes

travel time in peak times by public transport

+5% by 2031 metropolitan-wide

Access to capital city functions

% increase in population within 60

minutes of travel time of CBD

+30% by 2031

60%

40%

Transition to a lower emissions

society10%

Greenhouse gas emissions

Greenhouse gas emissions savings on Melbourne’s transport

system

3 MtCO2e net

cumulative savings by 25 years after opening

Daily metropolitan public transport mode

share16% by 2031

80%

20%

Increased use of public transport

Urban development in established areas

Number of jobs / residents / enrolments

in Arden precinct

30%

6,000 jobs15,000 residents

11,000 enrolments by 2031

Employment productivity

Gross Value Added$200m increase in GVA

in 2031

50%



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7.2.4 Reporting the delivery of benefits

Crowding and on-time performance of the train system is reported each quarter and monitored

regularly by the Department of Transport in publications such as Track Record.

DPCD together with the City of Melbourne will monitor developments in the Arden precinct.

VicRoads collects traffic volume information on major arterial roads and monitors travel speeds on the

network.

Gross State Product in general is monitored by State and Federal Treasuries. It will need to become

the responsibility of DOT and DPCD to correlate this with effective job density.

DOT monitors public transport usage and mode share closely and so can report on the impacts on

specific lines to isolate the impact of this project. Improved access to Parkville - St Kilda Road through

public transport travel time savings is a network-wide effect which will be manifested in tram and train

timetables.

The Federal Department of Climate Change and Energy Efficiency measures and reports on

emissions from the transport sector – these can be correlated with public transport usage patterns to

identify greenhouse gas emissions savings.

The precise reporting forums for these benefits will be determined.

7.2.5 Importance of the benefits to Government

The Melbourne Metro project is the critical enabler of a metro rail system in Melbourne, which is

needed to deal with population growth, decreasing access to jobs and services, a poorly performing

and congested transport system and declining productivity growth. Melbourne Metro:

� Addresses all of the Infrastructure Australia (IA) objectives, particularly the ‘develop our cities’ and

‘increase Australia’s productivity’ objectives, enabling a new urbanism through a quality, city-

shaping public transport system that provides a step-change in accessibility to a wider labour pool

and better connects Melbourne’s knowledge economy. The project’s agglomeration and

productivity benefits are therefore very significant. Commonwealth Treasury’s 2010

Intergenerational Report confirms that productivity has become the fundamental driver of

economic growth.

� Dramatically increases transport capacity to central Melbourne, delivering substantial transport

user benefits and significantly reducing congestion and externalities.

� Facilitates large-scale inner urban renewal through a major development precinct in North

Melbourne through a new station at Arden and enabling infrastructure.

� Delivers jobs closer to where people live, creating a pipeline of supply of dwellings in targeted

urban renewal sites to contribute to a sustainable urban form, and enhance accessibility to a

range of urban activities through sustainable means. These outcomes will support a refined

metropolitan structure which will ensure Melbourne retains its liveability and productivity.

� Delivers positive whole-of-life environmental outcomes, including reductions in greenhouse gas

emissions, air pollution, noise and water pollution and land consumption as a result of reductions

in private vehicle travel and a more compact urban form.

� delivers significant social benefits including improvements to the stock of human capital through

improved accessibility to jobs, education opportunities and inner Melbourne. This leads to a more



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equitable distribution of income, which in turn leads to decreased crime and improved health

outcomes.

� improves accessibility to services, leading to better health outcomes and increased opportunities

for sport, uptake of hobbies, and entertainment. It also promotes improved personal wellbeing and

societal welfare, such as choice in retail offerings, through improved access to goods and

services.

The scale of the project means that it contributes strongly to Victoria’s transport and land use

objectives and is considered critically important to the State. The project delivers economic benefits of

around $15 billion (in 2010 present value terms), which comfortably exceeds its whole-of-life cost ($8–

9 billion). These benefits do not include any of the social and some of the environmental benefits

discussed above.

The project enjoys strong support from the community and the Commonwealth Government.

7.3 Concept of Operations

7.3.1 Introduction

A Concept of Operations (COO) has been developed comprising both the MM project and the full MM

scheme (ie MM, DRC Program & for the purposes of this assessment, Upgrading Regional

Passenger Lines – formerly Melton Rail Upgrade) to ensure a logical staged development of the full

scheme and confirm that operational and infrastructure solutions address both the shorter term and

long term outcomes. It should also be noted that the COO has been developed to be entirely

consistent with the Melbourne Metropolitan Rail Capacity Upgrade Program – refer section 1.2.5.

The current COO provides sufficient detail on the operational concept to meet the requirements of the

business case. Further refinements will be made and a revised COO developed as part of the next

phase of the project. The revised version will reflect outcomes of the reference design and any

constraints that may necessitate alterations to the operating plan and establish other (more specific)

operational process and management changes that will need to be undertaken to enable the revised

network to function reliably and efficiently.

The following sections provide a summary of the COO for both MM Day 1 and the ultimate MM

scheme.



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7.3.2 MM Day 1 service plan

The network base case for MM is shown in Figure 7-1.

Figure 7-1: MM Base Case Network (post RRL and Sunbury electrification)

6

6

14

13

3

1614

8

6

6

14

13

3

1614

8

MM will provide the infrastructure to re-configure the Northern Group into three fully independent

metro lines operating as follows:

� Northern Loop Metro: Craigieburn and Upfield services via the Northern City Loop tunnel

� Sunshine-Domain Metro: Sunbury services via the MM Tunnel to Domain

� Re-configured Cross-City Metro: Werribee and Williamstown services to Flinders Street via the

Cross-City line and through to Frankston.

These line groups are shown schematically in Figure 7-2. The reconfigured network and new

infrastructure will provide the following operational outputs:

� segregates the existing Northern Group of lines into three stand-alone metros each operating

more frequent and reliable services with ‘Turn-up and Go’ style timetables operating homogenous

service patterns

� delivers a total of 14 additional peak hour services across the existing Northern Group lines and 3

additional peak hour services across the Caulfield Group of lines

� allows the opportunity to add a further eight services upon electrification to Melton



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� allows operation of up to nine-car trains from Sunbury (and Melton upon electrification) delivering

a further 50% increase in capacity

� relieves crowding and congestion at existing stations by diverting a number of passenger trips

through new CBD stations

� relieves tram congestion on Swanston Street-St Kilda Road.

Figure 7-2: MM and revised Northern and Caulfield Group Configuration

Sunshine-Dandenong Metro Operating Plan

The Sunshine-Dandenong Metro would operate all trains from the Sydenham/Sunbury line into the

new tunnel to Pakenham and Cranbourne via Dandenong. The removal of the Sunbury and

Dandenong trains from their respective city loop tunnels is a necessary requirement to fully establish

the remaining three metro line groups.

Upon opening it is anticipated that Melton services would still be operating with diesel hauled trains

via RRL tracks. As a result, a total of sixteen 9-car services an hour would operate on Sunbury line

via the Melbourne Metro tunnel on day one. The number of services operating on Dandenong rail

corridor will be determined as part of the DRC Program – any services in excess of 16 trains per hour

(the limit on Sunbury corridor without further works) could operate direct to Flinders Street.

The Sunshine-Dandenong Metro would be configured to enable the following enhancements in future

projects:

� capacity for up to 12 services from Melton (upon completion of Upgrading Regional Passenger

Lines project, formerly Melton Rail Upgrade project)



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� capacity to accommodate trains of up to 220 metres (notionally 9-car) in length.

The Sunshine-Dandenong Metro trains would be maintained at the proposed Calder Park stabling

and maintenance facility and be stabled at Calder Park and existing stabling locations on the line as

shown in Figure 7-3.

Bendigo regional trains will continue to share tracks with metropolitan trains on the

Sydenham/Sunbury corridor as far as Sunshine with MM. However these regional services will

operate at relatively low frequencies and sufficient capacity will be available for MM services to

operate largely independently.

Figure 7-3: Sunshine-Dandenong Metro - MM Day 1 Operating Plan

16

16

48

8

Maintenance Facility

Stabling Facility

6 Services in peak hour

CBD North

CBD South

Cross-City Metro Operating Plan

The Cross-City Metro would incorporate the Werribee/Williamstown and Sandringham corridors

connected via the ‘through suburban’ lines from North Melbourne to Flinders Street and the ‘special

lines’ from Flinders Street to Richmond.

A Cross-City Rail Group was established in May 2011 as part of the implementation of a new

‘greenfields’ timetable. However, in advance of MM, the Cross-City Group will need to accommodate

additional trains from other lines. This sharing will remove capacity from the Werribee/Williamstown

service and compromise the ability to operate a simple Metro service. In advance of MM the Cross-

City Rail Group will need to accommodate the following services:

� between 2011 and the implementation of RRL: Geelong services will operate as part of the Cross-

City Rail Group between Werribee and Southern Cross

� between the implementation of RRL and the implementation of MM: Up to seven Craigieburn

services would operate on the Cross-City Rail Group between North Melbourne and Flinders



Page 185 of 321

Street due to capacity constraints in the Northern Loop. These services would operate via the

Broadmeadows Suburban fly-over and merge, at grade, with services from Werribee.

Upon implementation of MM, it is proposed that services from Werribee/Williamstown would

exclusively operate from the west on the cross-city tracks. This will simplify operations, eliminate an

at-grade conflict at North Melbourne, result in full sectorisation and enable an additional five services

to operate from the Werribee corridor in the peak hour. The MM project facilitates capacity for an

additional two services per hour on the Frankston line and an additional service on the Sandringham

line.

Cross-City Metro trains will be maintained at Newport and stabled at various locations as shown in

Figure 7-4.

Figure 7-4: Cross-City Metro – MM Day 1 infrastructure requirements

Upgraded signaling between Werribee and Newport

New stabling at North Melbourne

New cross-oversat South Yarra

Upgraded platform and facilities at Brighton Beach to enable turn-backs

The implementation of the MM project would enable a total of 18 services per hour to operate on the

trunk section between Newport and Flinders Street (an additional five services from post RRL). Only

Werribee/Williamstown services would run direct via Cross-City group (Craigieburn direct services can

be removed). Most services continue to run through to Sandringham or South Yarra, while Frankston

services run via loop with only limited interaction with Cross-City group for rolling stock positioning.

All services would stop at all stations inbound from Newport. This service pattern is shown in

Figure 7-5.



Page 186 of 321

Figure 7-5: Cross-City Metro – MM Day 1 Operating Plan

12

33

18

9 16

10


Stabling Facility


Frankston Loop Metro

Cross-City Metro

Northern Loop Metro Operating Plan

The Northern Loop Metro would include the Craigieburn and Upfield corridors as well as the Northern

Loop and viaduct. The Northern City Loop will be used exclusively by trains from Craigieburn and

Upfield corridors. A grade-separated merge of Craigieburn and Upfield services at North Melbourne

would enable use of both city loop tunnel portals. A dedicated fleet of 33 Comeng trains would

operate this service.

All services would operate via the loop and originate from Craigieburn, Broadmeadows, Essendon

and Upfield. V/Line services from Seymour would also need to be accommodated along the

Craigieburn corridor but would run direct into Southern Cross only.

Northern Loop metro trains would be maintained at Craigieburn and stabled at various locations on

both suburban corridors as shown in Figure 7-6.

A total of 22 services would operate through the Northern Loop in the peak hour at Day 1. At present

it is planned that one in four of these would operate from Upfield, one in four from Essendon and one

in two from Craigieburn or Broadmeadows. This service pattern is shown in Figure 7-7.



Page 187 of 321

Figure 7-6: Northern Loop Metro – MM Day 1 infrastructure requirements

Upgraded signaling and power systems: Broadmeadows to Craigieburn

Upgraded platform and new point-work at Essendon to enable centre-road turn-backs

Additonal platform at Upfield

Figure 7-7: Northern Loop Metro - MM Day 1 Operating Plan

22

6

11

16


Stabling Facility


Essendon



Page 188 of 321

7.3.3 Ultimate Melbourne Metro service plan

The Dandenong Rail Capacity program, upgrades on the Melton line (as part of Upgrading Regional

Passenger lines project) and other enabling works on the Caulfield Group will facilitate the delivery of

the ultimate MM service plan.

The delivery of these projects will create an end-to-end metro service from Sunbury and Melton to

Cranbourne and Pakenham. In turn this will enable a major reconfiguration of the other lines to the

south-east as follows:

� Cranbourne and Pakenham services will be diverted into the new tunnel and run through to

Sunbury and Melton

� The Cross-City Metro will be reconfigured to operate services from Werribee and Williamstown to

Sandringham via Southern Cross and Flinders Street.

No change is envisaged on the Northern Loop Metro with introduction of DRC program, Melton or

other works. These line groups are shown schematically in Figure 7-9.

Ultimate infrastructure requirements, including High Capacity Signalling, to accommodate 24 trains

per hour through the tunnel are shown in Figure 7-8. Indicative ultimate operating arrangements are


Figure 7-8: Ultimate MM infrastructure requirements

CBD North

CBD South

Quad track to Deer Park, duplication and electrification to Melton

Melto

n

New stabling at Rockbank

New stabling at Pakenham East

HCS South Yarrato Dandenong

HCS Sunshine to South Ken

Duplication to Cranbourne



Page 189 of 321

Figure 7-9: Ultimate MM scheme configuration and indicative operating plan

18

24

16 6

9

16 24

18

24

16 6

9

16 24

7.3.4 Operational Outcomes

The separation of the Northern and Caulfield Groups into independent operating units as a result of

MM creates capacity for the following additional peak hour services from day one of tunnel opening:

� five Werribee line services

� four Craigieburn line services

� three Sunbury line services

� two Upfield line services

� one additional Sandringham line service

� two additional Frankston line services.

The full scheme (ie DRC Program, Melton line works and other supporting corridor upgrades) will

deliver additional capacity on the Dandenong and Sunshine corridors

� eight Melton line electrified services (removal of three diesel-hauled services)

� six Dandenong line services.

Peak hour services frequencies for the current timetable, the base case and the MM project and the

full scheme are shown in Table 7-4.



Page 190 of 321

Table 7-4: Peak hour capacity on Northern and Caulfield Group Lines

Line>

Scenario

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2011 Timetable: Current service levels

9 3 2* 9 11 8 14 15 71 -

Base Case (including RRL) 42

12 3 3* 13 14 8 16 16 85 +14

MM Day 1 16 6 3* 16** 18 9 18 16** 102 +17

Ultimate MM (DRC Program & Melton Electrification)

16 6 8 16** 18 9 18 24** 115 +13

* diesel services (Gippsland, Ballarat and Bendigo V/Line services not shown or included in totals)

** 9-car services

7.3.5 Service improvements, rolling stock and distance operated

This business case makes provision to operate all the additional peak hour services from day 1 of

opening. Additionally, operating costs have been included for day of opening to improve off-peak

services on the Sunshine-Dandenong Metro to ensure trains operate at least every 7.5 minutes

through the tunnel between 7 am and 10 pm on weekdays and between 10 am and 10 pm on

weekends. This would provide a similar level of service to that expected to be operating through the

other inner core routes by the time of implementation of MM.

Trains on the Sunshine-Dandenong Metro would be lengthened by adding up to three additional

carriages per train in the fleet to cater for anticipated demand growth (leading to additional carriage

requirements and the extension of suburban platforms and stabling roads).

In addition to capital and operating costs included from day of opening the business case has also

made provision for a gradual increase in shoulder peak services on all corridors up to the capacity of

the infrastructure, leading to increased kilometres operated and additional rolling stock requirements.

These figures are included in the economic analysis.

7.3.6 Reliability

The implementation of the MM project will result in significant improvements to the performance

reliability of the affected metropolitan lines. Reliability has been calculated using the RailSys model

which is calibrated to the current performance of the network.

Survey data collected for the calibration of the current timetable demonstrates that significant delays

are incurred at various locations for a variety of reasons. When estimating future performance some

42 Service capacity potential following implementation of committed works up to and including RRL and

deployment of new rolling stock



Page 191 of 321

assumptions have to be made about changes to the current delay profiles to reflect the changed

operating paradigm. In particular, the following assumptions have been made regarding changes to

likelihood and impact of delays:

� improved reliability between Kensington and Flagstaff on the Northern Loop Metro as a result of

eliminated interaction with Sunbury line services in the North Melbourne area

� improved reliability inbound from Footscray and inbound from South Yarra on the Sunshine-

Dandenong Metro as a result of eliminated interaction with Craigieburn, Upfield and Seymour

services in the North Melbourne area

� improved reliability from South Kensington to Southern Cross on the Cross-City Metro as a result

of eliminated interaction with Craigieburn direct services in the North Melbourne area

� reduced delays from extended dwell times as a result of reduced over-crowding and more even

train presentation

� increased scheduled dwell times at inner city stations on the Sunshine-Dandenong Metro

compared to existing stations to allow for higher numbers boarding and alighting.

� improved reliability from South Yarra to Southern Cross on the Frankston Loop Metro as a result

of eliminated interaction with Dandenong services

Table 7-5 shows the estimated peak period improvement in reliability of each of the metro lines as a

result of MM and the above assumptions. It should also be noted that these results have been

calculated on the basis of no infrastructure or rolling stock failures (ie they reflect an average day of

no infrastructure incidents). In practice, average performance over a period is likely to be slightly

lower than estimated here due to incidents of that nature.

Table 7-5: Estimated peak period reliability43

by corridor upon implementation of MM

Metro Line Base Case MM Day 1

Craigieburn - Upfield Medium High

Sunshine Low-Medium Medium-High

Werribee / Williamstown Low-Medium Medium-High

Dandenong Low-Medium High

Frankston Low-Medium High

Sandringham High High

7.4 Rolling stock deployment strategy

Additional rolling stock is critical to enable the additional services to operate. Planning is underway to

confirm future rolling stock requirements, appropriate deployment and procurement. Additional trains

will be required to support the provision of extra services across the network prior to and as a result of

the MM project. The introduction of HCMTs for operation on the MM will be further considered in the

43 Does not include impacts of future train crowding. Reliability performance will be affected by train crowding, which is likely to occur between completion of RRL and opening of MM as patronage continues to grow.



Page 192 of 321

next phase and is expected to reduce sizing of tunnels and stations. MTM strongly supports the

HCMT concept. The procurement of HCMTs would require construction of a new bespoke HCMT

maintenance and stabling facility at Calder Park and stabling at other locations across the network

according to the operational requirements.

The additional X’trapolis trains due to be delivered in the short term will support the growth in services

achievable in the peak and shoulder peak periods following the implementation of the committed

projects including RRL and the extensions to Sunbury and South Morang.

New trains will need to be deployed to cover:

� shoulder peak services enabled by RRL on the Craigieburn line

� retirement of Hitachi trains

� service improvements across the network to meet forecast rises in demand

� support enhanced maintenance requirements.

The preliminary deployment strategy (subject to ongoing review as part of the rolling stock

procurement program) is shown in Table 7-6.

Table 7-6: Indicative MM deployment strategy

Comeng Siemens Xtrap/HCMT

TOTAL (6 car Equiv)

New Trains

required(6 car eq)

Northern Loop 33 - - 33Included in totals below

Cross-City & Frankston

35 36 - 71Included in totals below

Sunshine-Dandenong (6 Car)

- - 60x6 60 22


- - 60x7 70 22*


- - 60x9 90 42^

Comeng Siemens Xtrap/HCMT

TOTAL (6 car Equiv)

New Trains

required(6 car eq)

Northern Loop 33 - - 33Included in totals below

Cross-City & Frankston

35 36 - 71Included in totals below


- - 60x6 60 22


- - 60x7 70 22*


- - 60x9 90 42^

* Assumes 7 car trailers already procured as part of “33 New Trains” business case

^ Assumes 10 additional trains already procured as part of DRC 9-Car to Flinders St proposed project

# Assumes 7 additional trains already procured as part of DRC High Capacity Signalling proposed project



Page 193 of 321

7.5 Patronage impacts

7.5.1 Network impacts

Summary AM peak period forecast results for the MM and the full scheme are presented in Table 7-7

and Table 7-8 compared the project base case. These forecasts have been developed using the

Zenith model. Table 7-7 shows an increase in total rail trips and a reduction in private vehicle trips

and bus and tram boardings resulting from each progressive stage of the project reflecting the staged

increase in capacity of the rail network and improved connectivity. The reduction of V/Line boardings

for the full scheme is due to the reclassification of Melton services as part of the Melton Line

electrification and duplication.

The relative impact on public transport boardings in the full scheme compared to the MM project case

is decreased by less boardings per trip as the additional improvements to connectivity reduce the

need for interchange. This improved network connectivity also goes towards explaining why the full

scheme has marginally more tram and bus boardings in the AM peak compared with MM.

With the implementation of MM the number of public transport trips increases by almost 8000

passengers in the AM two-hour peak. Although this appears a modest increase compared with the

whole network this actually equates to around nine train loads. Although patronage modelling is

based around the two-hour peak period (to better reflect peak spreading behaviour) rail capacity

analysis concentrates on the peak one hour. This is calculated by applying a factor of 0.6 to the two

hour peak demand. The impact of MM in the peak hour is therefore an increase in public transport

trips of 4500 which equates to five train loads.

Table 7-7: 2031 AM Peak 2 hour modelled network statistics for base and MM full scheme

Measure Base Full MM scheme Difference

Total person trips 3,838,546 3,838,546 0

Total person private vehicle trips

2,719,694 2,703,213 -16,480 -0.6%

Total car trips 1,915,533 1,901,288 -14,245 -0.7%

Total PT trips 609,838 627,571 17,733 2.9%

Total PT boardings 988,151 1,024,259 36,107 3.7%

Metropolitan rail boardings 550,121 601,230 51,109 8.5%

V/Line rail boardings 31,926 24,716 -7,211 -22.6%

Total rail boardings 582,048 625,946 43,898 7.5%

Tram boardings 188,040 181,390 -6,650 -3.5%

Bus boardings 218,064 216,923 -1,141 -0.5%

The methodology used to constrain public transport capacity in the Zenith model provides a

conservative estimate of the increase in public transport trips between the base and project case. The

transport modelling assumes demand for rail can continue above ‘crush capacity’. It is reasonable to



Page 194 of 321

assume that service overcrowding would in fact divert a greater number of trips to the road in the

base case. In this event, the project case would provide a greater increase in public transport users

and reduced traffic congestion but with less impact on public transport crowding, which would reflect

in the respective crowding and congestion benefits.

Comparison of network statistics for MM is shown in Table 7-8. This indicates that public transport

trips are forecast to grow more rapidly than population and employment between 2021 and 2031

though the growth in mode share rates slows between 2031 and 2046. This is generally consistent

with the DOT high level forecasts derived from the elasticity model. The forecast growth in private

vehicle trips is lower than population growth.

Table 7-8: AM peak modelled network statistics 2021, 2031 and 2046 MM

MM Constrained AM 2 hr 2021 2031 CAGR

2021–31 2046

CAGR 2031–46

Population 5,544,590 6,240,112 1.2% 7,085,987 0.9%

Employment 2,420,143 2,681,104 1.0% 3,027,936 0.8%

Total person trips 3,457,633 3,838,546 1.1% 4,351,773 0.8%

Total person private vehicle trips

2,496,023 2,712,931 0.8%

3,060,682 0.8%

Total car trips 1,759,667 1,909,724 0.8% 2,153,502 0.8%

Total public transport trips 513,786 617,459 1.9% 709,986 0.9%

Metropolitan rail boardings 477,651 585,718 2.1% 693,737 1.1%

V/Line rail boardings 26,312 31,433 1.8% 35,726 0.9%

Total rail boardings 503,963 617,151 2.0% 729,463 1.1%

Bus boardings 177,213 216,697 2.0% 242,459 0.8%

Tram boardings 149,440 180,297 1.9% 201,656 0.7%

Note that the Zenith model includes key regional centres in its network which is reflected in the statistics above, including population, employment and trips.

The metropolitan public transport mode share for motorised journeys with MM (as apposed to trip

stages within a journey) is shown in Table 7-9. These results are compared with the daily public

transport mode share from the 2007 Victorian Integrated Survey of Travel and Activity (VISTA). The

model forecasts that by 2021, public transport mode share (of motorised trips) will reach 19% in the

AM peak and 14% across the day. In 2046 the public transport mode share decreases outside of the

peaks. Public transport journeys do increase, but not relative to private vehicle. This may be due to

relatively lower road congestion outside the peaks, combined with an assumed reduction in the

growth in public transport trips.



Page 195 of 321

Table 7-9: Average weekday public transport mode share for metropolitan motorised vehicle trips with MM

MM (zenith model)

Time Period VISTA 200744

2021 2031 2046

AM peak 16.5% 18.8% 20.5% 20.9%

Off peak 7.5% 12.5% 13.6% 13.5%

PM peak 15.6% 16.8% 18.5% 18.8%

Daily 10.8% 14.3% 15.6% 15.7%

7.5.2 MM patronage

The two-hour AM peak line loads for the full scheme and base are shown in Figure 7-10 and

Figure 7-11. The graphs show an increased demand in the project case compared with the base and

sufficient capacity to meet demand (based on load standard capacities).

The highest demand is from the west, with peak line loads at Footscray, relating to this area’s

dependence on CBD based employment. With the Melton line electrification some demand shifts from

the Sunbury line, resulting in relatively even loads between the two lines.

44 This mode share is based on the percentage of total motorised journeys from origin to ultimate destination. Mode share is usually quoted as a percentage of each motorised trip stage, which equates to a current 2007 PT mode share of 13.3%

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7.5.3 Congestion relief: public transport network

The crowding levels on the rail network are presented in Figure 7-12 and Figure 7-13 for the current

(2008) and future (2031) situation with and without the MM project. (The crowding levels are based on

volume capacity ratios (ie the volume of demand in the two-hour AM peak compared with the load

standard capacity). It should be noted that the load standard is defined for the peak one hour.

Applying this standard to the two-hour period ignores the ‘peak of peak’ and therefore understates the

actual level of crowding experienced by the users). However, as noted above, patronage modelling

also accounts for the two-hour peak period to better reflect peak spreading behaviour.

The 2008 base case shows that all rail lines are approaching or at capacity. The 2031 base case

shows all rail lines over capacity. The MM project reduces crowding (but doesn’t eliminate it)

particularly on the Sunbury line and on the rest of the Northern Group. However load standards will

continue to be exceeded in some cases, particularly on the Werribee and Craigieburn lines.

Figure 7-14 and Figure 7-15 similarly show the crowding levels on the tram network for the 2008 and

2031 base case as well as the 2031 MM project case. The most significant change is reduced

crowding at the approaches to the CBD on Swanston Street and St Kilda Road (the road section

through the CBD is obscured by other tram routes). As was shown in Table 3-1 there is a reduction in

tram boardings with the MM project.

Figure 7-12: AM peak base rail crowding levels

2008 2031

The City Loop is not shown because the model network ‘over-represents’ the capacity of the loop for the purposes of analysis



Page 199 of 321

Figure 7-13: 2031 AM 2 hour peak rail crowding levels with Full MM Scheme

Figure 7-14: AM peak base tram crowding levels

2008 2031

The City Loop is not shown because the model network ‘over-represents’ the capacity of the loop for the purposes of analysis



Page 200 of 321

Figure 7-15: AM 2 hour peak tram crowding levels with Full MM Scheme

The MM project is expected to cause significant changes in forecast demand for inner city tram

services:

� a fall in tram demand on St Kilda Road between Flinders Street and Domain Station with a metro

service in place. It is estimated that the fall in demand is about 7200 passengers during the

morning peak (Figure 7-16)

� an increase in demand for access to William Street tram services from those alighting at Parkville

and Domain Stations (Figure 7-17)

� increased demand for travel between Domain Station and South Melbourne which will be difficult

as a pedestrian due to local access barriers (Figure 7-18).



Page 201 of 321

Figure 7-16: Forecast tram loading, AM peak southbound, Swanston Street/St Kilda Road

Figure 7-17: Destinations and last egress modes of alighting trips at Parkville, AM peak



Page 202 of 321

Figure 7-18: Destinations and last egress modes of alighting trips at Domain, 2031 AM peak

The complementary MM tram strategy devised to refine the tram network as a result of these impacts

is discussed in Section 6.

7.5.4 Congestion relief: road network

The shift in demand to rail from road results in reduced traffic congestion. Figure 7-19 illustrates the

distribution of congestion relief with the MM project, which reduces car trips across the metropolitan

area by almost 6000 in the 2031 AM peak. The most significant impact is reduced volumes on the

West Gate Freeway, as well as Francis Street, Footscray Road and the Calder Freeway.



Page 203 of 321

Figure 7-19: Full MM scheme impact on traffic volumes (2031, AM 2 hr)

The most significant levels of relief occur on the key east-west routes, which is illustrated by the

Maribyrnong/Yarra River screen line. This line bisects the routes into the CBD from the west and

provides a convenient assessment of traffic network impacts. Table 7-10 compares the traffic volumes

crossing the Maribyrnong River in the base and project cases. The results demonstrate a reduction in

overall east and westbound traffic with both project cases. There is a reduction of almost 5000 for the

full MM scheme - a typical freeway lane carries approximately 2000 vehicle/lane/hour.

Table 7-10: AM peak traffic volumes on Maribyrnong-Yarra River screen line

Traffic Volume

(two hours)

Base Full scheme

Traffic reduction compared to Base

Eastbound 75,000 69,800 - 5,200

Westbound 50,600 49,800 - 800

The transport modelling assumes demand for rail can continue above ‘crush capacity’ and the major

effect of the project is to reduce this level of crowding to more acceptable levels. It is reasonable to

assume the effect of service overcrowding would in fact divert a greater number of trips to the road

network under the base case. In this event, the project case would provide a greater reduction in

traffic volumes compared to the base, but a lesser impact on reduced crowding levels.

7.5.5 Patronage forecasts at inner stations

Figure 7-20 and



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Figure 7-21 show the patronage levels (alightings in AM peak period) for existing City Loop and MM

stations between the base and the project cases, and between different years for MM. The full MM

scheme provides significant relief to existing inner city stations, particularly Flinders Street Station,

whilst there is growth predicted at all MM stations.

Figure 7-20: 2031 AM peak inner core station alightings – Base vs Full MM Scheme

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

100,000

Dom

ain

CBD

Sou

thC

BD

Nor

th

Par

kville

Ard

en

Par

liam

ent

Mel

bour

ne C

entra

l

Flag

staf

fSou

ther

n C

ross

Flin

ders

Stre

et

Pas

sen

gers

per

2 h

ou

rs

Base Full Scheme

Figure 7-21: 2021, 2031 and 2046 AM peak inner core station alightings with Full MM Scheme

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

Dom

ain

CBD

Sou

th

CBD

Nor

th

Parkv

ille

Arden

Parlia

men

t

Melbo

urne

Cen

tral

Flags

taff

South

ern

Cro

ss

Flinde

rs S

treet

Pa

sse

ng

ers

pe

r 2

ho

urs

2021 2031 2046



Page 205 of 321

Figure 7-22 shows the inner station daily egress modes for MM in 2031. It indicates a high percentage

of passengers egressing the inner stations by walking, as well as the importance of the tram network.

The graphs highlight the interaction between the existing rail and MM at the interchange stations of

Footscray, CBD South/Flinders Street and CBD North/Melbourne Central. Arden is principally

accessed by walking but this may change as the public transport network is developed in this area.

Figure 7-22: Daily 2031 inner station egress modes with Full MM Scheme

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

Dom

ain

CBD

Sou

th

CBD

Nor

th

Parkv

ille

Arden

Parlia

men

t

Mel

bour

ne C

entra

l

Flags

taff

South

ern

Cro

ss

Flinde

rs S

treet

Pa

ss

en

ge

rs p

er

2 h

ou

rs

ToBus

ToTram

ToMetro

ToRegionalTrain

ToTrain

CarOut

WalkOut

Table 7-11 and Table 7-12 provide a summary of daily and AM peak statistics on inner station

boardings and alightings for the Full MM Scheme in 2031 and 2046. The patronage at future MM

stations can be compared against estimated current weekday exits at City Loop stations, which are:

Flinders Street 79,000; Parliament 36,200; and Flagstaff 18,500. In 2031, Parkville is estimated to

approach today’s Parliament station exits. Current station exit estimates do not include interchanging

within the station, unlike the future estimates in Table 7-11 and Table 7-12. This is not an issue when

comparing MM stations against current statistics, as these stations effectively only have one line

running through them. City Loop stations such as Flinders Street however, have high levels of

interchanging within the station, and therefore it is not possible to directly compare the current exit

estimates with the City Loop station statistics in Table 7-11 and Table 7-12.



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Table 7-11: Inner station boarding and alightings Full MM Scheme, 2031 (constrained)

TWO HOUR AM PEAK DAILY

STOP NAME

Boarding Alighting Total Boarding Alighting Total

Domain 3,300 15,100 18,400 32,800 36,700 69,500

CBD South 10,300 38,500 48,800 89,200 95,000 184,200

CBD North 7,800 20,200 28,000 61,000 53,100 114,100

Parkville 3,000 14,300 17,300 33,800 37,900 71,600

Arden 900 5,300 6,200 13,600 14,600 28,200

Parliament 9,500 35,500 45,000 87,100 107,600 194,700

Melbourne Central 10,000 32,500 42,600 84,100 103,900 188,000

Flagstaff 6,200 22,600 28,700 46,300 57,700 104,000

Southern Cross 16,200 40,000 56,200 149,400 139,100 288,500

Flinders Street 29,400 62,200 91,600 205,000 169,700 374,700

Table 7-12: Inner Station boarding and alightings, Full MM scheme, 2046 (constrained)

TWO HOUR AM PATRONAGE DAILY PATRONAGE

STOPNAME

Boarding Alighting Total Boarding Alighting Total

Domain 4,000 17,600 21,600 39,100 43,300 82,400

CBD South 12,300 48,400 60,700 108,300 116,400 224,600

CBD North 9,500 25,200 34,700 74,300 64,700 138,900

Parkville 3,700 17,100 20,800 40,900 45,400 86,400

Arden 1,700 9,500 11,200 23,400 25,100 48,500

Parliament 11,200 38,600 49,800 95,500 116,700 212,200

Melbourne Central 12,900 34,500 47,400 92,180 114,400 206,600

Flagstaff 7,400 25,100 32,500 51,400 64,300 115,600

Southern Cross 18,800 45,400 64,200 169,500 158,800 328,300

Flinders Street 36,300 68,200 104,500 226,800 188,300 415,100



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7.6 Land use impacts

7.6.1 Introduction

The increase in the capacity of the existing rail network and the creation of a metro system has the

potential to significantly reshape Melbourne in a number of ways, particularly when combined with

other, supporting interventions. Its scale creates the opportunity to influence Melbourne’s long-term

urban form (Figure 7-23) by:

� creating environments where higher density dwellings can be delivered via activity centres,

central activity areas (CAAs), other redevelopment sites along the rail corridor, underutilised

areas of inner Melbourne and areas around new and existing station sites;

� providing opportunities for new communities in growth areas to be anchored around high capacity

and high frequency public transport, providing access to a range of locations and activities within

the metropolitan area and region;

� improving accessibility to a range of existing and emerging activity and employment centres in the

south-east, north and west.

� broadening the activities which can be easily accessed by public transport, particularly for existing

and the substantial additional communities to be developed in Melbourne’s west and north.

� facilitating intense mixed use development with a focus on employment in North Melbourne

around the Arden station.



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Figure 7-23: City shaping impact of Melbourne Metro

7.6.2 Improved accessibility acting as a catalyst for significant redevelopment

Significant changes to accessibility have the capacity to act as a catalyst for significant redevelopment

activity within established areas. The development of a station or service level improvements in a

brown-field location can form an anchor for the redevelopment and revitalisation of a broad precinct.

Together with the creation of high amenity places and commercial exposure, the scale and nature of

land use achievable in an area (and therefore the benefit of the infrastructure investment) will be

maximised. The key elements of access, amenity and exposure are important principles in this

context.

Significant development opportunities in the Arden precinct arise from these accessibility, amenity

and exposure principles. These provide opportunities for the expansion of higher order employment

core, better access to jobs for those living in Melbourne’s west and north and for significant dwelling

development. It is estimated that this urban renewal precinct could support up to 25,000 jobs, 7000

dwellings and 12,000 students in the station catchment, as well as stimulating additional dwelling

development beyond the immediate station catchment.

Enhanced transport corridors stretching east-west across the city will bring about a change in the

perception of some places within the metropolitan network of activities and places, stimulating

additional opportunities for urban renewal.



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7.6.3 Linking jobs, activities and services to where people live

Enhancing connectivity to major centres of employment and mixed use activity centres will enable the

city to more sustainably accommodate population growth. Key activity centres outside Melbourne

CBD located along the metro lines are shown in Table 7-13 below. The creation of new

concentrations of employment, residential and other activities along metro corridors will further

enhance connectivity across the city. Providing an alternative to private transport to access a range

of services and facilities is particularly important in the context of climate change and the need for a

sustainable and efficient city.

Table 7-13: Key activity centres linked to MM

Sunshine – Domain Metro Sunshine to Dandenong Metro

Sydenham (Watergardens) Principal Activity Centre (PAC)

Sunshine PAC

Footscray Central Activities District (CAD)

Footscray Victoria University – Specialised Activity

Centre (SAC)

Parkville Medical and Bioscience SAC

St Kilda Rd including Alfred Medical Research and

Education SAC

Caulfield Major Activity Centre (MAC) including Monash University Campus

Clayton Monash University Health Research Precinct

SAC

Dandenong CAD

Cranbourne PAC

Sunshine Hospital, VU St Albans

Fountain Gate PAC, Berwick – Monash/TAFE/Casey

Hospital

Northern Loop Metro Cross-City & Frankston Loop

Metros

Broadmeadows CAD

Moonee Ponds PAC

Coburg PAC

Werribee PAC

Werribee Employment Precinct

Frankston CAD

7.6.4 Long-term city shaping

The increased level of accessibility delivered in the west and north by MM will make secondary areas

more attractive and feasible for development, particularly residential activity. For example, Sydenham

will be connected to education and employment opportunities at Parkville and it is therefore likely to

undergo a higher level of development. Whilst targeted urban renewal opportunities are an important

benefit of MM, it is also the case that the project will have benefits beyond immediate station

locations.

Recent work by DPCD has identified that the density of residential development is influenced by three

key elements:

� connectivity of the site, most distinctly that the access of a development site to public transport

services and accessibility to employment strongly influence development density

� context of the site, most distinctly that the density of development is influenced by the surrounding

density of the development site

� characteristics of the site including the shape of the lot.

The key implication of these findings is that higher public transport accessibility will result in a higher

density development outcome along the new metro corridors. Those locations where the other factors



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such as site context, shape of the lot and accessibility to jobs are present or are created should

experience further densification.

This work indicates that MM will result in increased capacity of areas to accommodate dwelling

development. The exact scale of this is difficult to determine. However, there is strong evidence that

MM will play a transformational role in providing a pipeline of housing supply opportunities, particularly

for higher density dwellings. In particular, higher service levels have the potential to create behaviour

changes as people respond to changes in accessibility to jobs education and other community

facilities and services. Such changes have the capacity to:

� shape activity on network, in terms of increasing the quantity and diversity of activities around the

fixed rail network

� shape central Melbourne, by facilitating the growth of the inner city towards the west.

Ultimately, this will ensure that Melbourne has a choice about its shape and structure, as it moves

from four to five million and beyond. A coordinated approach to maximising the benefits of these

opportunities will be required. This is particularly important given the increasing acknowledgement of

the need to provide for a settlement structure well beyond five million.



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8 Risk assessment

8.1 Risk assessment process

As part of the risk management process for the MM project, a comprehensive project risk assessment

has been conducted in accordance with AS/NZ 4360 Standard for Risk Management and the DOT

Project Risk Management Guidelines, 2009. A Risk Management Plan has been drafted for the MM

project, which sets out the context, frameworks and process for risk management of the project.

8.1.1 Objectives

The objectives of the risk assessment conducted for this business case were to:

1. Identify the assumptions underpinning the project scope

2. Identify and rate the risks to the MM project, relative to these assumptions

3. Identify proposed risk mitigation strategies and the residual (post mitigation) risk rating

4. Develop a risk register to permit the ongoing management and mitigation of risk through the

project life

5. Quantify a risk adjustment to the cost estimate to determine the overall estimated project cost.

8.1.2 Risk rating

Risks were assessed for their potential impact on five separate project consequences:

� Cost

� Schedule

� Project/Government Reputation

� Project Outcome or Benefit

� Safety

Conventions regarding the likelihood, consequence and overall risk ratings were sourced from the

DOT risk guidelines referenced above. MM project-specific risk rating scales were developed to

ensure consistent application of risk likelihoods and consequence ratings (see Table 8-1 and

Table 8-2).



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Table 8-1: MM Risk likelihood scales

Rating Descriptor Range of likelihood

probabilities

1 Rare <1%

2 Unlikely 1–10%

3 Possible 10–50%

4 Likely 50–80%

5 Almost Certain >80%

Table 8-2: MM Risk consequence scales

Rating Descriptor Cost impact Schedule

impact Reputation/

outcome impact Safety impact

1 Negligible <$500k Less than

a week Reputation intact. Internal knowledge only

Could result in first aid or minor supportive medical

treatment incident

2 Minor >$500k Less than a month

Minimum damage, immediate action taken to contain and redress issue

Media attention of local

concern

Could result in medical treatment or safety incident

3 Moderate >$5m 1–3

months

Moderate damage, required to be advised to Secretary

Limited media coverage

Could result in temporary partial disability or temporary total disability, hospitalisation or emergency medical

treatment

4 Major >$50m 3–6

months

Significant damage, requiring Ministerial and/or Secretarial involvement

Extensive and sustained

state media coverage

Could result in permanent partial disability or temporary total disability

5 Catastrophic >$500m 6–12

months

Irreparable Damage, Parliamentary inquiry.

Extremely adverse publicity,

national coverage

Could result in death or permanent total disability

The likelihood and consequence scores are combined, as shown in Table 8-3 below, to assign an

overall rating for each risk, which is a semi-qualitative assessment of the risk’s severity. This matrix is

slightly different to the DOT Project Risk Management Guidelines and has been developed specific to

this Project to align with the Rail Safety Accreditation requirements set out by Transport Safety

Victoria (TSV) for achieving “So Far as Is Reasonably Practicable” (SFAIRP).



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Table 8-3: Risk rating matrix

CONSEQUENCE

LIKELIHOOD

1

Negligible

2

Minor

3

Moderate

4

Major

5

Catastrophic

� 1 – Rare Low Low Low Medium Medium

� 2 – Unlikely Low Low Medium Medium High

� 3 – Possible Low Medium Medium High High

� 4 – Likely Low Medium High High Extreme

5 – Almost Certain Medium High High Extreme Extreme

8.1.3 Risk workshops

A series of risk workshops were conducted with the following project workstreams:

� Technical: Stations & Tunnelling

� Technical: Wider Network Works

� Commercial Project Delivery

� Arden Urban Renewal Precinct

� Land Use, Planning & Environment

� Patronage, Operations & Economics

� Transport Integration.

In these workshops the specific workstream assumptions were established, initial individual risk

ratings were assigned, appropriate mitigation strategies for each risk were identified and a residual

(post mitigation) risk rating was assessed. This information has been recorded in the MM Project Risk

Register which is attached at Appendix 3.

In addition, a series of concept development design workshops for the various technical sub-

workstreams were conducted by the Technical Advisor involving the Peer Reviewer and drawing on

input from the wider project team. This provided clarity around the scope assumptions for the project,

informed the risk workshops for the technical workstream and quantified cost impacts for technical

risks.

8.1.4 Management of change

A working group containing representatives from the operator (Metro Trains Melbourne, the

Accredited Rail Organisation), has been established to facilitate the Engineering Change,

Management of Change and Rail Safety Accreditation process for MM. This will ensure that the

requirements of Victorian Rail Safety legislation are included in the design, construction, testing,

commissioning and completion of MM and its components.



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Engineering Change refers to any configuration, maintenance or technical standard change applied

to MTM rolling stock and infrastructure operational assets. The Management of Change process

refers to the implementation of a systematic and structured process to ensure that all risks

associated with the change are identified, assessed, communicated and monitored and they are

eliminated or if not possible to be eliminated they are reduced to ‘so far as is reasonably practicable’

before the change can be implemented. It is a process for predicting, assessing and managing the

impacts of any type of change on an organisation and the safety of its activities.

The MM project risk register is therefore incremental to MTM’s risk register for the ongoing operation

of Melbourne’s rail system ie the risks are caused by the project.

8.2 Key risks

A full register of the project risks is attached as Appendix 3. A summary of the key risks that still have

a ‘high’ rating post mitigation at this stage of the project development, and the mitigating strategies,

are summarised in Table 8-4 below. The consequence categories impacted by each risk are shown.

Planning for the next phases of the project (including further development and procurement) has

focussed on mitigating these risks further.

Table 8-4: High-rated post-mitigation45

MM risks and mitigation strategies

Category46

Risk description Mitigation strategies S C P R O

Geotechnical Risks:

• Accuracy of geotechnical survey and adequacy of Tunnel Boring Machine (TBM) selection and construction

methodology

• Damage to nearby buildings and

structures due to ground settlement

• TBMs encounter and damage unknown/unsurveyed manmade structures (footings, piles, wells,

ground anchors etc)

• Volume of, and treatment/disposal of, contaminated soil and groundwater

• Latent ground conditions – areas of

high risk:

- Mined tunnels under Federation

Square

- Cut & cover tunnels through CBD

- River crossing (ITT or coffer dam)

- Western portal structure

- Crossing MURL

• Commission well-specified and targeted geotechnical survey; to inform design, TBM selection, spoil disposal strategy and risk sharing

between Owner and Contractor.

• Conduct condition survey of MURL and other structures to inform the design of protection works, TBM

selection and/or tunnel alignment.

• Rigorous monitoring regime of local

structures and community impact.

• Ensure approvals application accurately describes the impact of tunnelling processes and mitigation

measures proposed.

� � � �

45 At current stage of project 46 S=Safety, C=Cost, P=Program, R=Reputation, O=Outcome



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Category46


Community or other key stakeholders

raise objections during construction and

operation due to excessive noise and

vibration impacts.

• Rigorous monitoring regime of local structure and community impact.

• Accurate assessment to be made of sound and vibration effects; identify sensitive receptors/stakeholders. Physical treatments could include: sound enclosures; temporary accommodation for residents or while TBMs pass; restricted TBM operating

hours.

• Ensure approvals application accurately describes the impact of tunnelling processes and mitigation

measures proposed.

� �

Adverse impacts on transport

interfaces (road, rail, tram, cycle &

pedestrian) during construction,

particularly around the underground station

worksites and CBD tunnels along

Swanston St.

• Management Plans to be developed for each transport interface, which will include early engagement with key

stakeholders.

• Feasibility study underway on relocation of trams of Swanston St for

duration of construction.

• Public consultation through planning

approval process.

• Ensure approvals application accurately describes the impact on other transport modes and mitigation

measures proposed.

� � �

Construction work injuries. Works cause

injury to workers or public due to:

• An inexperienced contractor (poor OH&S management)

• Ground settlement (inadequacy of TBM) causes building/structure

collapse

• Flooding of tunnels or portals; or

• Inadequate design/construction of

temporary works results in collapse.

• Temporary works (TW) designs to be certified and independently checked. Contract to require that the TW designer has adequate levels of expertise/experience. TW designs to be accompanied by a design certificate and an independent checker's certificate.

• Develop and maintain Project Safety

Management Plan.

• Design to incorporate flood mitigation measures and backup pumping system. Entrance sill level placed above 1:1000 ARI Flood Levels. Provide backup pump system and dual power supplies during operations

and construction.

• The open face TBM to allow for probe drilling during excavation to check potential of intercepting significant

quantities of groundwater.

� � �



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Category46


Project Requirements/Completion Risk:

Inability to reach agreement with Rail

Operator (ARO) and Safety Regulator

regarding detailed functional and

operational specification of proposed

system.

Specific Issues:

• Capability of existing fleet to meet requirements (4% grade, platform

height, platform length)

• TSV Certification / Regulatory Acceptance

• Signalling Requirements

• Early and ongoing engagement with Franchisee for to input into, and sign-off on, design and performance requirements, to ensure an acceptable solution is delivered. Ongoing, Franchisee to be an active participant

in the Project.

• Regular interaction with Transport Safety Bureau.

• Conduct a formal Reliability, Availability, Maintainability and Safety (RAMS) assessment to determine appropriate requirements for the system, and include in contract

documentation.

• Technical review with existing rolling stock suppliers on operating

characteristics on 4% grade.

• Develop Safety Management Plan and Safety Case to set out accreditation process.

� � �

Work Packaging Interface and

Management Risk:

• Optimal procurement method is not selected;

• Inadequate DOT management of separate work packages and interdependent projects; or

• Poorly drafted contract documentation does not adequately identify interface

requirements.

• DOT to identify and acquire appropriate skills and resources for the project team.

• Interfaces between separate packages to be comprehensively identified and well defined, and reflected in the contract documentation.

• Interface management to commence early and be ongoing management. Through each stage of the Project. Project review brief to include

incompatibilities and inconsistencies.

• Further develop procurement and packaging strategy to identify interfaces and associated risks.

� � �

Market

Inability to support sufficient consortia/finance for multiple, competitive

bids, resulting in higher project costs.

Funding/delivery model design does not cater for market appetite and industrial

climate.

• Invite/persuade appropriately experienced international contractors to bid, encourage. Encourage collaboration between international

and local industries.

• Consider alternative delivery options to reduce private funding requirements and retain core package whole to

minimise interfaces.

� �



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Category46


Inter-dependent projects identified as

critical to MM operation, (Rolling stock

procurement, RRL and other rail upgrades)

are not delivered on time or do not function

as expected, requiring additional

infrastructure, or leading to an inability to

achieve the expected level of service.

• Key interdependent projects need to be included in project schedule.

• Regular communication with other project leaders to identify and address

slippage and/or scope gaps.

• Business Case needs to clearly state MM's dependence on these projects.

� � � �

Planning approvals process delayed as

a result of scope/process uncertainty,

including:

• Extent of Land Acquisition

• Resolution of contaminated soil and groundwater treatment and disposal

• River crossing impacts

• CBD construction impacts

• Uncertainty around MM scope, tunnel/station alignment, MM tunnel

extension alignment.

• Public Activities

• Commercial developments in corridor

• Engage planning consultancy.

• Commission geotechnical survey.

• Continuing resolution of project scope and process requirements for Project

and P&E Approvals Strategy.

• Maintain dialogue with other agencies (eg LMA, DPCD) and relevant Ministers.

• Consider additional strata title buffer

around tunnel/station alignment.

• Fact sheets to be produced as part of

Planning approval process

• Construction planning will take account of need to mitigate impact to businesses and commercial

operations.

• Decouple approvals process from critical path of delivery program.

�

Industrial Relations: Delays due to

industrial disputes during construction,

delays in access agreements for work on

live corridor, or delays/difficulty in

achieving acceptance of new

technologies/standards

• Early discussions/engagement with unions and other relevant

stakeholders.

• Integration of relevant stakeholders to the governance and management

decision making process.

• Tenderers’ record on industrial relations to be a criterion during tender evaluation.

� �

Resourcing Risk:

Project fails to attract or retain

key/experienced professional services

personnel on the Project team.

• Recruitment strategy to be finalised

• Review opportunity to package work

and engage private sector

• Performance requirements in Project Director’s KPIs to attract and retain

key staff

� �



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Category46


Design Development/Scope Creep:

• High alignment concept design not subjected to same level of rigour as

low alignment option

• RAMS assessments may add scope

• Tunnel alignment envelope may change

• Development of Reference Design.

• Design to agreed budget. Engagement of experienced cost planners during

next phase of development.

�

Land Acquisition

Delays in corridor protection requiring

additional work on alignment to avoid

constraints that emerge on proposed

alignment

• Clear and comprehensive documentation to support Government decision making.

• Define acquisition envelope and develop a clear set of communication

plans.

�

Construction

Failure of major equipment on critical path

(eg TBM) during construction.

• Engagement of competent contractors.

• Ensure only proven equipment suppliers are used.

Ensure adequate mitigation plans are

developed by Contractor and are in place.

� �

8.3 Risk modelling

The budgeting and capital approval process for construction and infrastructure projects requires the

total outturn cost of the works to be identified at an early point in the project lifecycle. The unknown

scope and cost elements in the initial budget relate to risk and opportunity items and present

uncertainty in the final project delivery cost when the budget estimate is being formulated.

The development of a risk-adjusted cost estimate for infrastructure projects using the probabilistic

risk-based estimating process includes the following components:

� Base estimate: this is the best estimate of the cost for the known scope of work that is quantified

and included in the business case.

� Inherent risk: this is the uncertainty in the scope, quantities or unit cost rates for individual line

items in the base estimate. This is particularly important where assumptions have been made in

regard to scope, size, material, etc, required for the project. Often these risks relate to productivity

and quantification variance.

� Contingent risk: this category includes modelling of cost imposts that may arise if the

assumptions underlying the base estimate do not prove to be valid or constant, or the occurrence

of an unforseen event. The MM Project Risk Register has been used as the basis to identify the

major contingent risks, their likelihood and impact on the project cost.

Collaborative workshops were held to establish a minimum, most likely and maximum cost impact and

probability distribution for each inherent and contingent risk. In cases where the major consequence

of a risk is on the delivery schedule, the cost of any estimated delay was inserted into the cost model

to gain a complete view of the cost implications. The @Risk software application was then used to



Page 219 of 321

perform a ‘Monte Carlo’ simulation, which provides a quantitative analysis of the inherent risk and

contingent risk. The inherent and contingent risk @Risk model inputs used to derive the contingency

figure are attached in Appendix 4.

These risk profiles have enabled the development of a risk contingency for the total project cost. The

project cost breakdown, including the above risk allowances, can be found in the next section.

8.4 Operational risk management

Once the project moves into the delivery phases an ongoing process of risk management will be

required to monitor, assess and review the status of project risks and the effectiveness of their

mitigation strategies. The risk register developed for this business case has established a framework

in keeping with the DOT risk guidelines to facilitate risk management for the duration of the project,

and to enable the current status of each risk’s rating to be determined.

In recognition of the variety of delivery strategies and work packaging configurations available to the

project team, the risks in the register have also been categorised, where possible, by scope. This will

allow individual risks to be grouped to establish different risk profiles for separate work packages,

providing a basis for informing the determination a Public Sector Comparator (assuming a PPP

delivery model) and assisting with contractual risk transfer during the procurement phase.



Page 220 of 321

9 Project cost

9.1 Overview

A breakdown of the costs of the preferred MM scope is summarised in Table 9-1 below. This includes

the tunnels and stations, surface works, land acquisition and the Arden precinct.47

More detail is

included in Appendix 4.

The initial estimated cost of the refined MM project scope is $7–7.5 billion (real, 2010/11 dollars,

reflecting the most likely and upper bound risk contingency allowances respectively at this stage of

the project). This includes an overall contingency of 28 per cent relating to the significant risks that

remain. It excludes rolling stock and related costs.

A comprehensive and robust process has been followed to develop a cost estimate of the refined

technical concept, taking into account the level of risks and uncertainties that remain at this stage of

project development. The cost estimates were established from first principles with a probabilistic

analysis using a Monte Carlo simulation, considering both planned (inherent) and unplanned

(contingent) risks for the project to determine a probabilistic range of costs.

The proposed detailed development to be undertaken in the next phase will continue to implement the

risk mitigation actions identified, undertake further value engineering and assess the opportunities.

This is expected to improve cost certainty.

47 Procurement of rolling stock is interdependent to MM, which includes rolling stock itself and enabling infrastructure such as stabling, surface power and overhead upgrades. It is the subject of a separate business case and so is not included in the capital cost of the project. It is included in the economic analysis however.



Page 221 of 321

Table 9-1: MM (Day 1) capital cost summary48

(real, 2010/11, $m)

Scope component Cost ($m)

Rail

Wider network surface works – Direct costs 279.0

Wider network – Site overheads and preliminaries 85.1

Underground works – Direct costs

– Western Portal 170.6

– Western driven tunnel: Western Portal to CBD North 389.6

– Cut & cover tunnel: CBD North to CBD South 341.8

– Eastern driven tunnel: CBD South to Eastern Portal 350.7

– Arden Station 179.2

– Parkville Station 232.7

– CBD North Station 291.8

– CBD South Station 344.7

– Domain Station 278.8

– Eastern Portal 123.7

– Signalling, Communications & Power 176.1

Underground works – Site overheads & preliminaries 588.8

Total Construction Costs – Rail 3,832.7

Design 282.0

Corporate Overheads & Profit 411.4

Total Design & Construction Cost – Rail 4,526.1

DOT Delivery Costs 442.1

Total Delivery Cost – Rail (excl. risk) (1) 4,968.2

Arden Urban Renewal Precinct (Arden)

– Boulevard Construction 129.4

– Soil Contamination & Flood Mitigation 125.7

– Other Works & Project Management 71.0

– Land Acquisition (Arden) 122.2

48 Values have been rounded.



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Scope component Cost ($m)

Total Delivery Cost – Arden (excl. risk) (2) 448.4

Land Acquisition – Rail49

324.9

On-costs associated with Land Acquisition 81.2

Total Cost- Land Acquisition (Rail) (excl. risk) (3) 406.2

Total MM Project Cost (excl. risk) (1) + (2) + (3) 5,822.7

Most Likely

(P50)

Worst Case

(P90)

Total Contingency50

on (1) – Rail 782.1 (16%) 1,346.3 (27%)

Total Contingency on (2) – Arden 107.6 (24%) 148.0 (33%)

Total Contingency on (3) – Land Acquisition (Rail) 69.0 (17%) 145.6 (36%)

Total MM Contingency 958.8 (16%) 1,639.9 (28%)

DOT Levies (2.5% of State contribution, assumed 25%) 42.4 46.6

Total MM Project Cost (Real, 2010, $m) 6,823.8 7,509.2

The above table expresses the costs of each component in direct cost terms. The total outturn costs

for each component – that is, inclusive of all indirect costs, corporate overheads and margin, delivery

costs and contingency – is shown in Table 9-2.

49 This figure does not include acquisition of the VicTrack site around Arden Station, estimated value $90m. It does include business disruption costs associated with occupation of this site during construction. 50 Total contingency includes allowance for inherent (planned) and contingent (unplanned) risks.



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Table 9-2: MM (Day 1) estimated outturn costs by component, P90 (real, 2010/11, $m)

Scope Component P90 Cost

($m)

Wider Network (Surface Works) 557.7

Underground works

– Western Portal 341.0

– Western driven tunnel: Western Portal to CBD North 778.9

– Cut & cover tunnel: CBD North to CBD South 683.2

– Eastern driven tunnel: CBD South to Eastern Portal 701.0

– Arden Station 358.2

– Parkville Station 465.3

– CBD North Station 583.4

– CBD South Station 689.1

– Domain Station 557.3

– Eastern Portal 247.3

– Signalling, Communications & Power 352.1

Land Acquisition - Rail Works 551.8

Subtotal MM Rail Works (including Land) 6,866.3

Arden Urban Renewal Precinct (including Land) 596.3

DOT levies 46.6

MM Total Project Cost (real, 2010, $m) 7,509.2

9.2 Cost estimate methodology

9.2.1 MM construction cost estimate

The initial costs presented above are for the preferred scope as previously outlined in this business

case, reflecting the minimum requirements to deliver the initial Day 1 service plan requirements of

MM, and incorporate recent value engineering investigations on the concept design. The estimate has

been developed by the technical advisor from first principles and assumes a D&C construction

delivery model – allowance has been made in DOT management costs for delivery of the project as a

PPP.

A peer review of the full scheme estimate was commissioned, as outlined in section 5.2. The major

findings of the Peer Review Team with respect to the project cost estimate developed by the

Technical Advisor were that direct costs are appropriate for the level of concept development, and

that indirect costs, design, corporate overheads and profit margins were optimistic.



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A risk-based analysis of overheads and profit margins has been applied to address comments related

to indirect costs from the PRT. This has given consideration to the likely delivery strategy for the

project as a PPP, and key risks and influences relating to project overheads:

� Regulatory environment of the Victorian construction industry;

� Design complexity and potential difficulties in obtaining rail operator acceptance;

� Complex nature of commissioning;

� Aversion to financial penalties;

� Liquidated damages environment; and

� Increased profit margins to allow for the likely level of risk borne by contractors.

9.2.2 DOT delivery costs

The next project phase will include further multidisciplinary investigations and development of the

design and tender documentation to prepare the project for the market, as well as oversight and

management of the project by the DOT project team. Provisions have been made for engagement

and cooperation of the major transport network authorities: Metro Trains Melbourne, Yarra Trams,

and VicRoads.

A provisional allowance has been allocated for headworks charges related to the increased utilities

requirements (mainly power) of the project. This allowance is considered an appropriate order of

magnitude, however further investigation will be required to provide more clarity on these

requirements.

The total provision of $442m for DOT costs amounts to approximately 10% of the contractor’s Design

and Construction costs.

9.2.3 Arden Urban Renewal Precinct

Indicative estimated costs for the Arden urban renewal precinct preferred option (option 2) were

developed separately by DPCD for the purposes of options analysis, and a detailed breakdown of

these costs is presented in Appendix 4. It is acknowledged that more development is required to

further define the scope and develop a robust cost estimate suitable for an implementation budget.

This will be a key focus of the next project phase.

9.2.4 Land acquisition

Land acquisition requirements for the MM rail works were identified by the technical advisor, and

requirements for the Arden development were identified by DPCD. A comprehensive valuation

exercise has been conducted with the Valuer General, as previously described in section 5, and a

detailed breakdown of the estimated land acquisition costs is shown in Appendix 4.

9.2.5 Cost-risk profile and contingency

As outlined previously in the risk section, a probabilistic analysis (monte-carlo simulation) was

conducted in accordance with the standard defined in the Nation Building Program (National Land

Transport) Act 200951

(cost estimation standard), incorporating inherent and contingent risks for the

project. Separate risk models were developed to derive individual contingency values for the rail costs

51

Best Practice Cost Estimation for Publicly Funded Road and Rail Construction, Evans & Peck, 2008



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(stations and tunnels), Arden Development and land acquisition, due to the different risk profiles and

different levels of development of these components.

Two confidence levels have been selected to derive contingency figures for an upper (P90) and lower

(P50) bound for the total project cost as shown in Table 9-3 below, along with the expected range as

defined in the cost estimation standard for a project at ‘concept’ phase of development. The P50

contingency is above the expected range and the P90 contingency is within the expected range.

Table 9-3: MM contingencies and expected ranges

Confidence level Total MM contingency Expected range

P50 (Best Case) $958.8m (16%) 10–15%

P90 (Worst Case) $1,639.9m (28%) 25–40%

Development of the MM contingency has accounted for the following influences:

� Project scope definition: The MM scope has been clearly defined and clarified through the

business case. The scope is primarily greenfield, consisting of underground stations and tunnels

around which there is a high level of confidence. Surface works and integration with the wider

network, including signalling, is a small part (less than 10%) of the MM project scope. The effort

expended in defining the boundaries of scope and hence scope definition has given confidence in

the rigour of the inclusions in the scope of the project. Allocation of certain scope items to other

projects such as HCMT and resolution of common sources of scope creep on transport projects

(eg DDA on wider network, grade separations) has been explicit and robust.

� Level of design and conservatism of base estimate: The nature of the project has in turn

enabled the technical advisor to produce an inherently conservative concept design for the works.

It therefore follows that the base cost estimate includes significant conservatism and this has

been confirmed through an independent benchmarking study on station costs52

.

9.2.6 Value engineering

The design development for MM is a continuous process of seeking to refine the design to reduce

costs whilst maintaining or increasing functionality and meeting the overall project objectives as set

out in this business case. By definition, value engineering does not fundamentally change the

functionality and overall value delivered by the project.

An eminent panel of experts has peer reviewed the technical concept, including the risks and costs,

and identified a number of value engineering opportunities which have been investigated for feasibility

and costing. These are reflected in the above initial estimate, which continues to be refined as part of

the value engineering studies. These include MM1 extension feasibility study, rail operations

refinements, assessment of the higher tunnel alignment, cost benchmarking, detailed constructability

assessments, CBD station sizing and interchange design and rail safety and systems assurance

studies. In particular, a higher tunnel alignment has been adopted through the city, which changes

the tunnel and CBD station construction techniques, and reduces the overall cost. A simpler and more

effective interchange with Flinders Street Station has also been included. Additional value engineering

52 Turner & Townsend, February 2011



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opportunities have also been identified within the project scope, and will continue to be investigated

throughout the next project phase.

The considerably more cost-effective “short” tunnel extension of MM1 along Toorak Road joining the

Dandenong rail corridor at South Yarra makes the MM2 default “long” tunnel from Domain to Caulfield

along Dandenong Road redundant. Recent assessment by the project team of the relative costs of

extending MM1 via the short and (default) long tunnel schemes indicates a considerable difference of

at least $2.5 billion.

The proposed detailed development to be undertaken in the next phase will continue to implement the

risk mitigation actions identified, undertake further value engineering and assess the opportunities.

This is expected to improve cost certainty.

9.2.7 DOT levies

Given the size of this project, DOT Corporate Finance has advised an allowance of approximately $40

million for DOT levies on this project. This levy is used to fund ongoing project development of the

portfolio’s pipeline of projects.



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10 Economic assessment

10.1 Overview

This section details the methodology used and the results of the economic assessment of MM. It sets

the framework and details all elements of the economic methodology used to undertake a whole-of-

life assessment of MM. Outlined are the key economic outcomes, methodological assumptions and

data sources used in calculating the suite of economic costs and benefits related to this project.

The economic benefit streams identified as part of this analysis closely align with the overall project

objectives, providing rail capacity and allowing a significant increase in public transport trips on the

metropolitan rail network that otherwise would have to be taken by alternative modes, in particular

road. In addition to the transport-related benefits the project provides important opportunities for

urban redevelopment, leading to urban consolidation benefits and a stream of wider economic

benefits (WEBs).

The economic evaluation considers all of the costs necessary to deliver the whole-of-life project

outcomes including:

� MM project scope (Day 1)

> rail tunnels from South Kensington to South Yarra

> new underground rail stations at Arden, Parkville, CBD North, CBD South and Domain

> surface works to accommodate 14 additional services on the Northern Group and 3 additional

services on the Caulfield Group

> platform lengthening on Sunbury to Footscray to accommodate longer trains.

> Arden Urban Renewal Precinct

> operations, maintenance and renewal of all infrastructure.

� Rolling Stock (critically interdependent project):

> new rolling stock to operate all additional services planned

> stabling yards at Calder Park to stable, service and maintain the additional rolling stock, plus

stabling at North Melbourne to facilitate operating strategies

> power and overhead line upgrades associated with additional train services

� Part of ultimate MM project (included in economic analysis but not part of MM Day 1 scope):

> Dandenong Rail Capacity Program

> Upgrading Regional Passenger Lines (Melton-Ballarat and Bendigo lines) – assumed for the

purposes of this economic analysis to be part of ultimate MM scheme.

� Project benefits have been categorised into:

> transport related benefits quantified in accordance with the Australian Transport Council

(ATC) Guidelines and Victorian Department of Transport (DOT) Guidelines where appropriate

> WEBs, including labour productivity improvements and urban consolidation benefits due to

the large-scale and city-shaping nature of the project.



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Various economic assessments have been prepared for MM since the project was originally proposed

in the EWLNA in 2008. This business case presents the most recent assessments undertaken for

both MM1 and full MM scheme in the 2010 business case. A new economic assessment will be

prepared for the "implementation" business case. The Implementation Business Case will provide an

update incorporating the latest thinking in the Metropolitan Planning Strategy (MPS) and a refined

project scope and cost (reflecting, for example, refinements from the statutory planning process). The

following provides a brief summary of the development of the economic assessment.

The EWLNA demonstrated that the full MM scheme delivered a positive economic outcome. A

subsequent economic assessment of MM was undertaken by the DOT as part of Victoria’s

submission to Infrastructure Australia (October 2008). The original analysis with the indicative cost

estimates resulted in a cost benefit ratio of 1.8 and a Net Present Value of $1.7 billion. The majority

of benefits were derived from decongestion (33%), benefits to existing and new public transport users

(collectively 26%) and WEBs (25%).

For the purposes of the route and station options assessment (March 2010) an incremental evaluation

was undertaken of various deviations from the default scheme. For example, with the addition of

Arden Station to the default scheme, at an incremental real cost of $110 million, an additional

economic benefit of urban consolidation of $300 million (NPV) was estimated, indicating a positive

variation to the project. Options were considered for adoption (or rejection) based largely on their

incremental contribution to overall benefit of the scheme with some consideration given to other

factors.

An updated assessment of the full (or ultimate) MM scheme was then completed for the 2010 MM1

Pre-Construction Business Case. This update included comprehensive modelling of travel demand,

user behaviour, Arden urban renewal project development, scope, risk and cost estimates. This full

scheme included the upgrade of the Dandenong corridor (to operate 9 car trains) and electrification to

Melton (now nominated as part of Upgrading Regional Passenger Lines project). There has been no

material change to the full MM scheme and therefore this original assessment remains valid (subject

to the comments below).

The second assessment was undertaken based on completion of the MM1 project on a "stand alone"

basis. This demonstrated that the first stage of the project (as envisaged by the EWLNA) produced a

positive economic outcome without the completion of any subsequent stages. A new assessment of

the revised MM project on a "stand alone" basis will be required to take account of changes to the

project since the 2010 assessment. The key changes compared to the 2010 MM1 scheme include:

� Capital ( day 1 project) cost increased by approximately 16% reflecting the tunnel extension and

additional portal and additional surface works; and

� Additional benefits due to the 21% increase in additional services being provided on the

Frankston and Sandringham lines as a result of the new through connection.

� Further capacity uplift is provided from the proposed platform extensions on the Sunbury line

(equivalent to eight 6-car services in the peak hour) if the DRC Program is completed prior to MM.

Alternatively these costs and benefits could be removed from the MM scope and assigned to the

DRC program.

Overall it is expected therefore that a stand-alone assessment of the latest scheme will show a higher

BCR and NPV than the original MM1 assessment.

A number of the underlying assumptions required for the economic assessment are under review as

part of the current MPS revising many of Melbourne's medium to long term planning directions. The



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update of travel demand forecasts that underpin the economic assessment is dependent on a number

of key assumptions including

� Population forecasts - the 2010 assessment was based on forecasts in Victoria in Future 2008.

(VIF2008) These forecasts are currently being reviewed and updated in the context of the MPS.

Draft forecasts have been prepared (VIF2011) but it is expected that final forecasts will not be

released until 2012.

� Employment forecasts - the 2010 assessment used employment forecasts based on VIF2008.

These forecasts are also subject to review. Recent employment trends suggest that inner

Melbourne employment has grown more rapidly and is likely to grow more strongly than

previously envisaged. The employment forecasts will be updated once the population forecasts

have been released.

� Transport Network Priorities - the 2010 assessment reflected underlying network assumptions

consistent with the transport policies and priorities at that time. The current government has a

number of planning studies underway and a detailed submission currently with Infrastructure

Australia that will directly affect the ultimate configuration of MM. For example, the timing of

delivery of initiatives in the DRC Program influences the MM scope. Some resolution of these

priorities is needed to resolve the assumed base case and whole of life scenarios.

It is therefore proposed to update the economic assessment once these underlying assumptions have

been resolved. Based on the information currently available the project team is not aware of any

major changes arising from the MPS that is likely to materially change the case for MM.

In a ‘city shaping’ project of this type the choice of discount rate is critical and the inclusion of

agglomeration benefits is important to align the assessment of the project with the strategic intent

established by current policy.

The evaluation of the ultimate MM project shows it is economically positive, with a BCR ranging

between 1.6 and 1.8 and an NPV of $5.6 to $6.5 billion including Wider Economic Benefits

(agglomeration) at a discount rate of 7%53

.

The results of the full MM scheme and MM1 are summarised in Table 10-1, which shows the results

for both the traditional transport benefits and the wider economic benefits (WEBs) and uses an upper

and lower range of project capital costs.

The MM1 scheme (ie terminating at Domain with no connection to the Dandenong rail corridor), has a

BCR of 1.5 to 1.7, indicating the economic merit of both extending MM1 and of the MM Day 1

scheme.

53 The lower range of the BCR and NPV results is based on the P90 costs, while the upper range is based on the P50 costs



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Table 10-1: Economic results - Ultimate MM Scheme and MM1 (7% discount rate)

$ 7,699 - 8,515 (1) 94% $ 4,074 - 4,449 (1) 94%

502.3$ (2) 6% 284$ (2) 6%

$8,201 - 9,017 100% $ 4,353 - 4,732 100%

1,703$ 12% 569$ 8%

517$ 4% 153$ 2%

4,177$ 29% 1,765$ 24%

21$ 0% 13$ 0%

95$ 1% 38$ 1%

541$ 4% 178$ 2%

0$ 0% 0$ 0%

277$ 2% 123$ 2%

7,330$ (3) 50% 2,839$ (3) 39%

1,319$ 9% 785$ 11%

233$ 2% 76$ 1%

197$ 1% 88$ 1%

1,748$ (4) 12% 949$ (4) 13%

2,467$ (5) 17% 1,447$ (5) 20%

11,546$ 79% 5,235$ 72%

326$ (6) 2% 276$ (6) 4%

11,872$ 81% 5,511$ 76%

11,872$ (7) = (3) + (4) + (5) + (6) 5,511$ (7) = (3) + (4) + (5) + (6)

$ 8,201 - 9,017 $ 4,353 - 4,732

$ 2,855 - 3,671 $ 779 - 1,158

1.3 - 1.4 1.2 - 1.3

176$ 1% 176$ 2%

2,603$ 18% 1,582$ 22%

28$ 0% 28$ 0%

2,807$ (8) 19% 1,786$ (8) 24%

14,678$ 100% 7,296$ 100%

14,678$ 7,296$

$ 8,201 - 9,017 $ 4,353 - 4,732

$ 5,661 - 6,477 $ 2,564 - 2,943

1.6 - 1.8 1.5 - 1.7

(9) = (7) + (8)

Wider Economic Benefits (Arden)

BCR BCR

NPV NPV

PV Costs (1) + (2) PV Costs (1) + (2)

PV Benefits PV Benefits (9) = (7) + (8)

Total Non-Transport Benefits Total Non-Transport Benefits

Total MM Benefits Total MM1 Benefits

Wider Economic Benefits (MM) Wider Economic Benefits (MM1)

Wider Economic Benefits (Arden)

Urban Consolidation Urban Consolidation

BCR BCR

(1) + (2)

NPV NPV

PV Benefits PV Benefits

PV Costs (1) + (2) PV Costs

Total Ultimate MM Transport Benefits Total MM1 Transport Benefits

Total Ultimate MM Traditional Benefits Total MM1 Traditional Benefits

Arden Transport Benefits Arden Transport Benefits

Total Externalities Total Externalities

Residual Value Residual Value

Accidents Accidents

Environmental Environmental

Decongestion Decongestion

Fare Resource Cost Correction Fare Resource Cost Correction

Total User Benefits Total User Benefits

VOC Resource Correction VOC Resource Correction

Parking Resource Cost Correction Parking Resource Cost Correction

Reliability Reliability

Health Benefits of Walking Health Benefits of Walking

New PT User Benefits New PT User Benefits

Reduced Crowding (existing) Reduced Crowding (existing users)

Existing PT User Benefits Existing PT User Benefits

Operating Costs Operating Costs

Total Costs Total Costs

ECONOMIC PERFORMANCE SUMMARY (present values 2010, $million)

Ultimate MM Scheme MM1 only

Capital Costs Capital Costs



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10.2 Key assumptions and parameters

The economic evaluation has been undertaken in accordance with the ATC guidelines, supplemented

by the Victorian DOT Guidelines as appropriate to determine transport-related benefit streams. Non-

transport related benefits have been quantified using relevant international experiences as well as

leveraging off the work done as part of the EWLNA. The evaluation incorporates all project benefits

and costs which are incremental to the base case, over a 30-year evaluation period. The key

evaluation assumptions/parameters are:

� Evaluation period – The evaluation period is 30 years plus the construction period, in

accordance with Infrastructure Australia guidelines. Construction is assumed to start in 2011 with

operation commencing in 2020 when the transport related benefits are assumed to commence54

.

� Base year – All monetary values have been estimated in, or adjusted to June 2010 prices.

� Discount rate – In accordance with Infrastructure Australia guidelines, a real discount rate of 7%

has been used, and subjected to the recommended sensitivities of 4% and 10%. A sensitivity test

has also been conducted using the Victorian specific real discount rate of 5.5% as this is the rate

deemed most reflective of Victorian economic conditions (Victorian Government recommended

rate). It should also be noted that Her Majesty’s Treasury (United Kingdom) have produced

guidelines for appraisal and evaluation that recommend a discount rate of 3.5%55

. The UK

appraisal guidelines recognise that for long life city-shaping infrastructure, the full benefits of the

project are not realised for many decades after construction, implying a lower discount rate is

appropriate for MM. The guidelines recommend a reduced rate beyond the 30th year of the

evaluation (3% for years 31–75 and 2.5% for years 75–100) when evaluating projects with a long

asset life such as the MM project.

� Annualisation factor (conversion of daily patronage numbers and benefits to an annual figure) –

An annualisation factor of 287 has been selected. Recent DOT information has indicated that

annual rail patronage is approximately 287 times the ‘equivalent normal weekday’, based on the

current relative levels of activity on normal weekdays, school holiday weekdays, Saturdays,

Sundays and public holidays. The number of equivalent weekdays can and does vary slightly

year to year depending on the movement of Easter, school and public holidays.

� Value of time – The value of time is measured in accordance with the DOT Guidelines ($11.49

per hour in June 2006) and indexed by CPI to determine the June 2010 value ($12.76 per hour).

10.3 Costs

The capital cost estimates used in this economic appraisal are the incremental costs incurred in

delivering and commissioning the infrastructure and rolling stock required for the ultimate MM scheme

over the next thirty years. Costs include:

� Melbourne Metro tunnels and stations

� Wider network surface rail works to facilitate the service plan, including indicative costs for Melton

and Dandenong rail corridor upgrades

54 The assessment of this project has assumed construction is complete and operations commence by 2020, based on expected delivery program and funding availability. 55 http://www.hm-treasury.gov.uk/d/green book_complete.pdf



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� Platform extensions

� Rolling Stock purchase and refurbishment*

� Stabling and maintenance facilities*

� Power and overhead line equipment upgrades on the wider network to facilitate service plan*

� Station refurbishment.

* part of Rolling Stock Procurement project

The total estimated capital costs over the thirty year period are $10.5 - $11.7 billion (real 2010). The

capital costs used in the economic evaluation do not include land acquisition costs and subsequently

do not include the benefits associated with uplift in land value over time. These costs are based on

the 2010 estimates of the ultimate MM scheme. They do not include the value engineering

undertaken during 2011.

Train operating and maintenance cost estimates used in this economic appraisal are the incremental

costs incurred in providing, operating and maintaining the rolling stock required for the ultimate MM

project over thirty years. All operating costs associated with the implementation of MM are estimated

based on the current franchise agreement. The cost estimates are summarised in Table 10-2 below.

Table 10-2: Ultimate MM scheme - Operating and maintenance cost assumptions (real 2010 $)

Cost element Description Annual Cost

Rolling stock Incremental costs incurred in providing, operating and maintaining the rolling stock required

$27.4m (2020) – $53.3m (2049)

New Stations Incremental costs incurred in operating and maintaining the five new underground stations

$15.9m

Track Infrastructure incremental costs incurred in operating and maintaining the new below-rail infrastructure

constructed

$11.5m

10.4 Transport benefits and network impacts

10.4.1 Transport benefits

The ATC and DOT guidelines outline a suite of benefits to be considered when evaluating transport

projects. These fall into a number of major categories:

� Public transport user benefits:

> in-vehicle, mode transfer and waiting time savings for existing and new public transport users

> reduced crowding for existing and new public transport users

> health benefits of walking and cycling for new public transport users

� Resource cost corrections (financial transfers that are misperceived as economic costs)

> vehicle operating costs

> avoided parking costs

> fares



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� Externalities (benefits that accrue to the wider community as a result of diverted trips):

> reduced road congestion

> reduced vehicle accidents

> reduced environmental and noise impacts

� Residual Value (value of the infrastructure asset beyond the 30-year evaluation period).

The transport-based benefits have been derived from the results of the strategic network ‘four-step

demand model’ - refer section 7.5. Key transport network performance results derived from the Zenith

public transport demand model (see patronage working paper for further details) are also summarised

in this section. These results underpin the derivation of the transport economic benefits.

The methodology for calculating each of the benefit streams is outlined in the following sections. A

more detailed description of the economic assessment undertaken is available in a DOT working

paper56

and the detailed discounted cash-flow analysis is included in Appendix 5.

10.5 User benefits

User benefits and dis-benefits (herein referred to as user benefits) are calculated by estimating the

change in Consumer Surplus for all users of the transport system. Consumer surplus is defined by the

Australian Transport Council (ATC) as “the surplus of consumers’ willingness-to-pay over and above

what they actually pay for a given quantity of a good or service.”57

Given this definition, user benefits

are equal to the total change in consumer surplus. The sections below describe the existing and new

user benefits by component of public transport journey.

10.5.1 Existing user benefits

Total journey travel time savings are categorised into discrete parts of the overall public transport

journey:

� In-vehicle time savings – The change in travel time due to service changes. The change in

in-vehicle time (IVT) is calculated within the patronage model and multiplied by the value of time

(VOT).

� Transfer and access penalty savings – The transfer and access penalties represent user

preferences which are not explicitly measured by variables in the patronage model. Access

penalties typically reflect preferences towards certain public transport modes due to their

perceived reliability, safety, comfort, etc. Transfer penalties are included to reflect the disutility

that most users associate with interchanging, over and above the measured travel time. The

transfer and access penalties are calculated within the patronage model and multiplied by the

value of time (VOT).

� Wait time savings – The reduction in wait time due to greater service frequency. The change in

wait time is calculated within the patronage model and multiplied by the VOT and a weighting of

1.4 times the value of IVT as passengers value time spent waiting for the service higher than time

spent in vehicle (ATC guidelines).

56 MM Economic Evaluation Report 57 ATC National Guidelines for Transport System Management in Australia, Volume 5



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� Walk transfer time savings – The change in transfer time (within or between modes) due to

service changes. The change in transfer time is calculated within the patronage model and

multiplied by the VOT and a weighting of 2.0 times the value of IVT as passengers value time

spent transferring between services at twice that of time spent in vehicle (ATC guidelines). For

this project there is a slight increase in walk transfer time and this is therefore included as a

disbenefit.

� Access and egress time savings – The aggregate change in walk and car access and egress

time. The change in access/egress time is calculated within the patronage model and multiplied

by the VOT and a weighting of 1.4 times the value of IVT as passengers value time spent

accessing the service and reaching their final destination upon disembarking at 1.4 that of time

spent in vehicle (ATC guidelines).

� Reduced crowding – Crowding, or crowded IVT, valuation reflects the discomfort passengers

feel from travelling in varying levels of crowded conditions. As crowding levels increase to crush

capacity, the valuation of crowding in IVT minutes also increases. The crowding benefits have

been derived using the prescribed value of time for each level of crowding according to the ATC

guidelines. The ATC guidelines are silent on the value of in-vehicle time to be applied in

conditions beyond crush capacity. This analysis has assumed that the value of IVT continues to

increase beyond crush capacity. It was noted that the application of the ATC guidelines resulted

in train loads in excess of crush capacity which suggests the guidelines undervalue the impact of

commuting in crowded conditions. This results in a high estimate of crowding benefits but a low

decongestion benefit due to the smaller diversion of passengers to car. Further analysis will be

undertaken to develop more realistic modelling assumptions.

� Rail network reliability benefits – Public transport users not only value travel time savings but

also improvements in the reliability of travel times. Where there is significant variability in journey

times, transport users may be required to allow more time for the journey to reduce the probability

of arriving late at their destination. If this variability in travel time is reduced, then transport users

benefit from being able to reduce the extra time allowance. Reliability improvements have been

quantified and converted to an equivalent IVT saving that is then multiplied by three in

accordance with ATC guidelines to reflect the value of unexpected wait time that occurs in

unreliable travelling conditions.

10.5.2 New user benefits

New users were computed as a result of additional services/capacity provided by the project; the ‘rule

of a half’ convention is applied to calculate new users’ consumer surplus based on the above-

mentioned methodology for existing users, as per ATC Guidelines.

Transport systems and urban form are also increasingly recognised as a factor influencing public

health outcomes, and in particular it is considered that car-dependency has led to the creation of

obesogenic environments (an environment which promotes gaining weight and is not conducive to

losing weight).

By increasing the attractiveness of rail travel as an alternative to car travel, people are more likely to

engage in incidental exercise when travelling to stations. This is likely to produce a reduction in the

intensity and scale of obesity and other illnesses caused by lack of exercise. This will subsequently

have an impact on health care costs.

The values of health benefits associated with walking and cycling are derived from research

conducted by the New Zealand Transport Agency (2008) and developed in accordance with DOT



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guidelines. Health benefits are quantified by applying an average distance of public transport access

trip of 700 metres (VISTA Survey) to additional walk access trips derived through the patronage

modelling. The dollar per kilometre rate in accordance with the DOT Guidelines is then applied to

derive the benefit stream. It is assumed 95% of these additional access trips are walk and 5% are

bicycle.

10.5.3 Resource cost corrections

The general principle with perceived benefits/dis-benefits is that travellers will fully perceive time and

comfort aspects and out of pocket costs such as fuel and car parking. These aspects/costs are taken

into account in their choice of mode and hence in the benefit to travel behaviour changers. However,

in many cases the out of pocket costs are not an accurate reflection of resource costs, hence there is

the need for resource cost corrections.

10.5.4 Vehicle operating cost savings

A proportion of vehicle operating costs are considered by motorists and therefore taken into account

in the net benefit to a change in travel behaviour. Only the fuel component of vehicle operating costs

is considered when individuals are determining their travel choices. Therefore, a resource cost

correction is necessary for the difference between the considered (fuel) cost and the total resource

cost of vehicle operating costs. The reduction in vehicle kilometres as a result of car users diverting

from the road to public transport is multiplied by a per-kilometre value derived from the AustRoads /

DOT guidelines vehicle operating costs calculator.

10.5.5 Car parking resource cost correction

Reduced car usage results in a reduction in the demand for parking facilities. The resource costs of

car parking can include the opportunity cost of land, the capital cost of parking facilities and the

provision of adequate security.

The number of reduced AM peak CBD bound car trips is multiplied by average CBD parking fees

(less tax). The ‘rule of half’ has been applied to the car parking resource cost correction as it applies

to new public transport users diverting from road.

10.5.6 Fare resource cost correction

All new public transport users have to pay a fare, which is part of their perceived costs in making their

mode choice decision. However, as the resource cost (capital and operating costs) is included in the

economic evaluation, fares are a transfer payment. Accordingly it is necessary to add it back in as a

component of the benefits to accurately derive the net resource benefit.

The number of new users is multiplied by a weighted average fare price. The average fare price is

based on actual Metlink ticket validations across the Melbourne public transport network for 2008/09.

10.6 Externalities

10.6.1 Congestion benefits

Congestion benefits are defined as travel time savings accruing to remaining private and commercial

road users as a result of some drivers diverting to rail. These benefits are derived from the VLC

Zenith model outputs, which provide global time savings for the entire road network. Congestion cost

outputs from the Zenith model are then applied to the ATC guideline parameters for VOT.



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10.6.2 Environmental externalities

The reduction in private and commercial vehicle kilometres as calculated by the patronage model is

used to calculate the corresponding reduction in air/noise/water/pollutants as per the ATC guidelines.

In addition to assessing the greenhouse gas emissions associated with operation, the emissions

associated with construction have also been assessed. Infrastructure Australia has published a

revised Reform and Investment Framework Templates for Use by Proponents – Stage 7 in October

2010. The revised templates propose a deviation for the ATC Guidelines when pricing carbon

emissions. According to the ATC guidelines, the recommended parameter for greenhouse gases are

based on a value of carbon that remains at $10 per tonne in real terms through time. However,

scenario analysis prepared in 2008 by the Australian Treasury finds that the estimated carbon price

rises in real terms over time, rising to between $80–$130 per tonne in 2040 (in 2005 real dollars).

Infrastructure Australia is of the view that the price of carbon will indeed rise in real terms over time,

and therefore all submissions should include a price of carbon which rises in real terms, utilising the

lower series of the Australian Treasury projections in the BCR estimate. This project has adopted the

abovementioned methodology.

10.6.3 Accident savings

The reduction in private and commercial vehicle kilometres calculated by the patronage model is used

to estimate the reduction in accidents as per the ATC guidelines which apply an avoided accident cost

per vehicle kilometre.

10.7 Residual value

The Infrastructure Australia guidelines specify the following treatment of the residual value of the

asset.

For infrastructure assets with a life of more than 30 years, a residual value

should be included, where appropriate. There are two potential methodological

approaches: first, for the residual value to be calculated using an approach

which estimates the Net Present Value of the future benefit stream provided by

the asset (to the end of the asset life); second, more traditional approaches

based around straight line depreciation of asset values. Infrastructure Australia

is receptive to both approaches.

The ATC guidelines specify the asset life of a tunnel to be 100 years. Given the significant

infrastructure asset life of the MM project it is prudent to accurately reflect the residual value of the

asset beyond the mandated 30-year evaluation period. Therefore, the residual value has been

quantified using the Net Present Value of the future benefit streams. The quantification has

conservatively used the benefit stream in the 30th

year of the evaluation, less the cost of maintaining

the required level of rolling stock, as fixed for years 31–100. The Net Present Value of these future

benefits has been calculated by applying a real discount rate of 6% between years 31–75 and 5%

between years 76–100. The decline in the long-term discount rate is consistent with the appraisal

guidelines produced by Her Majesty’s Treasury.



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10.8 Arden transport benefits

Traditional transport benefits that are realised specifically through the Arden development have been

derived through the patronage model independently of the broader MM scheme to ensure that double

counting is avoided. The quantification of the suite of transport benefits has been undertaken using

the same assumptions and parameters to ensure that the analysis is consistent with the MM and full

scheme evaluations.

To avoid double counting of transport benefits, specific patronage modelling was undertaken using

the base case MM scenario without any redevelopment of Arden. The project case was then to apply

the Arden redevelopment to determine the incremental benefit streams. Key transport related

benefits resulting from the Arden development are:

� decongestion benefits (44%)

� existing PT user benefits (14%)

� VOC resource cost correction (12%)

The urban consolidation benefits specifically relate to the development of Arden and the subsequent

savings from not having to provide additional land and infrastructure on the urban fringe.

10.9 Wider economic benefits

The wider economic benefits (WEBs) of the MM have been assessed, focussing on business

agglomeration58

. Human capital development effects have been considered but not been quantified

and are discussed in the social assessment section.

10.9.1 Agglomeration

As well as delivering benefits to public transport users, road users and the environment, a project like

MM can be expected to change the way firms interact with each other, with final consumers and with

the labour force, enabling production efficiencies that would otherwise not be available to them.

These benefits arise from the ‘city shaping’ effects of the rail project.

Agglomeration externalities relate to the benefits which flow to firms and households from locating in

areas which have a high density of economic activity (measured by employment). Such locations

allow firms to achieve economies of scale through access to an extensive customer base. This large

customer base presents firms the opportunity for economies of scope. That is, with increased

numbers of clients, firms gain efficiencies by specialising in a particular field. With many firms located

together there will be a high level of knowledge transfer between firms, which will help bolster

innovation. This innovation is vital for firms to survive in a competitive market place.

The degree of business agglomeration in any given location can be measured by Effective Job

Density (EJD); that is the number of jobs hosted by that location plus other jobs accessible to that

location divided by the travel time (or cost) incurred by economic transactors in reaching all these

jobs. The land use and transport context section discussed the current EJD conditions in

metropolitan Melbourne. The land use and transport changes in EJD brought about by MM, as at

2031, are shown in Figure 10-1. This indicates that the primary beneficiaries of the MM in terms of

EJD will be the western, northern and outer south-eastern sub-regions of Melbourne.

58 Agglomeration Benefits of the Melbourne Metro, Draft Report, SGS, November 2010



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The land use projections included in the transport model are assumed to broadly reflect the land use

changes brought about by MM, given MM supports those changes. However a base case land use

model has not been assessed (except for at Arden), hence only the agglomeration benefits due to

transport and Arden are included in the economic analysis.

Figure 10-1: Effective job density impact of MM (2031)

Source: SGS Economics & Planning

Figure 10-2 shows that those industries with the highest productivity elasticity with respect to

agglomeration are those which are closely associated with Melbourne’s reputation for liveability

(accommodation, cafes and restaurants, personal and other services, cultural and recreational

services etc) and its status as a recognised Knowledge City (property and business services, finance

and insurance).



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A number of overseas studies have shown that productivity elasticities with respect to EJD (ie the

percentage change in industry or firm level productivity with a doubling of EJD) range from 5% to

13%59

.

SGS has constructed a database for Melbourne which has allowed the estimation of Melbourne-

specific elasticities of agglomeration-related productivity effects, broken down by industry sector. The

database contains industry labour productivity for each Statistical Local Area (SLA) in Melbourne and

the associated EJD for the SLA. Regression analysis has shown an average elasticity of 8%, which is

in the mid range evident in the literature. Also consistent with the literature is the finding that

knowledge intensive sectors enjoy much stronger productivity elasticities with respect to EJD, for

example, Property and Business Services at 17%.

Figure 10-2: Agglomeration productivity elasticity versus industry growth

versus industry size

Source: SGS Economics & Planning Pty Ltd

When the labour productivity elasticities estimated by SGS are applied to the MM-induced changes in

EJD, the impact on Melbourne Gross Value Added (GVA) is indicated to be $128 million in 2031 and

$384 million in 2046 (Table 10-3). The present value (over 30 years) of the recurrent increases in

GVA enabled by MM is $864 million at a discount rate of 7%. However, these benefits will be ongoing

beyond this 30-year period. Assuming that the MM-induced GVA boost in 2046 continues indefinitely

at this fixed level (a conservative position), the present value of this residual benefit is $720 million at

a discount rate of 7%. Thus the total value of the agglomeration-based GVA boost offered by the MM

is approximately $1.6 billion.

59 Mare, D. and Graham, D. (2009) Agglomeration Elasticities in New Zealand, Motu Working Paper No. 09-06; Trubka , R. (2009) Productivity and the Density of Economic Activity: Preliminary Estimates of Agglomeration Benefits in Australian Cities, Curtin University’s Sustainability Policy Institute. Graham, D.J. (2006), Wider Economic Benefits of Transport Improvement: Link between Agglomeration and Productivity, Stage 2 Report, prepared for the Department for Transport, London. Ciccone, A. and Hall, R.E. (1996) Productivity and the Density of Economic Activity. American Economic Review 86:54-70.



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Table 10-3: Industry labour productivity impact ($ thousand) of MM by industry sector

Sector 2021 2031 2046

Manufacturing -10,964 -48,799 -68,627

Construction 6,083 41,211 76,377

Wholesale Trade 881 6,779 15,639

Retail Trade 2,190 18,371 46,182

Accommodation, Cafes & Restaurants 758 8,225 18,488

Transport & Storage -4,563 -30,401 -64,016

Finance & Insurance -1,060 22,229 87,963

Property & Business Services 5,245 60,084 162,245

Education 1,361 10,216 18,951

Health & Community Services 1,160 15,302 34,534

Cultural & Recreational Services 757 8,635 19,163

Personal & Other Services 3,652 16,303 37,140

Total 5,498 128,154 384,041

Impact Relative to Melbourne GDP 0.00% 0.05% 0.10%


In terms of the boost to SLA value added, measured in proportional terms, MM would have the

strongest impact on Melton East, Hobsons Bay (Williamstown), Brimbank (Keilor), Maribyrnong and

Melton (Balance), reflecting the accessibility shifts described earlier. In absolute terms, the biggest

impacts in GVA are expected to be felt in the inner city areas of Melbourne, Docklands and Port

Phillip West (Table 10-4).

Table 10-4: Impact of MM on GVA of selected SLA

$ Thousand Impact % of SLA GVA

Area

2021 2031 2046 2021 2031 2046

Melbourne (C) – Inner -$4,619 $10,058 $40,902 0.0% 0.0% 0.1%

Melbourne (C) – S'bank-D'lands $6,607 $19,253 $43,211 0.1% 0.2% 0.3%

Melbourne (C) – Kensington & Nth Melbourne $1,539 $5,428 $10,702 0.1% 0.3% 0.4%

Port Phillip (C) – St Kilda -$1,031 -$1,325 $2,620 0.0% 0.0% 0.0%

Port Phillip (C) – West $4,603 $10,022 $33,569 0.0% 0.1% 0.2%

Brimbank (C) – Keilor $2,054 $8,250 $24,451 0.1% 0.2% 0.5%

Brimbank (C) – Sunshine $1,209 $5,592 $25,496 0.0% 0.1% 0.4%



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$ Thousand Impact % of SLA GVA

Area

2021 2031 2046 2021 2031 2046

Hobsons Bay (C) – Altona $909 $5,077 $14,204 0.0% 0.2% 0.3%

Hobsons Bay (C) – Williamstown $1,907 $7,428 $15,271 0.1% 0.5% 0.7%

Maribyrnong (C) $4,231 $14,447 $25,593 0.1% 0.4% 0.5%

Moonee Valley (C) – Essendon $713 $6,251 $18,650 0.0% 0.2% 0.4%

Moonee Valley (C) – West $299 $2,407 $7,413 0.0% 0.2% 0.4%

Melton (S) – East $1,184 $6,158 $13,152 0.2% 0.7% 1.3%

Melton (S) Bal $2,087 $9,024 $14,475 0.2% 0.5% 0.6%

Wyndham (C) – North $1,445 $11,918 $22,796 0.0% 0.1% 0.2%


The ratio between the agglomeration benefits estimated by SGS and the transport benefits of the

project described earlier is in the same order of magnitude as the Jubilee Line Extension (which has

parallels to MM) and other transport projects from the United Kingdom.

10.10 Sensitivity tests and conclusion

10.10.1 Sensitivity tests

Sensitivity tests were undertaken as part of the economic analysis to assess the impact of changes in

major assumptions to the economic viability of the project. The sensitivity tests have been undertaken

using the upper bound cost estimates. The sensitivity test results in Table 10-5 show a broad range

of sensitivity tests conducted on the upper bound cost estimate.

The appraisal is quite sensitive to the discount rate applied, as shown by the IA-recommended tests

of 4% and 10% which have been conducted. Sensitivity tests on discount rates used in Victoria

(5.5%) and the United Kingdom (3.5%) have also been conducted, enabling comparison of the

economic performance of MM with that of other projects in those jurisdictions.

Sensitivity tests around the capital cost, vehicle kilometre savings and WEB benefit streams have also

been undertaken. Under each of the broad ranging sensitivity test the project remains viable with a

BCR above one and a strongly positive NPV.

London’s CrossRail scheme, which, like MM, links people and jobs across London and addresses

inner city rail congestion, has a BCR of 2.6 – 3.6 without WEBs at a 3.5% discount rate, depending on

the value of time adopted, which is comparable to the MM project. MM delivers an NPV of almost $30

billion and a BCR of 3.6 at the UK discount rate.



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Table 10-5: Summary of sensitivity test results (including labour productivity and urban consolidation)

Sens Test No

Input Variation NPV ($m)

BCR

0 Core evaluation result (IA 7%, P90 costs) - 5,634 1.6

Lower Bound Cost P50 costs 6,450 1.8

1 Capital cost (construction) increased by 30% 3,270 1.3

2 Capital cost (construction) decreased by 30% 7,998 2.2

3 Car km saved decreased by 30% 5,270 1.6

4 Discount rate (IA) 10% 1,065 1.1

5 Discount rate (Vic) 5.5% 11,342 2.1

6 Discount rate (IA) 4% 23,109 3.1

7 Discount rate (UK) 3.5% 29,583 3.6

8 WEB decreased by 50% 5,060 1.6

10.10.2 Conclusion

The 2010 economic assessments of the ultimate MM scheme and MM1 demonstrates the economic

merit of the scheme in part and in whole.

The MM evaluation developed in accordance with Infrastructure Australia guidelines (7% real discount

rate, 30-year evaluation period and quantification of WEBs) delivers a BCR of 1.6–1.8 and an NPV of

$5.6–$6.5 billion.



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11 Environmental assessment

11.1 Overview

MM will deliver positive whole-of-life environmental outcomes, including reductions in greenhouse gas

emissions, air pollution, noise and water pollution and land consumption as a result of reductions in

private vehicle travel and a more compact urban form.

A preliminary quantitative assessment of the net greenhouse gas emissions impact of MM shows a

reduction of approximately 8 MtCO2e, taking into account both the construction phase and operations

to 2046. This is equivalent to more than three times the total growth in Victorian transport sector

emissions over the past decade. Construction-related emissions are ‘paid back’ within three years of

operation. Furthermore, the city shaping outcomes of MM will drive a more efficient urban form,

delivering additional carbon-reduction benefits and helping to position Melbourne for a carbon-

constrained future.

There will, however, be local environmental and social impacts during the construction of MM.

Through the development of the technical concept, efforts have been made to reduce these impacts

and mitigation actions identified for those that cannot be eliminated. The residual environmental and

social risks have been assessed as largely negligible or low post-mitigation. Notable exceptions to

this are:

• surface transport disruption at the Parkville and Domain Station worksites which are located near

arterial roads and the cut and cover tunnelling of Swanston Street which is a heavily patronised

tram route and pedestrian area;

• construction vibration impacts on research facilities at Parkville during construction, which will

have been assessed as a moderate impact (ie similar to the impact associated with other major

developments in the area) and heritage impacts on the Royal Parade heritage boulevard;

• the crossing of the Yarra River and its impact on the use and enjoyment of the Yarra and environs

which will also have a moderate impact.

These temporary impacts are far outweighed by the permanent enhancements to the city’s human

capital and ability to respond to climate change.

A procurement strategy has been developed for the purpose of this business case, taking a

‘bottom-up’ approach considering wider environmental benefits.

11.2 Preliminary environmental benefits

11.2.1 Greenhouse gas emissions reductions

A whole-of-life assessment of the greenhouse gas emissions associated with MM has been

undertaken out to 2046. The analysis considered:

� GHG emissions resulting from the construction of MM

� GHG emissions resulting from the construction of required rolling stock



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� GHG emissions resulting from the operation of MM

� GHG emissions saved through mode shift as a result of MM.

The assessment60

did not consider the additional emission savings associated with the likely changes

in urban form as a result of MM.

The net GHG emission impact of MM is a reduction in GHG emissions of 8 million tCO2e, equivalent

to more than three times the total growth in Victorian transport sector emissions between 1998 and

2008. The emissions produced in construction are ‘paid back’ within three years of operation, as


Figure 11-1: Cumulative GHG emissions associated with MM construction and operation

Net cumulative GHG emissions resulting from the construction and operation of MM

-9,000,000

-8,000,000

-7,000,000

-6,000,000

-5,000,000

-4,000,000

-3,000,000

-2,000,000

-1,000,000

0

1,000,000

2010 2015 2020 2025 2030 2035 2040 2045 2050

tCO

2e

11.2.2 Air, noise, water and other pollutant reductions

MM will result in a reduction in private and commercial vehicle travel of approximately 1.5 million

kilometres by 2046. This has been derived from the strategic transport model.

This reduction in private vehicle travel results in reduced pollutant and amenity impacts on

metropolitan Melbourne, for example reduced:

� exhaust emissions from vehicles

� oil, rubber debris and other pollutant emissions released to road surfaces and associated

stormwater infrastructure

60 Greenhouse Gas Emissions associated with MM, Draft Working Paper, DOT, November 2010



Page 245 of 321

� noise to adjoining properties.

The economic value of these reductions can be estimated based on an average rate per kilometre of

vehicles travelled in accordance with the Australian Transport Council’s project appraisal guidelines

and have been factored into the project economic analysis as externalities benefiting the community.

11.2.3 More compact urban form

One of the major drivers and benefits of the project is the opportunity to create a more compact urban

form. This outcome is fundamental to the premise of this business case and ultimately this more

compact urban form will drive and complement macro environmental benefits that have not been

quantified in the economic assessment of the project.

The benefits of greater urban density and improved accessibility can be qualitatively measured in the

reduced environmental footprint of the Melbourne metropolitan area for example through:

� reduced pressure on growth area development allowing the retention of peri-urban areas as

green wedges and farming land

� reduced consumption (and resultant greenhouse gas emissions) resulting from peri-urban

development, for example reduced stationary energy use, water use, infrastructure provision,

embodied energy in larger households on the fringe etc

� reduced private vehicle travel (as discussed above)

� increased human capital and accessibility (discussed in the next section).

11.3 Preliminary environmental impacts

11.3.1 Summary

Preliminary planning and environmental assessments have been undertaken to inform the options

assessment process for MM and to assess the concept developed for business case, assessments

have continued to assess potential impacts resulting from the high-alignment value engineering

investigations. These environmental assessments focussed on the impacts of the project largely in

the construction phase to aid in the development of a ‘least impact’ concept design.

This work has identified the key environmental risks for the project and the areas that will require

further assessment as part of the detailed planning and environmental approval process throughout

2012 that has been described later in this report. After implementation of mitigation measures,

impacts can generally be contained to negligible or low impact, with the exceptions being transport

impacts during construction around busy inner city station locations and social, land use and noise

issues associated with the state significant hospitals and education precinct around Parkville station

and the Yarra River crossing. It is expected that further mitigation works will be established which can

contain these impacts to acceptable levels.

A summary of the impacts of the preferred MM tunnel alignment across specialist areas is provided in

Table 11-1. This work was completed in three stages:

� Stage 1 – a high-level assessment of the various options considered for the MM Tunnel

alignment and station locations and MM2 tunnel alignment and station locations.



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� Stage 2 – a targeted assessment of the preferred project components including the five MM

stations, the surface works in the South Kensington – Sunbury corridor such as stabling yard and

grade separations61

.

� Stage 3 – targeted assessments of value engineering opportunities including the high alignment

which results in a shallow crossing of the Yarra River which must be completed top down.

The table shows the impacts after the implementation of mitigation measures with the unmitigated

impacts provided underneath. The impact ratings in the summary table refer to the scale of impacts

shown in Table 11-2 below.

61 Stabling and grade separations are not part of MM scope. Stabling is part of rolling stock procurement.



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Table 11-1: Summary of environmental impacts of MM project (post mitigation)

Flora and Fauna Aboriginal

Cultural Heritage

Non Aboriginal

Cultural Heritage Transport

Contaminated

Soil and

Groundwater/

Natural Geology

Land Use

Planning

Social Planning

(including Noise

and Air Quality)

Western Tunnel Portal

Negligible Negligible Negligible Negligible

(Low)

Low

(Moderate)

Negligible

(Low)

Negligible

(Low)

Arden Station Negligible Negligible

(Major) Negligible Negligible

Low

(High) Negligible

Low

(Moderate)

Parkville Station Negligible Negligible Moderate

(High)

Moderate

(High)

Low

(Moderate)

Moderate

(Major)

Moderate

(Major)

CBD North Station

Negligible Negligible

(Moderate)

Low

(Moderate)

Moderate/High

(Major)

Low

(Moderate)

Low

(Moderate)

Low

(High)

CBD South Station

Negligible Negligible

(Major)

Low

(Moderate)

Moderate/High

(Major)

Low

(Moderate)

Low

(Moderate)

Low

(High)

Yarra River Crossing

Low

(High)

Negligible

(Major)

Low

(High) Negligible

Moderate

(Major)

Low

(Moderate)

Moderate

(Major)

Domain Station Negligible Negligible Low

(High)

Moderate

(Major)

Low

(Moderate)

Low

(Moderate)

Low

(High)

Eastern Tunnel Portal

Negligible Negligible Low

(Moderate)

Low

(Moderate)

Low

(Moderate)

Low

(Moderate)

Low

(High)

Tunnel (alignment between stations)

Negligible Negligible Negligible

(Low) Negligible

Low

(Moderate) Negligible Negligible

Note where impact rating has been changed after the implementation of Mitigation Measures the initial impact rating is provided in brackets.



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Table 11-2: Impact rating for environmental assessments

Impact Rating Description of Rating

Major High level of impact for Melbourne

High High level of impact for a region of Melbourne

Moderate High level of impact for the local are or moderate impact over a broader area

Low Low level of impact for some local areas or high impact for small groups of people

Negligible Minimal if any impact for local areas. Potentially some impact for small groups of people

11.3.2 Flora and Fauna

Potentially high impact mitigated to low impact

The MM tunnel is in a heavily modified inner urban environment and will therefore have limited

interaction with significant flora and fauna.

The impacts to land based flora and fauna have been assessed as insignificant throughout the study

area and generally relate to the removal of ornamental street trees in and around the station locations

and portal.

The crossing of the Yarra River presents some additional challenges with respect to fish species

within the river including a nationally listed species however these impacts are manageable.

These impacts can be reduced by appropriate tree protection and if required tree replacement in the

construction phase.

11.3.3 Aboriginal Cultural Heritage

Potentially major impact mitigated to low impact

The Aboriginal Heritage Act can require Cultural Heritage Management Plans (CHMP) to be prepared

for a number of types of works in proximity to areas deemed to be of cultural significance. MM will

require a CHMP as a result of the Arden and CBD South Stations being within 200m of the Moonee

Ponds Creek and Yarra River. Water courses are known to often contain sites of cultural significance

to indigenous communities.

Ultimately these locations are heavily modified inner urban watercourses and the surface interactions

of project works at the station boxes and Yarra River Crossing do not interact with any known heritage

sites.

There are some ‘registered places’ in the vicinity of the proposed CBD station sites however these are

not on the alignment and are unlikely to be impacted. These issues will also be covered in the

CHMP.

The CHMP is therefore likely to be a desktop-based mitigation measure reducing the risk of this issue

delaying the project to low to almost nil.



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11.3.4 Non-aboriginal cultural heritage

Potentially high impact mitigated to moderate impact

The stations at Parkville, CBD North and South and Domain are located in areas with substantial

heritage assets or precincts of both State and local significance that are covered by heritage overlays

or the Victorian Heritage Register.

Like all buildings along the route detailed investigations into the ground conditions and construction

techniques will be required to manage issues such as subsistence impacting on these heritage sites.

The interaction between surface MM infrastructure (eg station entries) and the heritage buildings will

also need to be assessed with sympathetic urban design treatments required in close proximity to

heritage buildings.

A moderate impact relates to Melbourne’s heritage boulevards Royal Parade and St Kilda Road and

the development of integrated tram/train interchanges in the centre of these roads. Heritage Victoria is

aware of these issues and further information and discussion is needed to make an informed

judgement on the impact during the approvals process.

The Shrine of Remembrance is a significant heritage asset and any impact on the Shrine and grounds

will need to be resolved with the Shrine Trust and in consultation with heritage agencies.

These issues will be managed mainly through early consultation with heritage groups, sympathetic

designs and construction methods in close proximity to heritage sites. This may result in some

alterations to the business case design for example altering the emergency egress currently located

in the Shrine grounds at Domain Station to an alternative location.

11.3.5 Transport

Major impact mitigated to moderate/high impact

MM will ultimately deliver transport benefits to Melbourne but during the construction phase of the

project a number of transport impacts through road, tram and cycle route closures and diversions will

be required.

These impacts will include construction of station boxes in the road reserves of:

� Royal Parade

� Grattan Street

� Swanston Street

� St Kilda Road.

Construction for the length of Swanston Street is also likely to be cut and cover including crossings of

La Trobe, Lonsdale, Bourke, Collins and Flinders Streets.

Managing these impacts will require detailed construction planning to minimise delays (as has already

been completed on a preliminary level for the business case design) and then a robust

communications process during the construction phase.

Construction traffic (eg for spoil removal from the North Melbourne site) will also need to be monitored

and directed to appropriate roads away from residential areas and activity centres.

Modelling of permanent traffic network changes such as reducing lanes on Grattan Street, Royal

Parade and St Kilda Road is also required to gain VicRoads approval to the MM project.



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The MM project has completed significant preliminary work on local access issues to the station

locations (as detailed in the options assessment and scope sections) and also assessing the potential

benefits to the tram network. These are opportunities for the project to build on throughout the

development and construction cycle of the project.

11.3.6 Contaminated soil and groundwater

Potential high impact mitigated to low impact

As the tunnel and all the stations are being constructed in existing urban areas, there is a strong

likelihood that the project will encounter contaminated soils and groundwater as a result of current

and historic land uses.

Arden Station has been assessed as having the highest likelihood of contaminated soils and

groundwater due to its current and historic industrial land uses and the presence of a shallow

groundwater table. Existing Coode Island Silt soils which can contain acid sulphate soils are also

found in this area.

Further environmental assessments will determine appropriate measures to manage the excavation,

handling and disposal of contaminated material. This process will be no different to the many

commercial developments completed in Melbourne each year.

11.3.7 Noise and vibration

Potential high impact mitigated to moderate impact

Noise and vibration impacts are most commonly associated with ‘sensitive receptors’ such as

residences, schools and hospitals. The MM project will pass through the nationally significant

Parkville hospitals and bio-technology precinct. The patients, equipment and animals at these

facilities are likely to be highly sensitive to noise and vibration associated with construction.

More moderate impacts have been assessed for other station locations and the tunnel portal in and

around the dense inner city environment through which the project passes.

Mitigation measures are available to significantly reduce the noise and vibration impacts such as the

choice of construction equipment used and the hours of operation impacts.

As with the contaminated soil this issue has not prevented other commercial construction projects,

including those with large basements similar in construction technique to the station boxes, from

proceeding in the Parkville area.

11.3.8 Air quality and greenhouse gases

Potentially moderate impact mitigated to minor impact

Local air quality may be impacted during the construction phase as dust from station worksites and

fumes from increased construction truck traffic impact on local areas. These issues are common

construction management issues that will require standard mitigation procedures for dust suppression

and choice of haulage routes.

Ultimately the project will deliver improved air quality and reduced greenhouse gas emissions by

providing for a significant uplift in public transport accessibility, capacity and priority to and around the

inner city.



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11.3.9 Water use, quality and contamination

Potentially major impact mitigated to moderate impact

The crossing of the Yarra River will require disturbance of the river bed and top down construction

within the river and riverbanks. There is potential for this to impact on water quality however these

impacts are manageable as evidenced by similar crossings of the Yarra River for Citylink and the

Melbourne Main Sewer Replacement Project.

The Tunnel Portal will require capture and rejection of rain runoff to avoid water within the tunnel itself

although the volumes of water are minimal.

Station locations will be within the street/urban fabric and provide no additional challenges beyond

standard construction sites.

11.3.10 Land use

Potential Major Impact mitigated to Low Impact

The major land use implications of the project relate to impacts on state significant land uses such as

Federation Square, St Paul’s Cathedral, State Library, RMIT, the Royal Botanic Gardens, the Shrine

of Remembrance, Melbourne University and the Parkville medical and bio-technology precinct.

Without mitigation there would also be major impacts on the commercial, tourism and retail uses

around the Swanston Street stations.

These impacts largely relate to the integration of the project into its surrounds. This may be a

physical relationship between a station entry and surrounding buildings or flow-on effects of increased

pedestrian traffic in the immediate vicinity of station entrances.

The development of urban design principles for the station entry sites and any associated above

station developments will be the main management measure for this impact which is also heavily

linked to impact areas such as heritage, transport and social impacts.

Discussion of positive macro-land use impacts is included in the next section.

11.3.11 Social impacts

Major Impact mitigated to Moderate Impact

Social impacts of the MM project will occur along the entire project route during construction. These

are discussed in more detail in the next section.



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12 Social assessment

12.1 Overview

The spatial distribution of urban development affects the accessibility of activities, facilities and

employment opportunities and this is an important element of social assessment of a project. MM will

improve household access to goods and services via improved transport, stemming from two distinct

factors:

� providers relocating to more accessible locations across the metropolitan area, notably the Arden

Urban Renewal Precinct

� reduced travel times across the metropolitan area and therefore the extension of the catchment

within an acceptable travel time for households.

MM will ultimately deliver significant net social benefits including improvements to the stock of human

capital through improved accessibility to jobs, education opportunities and the CBD, reduced reliance

on private motor vehicles and costs of transport and improved liveability of the city through more

intensive and higher amenity urban development, leading to reduced crime.

Access to goods and services is also important in promoting both personal wellbeing and societal

welfare, such as choice in retail offerings. Improved accessibility is an integral part of the drive to

increase participation and achievement in education, to improve health outcomes and to increase

opportunities for sport, the uptake of hobbies, and entertainment.

The project’s construction will impact the social fabric of the city by temporarily reducing local

accessibility to public spaces and institutions and by creating a series of construction impacts such as

noise and vibration, dust, construction traffic and visual intrusions to the public realm.

The tunnel alignment is a critical social spine for the city connecting St Kilda Road parklands and the

arts precinct, to Federation Square, major civic buildings like St Paul’s Cathedral, Melbourne Town

Hall, State Library, RMIT and the University of Melbourne

However, mitigated by adequate communication and construction techniques, this is regarded as a

moderate impact and, given it is temporary, it is far outweighed by the permanent, long-term

enhancements to the city’s human capital.

12.2 Human capital benefits

Improvements to the stock of human capital will not only flow into improved productivity, as discussed

in the economic assessment section. Human capital benefits accrue to households from improved

accessibility, as distinct from firms gaining a wider economic (agglomeration) benefit through locating

themselves in areas with high levels of accessibility.

Other non-market impacts can be anticipated, such as decreased crime and improved health. These

latter effects undoubtedly represent an increase in welfare. However, quantification of these benefits

has not been undertaken for this project.



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Improved accessibility to jobs made possible by MM is expected to lift the stock of human capital in

the metropolitan area $1,400 million (NPV) 62

.

When the job redistribution impacts of the MM have fully worked through the Melbourne economy, the

northern, western and south-eastern regions will, again, see the greatest proportional increase in

human capital (Figure 12-1). In 2031, relatively disadvantaged areas such as Maribyrnong, Melton

Wyndham and Dandenong all benefit significantly due to the construction of MM. The distribution of

the human capital uplift is important when one considers the relative socio-economic disadvantage

experienced by these areas of Melbourne (Figure 12-2).

Figure 12-1: Spatial distribution of human capital impacts of MM (2031)


62 SGS, November 2010



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Figure 12-2: Most disadvantaged SEIFA quintiles (Melbourne, 2006)


Land use change also has a number of other social benefits which are not yet able to be quantified.

These benefits are based on the outcomes which MM is likely to generate. The key benefits are

discussed below.

12.2.1 Increased choice and accessibility

MM will provide those living in Melbourne’s west, north and inner areas with more frequent train

services to existing and some new locations. The ability to get to new locations will increase the

breadth of choices available to patrons, whilst increased frequencies will make accessing existing

locations easier. This will effectively broaden the choices available to people regarding where they

can go to access services such as health and community services, retail, commercial and recreation

facilities.

By providing better accessibility to key regional activities such as Sunshine Hospital and Victoria

University campuses in Footscray and St Albans, the ability of those living in Melbourne’s west and

north to access important regional facilities will be improved.

Together with supportive policy and other interventions, MM has potential to support the development

of clusters of specialised medical/education precincts. Specific interventions to facilitate this will be



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identified in more detailed planning work. The development of such precincts will further enhance

choice, but is also likely to result in increased productivity/agglomeration and specialisations.

MM provides some key opportunities to facilitate increased dwelling development in Melbourne’s

established area. Increased service levels provided through MM will have direct links with the scale of

dwelling activity supportable in some locations, and the additional dwelling development will provide

increased choice of dwelling for those living in the city, as well as dwellings with greater diversity of

activities nearby.

12.2.2 Retail and activity centre development

The availability of public transport can support higher density residential development in and around

activity centres. In turn, the greater residential population supports the provision of increased retail

facilities over time. Similarly, public transport provides support for employment opportunities in

activity centres, including in retail and service businesses, but also creating the potential for medium

or larger scale office development in suitable locations.

A range of other supporting facilities are often included within or close to the activity centres, including

health, education, community and civic uses, leisure, sporting and entertainment. The mixed use and

multi-purpose nature of development within activity centres helps to create a critical mass of usage

and activity, which in turn supports retail demand and therefore an increased range of retail facilities.

A more direct retail opportunity is created from the passenger traffic around train stations. If

passenger volumes are sufficient, a certain amount of convenience and service retail can be

supported, with uses such as cafes, convenience stores and small groceries, dry cleaning, shoe

repairs and the like. These types of retail businesses can generate direct spending from the rail

passenger traffic, while also benefiting from the exposure and identity created by the location.

The extent of benefits would clearly depend on the size of the station, passenger volumes and the

physical layout of the station in relation to adjoining properties with retail potential. These benefits are

not included in the economic analysis.

12.2.3 Dwelling development in established areas

The benefits associated with dwelling development in established areas (urban consolidation benefits)

have been included in the MM economic analysis, specifically in regard to the Arden redevelopment

precinct.

There are locations other than Arden where dwelling development is likely to occur that have not been

quantified in the economic analysis. These benefits fall into two major categories:

� Key development sites identified as having capacity to support precinct-wide dwelling activity

within a defined area. The exact scale and nature of this will need to be identified through a more

detailed precinct planning process, but there is potential of 10,000 dwellings supportable in these

areas.

Analysis indicates that there are opportunities for city shaping outcomes associated with MM. It is

estimated that there is land capacity to accommodate approximately 4500 dwellings in West

Footscray, 3500 dwellings in Sunshine/Albion and 1700 dwellings in Moonee Ponds/Essendon.

This is equivalent to approximately 500 hectares of growth area development. Combined with the

Arden precinct redevelopment and E-Gate, a pipeline of supply of urban renewal locations in

Melbourne emerges. Such sites will play an increasingly important role in the provision of housing

and urban activities as Melbourne grows to five million and beyond.



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� Incremental and infill development – recent work by DPCD has identified that the density of

residential development is influenced by the connectivity, context and characteristics of the site.

This means that a higher density of development is likely to be available in areas around stations

where service levels improve. Secondly, where high density dwelling development is proposed,

further capacity for dwelling development in surrounding areas will result. Higher public transport

accessibility levels will therefore result in higher density development and additional dwellings in

established areas.

The scale of the above impacts could be quite significant, with improvements to accessibility and

choice generally and more people in established areas in accessible locations. These changes

combined will help transform the structure of the city over time.

12.3 Other social benefits

The improved choice enabled by MM (including Arden) may flow through to other social benefits. For

instance:

� Access to goods and services is important in promoting both personal wellbeing and societal

welfare. Retail opportunities for example, impact on the price and quality of food available to

households. SEU (2003)63

draws attention to the importance of government intervention to enable

access to healthy affordable food because of the link between poor diet and future health

problems.

� Limited access to education providers, including child care, schools, higher education institutions

and adult learning centres, can prevent people from participating in learning or restrict their choice

of the quality, subject matter or type of learning they attend. Improved accessibility is therefore an

integral part of the drive to increase participation and achievement in education (SEU 2003).

� Similarly limited access to health care providers can impose significant costs on patients; poorer

health through missed appointments, late diagnosis or healthcare simply not being sought; and on

providers; wasted resources through missed appointments, delayed discharge from hospital,

unnecessary home visits and delayed treatment of illness in place of early intervention (SEU

2003).

� Improved accessibility may provide increased opportunities for sport, the uptake of hobbies, and

entertainment. The construction of new recreation facilities or formation of new groups and

networks may be more viable due to the increased size of the market driven by greater

accessibility. To the extent that these opportunities are taken up, the SEU (2003, p16) reports,

“participation in social cultural and leisure activities is very important to people’s quality of life and

can play a major part in meeting policy goals like improving health, reducing crime and building

cohesive communities”.

12.4 Specific urban development benefits

The opportunities for urban development along MM corridors (except for the tunnel section which was

discussed earlier) have been identified through an initial review of existing urban development

conditions in the area. This process included a review of existing activity centres/locations, relevant

planning policies and controls, as well as estimates of capacity to accommodate additional

63 Making the connections: Final report on transport and social exclusion London, UK, Cabinet Office, SEU (Social Exclusion Unit) 2003



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development. Existing land use structure including connectivity and site opportunities were also used

in evaluating the scale and nature of the opportunity. Such opportunities lead to more intense and

higher amenity urban development, which leads to more activity, better and more liveable places, less

crime and better health.

This initial review of development opportunities (and subsequent benefits) identified potential benefits

at a high level – further review and analysis will provide additional detail regarding the exact scale of

opportunity. The benefits of this development and the interventions and costs (if any) required to

facilitate these opportunities are not explicitly included in this business case, but will be pursued in a

way complementary to the project by DPCD.

The non-quantified social urban development benefits of MM in specific locations are in Table 12-1

below. The process of identifying these locations included a review of existing activity

centres/locations, relevant planning policies and controls, as well as estimates of capacity to

accommodate additional development. Existing land use structure, including connectivity and site

opportunities, were also used in evaluating the scale and nature of the opportunity.

Table 12-1: Location specific urban development benefits

Outcome Relevant locations Social benefit

Regional mixed use centres: Locations where there are opportunities to develop major regional mixed use centres, and potential for a different type of development to that which exists in the location

currently

Broadmeadows

Footscray

St Albans/Ginifer

Sunshine/Albion

Increased choice regarding locations to access education, health, retail, community facilities, etc

Better access to major regional activities such as hospitals, university

campuses, etc

Improved overall the scale and scope of services provided in the area

Activity centre intensification: Additional retail, commercial, community and housing activity can be supported in

existing activity centres

Coburg

Moonee Ponds/Essendon

Sydenham/Watergardens

Hoppers Crossing/Werribee

Increased retail development in policy supported locations; less pressure on out of centre development

More choice for those visiting activity

centre

Major change areas: Opportunity for significant land use change related to MM

West Footscray/Brooklyn

Avoided infrastructure/land savings on the fringe

Putting people in locations with choice about travel mode and accessing goods, services and jobs:

better choice and accessibility

Areas currently under planning consideration: Areas for which planning is currently occurring or will be undertaken in the future. Includes Precinct Structure Plans and other mechanisms. Such planning should consider improved

service levels

Laverton/Aircraft/Williams Landing

Hopkins Road/Rockbank/Toolern/Melton

South

Werribee Employment Precinct

As above – activity centre intensification, incremental & infill

development



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Outcome Relevant locations Social benefit

Infill/incremental change: Areas where service levels are high and likely to have an impact on rate/density of surrounding areas

Also includes areas where industrial land could be turned

over to residential/mixed use

Batman/Merlyston/Fawkner/ Gowrie/Upfield

Royal Park/Flemington Bridge

Jacana/Glenroy/Oak Park/Pascoe

Vale/Strathmore/Glenebervie

Ascot Vale/Newmarket/Kensington

Sunbury/Diggers Rest

Ardeer/Deer Park

Seddon/Yarraville/Spotswood/

Newport

Avoided infrastructure/land savings on the fringe

Putting people in locations with choice about travel mode and accessing goods, services and jobs: better choice and accessibility

Increased accessibility across region: Locations that can act as regional interchange hubs and opportunities to enhance benefit of MM by linking it with nearby activities to create

more complex precincts/areas

Craigieburn/Roxburgh Park

Sydenham/Watergardens

Essendon/North Essendon

Upfield line – Sydney Road/Lygon Street/Nicholson Street

Link St Albans and Ginifer

Link Sunshine and Albion

Sunshine to Altona/Williamstown and

Flemington/Royal Park

Maribyrnong Defence Site to Moonee

Ponds & Footscray

Improve regional accessibility and improved opportunities to switch

between modes

12.4.1 Basis for further access enhancements

Whilst providing significant benefits in its own right, MM also provides a robust platform to create

further interconnections and human capital benefit within the inner west and north. As transit

networks develop, the overall network effect provides an ability to make complex journeys which is

greater than the sum of the individual routes. MM will make an important contribution to the

development of the transit network in the historically under-developed inner west and north of

Melbourne.

The following links are considered to be key opportunities to further understand, plan for and facilitate

increasingly complex and linked activity networks:

� Sunshine, West Footscray/Tottenham to Altona and Williamstown: The red orbital bus route

currently provides the single public transport option for this trip. The convoluted route through the

middle of the Brooklyn Industrial Area could be improved and this would provide residents of

suburbs south of the Westgate Freeway with access to the shopping and entertainment facilities

of Sunshine.

� Maribyrnong Defence Site to Moonee Ponds/Essendon and the Brunswick/Lygon Street

Shopping Precinct: The former Defence Site in Maribyrnong, located adjacent to the northern

boundary of the Highpoint Activity Centre represents one of the largest and most realistic future

development sites within the study area (planned to contain at least 3000 dwellings and

commercial office development). A strong and prioritised east–west public transport option

connecting this site with the Brunswick/Lygon Street shopping precinct would considerably

enhance the urban experience for those living in this community of the future.



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� Sunshine, West Footscray/Tottenham and Footscray to Flemington Racecourse: The

Maribyrnong River acts as somewhat of a barrier to accessibility to Flemington Racecourse for

populations in the west. Access to this major entertainment facility by public transport from the

west requires an interchange at North Melbourne to a rail service directly serving the racecourse.

Such a significant entertainment facility should be more accessible from the west, and a more

desirable link should be found.

There are also existing and emerging nodes of activity for which linkage into the most complex ‘inner’

zone of activity would further enrich urban experiences and enhance perceptions of

interconnectedness and relatedness across this part of the inner city. They include:

� Sunshine/Albion to Ginifer/St Albans: Major health and tertiary education facilities at Ginifer

(Sunshine Hospital) and St Albans (VUT campus) respectively constitute significant catalysts for

further development and redevelopment along the spine connected by St Albans Road. Linking

these key nodes through a coordinated approach to the development of a number of potential

sites located along St Albans Road has the potential to create a contiguous urban corridor and

enrich the range of activities and interactions available for populations located along it.

� Moonee Ponds/Essendon/Essendon North: The corridor linking Moonee Ponds, Essendon and

North Essendon presents significant opportunities for urban redevelopment, in the form of

dwellings, retail, commercial and community activities. In particular, Moonee Ponds is an

established activity centre with a strong and high amenity main street environment with a diversity

of existing retail and commercial activity. It exhibits some key preconditions for further investment

and employment growth. The linking of these nodes, and connecting them to the wider network of

activity within the inner north and west (such as Maribyrnong Defence site, Highpoint Shopping

Centre, Sunshine and Footscray) will provide a strong foundation for a mature urban context to

develop. This would support the significant growth forecast to occur in Melbourne's west and

north.

12.5 Social impacts of tunnel construction

The social impact of tunnel construction has been identified as a major impact that can be mitigated to

a moderate impact.

Social impacts of the MM project will occur along the entire tunnel alignment during construction. The

Swanston Street/St Kilda Road alignment is not only a transport spine for Melbourne but also a critical

social spine connecting St Kilda Road parklands and the arts precinct to Federation Square, major

civic buildings like St Paul’s Cathedral, Melbourne Town Hall, State Library, RMIT and the University

of Melbourne.

The project’s construction will impact the social fabric of the city by temporarily reducing local

accessibility to public spaces and institutions. It will also create a series of construction impacts such

as noise and vibration, dust, construction traffic and visual intrusions to the public realm.

The project’s main management technique for this issue will be to adequately communicate the long-

term benefits of the project to gain acceptance of inevitable short-term impacts. However, as

identified in other environmental impact areas in Section 11, mitigation measures for accessibility,

noise and vibration and other impacts will also help to reduce the social impacts of the project.


PART D – DELIVERY ARRANGEMENTS

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13 Stakeholder engagement

13.1 Stakeholder engagement strategy

The MM project team is undertaking a multi-phase engagement program structured around the overall

project program. This will allow the project to include stakeholder considerations at key phases of

project development and implementation.

The engagement program aims to raise awareness of the project and seek input from key

stakeholders at key points of the projects development. The project has had strong community

support since its announcement in March 2008 as part of EWLNA.

Formal and informal feedback following the release of EWLNA showed strong community support for

investment in a large rail project:

� 90% community support through the formal submission process

� 93.1% support through the market research process

Through effective engagement with key stakeholders at key stages of the project the engagement

program aims to raise community awareness and continue this strong level of community support.

A more detailed outline of the specific stakeholder engagement activities is available in the

‘Melbourne Metro Communications and Stakeholder Relations Plan’.

� Phase 1 – Development Phase (Options Evaluation) October 2009 – April 2010

> Stakeholder engagement revolved around raising awareness of the project and its key

benefits.

> The key question asked was “What are your requirements and questions about MM, such as

around service, station locations, and station design?

� Phase 2 – Preferred Option Phase (Option Refinement / Concept Development)

May 2010 – September 2010

> Following the identification of the preferred option, the MM rail tunnel team provided

stakeholders with the opportunity to learn more about that option and why it was chosen.

> The project also sought feedback from stakeholders on the preferred option to ensure there

are no fundamental issues that prevent in-principal support.

> The key question asked will be “What do you think of the preferred option?”

A full summary of the results of the feedback received on the preferred option is provided below.

� Phase 3 – Public Comment Phase (Supporting the Statutory Approvals Process), Late 2011 –

Late 2013



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The MM Project proposes a targeted strategic approach to communications and stakeholder

engagement throughout the approvals process. The process will seek to inform as well as involve

affected stakeholders in the statutory approvals process. The overarching goals are to:

> Support the DPCD-lead engagement as per statutory requirements;

> Ensure the Comprehensive Impact Statement takes into account community inputs, issues

and ideas;

> Ensure impacted stakeholders are informed about the project and are provided with

appropriate opportunities to provide feedback about the project scope and construction

approach for the project’s consideration;

> Maintain a high level of community support for the MM Project during the planning approval

process;

> Maintain support and advocacy for the project from key project stakeholders;

> Generate community awareness about the MM Project benefits and outcomes, the proposed

route, the proposed construction approach, the status of the project, the CIS process; and

> Minimise fear and unproductive public debate about the MM Project.

13.2 Stakeholder framework

The communications and stakeholder relations plan involves active engagement with the key

stakeholders identified in the stakeholder framework.

Table 13-1 below lists MM stakeholders – engagement activities to date and issues raised. The

proposed ongoing engagement activities aligned with each are included in Appendix 2. The

framework does not include technical stakeholder relationships (approval agencies, utilities, water

authorities).

The stakeholder framework will be updated as the project progresses.

Table 13-1: MM stakeholders

DECISION MAKERS

Cabinet/Expenditure Review Committee

Commonwealth Department of Infrastructure and Transport (DOIT) and Minister for Infrastructure and Transport

Department of Premier and Cabinet

Department of Treasury and Finance

Infrastructure Australia (IA), Chair and Members

Minister for Public Transport

Statutory approvals process decision-makers

• Victorian Minister for Planning

• Department of Planning and Community Development (Environmental Assessment)

• Commonwealth Environment Minister

• Department of Sustainability, Water, Environment, Population and Community

• Normal applicable law decision makers ie. EPA, VicRoads, Heritage Victoria etc.

• Aboriginal Affairs Victoria



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PROJECT PARTNERS

Department of Planning and Community Development (State Planning and Strategy)

Operational Project Partners:

Bus Operators/Bus Association Victoria

Metro Trains Melbourne

V/Line

VicRoads

VicTrack

Yarra Trams

KEY LOCAL GOVERNMENT STAKEHOLDERS

Municipal Association of Victoria

Victorian Local Governance Association

Metropolitan Transport Forum

Melbourne City Council

Port Phillip City Council

City of Stonnington

Councils benefiting through additional or better rail services and impacted by works

Those above plus Cities of Bayside, Maribyrnong, Moonee Valley, Brimbank, Moreland, Hume, Wyndham and

Hobsons Bay

Councils benefiting through additional or better rail services

Cities of Monash, Kingston, Frankston, Glen Eira, Greater Dandenong, Cardinia and Casey

KEY NON-GOVERNMENT ORGANISATIONS (NGO) AND TRANSPORT ADVOCACY STAKEHOLDERS

Australasian Centre for the Governance and Management of Urban Transport (GAMUT)

Committee for Economic Development of Australia

Committee for Melbourne

Metropolitan Transport Forum

Monash University

Protectors of Public Land Victoria

Public Transport Users Association (PTUA)

RMIT University

Royal Automobile Club of Victoria (RACV)

University of Melbourne

Victoria Council of Social Services (VCOSS)

Victoria University

Victorian Employers' Chamber of Commerce and

Industry (VECCI)



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DIRECTLY OR POTENTIALLY IMPACTED STAKEHOLDERS

Various private property owners/local residents/local businesses and traders

Property developers

Resident/Lobby Groups (if impacted)

Flemington Association

Kensington Association, Inc

North & West Melbourne Association

Parkville Association

Protectors of Public Lands Victoria Inc

Royal Park Protection Group

South Melbourne Business Association

The 3068 Group

Environmental groups

Heritage Victoria

Rail passengers (V/Line, metropolitan or interstate

operators)

Media

Motorists

On the route or near neighbours

Shrine Trustees

St Paul’s Cathedral

Federation Square

National Gallery of Victoria

Arts Centre

Major hospitals on the route

Alfred Hospital

Dental Hospital [now on Swanston St]

Royal Children’s Hospital

Royal Melbourne Hospital

Royal Women’s Hospital

Victorian Comprehensive Cancer Centre (under construction)

Northern Biomedical Precinct – Parkville Precinct Biomedical Institutes

Austin Biomedical Alliance

Centre for Adolescent Sexual Health

Howard Florey

Laboratories on Royal Parade

Ludwig Institute for Cancer Research [Royal

Melbourne]

Melbourne University – Royal Melbourne, Neurosurgery on Royal Parade

Murdoch Children's Research Institute

Walter and Eliza Hall

Southern Biomedical Precinct

Melbourne Clinic Albert Road/Domain Intersection

Universities on or near the route

Melbourne University – particularly schools along

Grattan Street

Monash University and Victoria University

RMIT University

Schools on or near the route

MacRobertsons Girls High

MCEGGS

Melbourne Grammar School

Royal Victorian Institute for the Blind

University High

Victorian School for the Deaf

Wesley College

13.3 Stakeholder consultation results

To date, the vast majority of stakeholder feedback has been very positive. There is considerable

support for the project, as well as buy-in to the stakeholder engagement strategy.

13.3.1 Phase 1 – Options evaluation consultation results

As part of Phase 1, the project team extended invitations to a wide range of key stakeholder

organisations to organise initial listening tour meetings to outline project and consultation process and

begin asking the initial questions. These included:



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� select key local government stakeholders (Melbourne City Council, Port Phillip City Council,

Maribyrnong City Council, Victorian Local Governance Association, Municipal Association of

Victoria, Metropolitan Transport Forum)

� select key Non-Government Organisations (NGOs) and transport advocacy stakeholders

(Australasian Centre for the Governance and Management of Urban Transport (GAMUT),

Committee for Melbourne, Victorian Employers' Chamber of Commerce and Industry (VECCI),

Royal Automobile Club of Victoria (RACV), Bus Association of Victoria, Institute for Sustainable

Transport, Monash University, University of Melbourne, RMIT University, Victoria University,

VCOSS)

� select impacted/public stakeholders (Heritage Victoria, Shrine Trustees, residents associations).

Among the issues raised in stakeholder outreach meetings included:

� interest in potential urban redevelopment options in West Melbourne and/or South Melbourne

� significant interest in possible station locations, such as the Shrine of Remembrance Trustees’

interest in a possible Domain location and University of Melbourne’s interest in a Grattan Street

station

� possible construction impacts

� interconnectivity of the CBD stations with the existing rail network

� project costs and timelines

� how stakeholders can help support the project.

13.3.2 Phase 2 – preferred option consultation results

Phase 2 has provided the public and stakeholders with the opportunity to learn more about the

preferred option and why it was recommended. Communication effort sought feedback from

stakeholders to ensure there are no fundamental issues that prevent in-principle support and to

identify any new issues that should be addressed by the business case. The key question asked in

this phase is “do you agree with the preferred station locations?” The MM ‘Preferred Station

Locations’ was launched on 12 July 2010.

Preferred station location consultation survey results

An online, 10-part questionnaire enabled the public to provide direct feedback into the preferred

station locations and express their views regarding the project. A total of 564 people responded,

considered to be a good response. A summary of the results are graphed below in Figure 13-1 and

Table 13-2.



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Figure 13-1: Summary of support levels for MM

75%

93%89% 89% 90% 88%

93%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Arden Parkville CBD North CBD South Domain Swanston St

Alignment

Overall

Project

Comments provided with the questionnaires were generally positive in line with overall support for the

project. Some common themes from respondents who did not support the project include:

� cost and support for other projects as a priority

� Arden Station – both questioning the need for the station and/or suggesting interconnection with

existing lines

� need for a Southbank station.

To date no specific issues have been raised (in any sufficient numbers) that suggest any change to

the current direction of the project. The feedback does suggest a need to better communicate the

rationale for the Arden station.

Preferred station location – written submissions

As part of the Phase 2 consultation process, the project also sought written submissions from key

stakeholders. Ten written submissions were received from key stakeholders including City of

Melbourne, City of Port Phillip, Public Transport Users Association, Ventura (bus operator), Bus

Association of Victoria, Melbourne Transport Forum, and Kensington Residents Association.

Feedback received has shown a good general level of support for the project with stakeholders

identifying key areas of interest they would like to see addressed in the delivery of the project.

Table 13-2: Summary of Phase 2 Survey Results

Survey question Result Comments



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Do you support the Melbourne Metro Rail

Tunnel project?

Yes – 93%

No – 4.5%

Other –2.5%

A total of only 7% either did not support the project or do not know. Of those 7%, responses included:

Vast majority cite cost and/or other priorities as the main reason for their opposition.

A small number cite Arden Station as the main reason for their opposition.

Do you agree with the preferred station locations?

Yes – 73%

No – 17%

Other – 10%

What do you think of the preferred station locations and tunnel

alignment?

Approximately 34% of respondents (189 total) offered additional feedback regarding this question.

Of these, the vast majority offered positive or neutral feedback. Specific issues raised included:

A very large percentage questioned the need for and/or location of the Arden Station.

Other offered a range of alternate alignments, many pointing to a possible Southbank station.

Many supported continuing with MM2 – many (unsolicited) supporting a South Yarra connection.

Those that offered negative feedback overwhelming questioned either the overall need for the project and/or the project’s perceived high costs.

Do you agree with the Arden Station location?

Yes – 75%

No – 14%

Other – 11%

Of the 14% that said No to Arden Station, the majority indicated they preferred a location in North Melbourne that would interconnect with the existing train lines. The remainder suggested alternate locations in North

Melbourne or that Arden was not needed at all.

Do you agree with the Parkville Metro Station location?

Yes – 93%

No – 4%

Other – 3%

Vast majority support this location, citing the area’s unique medical and education draw cards.

Comments included suggestions regarding exit/entrance locations, interchange opportunities with the tram network, and whether there could be better

interconnection with Royal Children’s Hospital.

Do you agree with the CDB North Metro Station

location?

Yes – 89%

No – 7%

Other – 4%

Do you agree with the CBD South Metro Station

location?

Yes – 89%

No – 7.5%

Other – 3.5%

Vast majority support the two proposed CBD locations, most citing the need to adequately interconnect with the existing system at Melbourne Central and Flinders Street stations.

Other comments included a desire for a Bourke St station, specifics on entrances/exits throughout the CBD, different alignments through the CBD, and suggesting different names for the CBD stations.

Do you agree with the Swanston Street

alignment?

Yes – 88%

No – 7.5%

Other – 4.5%

Vast majority support the Swanston Street alignment, as it would best dissect the CBD and flow down St Kilda

Road while best interconnecting with the existing system.

Other comments included alternate suggestions for an Elizabeth Street or William Street alignment.



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Do you agree with the Domain Metro Station

location?

Yes – 90%

No – 6%

Other – 4%

Vast majority support this location, citing the need for a station along the St Kilda Road corridor to connect better with the CBD and Parkville area and to alleviate congestion along the tram corridor.

Other comments include a concern for potential impacts along the Shrine Reserve, the suggestion to move the station further south along St Kilda Road, and suggestions to continue the tunnel through to Caulfield.

Would you like to offer any additional opinions on the Melbourne Metro

Rail Tunnel project?

264 of 564 respondents offered additional opinions – Approximately 47% of

all respondents

The majority of respondents provided positive feedback, many saying that the project should proceed as quickly as possible, that it is long overdue, and that they support

early planning into its development.

Potential negative issues or questions raised in this area echo very closely those mentioned above: location of need for Arden Station, suggestion to build a Southbank station, question need for project and/or high cost, and

that other transport priorities should come first.

To date, there are no definitive issues raised in this interim report on the public survey that would significantly

affect the project’s progress.

13.4 Stakeholder consultation next steps

13.4.1 Phase 3 – public comment phase

Phase 3 will take the project through the planning approval process and has been designed to provide

the public with greater detail and the opportunity to comment on areas of the project including station

design as well as potential construction and operational impacts.

A key component of the public comment phase is the establishment of a Key Stakeholder Reference

Group comprising project partners and key local Councils. This group will provide advice to the project

team on planning and consultation matters and act as a conduit for project information to their own

organisation.

A Community Reference Group (CRG) will be established in early 2012 to gather community input

and to help ensure the project’s integration with the existing urban environment. A call for

nominations to the CRG will be made in early 2012.

Supporting these reference groups will be a range of activities designed to raise awareness of the

project and encourage public feedback on broader design elements. The project will be conducting

community information sessions, community displays as well as ongoing direct engagement with key

stakeholders and affected property owners during phase 3.

The result of this work will inform the design process and be incorporated into the submissions to the

Minister for Planning for consideration during the planning approval process.

Phase 3 is expected to continue to end 2013.

13.4.2 Communication and stakeholder relations activities into delivery

The project team will have ongoing discussions with key stakeholders and provide regular updates to

residents and businesses during the procurement phase (ie tender advertising and contract award).



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Extensive community engagement will also be required to give as much project delivery information

as possible to key stakeholders, including early updates on construction programs for any enabling

works and the process for dilapidation surveys.

A full-delivery communication strategy will be developed and implemented as part of the procurement

phase of the project, incorporating feedback gathered during all three phases of the stakeholder

engagement process during pre-construction.

13.5 Technical and operational stakeholders

A number of stakeholders have a core role in delivering the project into operation. These are outlined

below.

13.5.1 Metro Trains Melbourne (MTM)

MTM is currently the Accredited Rail Operator (ARO) under Part 5 of the Rail Safety Act (2006) for the

metropolitan rail network. MTM (or any subsequent franchisee) will be responsible for operating MM

and, as the ARO, is responsible for accepting the infrastructure on completion.

The risk that agreement is not reached with the ARO regarding detailed functional and operational

specification of the system has been rated as ‘high’. This is particularly important given the working

proposition that the project is delivered as a Public Private Partnership. If the specification is not

agreed with the ARO in the first instance, the ability to change the specification during delivery will be

very limited.

The program for engagement with MTM to date has been:

� initial meetings held from the commencement of MTM’s franchise in November 2009, including

issuing an early version of the Concept of Operations (COO) for review

� declaration of MM as a Proposed State Project under the Projects Agreement, requiring MTM to

participate in project development and for DOT to make payments in respect of their participation

� participation of MTM in the market-sounding exercise, including input to the packaging and

procurement strategy

� program of discipline-specific workshops focusing on the technical and operational concepts

� review of technical concept and COO by MTM

� management of change working group convened (refer Section 8.1.4)

� letter from CEO of MTM advising their support for this business case.

The proposed program from completion of business case through to completion of specification and

tender documents is as follows:

� development of a franchisee engagement and network integration strategy, as discussed in the

next section

� substantial involvement in developing the specification for delivery

� MTM input to the further development of the commercial model, including refining the operations

and maintenance aspects and safety responsibilities.



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13.5.2 Transport Safety Victoria (TSV)

TSV is responsible for accrediting and auditing AROs and, as such, is a key stakeholder in the

commissioning and operation of the project.

Early discussions with TSV have commenced and its involvement in the development of the

specification for delivery will be sought.

13.5.3 Emergency services

Emergency services agencies have a key role in accepting the project into operations. Review of and

input by the Metropolitan Fire Brigade to the requirements specification documents that form the basis

of the technical concept has had a particular emphasis on ensuring the fire and life safety principles

developed by the project are acceptable.

Preliminary engagement with emergency services has occurred through several workshops during a

fire and life safety review undertaken by an independent advisory. Engagement will continue through

the development of the specification for delivery.



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14 Delivery strategy

14.1 Procurement strategy

This section summarises the investigation64

into procurement strategies for MM, including an analysis

of project packaging, delivery model assessment and market sounding of the proposed option.

14.1.1 Approach

The approach to the procurement strategy development is a bottom-up analysis based on unique

project characteristics, constraints, risks and value drivers.

The key findings were that the tunnels and stations should be packaged as one ‘core bundle’ and

delivered by a Public Private Partnership, with a design, build, maintain model retained as the

preferred traditional model (ie without private finance). Other works, including on the existing

Northern Group corridors, should be delivered by DOT using traditional delivery models.

This process draws on experiences from precedent procurements which inform and guide the

development of the strategy. The methodology is based upon Infrastructure Australia’s National

Public Private Partnership: Procurement Options Analysis guidance. The approach has been tailored

for the characteristics of MM and for DOT’s standard process that is applied across all projects.

Market sounding undertaken with 20 key industry market participants confirmed that this procurement

strategy is appropriate and that there is market appetite for the project. The approach is illustrated in

Figure 14-1.

Figure 14-1: Approach to developing the procurement strategy

Extent of project packaging

Disaggregated Project Bundled Project

Identification and classification of the range of project components Step 2. Identification and classification of the range of project components

Step 4. Filtering of packaging components based on:

► Constraining factors

► Value drivers

Preferred packaging options

Value Drivers and

Constraints

Step 5. Assessment and matching of delivery models to preferred packaging options

Preferred delivery packages and models

Delivery model assessment

against procurement

objectives

Pa

cka

gin

g a

sse

ssm

en

tD

elive

ry m

od

el

asse

ssm

en

t

Assessment Steps

Step 3. Identification of constraining factors and value drivers

Identify issues for further consideration in feedback loop and/or in detailed

procurement design:• Total project size

• Station air rights, retail and other commercial ops strategy

• Extent of operations and station interface (eg

boundary between MM1 and Franchisee)

Feedback loop and validation

Data gathering and procurement objectives

Da

ta g

ath

eri

ng

Step 1. Identification of project and procurement objectives, scope, interfaces and risks

Step 6. Feedback loop and validation: Market sounding and case studies

64 Melbourne Metro 1 – Procurement Strategy Development, Ernst & Young, November 2010



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14.1.2 Packaging

The recommended packaging approach is shown in Figure 14-2.

Figure 14-2: Recommended packaging approach65

Station & tunnel f it out – mechanical, electrical and f ire services; general station f it out

Civil works – tunnel, stations, portal, surface works

Systems

Track

Signalling

Core Bundle1

(Infra + M)

Commercial development (including station airspace)

Service Delivery (including train operations)

Northern Rail Group works (excl signalling)

Early Works (incl services diversions)

Land Acquisition

Wider commercial opportunities (station retail, utilities)

TBD in separate delivery model assessment

DOT acquired

Align with Next Generation Train procurement strategy

Franchisee

Maintenance

Case by case basis

Procurement strategy recommendation

DOT Signalling Strategy under development

Delivered separately

Case by case basis

MM1 Rolling stock

Depot and stabling

Key assumptions of the proposed delivery model are outlined below. In all cases, these will be subject

to ongoing refinement and review.

� Service delivery including train operations, ticketing, platform operations and passenger

communications should be separately procured and continue to be provided by the metropolitan

rail Franchisee. The impact on the wider network and the complexity and additional cost of

introducing a second franchise is expected to exceed the whole-of-life and integration benefits of

having a dedicated operator for Sunbury to Domain (and onwards to MM2). Exclusion of the

procurement of train operations from MM Project does not preclude the introduction of a second

Franchisee at a later date should the State wish to pursue this approach.

� Land acquisition should be managed by the State.

� Northern Group works should be procured separate from the core bundle. The works have a

strong interface with the existing network and thus have an inherently different risk profile to other

elements of the MM project. Once the scope of these works is further refined during detailed

project development, the delivery model(s) for these works can be determined and should

consider any lessons learnt from the Regional Rail Link project.

� Enabling works including services diversions should be procured separately from those

service diversions which can be easily separated from the main works and which have significant

time constraints, bespoke risk profiles or interfaces. Service diversions that are independent of

the main works and on the critical path could be considered as an early works package. This

65 For rail systems (infrastructure delivery and maintenance), further analysis is recommended in the next phase of project development to determine the preferred packaging approach and allocation of responsibilities between the Franchisee and the core bundle recognising the close integration of rail systems with network operations.



Page 272 of 321

would be expected to reduce risk premiums associated with service relocation uncertainty if

completed prior to tendering of the core bundle.

Service diversions works which are integrated with the project structure should be packaged with

the core bundle.

� Rolling stock, stabling and depot requirements for MM should be included in the High Capacity

Metro Trains Business Case. Bundling of the MM rolling stock requirements with the broader

network rolling stock requirements has potential to deliver synergies which are expected to

outweigh any potential synergies from bundling with MM rail infrastructure components.

� Urban development opportunities at Arden should be delivered separately from the core

transport solution. Precinct-wide development involves a different set of capabilities to the core

transport project and there are limited and manageable interfaces between Arden Station and the

wider precinct.

� Station airspace rights at Parkville, CBD and Domain stations should be separately delivered

from the core transport solution. The realisation of the potential value of the commercial

development when packaged with the core bundle is not expected to deliver value for money due

to the long lead time between financial close and placement of tenants, and uncertainty with

respect to planning requirements.

This conclusion is premised on the State’s ability to manage the interface between the station and

above station developments. During detailed design of the stations, the State will need to develop

its plan for the station airspace, including use, access and loading requirements, with a view to

tendering the airspace rights during or following completion of the stations.

� Other commercial opportunities (such as station retail and utilities) should be considered on

a case by case basis to the extent that they strongly interface with other project components.

They are not considered to be a significant revenue source and should not drive the packaging

and delivery model decision.

� Civil works, station fit out and track should be retained in a core bundle to minimise the

significant interfaces between project components and provide opportunities for innovation and

realisation of synergies. The core project components should be bundled to the extent that the

total project size is not compromised by market competition.

� Signalling should be packaged separately from the core bundle due to the uncertainty

surrounding DOT’s HCSand the strong interface with rail components outside of MM including

interface with the broader network, rolling stock and rail operations. Once the State has clarified

the network signalling plan, choice of technology and its interface with MM, further analysis of the

preferred packaging for signalling should be undertaken.

� Rail systems (including rail communications, traction power and high-voltage electrical supply)

have strong interfaces with the core bundle, rolling stock, signalling, rail operations and the

broader network. Rail systems could be separated from the core bundle, installed with the core

bundle and handed over to the Franchisee upon commissioning. Alternatively it could be installed

and maintained with the core bundle. More detailed technical assessment and risk allocation

analysis is required to determine the preferred packaging option.

� Maintenance activities should be included within the core bundle to deliver whole-of-life benefits

and minimise interface risk between project components. The final scope of maintenance

responsibilities, operating responsibilities and the management of the interface with the



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Franchisee (including issues such as safety management and responsibilities) should be further

refined during the next project development phase. At this stage the proposed scope includes:

> maintenance (but not operations) of the tunnel structure, ventilation systems and fire and life

safety systems

> maintenance and facility operations of the stations including maintenance of station structure

and systems and ‘soft’ services such as cleaning and security (with the Franchisee to retain

responsibility for train operations including provision of passenger information data, ticketing

and crowd control).

The maintenance scope could also include some rail systems where there is a less significant

interface with train operations. Further analysis is recommended to determine the allocation of

responsibilities between the Franchisee and the core bundle in the next phase of project development

recognising the close integration of rail systems with network operations.

14.1.3 Core bundle – delivery method

It is recommended an output specification be developed for the procurement of the core bundle to

deliver whole-of-life benefits. The development of an output specification with well-defined

performance specifications is preferred to:

� align with the State’s project objectives

� deliver performance orientated outcomes

� provide opportunities for contractor innovation across a range of price, time and quality outcomes.

It is provisionally recommended that a PPP delivery method be adopted for the core bundle.

Private financing using a PPP delivery model provides the State with strong risk transfer with regard

to completion (PPP has strong incentives for certainty of delivery and price), long-term performance

outcomes and maximises potential scope for innovation and whole-of-life benefits.

This recommendation is subject to further consideration of the potential for value for money to be

achieved in light of project risks, the scale of private funding required and the private cost of financing.

Full private financing may not deliver VfM as the financing premium may exceed the level of risk that

the State is seeking to transfer.

A PPP delivery model for the core bundle could incorporate government contributions or support to

maximise Value for Money (VfM). Partial private financing may deliver better VfM by realising the

benefits of private financing whilst mitigating potential private financing cost or capacity constraints

associated with the significant funding requirement for the project.

Further work to investigate funding options will be undertaken in the next phase of project

development. This will include a detailed risk identification and quantification process to assess

potential risk allocation under a Design Build Maintain (DBM) or PPP to understand whether a VfM

outcome is likely under a PPP model that incorporates part private financing.

DBM will be retained as the State’s preferred traditional (non-private financing based) delivery model,

and a fall-back option to PPP. The recommendation to include an output specification based whole-of-

life model allows the State to proceed with the development of MM output requirements, without the

need to firmly commit to a procurement model.

Through the next phase of project development, a range of specialist input will need to be sought,

such as through the use of further peer review panels to test key concept design and constructability



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directions, and seek to maintain flexibility where possible in project parameters (such as the project

land reservation) to facilitate bidder innovation during procurement.

14.1.4 Next steps in procurement strategy

The proposed next steps in developing the procurement strategy are outlined below.

� Risk identification and quantification: Further development of the risk analysis undertaken by

the project team to date, including:

> review and extension of the risk register to capture risks across all aspects of the project

including commercial, financial, whole-of-life, design and construction

> quantification of risk for inclusion in the Public Sector Comparator and to inform the

development of risk allocation and risk management strategies as part of the development of

commercial principles.

� Governance: Consideration of different project governance and organisational structure models

based on the attributes of success for major infrastructure project delivery.

� Procurement process and program sequencing design:

> procurement process and program sequencing design including development of a

procurement timetable for each project package and for the overall project, identification of

interdependencies between project components, and development of an evaluation

framework and initial tendering documents (draft EOI)

> continued market engagement and market building activities to ensure MM attracts a large

range of highly competent bidders.

� Development of commercial principles: Development of key commercial principles for the

project under the Partnerships Victoria framework, including:

> Further refinement of the scope of works and development of an output specification for

inclusion in each package of works. This analysis would include consideration of outcomes

from the risk identification and quantification process and risk allocation principles; further

technical development of the project; further development of DOT’s HCSstrategy and HCMT

project; and the development of network integration and interface strategies discussed below.

> Development of a Franchisee engagement and network integration strategy. This strategy

would consider the role of the Franchisee across project development, delivery, and

operations, including allocation of maintenance, safety, testing and commissioning

responsibilities. The State should test potential failure scenarios, and who is best placed to

control and manage the risk of these events. Following this analysis, an informed packaging

decision from a commercial and VfM perspective can be made. The Franchisee strategy

would also consider the approach to engaging with the Franchisee across each project stage

and the development of commercial principles for the interaction between the State,

Franchisee and Contractor over the project term (eg through interface agreements).

> Development of an interface management strategy to consider the approach to the delivery of

multiple packages of works.

> Assessment of interrelationships with Arden redevelopment feasibility study to ensure that the

procurement strategies are complementary.



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> Consideration of other key commercial principles such as the approach to commissioning,

completion, safety management, site access and conditions, and refurbishments.

> Development of the payment mechanism and KPI regime which allows interface with the

existing Franchise incentive regimes (for example Operating Performance Regime (OPR) and

Customer Experience Performance Regime (CEPR)) and reflects the proposed risk

allocation.

> Development of a reference design, functional brief/output specification and services

specification detailing whole-of-life requirements.

� Project funding, value capture and financing strategy: Further development of the project

funding and private financing strategy, including:

> Development of a Public Sector Comparator model to inform both project funding and

procurement model development. This work stream would build on the risk quantification

process and the further development of the reference design.

> Analysis of potential outcomes under a PPP model including development of a proxy PPP

financial model. This process would assist in the assessment of the scope for achieving VfM

outcomes under a PPP model in light of project and systematic risks, the proposed risk

allocation and scope for innovation.

> Consideration of potential PPP model structures including combining private financing with

Government contributions or support to maximise VfM and meet State and Federal

objectives. For example, this analysis could include considering a capital contribution in the

proxy PPP financial model.

> Consideration of strategies to incorporate Federal and State funding of the project within the

procurement design.

> Options for funding and value-capture for the MM project are being identified, assessed and

quantified. This includes over-station development, proceeds from uplift in state-owned land,

Tax Incremental Financing, rates levies, uplift in future public transport far receipts,

reallocation of the CBD parking charge, public transport ticket levy, further charges to

landowners based on uplift in property values and vehicle registration levies.

14.1.5 Arden procurement

It is likely that a combination of procurement models will be used in the Arden Precinct Urban

Renewal project. This may include traditional government investment in infrastructure, PPP,

development agreement or alliance. A more detailed options assessment regarding procurement and

delivery will be undertaken in the next stage of the project.

The roles considered at this stage to be most appropriately undertaken by government in this

‘brownfields‘ urban development include:

� development of a high level masterplan, road network layout

� public land acquisition, consolidation and cleanup

� private land acquisition – the absolute minimum required to enable the public works required

� direct funding of the public works, roads, open space

� incorporating a suitable planning regime



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� surplus land sales back to the private sector (perhaps a combination of development agreement

for larger sites and simple sales for smaller sites).

The delivery strategy will be developed for Arden as part of the next stage of investigations.

14.2 Planning approvals

14.2.1 Legislative options

In Victoria, there are two legislative options to guide the overall planning, social and environmental

assessment of major projects:

� Major Transport Projects Facilitation Act (MTPFA), which requires a Comprehensive Impact

Statement (CIS)

� Environmental Effects Act (EEA), which can require an Environmental Effects Statement (EES).

The two acts are summarised below.

� Major Transport Projects Facilitation Act (MTPFA):

> A new process designed to streamline the delivery of major transport projects by combining

planning powers and delivery powers under one Act in a similar way to project specific

legislation as used by CityLink and EastLink in the past.

> Westlink (now known as East-West Link) is the first project to use the planning powers of the

MTPFA and is only part way through its assessment process.

> Approvals under eleven separate pieces of legislation are brought together for a single

approval decision by the Minister for Planning.

> Requires strict statutory time frames for the assessment of projects. In certain circumstances

this may lead to a longer approvals process than the EEA. In general the MTPFA will provide

a more certain timeline for an approval decision.

� The Environmental Effects Act (EEA):

> A long-standing process used for the majority of major projects in Victoria, including Channel

Deepening Project, the Victorian Desalination Plant and Peninsula Link.

> Minister for Planning determines if an Environmental Effects Statement (EES) is required for a

project. If an EES is not required, in most cases a conditional assessment is granted with

specific environmental studies required to satisfy the EEA.

> A decision under the EEA facilitates formal approval processes but is NOT an approval in

itself.

> Further approvals such as Planning Scheme Amendments and Planning Permits, Heritage

Permits, Road Management Act approvals amongst others must be gained through their own

specific legislation once the Minster for Planning has completed the assessment under the

EEA.

> The Department of Planning and Community Development (DPCD) has informed DOT that an

EES is likely to be required for the MM project based on the likely construction impacts of the

project.



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A Comprehensive Impact Statement (CIS), which is of a similar scale and form to an EES, must be

completed under the MTPFA. There is no option to avoid this full assessment through a conditional

assessment under the MTPFA. DOT has had detailed discussions with the DPCD Environmental

Assessments team to determine the most appropriate option to achieve planning and environmental

approvals for the project. Table 14-1 provides a summary of the relative merits of each process for

various factors relevant in the approvals process.

Table 14-1: Comparative assessment of approvals options

Factor MTPFA – CIS EEA – EES

Timeline Statutory time limits at key decision points leads to certainty

of timing ��

No statutory time limits imposed on key decision points. Flexibility of timing can lead to shorter process but worst case

is ‘unlimited’

�

Integrated Approval

Approvals under 11 Acts are brought into a single integrated approval decision by the Minister for Planning

��

Facilitates decision making under other acts however the separate processes and responsible decision makers must provide individual approvals

�

Further Assessments

Cultural Heritage Management Plans and Federal environmental requirements are specifically excluded

-

Federal environmental requirements are accredited under the EEA. Cultural

Heritage Management Plans required �

Property Specific benefits for the Land Acquisition process �

No specific benefits for the Land Acquisition process -

Knowledge of Process

WestLink is the first project to use the planning powers. It is part way

through the process �

Tested process used for many major projects ��

Flexible and Iterative

Process

The MTPFA provides for an iterative review of the CIS following public exhibition and prior

to the approval decision

��

The EES provides for greater flexibility in project definition and scope to be assessed up to the public exhibition period, but does not allow an iterative review process

��

Integration with delivery

powers

Process benefits to using the MTPFA planning and delivery powers (eg designation of project area)

�

No ability to benefit from process benefits of delivery powers/planning

powers under MTPFA -

Total 10 8

The most critical benefit of the MTPFA is the consolidation of approvals for a single integrated

decision made by the Minister for Planning. This integrated decision will help to avoid situations

where multiple decisions are required by multiple responsible Ministers or delegated officers under up

to 11 different pieces of legislation. This reduces the risk of ‘single issue’ processes delaying overall

project approval.

The MTPFA is considered to be more beneficial than the EEA in all but two factors in selecting the

preferred process – ‘knowledge of the process’ and ‘further assessments required’. These can be

mitigated through effective management of the approvals process.

DPCD has advised an EES is likely to be required if DOT were to refer the project under the EEA, due

to the range and scale of anticipated short term social and transport impacts associated with



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construction of the project. If an EES were not required, then it would be preferable to follow the EEA

process, as the MTPFA requires a CIS irrespective of impacts. Both a CIS and EES require a similar

level of work including specific investigations for key environmental risks, public exhibition periods and

a planning panel process.

Use of the EEA would lead to a very similar timeline and work program to the MTFPA, but as noted

above, creates additional risks. The Minister for Public Transport has been advised that the MTPFA is

the preferred project approvals strategy. Formal approval to adopt the MTPFA for the project will be

sought after the submission of the business case.

14.2.2 Proposed approvals process

The following assessment is based on the assumption that the MTPFA will be used for the project

approval. The MTPFA process is very deliberately set out under the Act to provide surety of timing

and process when applying for environmental approvals for major transport projects. This is detailed

in Figure 14-3 below.

The timeline for a ministerial decision under the MTPFA is consistent with the requirements of the

master project program. An approval decision in the first quarter of 2012 will facilitate, subject to

funding, land acquisition through 2012 and subsequently the commencement of construction during

2013. The MTPFA process requires a public consultation period and the publishing of detailed

information about the project in mid 2011.

As shown in Figure 14-3, the MTPFA requires that projects are declared prior to embarking on the

approvals process. As explained below, this means both MM and MM2 will be assessed (and

declared).

14.2.3 Scope of project to be approved

The design of MM at Domain is dependent on the future MM2 alignment. The MM2 option chosen

(the short or long tunnel) will determine the specific location and impacts of Domain station, including

land take. The approvals process for the MM project will therefore require extensive consultation on

the MM2 project. Given the extent of consultation required, a planning process for the full Melbourne

Metro project is likely to be the most appropriate pathway for approvals.

A single approval will be beneficial from a process and outcome perspective by allowing a simple

extension of the otherwise necessary MM2 consultation into an approval process which capitalises on

already completed work and reduces planning uncertainty for affected communities.

MM2 is part of the seven-stage rail capacity upgrade plan and is a critical part of the overall east-west

rail link, for which IA has allocated development funding. MM2 is included separately in IA’s pipeline

of projects. A Cabinet determination on the preferred approvals pathway is required in advance of

project declaration. Cabinet has not endorsed detailed consultation on MM2 at this stage.

In addition, Federal environmental approvals are likely to be required for some aspects of the project

under the Environmental Protection and Biodiversity Conservation Act (EPBCA), which may require

an assessment of the full scheme (ie MM and MM2).

The environmental assessment process for the full scheme has commenced. It will assist in

preparation of the project proposal (for declaration), to be submitted to Cabinet in early 2011.



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Figure 14-3: MTPFA program and key decision points

Submission of Project Proposal to Minister for Planning• Minister for Planning responds with Scoping Directions that guide DOT’s

assessment of impacts from the project

Infrastructure Australia Submission• Statement of intent regarding project• Provide full supporting documentation

Project Declaration under MTPF Act• Premier recommends to Governor in Council

State Budget• Funding allocation for corridor protection

Submission of Comprehensive Impact Statement to Minister for Planning• Exhibition period follows

Nil

Timing Decision Budget Implications

Nil

Nil

$100m allowance sought

CIS completion triggers $20m payment from Cth (TBC)

Can defer if corridor protection funds not in budget

Approval Decision under MTPF Act by Minister for Planning• Incorporation of the Reservation into the Planning Scheme

DOT subject to claims against corridor protection funds

HOLDPOINT

Submission of Revised CIS Following Consultation• Panel hearing follows

Can defer if corridor protection funds not in budget

HOLDPOINT

Nov 2011

Mar 2012

Feb 2012

Feb 2012 Submission of EPBC Referral to Commonwealth Environment Minister• Decision required under Commonwealth legislation

Nil

Nov 2012

Apr 2013

Aug 2013

May 2012

14.3 Planning process to support property acquisition

14.3.1 Processes for securing project land

In keeping with project approvals for MM, the project team proposes to use the delivery processes set

out in the MTPFA for securing the rights to land, be they freehold or leasehold interests, or reserved

or unreserved Crown land.

The MTPFA calls on the compulsory acquisition processes described in the Land Acquisition and

Compensation Act 1986 (LACA). The 281 freehold land titles (whether whole titles or strata) will be

secured in accordance with these processes. This entails reserving the land when the Minister for

Planning makes a project approval decision under the MTPFA. This reservation is likely to be

reflected in the planning scheme in a public acquisition overlay. The reservation of land enables the

project team to serve notices pertaining to compulsory acquisition of the title. Typically these

processes take some 12 months from reservation to possession of the land.

Similarly, MTPFA and LACA will enable the project to extinguish leasehold interests on freehold and

Crown land using the compulsory acquisition processes. Compensation will be paid to lessees taking

account of unexpired lease terms and the tenants’ intentions with respect to future occupancy.

The same legislation will also enable the project team to compulsorily lease freehold land for the

purposes of establishing construction sites for the approved project.

The delivery powers of the MTPFA provide a streamlined process for securing Crown land for

approved projects. This involves the Project Minister recommending to the Governor in Council (GIC)

that Crown land held by local and public authorities be surrendered. Agreement by the GIC results in

the land becoming unalienated Crown land freed and discharged from all trusts, limitations,

reservations, restrictions, encumbrances, estates and interests and temporarily reserved for the



Page 280 of 321

purposes of the approved project. These powers also include revocation of any existing Committees

of Management so far as they apply to the land concerned.

As part of the project delivery, there will need to be a number of road closures (both temporary and

permanent) and other possible property access requirements. Powers exist within Division 8 of the

MTPFA to facilitate road closures. The extent and details of road closures will not be known until

more work on detailed design and construction methodology has occurred.

Although road closures will be brought into effect by project managers at the appropriate times, there

will be a property interest with respect to possible compensation claims arising from this.

14.3.2 Assessment of Crown land

All parcels of Crown land on the current alignments for MM (including stabling) have been identified

by the Crown land Registry office within the Department of Sustainability & Environment (DSE). A

preliminary assessment of these parcels has been undertaken by the Public Land Services section of

DSE in accordance with the future act regime of the Native Title Act 1993 to identify any significant

issues which may arise if these parcels were to be used as part of MM.

The project team has been advised that Native Title has been extinguished in relation to all of the

parcels identified and there are no areas where Native Title procedural rights would apply.

DSE has noted that a final Crown land assessment should be undertaken once project design and

alignments have been finalised and it is known whether the State has entered into any framework

agreement with traditional owners prior to undertaking projects.

14.4 Pre-construction phase schedule

14.4.1 Overview

The resources and timelines to take the MM project from business case to construction

commencement have been developed using both a top-down and bottom-up approach. Figure 14-4

presents an indicative timeline from 2011 to construction commencement in July 2015.

These timelines and resource estimates for market engagement are to be further developed during

the detailed project development phase in order to present a more precise forecast to inform a

decision on implementing the project in mid 2013.

14.4.2 Key assumptions

The following assumptions have been made in establishing the detailed project development phase

schedule:

� a conventional procurement approach (Register of Interest, Expressions of Interest, Request for

Tender) with full funding commitment made by Government(s) in May 2013

� PPP delivery of the core infrastructure – twin tunnels and stations

� surface works delivered via a number of separate suppliers utilising traditional methods

� rolling stock and signalling components separately delivered, but with strong interaction and

coordination by the MM project

� a strong and competitive supplier market with necessary financial support.



Page 281 of 321

Figure 14-4: Indicative program for detailed development and market engagement

Key tasks

Conduct Investigations Develop Technical Specifications & Reference Design Prepare Community Impact Statement Process Undertake Land Acquisition Process

Issue ROI ��

Conduct Market Soundings Develop Commercial Solution & Finalise Contract Design Prepare EOI

Issue EOI ��

Prepare response to EOI

Select Shortlist ��

Prepare RFT

Issue RFT ��

Submit Bid

Select Preferred Bidder Execute Contract with Preferred Bidder Achieve Financial Close

Commence Construction ��

Legend: Dotted line represents tasks in the higher end estimate that have different timing to the minimum estimate

2011-12 2012-13 2013-14 2014-15 2015-16



Page 282 of 321

14.5 Construction schedule

14.5.1 Overview

The construction methodology and program for the delivery of the MM project has been investigated.

The schedule assumes the tunnels and stations are delivered as a single large package by a single

proponent. To achieve the program it is assumed that a significant amount of preparatory work will be

undertaken by DOT. This work relates to the preparation of a robust reference design for the

tendering process. While preparing the reference design it is assumed that DOT will initiate and

progress discussions with relevant stakeholders to streamline the process for the future proponent.

The program also assumes that the majority of the utilities diversion and protections works will be

carried out as preparatory works prior to the award of the main construction contracts. Significant

opportunities exist to expedite the works, particularly by progressing service relocation design and

undertaking the physical works.

The program assumes four concurrent workstreams, utilising differing construction methods and are a

logical way to separate the works:

� Western Section: TBM tunnels, cut and cover structures from western portal to CBD North;

� CBD Section: Cut and cover tunnels and stations along Swanston Street to CBD South, mined

tunnels to Yarra River north bank;

� Yarra River crossing: Immersed tube tunnel or coffer dam construction; and

� Eastern Section: TBM tunnels and cut and cover structures from Yarra River south bank to

eastern portal.

The critical path for the program is summarised below:

� initial design and project documentation

� TBM launch shaft design approvals and TBM procurement

� construction and fitout of the Western Section tunnels

� commissioning of the system wide operational systems

� overall system testing and commissioning

� trial running of rolling stock on the new network

� commencement of operation.

The tunnelling works are assumed to be undertaken from two locations: Western Section tunnel

drives would be launched and operated from the Arden Station site, first to CBD North Station before

retrieval and a second drive to the western portal. The Eastern section tunnel drive would be

launched from a worksite on the south bank of the Yarra River, at Alexandra Avenue. Two tunnel

boring machines (TBMs) will operate from each tunnelling portal (total of four TBMs). The program

has been developed based on the principle that the stations are progressed sufficiently to allow the

TBMs to ‘walk’ through with the primary support of the stations complete. The Western Tunnel works

are on the critical path due the lengthy procurement period for the TBMs and need to retrieve and

recommence a second drive from Arden to the Western Portal. Construction of the CBD North and

CBD South stations is near- critical.



Page 283 of 321

The construction of all stations is assumed to commence as soon as possible after contract award. A

period of nine months has been allowed for design, interface with stakeholders and gaining necessary

approvals before the permanent works commence.

The works on the wider network are assumed not to be critical and will be undertaken as necessary to

suit the overall project program.

A time chainage diagram is shown in Figure 14-5. It presents the proposed construction program

based on these workstreams and indicates a construction timeframe of 5 ½ years from Contract

Award.

14.5.2 Key assumptions

The following assumptions have been made in establishing the preliminary MM program:

� a decision on whether the project is to proceed is made in mid 2013 and construction starts in

July 2015

� the procurement of the project is done in a way that splits the scope of the project geographically,

with the wider network being done as separate contracts to the underground section

� the procurement of the rolling stock (including associated stabling yards, power and overhead

upgrades) is not part of the MM scope, however it will be a key interface

� all necessary statutory and environmental planning project approvals will be in place at contract

award

� all necessary property acquisitions have been made prior to contract award to avoid extending

construction during and to minimise risk of delay

� a railway systems provider/designer is contracted in time to provide the necessary input into the

civil design

� Surface: 12-hour working, six days a week; Underground: 24-hour working, seven days a week,

with sound attenuation enclosures in place

� experienced, competent designers and constructors are assumed to be engaged for the

construction phase

� the Arden site will be large enough to provide all the necessary area for workshops, fabrication

yards, laydown and storage areas

� adequate resources are available for all stations to be constructed in parallel and at the required

production rates

� tunnelling rate is assumed to be 300 metres a month for both types of TBM under consideration,

ie slurry and earth pressure balance (EPB)

� the TBMs constructing the tunnels will have a delivery time of 15 months and an assembly period

of three months

� the design and construction of the stations will be such that the TBMs will be able to traverse the

stations when they arrive at them with minimal delays (that is, the TBMs will be slid through the

stations rather than excavate through them)

� the testing and commissioning of the rolling stock to be used on the MM project will largely be

done on other tracks to reduce the testing and commissioning time required after construction

completion of underground section



Page 284 of 321

Figure 14-5: Preliminary time-chainage chart

`

Month Month

Oct

Feb

May

Jun

Melbourne Metro High Alignment: Cut & Cover Tunnel Thru CBD

Sep

Nov

Dec

Nov

Dec

May

Jun

Jul

Aug

Sep

Apr

Y6

Aug

Oct

Feb

Mar

Apr

Jul

Jul

Jan

Sep

Oct

Nov

Dec

Mar

Apr

May

Jun

Oct

Nov

Dec

Feb

Mar

Apr

May

Jun

Jul

Aug

Oct

Nov

Dec

Sep

Jan

Jun

Jul

Aug

Sep

Feb

Mar

Apr

May

Oct

Nov

Dec

Jan

Jun

Jul

Aug

Sep

Feb

Mar

Apr

May

Oct

Nov

Dec

Jan

Jun

Jul

Aug

Sep

Apr

May

Y4

Aug

Sep

Oct

Nov

Jul

Aug

Sep

Feb

Mar

Oct

Nov

Jun

Jul

Dec

Jan

Y5

Dec

Jan

Feb

Mar

Apr

May

Jun

Y2

Y3

May

Jan

Dec

0.5 1.0 9.5 10.01.5 2.5

Feb

Mar

Aug

Sep

Feb

Mar

Apr

May

Jun

Jul

Dec

AprY

3Y

4

Aug

Jan

Nov

Dec

Oct

Feb

May

4.5 5.0

Mar

Apr

0.0 2.0 5.5

Y1

6.5 7.0 8.0

Jun

Jul

Aug

Sep

Apr

Y5

10.5

Jun

Jan

Sep

Jul

Y2

Aug

Oct

Nov

Y6

Jan

Mar

Nov

Y1

Jan

May

Oct

Feb

Mar

Feb

3.0 3.5 4.0

Jan

8.5 9.06.0 7.5

Arden StationTBM Launch

Contract Award

East Portal

Parkville Station

West Portal

Station

SYSTEMWIDE COMMISSIONING & TRIAL RUNNING

Track & Rail Systems Installation

TB

M M

an

ufa

ctu

re a

nd

De

livery

:18 m

on

ths

Asse

mb

ly &

T&

C :

3 m

on

ths =

21 M

on

ths

TBM Relocation



CBD North Station

CBD South Station

Domain Station

River CrossingTBM Launch

Design Approval

TB

M M

an

ufa

ctu

re a

nd

De

livery

:18 m

on

ths

Asse

mb

ly &

T&

C :

3 m

on

ths =

21 M

on

ths

Swanston StTram Diversions,Canopy & Tree

Removal

Bri

din

g U

nd

er

Fe

d S

q R

ail L

ines

Legend :

Mobilisation

Early Works

Walk TBM Thru

Station

TBM Excavation

E&M, BS & Fitout

Roadheader

Excavation

Track & Rail Systems

Installation

Cross Passage

Commissioning & Trial

Running

Station/Decline

Structure Construction

Piling, Roof &

Reinstate Surface

TBM Shaft

TBM Assembly

Design

River Crossing



Page 285 of 321

15 Project governance

15.1 Overall governance

15.1.1 Governance options

Governance arrangements for the project will evolve over the project’s life. At each stage of the

procurement lifecycle, appropriate governance will be needed to ensure the overall success of the

project. Furthermore, given the scale of the project, governance of the project will ultimately be

determined by the sponsoring Government(s).

Importantly, the governance provided during these early stages of the project should facilitate a

smooth transition to the ultimate delivery structure. At this stage no decisions have been made on the

appropriate delivery structure nor are they required at this relatively early stage of the project life. The

project’s delivery method (including resolution of risks to be retained and managed by the State)

should also be confirmed before the governance structure for delivery is established.

A decision to proceed with implementation of MM does not need to be made until completion of the

detailed project development. In absence of a decision to proceed it is recommended that project

development continue to be the responsibility of DOT. It is also recommended that any decision to

proceed with the project incorporate directions on the governance model to be adopted.

For the purposes of this business case and in the interests of ongoing discussion, three potential

governance models for project delivery have been considered:

� Existing DOT structures – under current procedures, major public transport projects are

developed by the Public Transport Division (PTD) and then handed over for delivery to the

Transport Projects Division (TPD).

� Establish a new DOT division – given the scale of this project a standalone division or agency

under the auspices of DOT could be created (with or without a Project Board) as was initially the

case for the RRL project (now a separate administrative authority).

� Establish a new statutory delivery authority – the scale of this project may warrant a specific-

purpose statutory authority similar to that created for the Spencer Street Redevelopment, CityLink

and EastLink projects.

Considering the scale of the core project works (ie tunnel and stations) and noting that these have

minimal interaction with the existing rail network, it is feasible to consider a new delivery authority,

charged with the design, construction and commissioning of the project. Such an arrangement

provides the advantage of having a single focus and providing a single point of contact for the most

challenging parts of project delivery.

Importantly, once the project specification has been agreed, the delivery of tunnel and stations

requires minimal engagement with the operator on day-to-day matters (while acknowledging the

operator will have a critical role in testing and acceptance of the new infrastructure).

The same arrangement is not appropriate for the delivery of the associated surface works which

require significant interaction with the operator and coordination with other DOT programs. These

works lend themselves to more traditional delivery arrangements, for which the existing DOT

structures are ideally suited.



Page 286 of 321

The above arrangements form the basis of ongoing project planning. The case for a new delivery

authority will be examined in more detail (along with overall delivery strategy) as the commercial

model for delivery is developed in the next phase of the project.

15.1.2 Evolution of governance arrangements

Should a new delivery authority be the preferred governance model, it would not be necessary to

establish such an authority until there is formal approval for the project to proceed. It is not expected

that such approvals will be granted until May 2013 (ie the release of the Commonwealth Government

budget for the 2013/14 financial year), at the earliest. Therefore it is proposed that a staged approach

to governance is adopted which evolves as the project progresses.

� Concept development stage (business case) – during the concept stage of project

development (ie current stage) governance has been provided in accordance with DOT’s project

management guidelines. That is, the project is the responsibility of a project team reporting to the

Director of Public Transport. This reflects the importance of the ‘client’ or sponsor role in defining

the project scope and justifying the required investment within the context of competing priorities.

The Director of Public Transport is supported by a Project Control Board comprising

representatives across DOT, DTF, DPC, DPCD and the Commonwealth Government. This wide

cross section of government (both State and Federal) has ensured appropriate ‘buy in’ and

oversight of the project and provided the most appropriate governance structure for the project to

date.

� Pre-construction stage (approvals and specification) – the next stage of project development

will adopt a continuation of the current governance arrangements and is detailed in Figure 15-1.

As the project progresses, it will be important that the project team reflects a greater focus on

‘delivery’. To this end, ongoing development should be a joint undertaking shared between both

PTD and TPD. PTD’s role will continue to be critical to ensuring the full engagement of the

operators in the detailed development of project requirements and the successful conclusion to

the statutory planning process. Equally, TPD’s role will be ensuring that development of the

delivery model and specification is such that the project can be delivered in a manner which

provides the greatest value to the State and Commonwealth Governments.

Once the scope of the project has been fully resolved, including resolution of the process for a

seamless transition from project completion to service delivery, the project would be ready to

transition fully to a delivery governance model. Given that this may occur before the final approval is

granted for implementation, some further interim arrangements would be advantageous in managing

the transition. This could include establishment of a Project Board to replace the Project Control

Board. The role of the Project Board would be to prepare the project for transition to a standalone

Delivery Authority, including the establishment of the appropriate protocols for working with DOT,

MTM and other primary stakeholders. It is envisaged that a majority of the Project Board would

become the Board of the Delivery Authority once it is established.



Page 287 of 321

Figure 15-1: Detailed development stage governance structure

15.2 Project team

15.2.1 Work streams

From approval of this business case the project will enter the detailed development stage, expanding

in the number of personnel and skill sets required. Personnel and tasks required for the next phase of

the project includes:

� Project management – includes project planning, work package identification, project

scheduling, reporting, risk management coordination, project coordination and

cost/schedule/quality tracking and reporting.

� Engineering – includes the conduct of further technical investigations, completion of the MM

Reference Design, technical standards, develop the contractual specifications, contractual

statement of work and coordination with transport operators and other technical organisations.

� Commercial – includes the development and implementation of a commercial acquisition

strategy; probity advice; legal advice; contract document preparation; leading the development of

market communication documentation (EOI(s) and RFT(s)); financial and budgetary planning; and

management of the project.

� Property and urban development – includes planning and environmental approvals, land use

planning, land acquisition planning and engagement, community relationships and consultations,



Page 288 of 321

station architecture and urban integration of MM. Specific assessment and development of the

Arden Urban Renewal precinct and interventions will be a key aspect of this group’s activities,

including gathering sufficient information so as to allow government to make an informed decision

regarding Arden. This will include greater level of detail regarding costs, development outcomes,

opportunities and constraints.

� Communications and stakeholders – supporting planning and environmental approvals, media

engagement and general community presentations and communication.

All project teams will also be involved in market engagement, EOI evaluation and various types of

stakeholder communication and engagements.

15.2.2 Organisational structure and staffing profile

The project will need to be staffed by a combination of DOT full-time staff, contractors and

consultants, with some representation from other organisations who will have a significant relationship

with the project (ie VicRoads, DPCD, VicTrack). The majority of staff throughout the next stage are

expected to be contractors, due to the large quantity of complex specialised work to be conducted

over a relatively short period of time.

The organisation’s structure will be representative of the major work streams to be completed during

the pre-construction phase and is indicatively shown on Figure 15-2. Further details are provided in

the pre-construction funding submission.



Page 289 of 321

Figure 15-2: Indicative MM project organisational structure



Page 290 of 321

15.3 Reference groups

The project will establish three reference groups (utilising organisations previously involved in the

project from working groups) that will provide project integration within DOT, across government

departments and with other parties related to the outcomes and activities of the project. The reference

groups will be required to review project plans, designs, specifications and strategies, to ensure that

all parties are informed of the project’s activities and provide advice, direction, endorsement and

approval from each of their relevant organisations.

The Technical Reference Group will focus on technical design, specifications, standards, logistics and

design and construction strategy of MM. The Technical Reference Group will be led by the

engineering team of the project and primarily consist of government, operator and engineering

organisations. An indicative composition of the Technical Reference Group is detailed in Figure 15-3.

Figure 15-3: Indicative Technical Reference Group

The second reference group will focus on community related aspects of the project, such as land use

and acquisition, station design and station integration with communities. The Community Reference

Group will be led by the project’s Land Use team and will focus on the communities around each of

the proposed stations and tunnel portal. An indicative composition of the Community Reference

Group is detailed in Figure 15-4. Due to the various locations of stations and different community

effects, the sub-groups of the CRG group may be formed to focus on specific locations.



Page 291 of 321

Figure 15-4: Indicative Community Reference Group

An Approvals Reference Group for the planning and environmental approvals process will be

established after the project has been declared under the MTPFA. This will include representatives

from EPA, DOT, DPCD, Melbourne Water, Heritage Victoria, Aboriginal Affairs Victoria and VicRoads

(Figure 15-5).

Figure 15-5: Indicative Approvals Reference Group



Page 292 of 321

16 Funding requirements

The development of Melbourne Metro is progressing through three distinct phases, each with a

defined set of deliverables and funding requirements. These are discussed below.

16.1 Phase 1 – Project Development

Phase 1 (current phase) is the project development phase. The Commonwealth has allocated $40

million to project development, which includes options analysis, preparation of this business case

and undertaking statutory approvals. Phase 1 has so far produced an options assessment, numerous

technical investigations and studies, preliminary environmental investigations, land use planning,

property studies, stakeholder engagement activities, patronage and economics analysis, rail

operations analysis, scope definition, concept design, indicative cost and risk plans and this business

case.

Future activities for the remainder of this phase include:

� constructability reviews and further value engineering

� further scope and project definition

� geotechnical investigations

� statutory approval by the Planning Minister under Major Transport Projects Facilitation Act 2009

� land requirement finalisation

� various further investigations as required (planning, commercial, technical, operational).

The statutory approvals process seeks to establish and protect a reservation for the project, which

requires an estimated $100 million corridor protection funds to compensate landowners for

planning blight as a result of the reservation. This is part of the overall land acquisition budget, but is

required to complete the statutory approvals process. It is envisaged that all land acquisition and

corridor protection budgets will be funded by the State Government.

16.2 Phase 2 – Pre-construction

Phase 2 is the pre-construction phase which principally includes development of a reference design,

completion of an implementation business case and preparation of contract documentation for

market.

The estimated budget to complete this phase is $130 million (nominal), assuming expenditure would

be expended over the next three financial years (FY2012/13 to FY2014/15), with enabling (early)

works extending over the latter two years. This estimate is in addition to the $40 million already

allocated and is separate from the corridor protection budget.

The key deliverables for the design and pre-construction phase are:

� MM implementation business case and funding submission, including commercial delivery options

analysis, comprehensive delivery program and a final cost plan66

66 Assuming a PPP delivery model is selected, this will also involve the development of a Public Sector Comparator.



Page 293 of 321

� ongoing value engineering, constructability and program reviews

� reference design and technical specifications

� station precinct plans

� commercial model and delivery strategy

� commercial and technical tender documentation

� enabling utility works.

These activities are discussed in more detail in the pre-construction funding submission.

16.3 Phase 3 – Implementation

This phase encompasses the delivery of Melbourne Metro - an initial capital estimate of $7 – 7.5

billion (real 2010/11) has been established (refer section 9). This excludes rolling stock and

associated works and ongoing operational costs.

An approximate cash flow profile has been developed to determine an indicative nominal cost

estimate and cash flow. The following escalation rates have been adopted:

� 4.3% per annum has been applied to all rail-related works for 2012-13 to 2015-16, and 3.9% per

annum thereafter67

;

� 6.0% per annum has been applied to land acquisition costs68

Indicative real and nominal cash flows for implementation of MM are shown respectively in Table 16-1

and Table 16-2 below. All figures are in $millions and have been rounded. They are based on the

upper bound (P90) cost estimate including the pre-construction and corridor protection estimates

identified above.

67 Department of Transport – Schedule of Financial Parameters for Cost Estimates to be used in Funding Submissions, DOT Finance, 18 August 2011 68 Analysis of property sales in inner Melbourne over the last 20 years for which areas are available DOT Property & Commercial Development, June 2011



Page 294 of 321

Table 16-1: REAL cash flow profile: MM Total Project implementation (real 2010/11, $m)

Cash flow Total

20

12

/13

20

13

/14

20

14

/15

20

15

/16

20

16

/17

20

17

/18

20

18

/19

20

19

/20

20

20

/21

20

21

/22

20

22

/23

20

23

/24

20

24

/25

Project implementation – Rail

6,314.5 48.9 57.2 757.7 1,156.7 1,389.2 1,515.5 820.9 315.7 252.6 - - - -

Land Acquisition - Rail 551.8 - 275.9 275.9 - - - - - - - - - -

Arden Development 596.3 - 29.8 53.7 53.7 89.4 143.1 143.1 38.8 8.9 8.9 8.9 8.9 8.9

DoT Levies 46.6 0.3 2.3 6.8 7.6 9.2 10.4 6.0 2.2 1.6 0.1 0.1 0.1 0.1

Totals 7,509.2 49.2 365.2 1,094.1 1,218.0 1,487.9 1,669.0 970.0 356.7 263.2 9.0 9.0 9.0 9.0

Table 16-2: NOMINAL cash flow profile: MM Total Project implementation (nominal, $m)

Cash flow Escalation

Rate Total

20

12

/13

20

13

/14

20

14

/15

20

15

/16

20

16

/17

20

17

/18

20

18

/19

20

19

/20

20

20

/21

20

21

/22

20

22

/23

20

23

/24

20

24

/25

Project implementation – Rail 4.3%/3.9% 8,101.8 53.2 65.0 896.7 1,427.8 1,747.7 1,980.9 1,114.8 445.5 370.3 - - - -

Land Acquisition 6.0% 676.9 - 328.6 348.3 - - - - - - - - - -

Arden Development 4.3%/3.9% 783.1 - 33.8 63.5 66.2 112.5 187.1 194.4 54.7 13.1 13.6 14.2 14.7 15.3

DOT Levies 4.3%/3.9% 59.5 0.3 2.6 8.0 9.3 11.6 13.5 8.2 3.1 2.4 0.1 0.1 0.1 0.1

Totals 9,621.4 53.5 430.0 1,316.6 1,503.4 1,871.8 2,181.5 1,317.4 503.3 385.8 13.7 14.2 14.8 15.4



Page 295 of 321

17 Lessons learned and innovation

The MM project will provide an expansion to inner city rail capacity that is unprecedented in recent

Victorian history. There are examples of similar investments in Victoria, interstate and internationally

which are exemplars of both good practice and the pitfalls to be avoided in major re-development,

tunnelling and rail projects. Case studies can also provide ideas of what can be done and be pointers

for innovation – in the Melbourne context, in relation to tunnelling and transit oriented urban

development.

17.1 The Tunnelling Joint Code of Practice

During the 1990s, the tunnelling industry experienced a number of serious claims, causing the UK

and European insurance markets to apply extremely strict underwriting criteria to tunnelling projects.

This made it difficult, and in some cases impossible, to arrange for appropriate insurance on

tunnelling projects from these insurers. In an effort to address this industry shift, a joint effort between

the Association of British Insurers and the British Tunnelling Society resulted in the Joint Code of

Practice for Risk Management of Tunnel Works (JCoP).

One of the compelling hallmarks of the JCoP is the recommendation that owners implement a

formalised and ongoing risk assessment and risk management process. Application of the

fundamentals of the JCoP is now increasingly being relied upon by insurers in the UK and Europe in

order to make important underwriting decisions for tunnelling projects they insure. United States

insurers do not necessarily rely on the JCoP when underwriting tunnelling risks.

Whether or not the JCoP approach is confirmed to be an effective risk management tool by normal

lagging indicators, it is now increasingly being used as a determinative underwriting criterion by some

UK and European insurers on tunnelling projects of a certain size or character. Those companies that

become familiar with the requirements of the JCoP and establish their own internal risk management

tools to conform generally to the required protocols can be better prepared to address the

underwriting issue. They may also be prepared for possible future shifts in the underwriting criteria

applied by markets outside the UK and Europe or on other types of high risk work.

The JCoP has been and will continue to be an integral part of the development of the MM concept.

17.2 Victorian projects

Several projects have been delivered in Melbourne that provide learnings for MM, both in terms of

tunnelling and project delivery. These include Melbourne Underground Rail Loop, CityLink, EastLink,

M1 Upgrade and Melbourne Water tunnel projects. Significant urban redevelopment projects include

Southbank and Docklands.

17.2.1 Melbourne Underground Rail Loop

The Melbourne Underground Rail Loop (MURL) project commenced construction in 1971 and was

completed in 1985. Its final cost (in say 1978 dollars) was $500 million, which is equivalent to more

than $2 billion in today’s prices. It was fully funded by the government (State and Local Governments

only), with 40% of funding derived from a levy which was to run for 53 years, but ended in 1995. It

was constructed in an environment where stakeholder management and environmental impact were

considered to a far lesser extent than now.



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A project-specific MURL Authority was established to develop and construct the project. The project

was delivered using a traditional design then construct approach (with the State bearing the interface

risk), with multiple construction contracts being awarded to an international team of contractors. The

contract superintendent and project management was provided by a team of engineering consultants,

who were also the designers. This proved ineffective in the management of design and contractor

claims. The project relied heavily on international resources for design, construction and construction

management and also relied on a traditional quality control approach rather than current best practice

quality assurance methodology.

A critical piece of tunnelling under Elizabeth Street was completed using ‘compressed air’ tunnelling

techniques to control ground water and settlement. This technique is not available today because of

OH&S concerns, however suitable mechanical methods are available to minimise this risk.

The final cost of the project was significantly greater than the budget at the time of the formation of

the MURL Authority, in part due to high inflation during the 1970s.

17.2.2 CityLink

CityLink, a $2.2 billion ($3.1 billion in 2009 prices) road project completed in 2000, including

significant tunnelling, was the first Victorian civil engineering project delivered under a Build Own

Operate Transfer model (now referred to as a Public Private Partnership or PPP) with the

concessionaire taking full delivery, operational and patronage risk. The government established a

project-specific authority to oversee the development, delivery and early stages of the operations of

the project. This aided the project significantly in that the authority was focussed on achieving the

government’s project objectives. The authority managed the project interface with other government

departments and agencies against these objectives, rather than the broader department or agency

objectives. This was particularly successful and appropriate because of the limited operational

interfaces during the development and construction period.

However given it was the first PPP-style contract in the State, the market did not adequately

understand the PPP philosophy or risk transfer and lacked maturity in the appreciation of the

liquidated damages environment.

The documentation for the project included clear risk allocation to the concessionaire and led to a

good outcome for the State. When these risk allocations were tested they were found to be sound and

the State achieved the delivery of this project without suffering the consequence of these risks. It

appears that industry, particularly the technical suppliers, did not fully appreciate, and therefore price,

the risks being transferred. However in similar projects developed throughout Australia more recently

it is clear that these risk allocations are better understood and are now being priced. The CityLink

specification was a functional specification allowing industry to be as innovative as possible. This was

broadly a successful approach by the State. Following selection of the preferred party the features of

their own proposal were incorporated in the contract documents.

Design problems that did eventuate were dealt with by the concessionaire, with the quality assurance

and completion processes built into the documentation working to the State’s benefit. Again, industry

did not fully appreciate the consequences of these processes at the time of the development of

CityLink. However, today’s industry is fully aware and prices these consequences into their bids.

The impacts of tunnelling over a broader area were not well understood on CityLink. The project has

therefore catalysed a significant increase in the attention given to broader geographical hydrogeology

matters and to undertaking adequate three-dimensional geotechnical investigations.



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Quality assurance is now built into the processes of all of Australia’s major engineering organisations.

CityLink also suffered from a lack of maturity in the engineering industry at that time due to the lack of

major projects completed in Australia prior to the development of this project. Australia has seen

many major and technically complex road, transport and water projects completed over the last 10 to

15 years providing an experienced project delivery pool to the Australian engineering industry.

17.2.3 EastLink

EastLink, a $2.5 billion road project (or $2.7 billion in 2009 prices), including tunnelling, was

developed and delivered under the State’s Public Private Partnership model and built upon the

CityLink experience. Again, a project specific authority was established, drawing on a number of the

staff who had been involved in the CityLink project. This was essentially a greenfield project, allowing

the design and construction contractor to achieve expenditure rates of approximately $100 million per

month at its peak. The project was delivered by essentially Australian resources, except for the

electronic tolling components. It included minimal interface with existing operational assets, enabling

a smooth delivery except for the completion process. The risk allocation was similar to CityLink and

where CityLink suffered from design problems, EastLink has suffered patronage issues. As with

CityLink, the State has not suffered the consequences of the risks given the risk allocation

incorporated into project documents.

17.2.4 M1 Upgrade

M1 Upgrade, a $1.4 billion freeway upgrade project recently completed was undertaken as a series of

alliances between design and construction contractors and VicRoads, in partnership with CityLink.

The project was delivered promptly and – given the significant operational interface – with minimum

interference to the operation of the road network. The project budget increased during the project

delivery.

17.2.5 Melbourne Main Sewer Replacement

Melbourne Water has a major capital works program, with a pipeline of tunnelling projects to construct

new sewers underway.

The Melbourne Main Sewer Replacement is currently under construction, replacing a brick line tunnel

from West Melbourne into the Main Hobsons Bay sewer. The $220 million project involves the

construction of a tunnel through some complex and difficult ground conditions similar to those that will

be encountered on the MM alignment, including passing under the Yarra River. The MM project team

has held discussions with Melbourne Water regarding their construction techniques, particularly the

river crossing.

Melbourne Water is using an Early Contractor Involvement (ECI) term contract model for a bundle of

upcoming tunnelling works over a six-year period, which has allowed the contractor to have significant

input to the design. Melbourne Water believes this has resulted in significant cost savings.

17.2.6 Southbank

In 1985, the Victorian Government had a vision to realise significant redevelopment opportunities in

Southbank, a previously derelict area of Melbourne. While the Southbank site had a high level of

natural exposure and access due to its proximity to the Melbourne CBD, it did not have a high

amenity. Without Government-led localised amenity improvements and remediation, redevelopment

of Southbank would not have been possible. Key Government interventions included Southbank



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Promenade (1990), Melbourne Convention & Exhibition Centre (1995) and Crown Entertainment

Complex (1997).

Southbank has now developed into a major location for housing and employment and effectively

forms part of an expanded CBD economic zone, courtesy of major public and private investment.

Southbank is now also home to over 12,000 residents and major cultural destinations such as the Arts

Centre.

Lessons learned from the Southbank redevelopment include:

� the need for accessibility

� the value of high amenity locations

� the advantages of exposure and local identity.

The need for accessibility

Southbank has developed into an employment destination in its own right. This is due in part to the

high levels of transport accessibility adjacent to the site. Due to its proximity to the established CBD

grid, Southbank enjoys direct access to Flinders Street Station, which is the busiest station in

Melbourne. Southbank also has direct access to the St Kilda Road tram network which is one of the

busiest tram corridors in the world.

These major pieces of transport infrastructure have allowed business within Southbank to access a

large number of workers. In addition, Southbank provides residents with localised access to central

Melbourne and capital city functions such as the Arts Centre and Botanic Gardens.

The value of high amenity locations

The redevelopment of Southbank from a range of industrial uses to a major employment node

required substantial amenity improvements. Once again Southbank enjoyed a high level of natural

amenity due to its location on the south side of the Yarra River. The creation of public open space

such as Southbank Promenade has helped transform the area into a place that attracts workers,

residents and tourists alike.

The advantage of exposure and local identity

The development of Southbank into a premium commercial and residential address has been driven

in part by its high level of exposure. The strategic location on the Yarra River with sweeping-river and

city views has attracted significant private investment, while allowing the creation of recognisable

‘brands’ such as Freshwater Place.

17.2.7 Docklands

In more recent times the Victorian Government, through the Docklands Authority (established 1991)

and now VicUrban, has led the redevelopment of Docklands together with the private sector. The

Victorian Government had significant land holdings and partnered with the private sector to develop

Melbourne Docklands as a world-class mixed use precinct with a blend of residential, commercial,

retail and leisure activities. By 2020 VicUrban expects Docklands to become:

� Home to 17,000 people

� Workplace to 40,000

� Destination for 55,000 visitors per day



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Docklands is now home to a number of high profile national and international tenants such as:

� National Australia Bank (NAB)

� Ericsson

� Australia and New Zealand Banking Group (ANZ)

� Myer

Similar to Southbank, the Docklands area was historically an industrial and port-related precinct, with

relatively low levels of urban amenity. The vision to transform Docklands, in partnership with the

private sector, centred on similar categories of interventions to Southbank.

The need for accessibility

While Docklands is in close proximity to central Melbourne, Government interventions were required

to provide for greater levels of local accessibility:

� Land remediation

� Tram route extensions

� Road extensions (Bourke and Collins Street extensions)

� New roads (Wurundjeri Way)

The northern end of Docklands has direct access to Southern Cross station, which is highly

accessible to workers and therefore an attractive location for business. Docklands is provided with

high levels of access for workers and residents alike through Southern Cross Station, as well as

localised road and tram extensions.

The value of high amenity locations

Docklands, including Etihad Stadium (2000), and Southbank are both areas of high natural amenity

value owing to waterfront views and access. Similar to Southbank the vision for Docklands has

centred on the creation of localised amenity improvements, like New Quay promenade, to generate

street-based activity. These urban amenity upgrades, along with increased accessibility have been

central to the creation of Docklands as a ‘place’ and subsequent private sector investment.

The advantages of exposure and local identity

As part of the vision for Docklands, Government facilitated the extension of Bourke and Collins

Streets into the precinct. This local road intervention has given Docklands a much greater sense of

local identity and exposure, especially to business. Docklands can now provide major national and

international tenants with a Collins Street address and integration into the inner employment core of

Melbourne.

17.3 Interstate projects

In recent history, a handful of rail tunnel projects have been delivered in Australia – notably the

Epping to Chatswood Rail Link in Sydney and the CBD section of the Mandurah Line in Perth. These

provide learnings for the Melbourne Metro project in terms of both the project development approach

and delivery aspects.



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17.3.1 Epping to Chatswood (Sydney)

The Epping to Chatswood Rail Link project was recently completed at a cost of $2.3 billion. The new

13 kilometre rail link connects Epping and Chatswood stations via twin underground rail tunnels and

provides three new stations at Macquarie University, Macquarie Park and North Ryde and included

new transport interchanges at Epping and Chatswood.

The Macquarie Park station was designed to take advantage of the planned development of this

precinct, which is forecast to become Australia’s fourth largest business district over the next

25 years, with 30,000 jobs.

On average, approximately 8,000 customers have been using the three new stations each weekday,

which is relatively low patronage compared to that envisaged for the MM stations. North Ryde and

Macquarie Park stations will have a 10–20 year patronage ramp up, due to the developing nature of

these precincts.

In delivering the project, many different procurement types were employed. Chatswood Transport

Interchange was constructed as a PPP, delivering a retail hub and the air rights above the station

(currently largely vacant due to a commercial dispute with the developer). The project team went to

some effort to separate a greenfields area for the tunnel contract (civil and systems), with the

brownfields work such as the at-grade tie in undertaken separately as a cost plus contract. Fit out of

the new underground stations was delivered through a construct-only contract, with the State

maintaining control of design aspects such as finishes.

17.3.2 Mandurah – CBD Rail (Perth)

This project extended the existing commuter rail network by 70 kilometres through the construction of

a new line from Perth Central to Mandurah. Eleven new stations were constructed, two of which were

underground. Much of the extension runs down a surface easement in the centre of the Kwinana

freeway. The total cost of the project was $1.65 billion.

In developing the project, TransPerth undertook significant stakeholder consultation around individual

stations, ensuring station designs were ‘owned’ by a nominated group of local stakeholders. Having

the design locally-owned, acted as a defence mechanism against criticism which proved important in

project implementation. TransPerth created a master planning document for the project that was

publicly available. It included the vision, key objectives and any salient points on the local benefits.

Changes to scope were in effect changes to the master plan and had to be justified as such. Scope

creep was limited to 5%.

The underground parts of the extension comprise of 700 metres of twin bore tunnel and 1200 metres

of cut and cover. Perth Central Station was constructed by mining under underpinned structures

while Esplanade Station was cut-and-cover. Sheet piles and props were used for the cut-and-cover

section as the contractor was able to secure a large amount of second hand ground support

equipment from a project in South East Asia. TransPerth considered that this was unsuccessful and

in retrospect would have preferred to use the slurry diaphragm wall technique.

When asked about the apparent low price of the project considering the scope of works, TransPerth

advised that the tenders were fortunately let at a time just prior to the full extent of the resources

boom. They also pointed out that much of the alignment lay in a pre-existing easement that required

little improvement for rail use and sundry land acquisitions were not excessive.



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17.4 International projects

While Australian cities do not have a strong recent history in delivering major projects that combine

metro rail with urban redevelopment, there are many international examples where this has been

done successfully.

17.4.1 Hong Kong Mass Transit Railway, Hong Kong

The Mass Transit Railway (MTR) Corporation is Hong Kong’s principal rail operator, with the Hong

Kong Government as its majority shareholder. While public transport usage is high in Hong Kong, a

significant proportion of revenue raised by MTR to finance railway infrastructure and transit-oriented

development is generated through property development.

MTR has successfully implemented its ‘Rail + Property’ model whereby high quality residential and

commercial development is packaged with rail infrastructure provision. The consequentially high real

estate prices are a source of value-capture funding for the infrastructure in addition to patronage

income. As a result of the model’s success, it is now being considered for mainland Chinese capital

cities.

Profitability for MTR has been growing steadily since breaking even in the early 1990s to an annual

profit of over HK$8 billion in 2008. Furthermore it is estimated that the Hong Kong Government has

received in the order of HK$140 billion in direct net financial returns over the period of 1980 to 2005.

17.4.2 Bay Area Rapid Transport, San Francisco, California, USA

The Bay Area Rapid Transit (BART), a rapid transport system servicing the San Francisco Bay Area,

was built in the 1960s and commenced service in 1972. According to studies undertaken in 1978 and

1995, residential housing at BART stations has changed from very low-level development in 1978 to

many more multi-family dwellings in 1995. The demand for high-density dwellings in the suburbs in

1978 was low with a preference for single-family buildings driven by automobile dependence. By

1995, increased housing costs and worsening traffic congestion created higher demand for moderate

and high-density housing in proximity to transport nodes.

BART shows evidence of premiums for office and commercial land near to transit (Holling et al, 2007).

However, Gilbert and Ginn (2001) found that, since the opening of the BART system, population

growth has generally occurred faster in suburbs away from BART stations than those adjacent. On

the other hand, overall employment growth has been higher around BART stations, particularly in

downtown San Francisco.

All four BART stations in downtown San Francisco have been the focus of intensive office and retail

development. Montgomery Station has seen the most intensive development, with the area around

the station being zoned for the highest floor space ratios and allowable building heights in the city.

The area around the station saw numerous tall skyscrapers built there before the 1992-96 recession.

The Fruitvale Transit Village was constructed at the Fruitvale BART Station which is serviced by three

heavy rail routes. The success of the Fruitvale Transit Village can be attributed to the involvement of

the local community and The Spanish Speaking Unity Council (a not-for-profit body) which pushed for

a transit oriented development at the site. The project comprises a 20 acre mixed use development

with neighbourhood retail, affordable housing and places for community interaction on land that had

previously been a parking lot.



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17.4.3 Washington, District of Columbia, USA

Washington DC’s Union Station is a prime example of densification and redevelopment around

stations. This project saw 1200–1500 jobs generated following the refurbishment as well as new

business development.

The Metrorail system attracted $US970 million of new development along its corridor in its first three

years of operation, returning around $US50 million in local tax revenues in 1985 alone. The New

York Avenue Station was built with a mix or private and public funds. The assessed valuation of the

35-block area increased from $US535 million in 2001 to $US2.3 billion in 2007. Over 15,000 jobs

have been created since 1998, with $US1.1 billion in private investment (National Council for Public-

Private Partnerships, 2006).

In the Washington DC communities of West Hyattsville and Maryland, overly restrictive station

development plans that did not relate to market conditions failed to create sufficient economic

incentives for the type of development required. The Transit Oriented Development (TOD)

development potential was stifled in these instances, highlighting the need to understand the market

conditions when writing planning controls. However, ‘fast-track’ permit approvals assisted

development around some Washington DC metro stations such as Bethesda. An ‘optimal zoning’

standard put projects with high quality construction and public amenities, such as pedestrian friendly

design, on a fast-track for permit approval.

The New York Avenue Metrorail Station was an infill station on the existing Red Line in Washington

DC, which opened for service in November 2004. It was the first Metrorail station in Washington to be

funded by a mix of public and private funds.

A ‘Transit Benefit District’ was used to fund 28% of the station cost. Prior to station construction, the

area had a mix of residential, commercial and light industrial uses with substantial vacant properties.

Even with the vacant properties, nearby sites were at capacity and no new development was being

delivered. Property owners within the District agreed to a ‘Metro Benefit Fee’ requiring property

owners within 2000 feet of the station to collectively generate $US25 million to fund general obligation

bonds.

The willingness of property owners to contribute to the construction cost was a reflection of the

expected potential of the new station to increase property values, thereby encouraging new

development opportunities.

17.4.4 Crossrail, London, UK

CrossRail is a project which will provide new high frequency rail connections under central London. It

is based around an east-west tunnel with a central section from Paddington to Liverpool Street

station, joining up existing commuter lines that extend to the east and the west of London. The

second route is the Chelsea-Hackney line. Due to commence in 2017, 10-carriage trains will run at

frequencies of up to 24 trains per hour in each direction through the central tunnel section.

CrossRail has been designed to reduce crowding on London’s transport network by increasing route

choice and providing faster and more reliable connections. It will operate with main line size trains,

carrying more than 1500 passengers in each train during peak periods.

CrossRail will deliver substantial economic benefits for London, the South-East and across the UK,

with predicted contributions of at least £36 billion to the British economy. For every £1 spent on

building it, £2.60 will be returned in various benefits to the community (Transport for London figures,

May 2006).



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In recognition of this economic contribution, the London Mayor has announced a business levy of up

to 2% on business properties valued more than £55,000 following the opening of CrossRail for a

period of 24 to 31 years. The levy, to be imposed by local government, is expected to collect £4.1

billion of the project’s £15.9 billion cost.

Up to 14,000 people are expected to be employed at the peak of construction, creating new jobs and

safeguarding existing ones. A new Tunnelling Academy is being created to help people into work.

17.4.5 Second Avenue Subway, New York City, New York, USA

The Second Avenue Subway will be New York City’s first major expansion of the subway system in

over 50 years. When fully complete, the line will stretch 8.5 miles along the length of Manhattan's

East Side, from 125th Street in Harlem to Hanover Square in Lower Manhattan. In addition, a track

connection to the existing 63rd Street and Broadway Lines, will allow a second subway line to provide

direct service from East Harlem and the Upper East Side to West Midtown via the Broadway express

tracks.

The $US3.8 billion first phase of the subway line, formally commenced in April 2007, will cover a two

mile stretch of subway from 96th to 63rd streets, where trains will link up to the existing subway grid.

The line is slated to carry about 200,000 weekday passengers when it opens in 2013.

The Report on the Economic Benefits of the Second Avenue Subway and East Side Access,

(prepared by the Office of Congresswoman Carolyn B. Maloney, February 3, 2009) states the Second

Avenue Subway has created 16,000 jobs, generated $US842 million in wages and produced $US2.87

billion in economic activity for the city.

17.4.6 International projects key observations

Key observations from international metro case studies are summarised as follows:

1. Transit infrastructure can measurably increase property values when compared to non-TOD

locations. The magnitude of land value premiums is largely associated with the age of the system

and it may take time for market values for property to reflect the accessibility premium brought by

proximity to passenger rail. Land values often take between 15 and 20 years to mature.

2. Transit infrastructure itself is not enough to catalyse development if the market conditions are not

supportive.

3. Walkable streets and community life are more important to the success of TODs than dwelling

density. This includes pedestrian-friendly infrastructure, weather protection, security and

surveillance.

4. There is a clear link between urban planning and transit-oriented outcomes. Development controls

and incentives are required to generate activity in TOD precincts.

5. Public investment can build confidence and spur additional investment in station areas.

Government agencies need to take on a role in developing demonstration projects to guide the

market.

6. Amenity, quality design and reduced parking requirements are important factors in influencing the

success of TODs.

7. Station area planning works best when it responds to the needs of the local community and

broader region. This helps build community support as well as integration with surrounding uses.



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18 Public interest issues and Transport Integration Act

18.1 Overview

The development of MM has involved close consideration of the principles and objectives in the

Transport Integration Act (TIA). Mapping of key aspects of the project against the TIA principles and

objectives shows very strong alignment. The mapping also showed that public interest issues are

comprehensively incorporated in the project.

18.2 Public interest

The impact of the initiative must be assessed against the eight elements of public interest issues

outlined in DTF’s business case guidance. These public interest issues are closely linked to those

embodied in the TIA, which therefore provides a helpful and relevant lens through which these issues

can be considered.

This public interest test was undertaken for a general investment, not specifically for a PPP. The

public interest test for a PPP will be undertaken as part of the detailed assessment of a PPP in the

next phase.

The eight elements of public interest are:

� Effectiveness

� Accountability and transparency

� Affected individuals and community

� Equity

� Consumer rights

� Public access

� Security

� Privacy

18.3 Principles

MM has been planned using the guiding principles in the TIA. It is both appropriate and necessary to

gauge the compatibility of such a major Government initiative such as MM to the legislative

centrepiece of the Victorian Government’s integrated approach to transport and land use planning.

This assessment also satisfies the public interest issues test.

Three Overriding Principles derived from the TIA which are relevant to MM are being used to guide

the project’s development:

� The rail system should be considered in its role as an integrated part of the Victorian and

Australian economy and the transport system supporting State and Federal priorities. Rail’s



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natural competitive advantages for mass transit should be grasped to grow its role within the

wider transport system.

� All decisions should be based on a triple bottom-line assessment, taking account of market

demand and value for money, with a long-term outlook on the wider transport and land use

system.

� The purpose, value and justification for any investments and other interventions should be

transparent from stakeholders’ perspectives.

These overriding principles are embedded in the decision-making principles as discussed below in

Table 18-1. The relevant public interest issues are noted.



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Table 18-1: Compatibility of MM with Transport Integration Act decision-making principles

Decision-making principle and meaning Melbourne Metro compatibility

Integrated decision making

Seeking to achieve Government policy objectives through coordination between all levels of government and government agencies and with the private sector

Relevant Public Interest Issue:

• Accountability and transparency

East West Link Needs Assessment Study – involved consultation with the public and across agencies. MM was a key initiative identified to address lack of east-west connectivity and became a centrepiece of the seven-stage rail capacity upgrade plan

The project has been undertaken in partnership with the Department of Planning & Community Development (DPCD) to ensure the project’s city-shaping objectives guide the project appropriately. DPCD is leading work on the Arden Urban Renewal precinct, an important aspect of the overall MM business case. DPCD is also investigating land use intensification opportunities which might arise from the increase in service provision

and has shaped the land use considerations of the options assessment

City of Melbourne and City of Port Phillip (CoPP) have been engaged on the project as appropriate and fully support the proposed scheme. CoPP would like to see MM extended to St Kilda. CoM’s Municipal Strategic Statement is structured around MM being the biggest change in the city’s form in the foreseeable future

The project team participated in the development of the DOT’s flagship collaboration initiative, the Port & Inner West Conceptual Framework. The Arden Station and surrounding development is an important component of the strategy to revitalise the inner west and better link Melbourne’s west to economic opportunities

The project is being undertaken in collaboration with other project teams (eg RRL, SEP, WestLink) and with strategic transport planners within DOT and DPCD to ensure future options are protected where appropriate

to ensure future capacity, flexibility and certainty

Market soundings have been undertaken with the private sector (construction companies, financiers) to gauge interest in the project and to understand views and issues on appropriate delivery methods for the project

Triple bottom line assessment

Assessment of all the economic, social and environmental costs and benefits taking into account externalities and value for money


• Effectiveness

• Affected individuals and community

Triple bottom-line (TBL) assessment is a fundamental component of business case requirements for the Victorian Government and Infrastructure Australia (IA) and so have formed a critical part of assessments to date, influencing the various levels of options assessment and definition of the scope

The TBL assessment takes account of market demand and value for money, with a long-term outlook on the

wider transport and land use system

IA has already designated the project its highest status (‘ready to proceed’), based on the TBL assessments

to date, which have been refined in this business case. MM2 has been designated as having ‘real potential’



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Equity

equity between persons irrespective of their:

− personal attributes, including age, physical ability,

ethnicity, culture, gender and financial situation; or

− location, including whether in a growth, urban, regional, rural or remote area

equity between generations by not compromising the ability of

future generations to meet their needs

Relevant Public Interest Issues

• Equity

• Consumer Rights

MM improves accessibility to jobs and services in inner Melbourne from the western and northern suburbs and outer suburban growth corridors which have low jobs to residents ratios, lower socio-economic status and poorer access to education and services compared with the eastern suburbs

MM improves accessibility to the public transport system by removing barriers or improving functionality

and/or ease of use of the rail system through provision of new, fully accessible stations

MM is future proofed to allow for the future development of the transport system as outlined in DOT plans. Long-term options for the system that future generations may wish to implement are protected as far as practical

The proposed PPP delivery model ensures the funding burden of a project is shared across generations

Transport system user perspective

understanding the requirements of transport system users,

including their information needs

enhancing the useability of the transport system and the

quality of experiences of the transport system

Relevant Public Interest Issues

• Public access

• Security

The project has considered in detail the transport user requirements, for example station access and mobility, wayfinding and public transport interchange, to ensure a quality user experience

Passenger information is a critical user requirement which has been allowed for and will be specified in detail

in the detailed design of the stations

Development of the project concept has been based on a vision and strategy for the transport and land use system

Direct input from users has been sought through consultation and surveys



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Precautionary

If there are threats of serious or irreversible environmental damage, lack of full scientific certainty should not be used as a reason for postponing measures to prevent environmental

degradation. The precautionary principle includes:

a careful evaluation to avoid serious or irreversible damage to

the environment wherever practicable

an assessment of the risk-weighted consequences of various options


• Effectiveness

The project is seeking to minimise the impacts on the environment both temporary and permanent. A preliminary assessment of environmental and social impacts was undertaken both to inform the options assessment and to ensure there were no issues of such significance that the project should not proceed

MM includes viable ESD measures to optimise sustainability performance of the project

The technical concept development for MM allows for the impact of climate change

Stakeholder engagement and community participation

taking into account the interests of stakeholders, including transport system users and members of the local community

adopting appropriate processes for stakeholder engagement


• Affected individuals and community

• Consumer Rights

• Privacy

EWLNA and subsequent government strategies have involved public processes and release of detailed information to inform the public about the Government’s transport strategies and projects, including MM

Stakeholders and community groups have been and will continue to be engaged at all stages of the project

deliberations to ensure views are accounted for

A web-based survey was undertaken between July and September 2010, which generated a very large

response, overwhelmingly in favour of the project and the station locations

Transparency

Members of the public should have access to reliable and relevant information in appropriate forms to facilitate a good understanding of transport issues and the process by which decisions in relation to the transport system are made


• Accountability and transparency

• Public access

The project has remained faithful to the intentions and integrated strategies underpinning the seven-stage rail capacity upgrade plan, indicating a consistent and transparent approach to planning the urban transport and land use system. This improves public confidence that there is a long term plan and improves understanding of transport issues

A 20-page booklet describing the project details and preferred station locations was released to the public in

July 2010 for comment and information



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18.4 TIA Objectives

MM has been assessed against the range of objectives specified in the TIA. While the objectives for MM are more specific than the TIA objectives it is

appropriate to gauge the compatibility of the TIA’s overarching objectives. Table 18-2 below shows MM comprehensively delivers on TIA objectives.

Table 18-2: Compatibility of MM with Transport Integration Act objectives

Transport Integration Act Objective Melbourne Metro response

Economic

The transport system should facilitate economic prosperity by:

a. enabling efficient and effective access for persons and goods to places of

employment, markets and services

b. increasing efficiency through reducing costs and improving timeliness

c. fostering competition by providing access to markets

d. facilitating investment in Victoria

e. supporting financial sustainability

MM is focused on increasing the efficiency of the Northern Group to increase accessibility to jobs and services, contributing to the development of a ‘least cost’ city

MM is being developed with value management techniques to ensure the most cost-

efficient scope

The city-shaping nature of the project provides agglomeration and wider economic benefits by enhancing accessibility to key economic centres, particularly for residents

of the west and north

MM creates opportunities for investment in Victoria in the delivery of the project, in

urban development and in business.

Environmental

The transport system should actively contribute to environmental sustainability by:

a. protecting, conserving and improving the natural environment

b. avoiding, minimising and offsetting harm to the local and global environment, including through transport-related emissions and pollutants and the loss of biodiversity

c. promoting forms of transport and the use of forms of energy and transport

technologies which have the least impact on the natural environment

d. improving the environmental performance of all forms of transport and the forms

of energy used in transport

MM increases capacity of public transport system and hence provides the opportunity for more people to use public transport, thereby reducing emissions of greenhouse gases and pollutants, noise, land take and other environmental impacts

Viable sustainability initiatives are included in the project scope to enable reduced

use of natural resources and the environmental impact of the whole transport system

The city-shaping nature of MM will help build a low-impact urban form, with reduced travel distances, reduced reliance on motor vehicles and avoided impacts of urban expansion into Melbourne’s hinterland



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Social

The transport system should provide a means by which persons can access social and economic opportunities to support individual and community wellbeing including by:

e. minimising barriers to access so that so far as is possible the transport system is

available to as many persons as wish to use it

f. providing tailored infrastructure, services and support for persons who find it

difficult to use the transport system

MM grows stock of human capital improves accessibility to jobs and services in inner Melbourne from the western and northern suburbs which have low jobs to residents ratios compared with the eastern suburbs

MM is designed incorporating accessibility principles by avoiding barriers or functionality which would otherwise restrain access through provision of new, fully

accessible stations

Integration

1. The transport system should provide for the effective integration of transport and land use and facilitate access to social and economic opportunities

2. Without limiting the generality of subsection (1), transport and land use should be effectively integrated so as to improve accessibility and transport efficiency with a

focus on:

a. maximising access to residences, employment, markets, services and recreation

b. planning and developing the transport system more effectively

c. reducing the need for private motor vehicle transport and the extent of travel

d. facilitating better access to, and greater mobility within, local communities

3. Without limiting the generality of subsection (1), the transport system and land

use should be aligned, complementary and supportive and ensure that:

a. transport decisions are made having regard to the current and future impact

on land use

b. land use decisions are made having regard for the current and future development and operation of the transport system

c. transport infrastructure and services are provided in a timely manner to

support changing land use and associated transport demand

4. Without limiting the generality of subsection (1), the transport system should improve the amenity of communities and minimise impacts of the transport system on adjacent land uses

Selection of alignment and station locations is based on unlocking inner urban land redevelopment opportunities (eg Arden), maximising access to existing development and reshaping the west, having regard for likely future urban growth as described the

government’s projections and strengthening the central city

MM improves accessibility to key economic activities (such as Parkville medical precinct, CBD, Melbourne University and St Kilda Road), by integrating the project with existing land uses and thus improving efficiency of the transport system

generally

MM will support transit oriented development patterns, by encouraging the take-up of opportunities to intensify land use around new metro stations and existing stations on

the wider network

MM reduces congestion across the transport network, including road, tram and train networks, thereby increasing the efficiency of the transport and land use system. Station Access & Mobility studies have been undertaken for each MM station to

ensure transport network integration and maximum mobility by all modes

Opportunities for urban intensification along all the rail corridors which have higher levels of services have been identified. These opportunities arise from changing zonings (eg from industrial to residential) that encourage more intense development; or the rail service improvements enable more intense development to be served

more efficiently

Land which is being acquired for construction of the project is being assessed for redevelopment potential, which includes the impact that acquisition may have on the community. This assessment is also informing the selection of locations for

construction sites, ventilation shafts and access points



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Safety and Health

1. The transport system should be safe and support health and wellbeing

2. Without limiting the generality of subsection (1) the transport system should:

a. seek to continually improve the safety performance of the transport system

through:

i. safe transport infrastructure

ii. safe forms of transport

iii. safe transport system user behaviour

b. avoid and minimise the risk of harm to persons arising from the transport system

c. promote forms of transport and the use of forms of energy which have the

greatest benefit for, and least negative impact on, health and wellbeing

MM promotes increased use of public transport thereby reducing adverse safety and health impacts from transport (eg reduced transport accidents, more use of ‘active’ transport modes)

MM is scoped in a manner to maximise public safety outcomes (a fundamental design criterion) in accordance with Victorian rail standards and the rail operator’s risk register in that at minimum the project will not cause the system to be no less safe than it is currently

Efficiency, Coordination and Reliability

1. The transport system should facilitate network-wide efficient, coordinated and

reliable movements of persons and goods at all times

2. Without limiting the generality of subsection (1), the transport system should:

a. balance efficiency across the network so as to optimise the network capacity of all modes of transport and reduce journey times

b. maximise the efficient use of resources including infrastructure, land, services

and energy

c. facilitate integrated and seamless travel within and between different modes

of transport

d. provide predictable and reliable services and journey times and minimise any inconvenience caused by disruptions to the transport system

Contributes to the provision of more efficient, coordinated and reliable journeys for rail services by removing existing rail system bottlenecks in the inner core and increasing the efficiency and capacity of the rail network to accommodate the future

growth in demand

MM has been designed and options have been selected on the basis of facilitating

integrated and seamless transfer between rail and other modes

MM contributes to optimising use of the existing rail network by removing inner core capacity constraints thereby enabling more intensive use of existing corridors

MM is being undertaken in collaboration with other project teams (eg RRL, SEP) and with strategic public transport planners within DOT to ensure future rail options are

protected where necessary to ensure future capacity, flexibility and certainty



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19 Recommendation

This assessment of the MM project demonstrates that it will shape Melbourne’s development over the

next 20–30 years. It shows compelling economic, social and environmental benefits and justifiably

enjoys strong stakeholder and community support.

In acknowledgement of the scale and complexity of the project it is recommended that Governments

proceed with the next phases of development to enable a full implementation business case to be

prepared.

It is recommended that this business case be endorsed as a basis for considering the pre-

construction and corridor protection funding submissions.



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20 Bibliography

Policy documents

Transport Integration Act (Victorian Government, 2010)

State of Australian Cities (Infrastructure Australia, 2010)

Victorian Transport Plan (Victorian Government, December 2008)

Melbourne @ 5 million (Victorian Government, December 2008)

Future Melbourne (City of Melbourne, 2008)

Freight Futures (Victorian Government, December 2008)

National Objectives and Criteria for Future Strategic Planning of Capital Cities (COAG, 2009)

Investing in Transport, East West Link Needs Assessment (DOT (Eddington) 2008)

Melbourne 2030 (Victorian Government, 2002)

Project submissions

Regional Rail Link & Melbourne Metro 1 Rail Tunnel – Project Plan for Infrastructure Australia as at

January 2009 (DOT, 2009)

Regional Rail Link & Melbourne Metro 1 Project Plan: Progress Report for Infrastructure Australia as

at October 2009 (DOT, 2009)

Melbourne Metro Progress Report for Infrastructure Australia (Victorian Government, November

2011)

Melbourne Metro One, Pre-Construction Business Case (Draft) (DOT 1 December 2010)

Patronage forecasting and transport modelling

Understanding and Forecasting Metropolitan Public Transport Patronage (DOT, 2008)

Melbourne Metro Business Case Application of the Enhanced MITM (final), AECOM, (2010)

Strategic Model Enhancements for the Melbourne Metro Project (final), AECOM (2010)

ZENITH Model Report Melbourne Metro Stage 1 Business Case draft), VLC (2010)

ZENITH Model Report Melbourne Metro Stage 1 Options Testing, VLC (2010)

Melbourne Metro Transport Modelling Metro Patronage Results Version 5 (draft), Bell (2010)

Melbourne Metro Transport Modelling, A Tale of two Models, version 6 (draft), Bell (2010)

Melbourne Metro One Business Case Public transport patronage forecasts (draft), DOT (2010)

Victorian Official Patronage Series, June 2010 edition, Department of Transport (2010)

Land use and urban development

Arden Urban Renewal Precinct, Working Paper (Draft), DPCD, February 2011

Small Area Land Use Projections: Melbourne Metro Scenario (SGS, March 2010)

Melbourne Metro 1 Urban Renewal Opportunities Study, Final Draft (City of Melbourne, 2009)



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Density Study – North and South Melbourne (Buchan, 2009)

Development Concept Plans for North and South Melbourne (Buchan, 2009)

Station Options Investigation (SGS, 2008)

Metro Melbourne, Retail Advisory, Final Report (Colliers International, November 2010)

Assessment of Property Development Opportunities at Alternative Station Locations (Charter Keck

Cramer, 2010)

Arden Metro Flood Mapping and Technical Information (Melbourne Water, 2010)

Utility Services Analysis and Environmentally Sustainable Development for North Melbourne Precinct

(AECOM, 2010)

Cost Estimates for Infrastructure Projects – North Melbourne Redevelopment Area (Currie and

Brown, 2010)

Economics

Melbourne Metro Economic Assessment working paper, DOT, November 2010

Melbourne Metro 1 – Urban Consolidation Benefits (DOT, 2010)

Arden Metro Business Case, Societal Benefits Assessment, Final Report, SGS, 15 December 2010

Agglomeration Elasticities in New Zealand, Motu Working Paper No. 09-06, Mare, D. and Graham, D.

(2009)

Productivity and the Density of Economic Activity: Preliminary Estimates of Agglomeration Benefits in

Australian Cities, Curtin University’s Sustainability Policy Institute, Trubka, R. (2009)

Wider Economic Benefits of Transport Improvement: Link between Agglomeration and Productivity,

Stage 2 Report, prepared for the Department for Transport, London, Graham, D.J. (2006)

Productivity and the Density of Economic Activity. American Economic Review 86:54-70, Ciccone, A.

and Hall, R.E. (1996)

ATC National Guidelines for Transport System Management in Australia, Volume 5

Technical

Melbourne Metro Concept Summary Report, Aurecon et al, 25 November 2011

Melbourne Metro, Peer Review Supplementary Report, MM Peer Review Team, November 2011

Melbourne Metro Phase 1 Contamination Assessment and Acid Sulphate Assessment, Golder

Associates, August 2011

Melbourne Metro Stage 2 Phase 1, Hydrogeological Interpretive Report, Golder Associates,

September 2011

Melbourne Metro Stage 2 Phase 1, Geotechnical Interpretive Report, Golder Associates, 6 July 2011

Melbourne Metro – High Alignment Options, Constructability Assessment, Evans & Peck, 17 June

2011

MM1 Extension Study, Aurecon et al, 12 July 2011

Melbourne Metro 1 Peer Review (Draft), MM Peer Review Team, October 2010

Melbourne Metro Stage 1, Concept Development Report, Aurecon et al, 29 October 2010



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Melbourne Metro Stage 1, Concept Development Technical Discipline Reports (27), Volumes 1-5,

Aurecon et al, 15 October 2010

Melbourne Metro 1, Options Cost Estimate Report (Aurecon, 2010)

East West Rail Link Engineering Study (Connell Wagner, 2008)

Melbourne Metro – CBD Vertical Alignment Review (PB, 2009)

Additional Option Study – Melbourne Metro 2 (Aurecon, 2009)

Station Access & Mobility/Tram

Melbourne Metro Tram Network Plan, Final Report (AECOM, October 2010)

Strategic Rapid Assessment of Tram Network – Metro Route Alignment and Staging Options

(AECOM, 2010)

Melbourne Metro: Impact on Inner Tram Network (DOT, 2009)

Arden Metro Station Access and Mobility Plan, Report 1: Issues, Opportunities and Needs (AECOM,

2010)

Arden Metro Station Access and Mobility Plan, Report 2: Station and Entrance Location, (AECOM,

2010)

Arden Metro Station Access and Mobility Plan, Report 3: Station and Precinct Supporting Measures,

(AECOM, 2010)

Parkville Station Access and Mobility Plan, Identification and Assessment Paper; (AECOM, 2010)

Station Access and Mobility Plans – CBD Precinct for Melbourne Metro 1, (SKM and Booz&Co, 2010)

Domain Metro Station Access and Mobility Plan, Report 1: Issues, Opportunities, (AECOM, 2010)

Domain Metro Station Access and Mobility Plan, Report 2: Station and Entrance Location; (AECOM,

2010)

Domain Metro Station Access and Mobility Plan, Report 3: Station and Precinct Supporting Measures,

(AECOM, 2010)

Parkville Access and Mobility Plan (AECOM, 2009)

Parkville Precinct Strategic Plan (Victorian Government, 2006)

Parkville and Domain Stations, Concept Design (Grimshaw, 2009)

Station Access and Mobility Plan – CBD Precinct, Preliminary Analysis for Input into Options

Assessment for Melbourne Metro 1 (Booz & Co, 2010)

Station Access and Mobility Plans – West Melbourne and South Melbourne, Preliminary Analysis for

Input into Options Assessment for Melbourne Metro 1 (AECOM, 2010)

Planning & Environmental

Australia’s National Greenhouse Gas Accounts, State and Territory Greenhouse Gas Inventories

2009, Department of Climate Change and Energy Efficiency, Australian Government, 2011

Greenhouse Gas Emissions associated with MM, Draft Working Paper, DOT, November 2010

Melbourne Metro 1 Planning and Environmental Services Stage One Preliminary Assessment (Beca,

March 2010)



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A Spatial Analysis of Future Macro-Urban Form, Greenhouse Gas Emissions and Transport Energy

Outcomes for Melbourne, Jeremy Whiteman and Gavin Alford, Department of Transport

Unsettling Suburbia: The New Landscape of Oil and Mortgage Vulnerability in Australian Cities, Jago

Dodson and Neil Sipe, Griffith University Urban Research Program, Research Paper 17, August 2008

Growing Cooler: The Evidence on Urban Development and Climate Change, Urban Land Institute,

Washington 2007

Transport and Stationary Energy and Greenhouse Gas Emissions Scenarios for Melbourne 2031,

Jeremy Whiteman, ATRF 2010 Proceedings, 29 September – 1 October 2010, Canberra Australia

Other supporting studies and project documents

Melbourne Metro Options Assessment Report, DOT, March 2010

Melbourne Metro Communications and Stakeholder Engagement Strategy, DOT, November 2011

MM Preliminary Procurement Strategy Overview, Ernst & Young, March 2010

MM Procurement Strategy Development, Ernst & Young, November 2010

MM Detailed Development and Market Engagement Program, Firecone, January, 2011

Melbourne Metro Two, Alignment Options Assessment, DOT, September 2011


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21 Acronyms and Glossary of Terms

Acronym Full name Description

ARO Accredited Rail Operator

- Agglomeration

Agglomeration externalities relate to the benefits which flow to firms and households from locating in areas which have a high density of economic activity (measured by employment). Such locations allow firms to achieve economies of scale through access to an extensive customer base. This large customer base presents firms the opportunity for economies of scope. That is, with increased numbers of clients, firms gain efficiencies be specialising in a particular field. With many firms located together there will be a high level of knowledge transfer between firms, which will help bolster innovation. This innovation is vital for firms to survive in a competitive market place. The degree of business agglomeration in any given location can be measured by Effective Job Density (EJD); that is the number of jobs hosted by that location plus other jobs accessible to that location divided by the travel time (or cost) incurred by economic transactors in reaching all

these jobs.

ATC Australian Transport Council

BCR Benefit Cost Ratio

CAA Central Activities Area Designated activity districts which provide second order CBD functions – Broadmeadows, Footscray, Ringwood, Box Hill, Dandenong, Geelong and Frankston. Formerly known as Central Activities Districts

CEPR Customer Experience Performance Regime

CHMP Cultural Heritage Management Plan

CIS Comprehensive Impact Statement As specified in the MTPFA

CPI Consumer Price Index

COO Concept of Operations Operating plan for rail system

DBM Design Build & Maintain Method of procurement


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- Default Scheme

Through the EWLNA and subsequent DOT planning, a default scheme was proposed for the Melbourne Metro, based on the preferred corridor option. The default scheme follows a Swanston St alignment with new underground stations built at Parkville, Swanston Street North, Swanston Street South and Domain as part of MM1. As part of MM2, the default scheme follows a Dandenong Road alignment to Caulfield, with stations at Alfred, Windsor and Orrong Road

IPCD Integrated Programs Co-ordination Division (DOT)

DDA Disability Discrimination Act (1995)

DOT Department of Transport

DPC Department of Premier and Cabinet

DPCD Department of Planning & Community Development

DSE Department of Sustainability & Environment

DTF Department of Treasury & Finance

Victorian Government Departments

EEA Environmental Effects Assessment

EES Environment Effects Statement

EJD Effective Job Density A measure of proximity and accessibility of jobs to each other. Refer agglomeration

EOI Expression of Interest

EPBC Environment Protection & Biodiversity Conservation Act (1999)

ERF Emergency Relief Facility

ESD Environmentally Sensitive Design

EWLNA East West Link Needs Assessment

FSS Flinders Street Station

GAA Growth Areas Authority

GHG Greenhouse Gas


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GIC Governor in Council

- Human Capital

Improvements to the stock of human capital will not only flow into improved productivity. Human capital benefits accrue to households from improved accessibility, as distinct from firms gaining a wider economic (agglomeration) benefit through locating themselves in areas with high levels of accessibility. Other non-market impacts can be anticipated, such as decreased crime and

improved health, representing an increase in welfare.

HCS High Capacity Signalling In-cab signalling with automatic train protection and warning systems enabling high frequency operations

HCMT High capacity metro train

IVT In-Vehicle Time

JCOP Joint Code of Practice (Tunnelling)

KPI Key Performance Indicator

LACA Land Acquisition Compensation Act

MITM Melbourne Integrated Transport Model Department of Transport’s strategic four-step transport model using Cube software

MTM Metro Trains Melbourne

MTPFA Major Transport Projects Facilitation Act (2009)

MURL Melbourne Underground Rail Loop

MM Melbourne Metro Stage One

MM2 Melbourne Metro Stage Two

- Metro style services

NPV Net Present Value

OHLE Overhead Line Equipment

OPR Operational Performance Regime

OH&S Occupational Health & Safety


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PPP Public Private Partnership

PSC Public Sector Comparator

PTD Public Transport Division (DOT)

PTDA Public Transport Development Authority

PV Present Value

RLV Residual Land Value

RRL Regional Rail Link

SAM Station Access and Mobility

SEP Sunbury Electrification Project

SLA Statistical Local Area

- Sectorisation / Segregation Disaggregation of the four metropolitan rail groups into separate sectors or metro lines which operate on dedicated tracks and independently of each other, with dedicated rolling stock,

stabling and maintenance facilities

TA Technical Advisor Providers of engineering and architectural services to the project team

TBL Triple Bottom Line Social, environmental and economic impacts

TBM Tunnel Boring Machine

TIA Transport Integration Act (2010)

TOD Transit Oriented Development

TPD Transport Projects Division (DOT)

TSV Transport Safety Victoria Transport safety regulator in Victoria reporting directly to Ministers

VFM Value for Money

VOC Vehicle Operating Cost


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VOT Value of Time

WEB Wider Economic Benefit

- Zenith Strategic four-step transport model using proprietary software (Veitch Lister Consulting)

Documents

MELBOURNE METRO Business Case Commercial in Confidence