2.6 A late change to extension plans on Sydney Metro Northwest
The decision to procure the operations, trains and rail systems for the Sydney Metro Northwest project via a PPP contract with a 15-year operations phase was announced in June 2012.10 At this time, it was expected that government funding for the proposed extension of the Metro network south of Chatswood would only become available towards the end of the PPP contract's proposed 15-year operations phase. Accordingly, it was thought that a new contract to operate and maintain the extended metro system in a fully integrated manner could be competitively tendered at this time, which would ensure that NSW taxpayers obtained the best value for money outcome from the operator of the extended metro.
It was not until June 2014, the same month that Northwest Rapid Transit (NRT) was announced as the preferred bidder for the PPP contract,11 that the Baird Government announced it would apply the funds that it would generate from selling its electricity distribution assets (the 'poles and wires') to the extension of the metro south of Chatswood, if it secured a mandate from voters at the March 2015 election.12 This meant that it was now almost certain, rather than remotely possible, that during the term of the PPP contract, government would need to negotiate with NRT to try to reach agreement on commercial terms for the operation of the extended metro system. Accordingly, a more detailed augmentation regime was added to the PPP contract to assist government with these negotiations.
____________________________________________________________________________________________
12 http://www.transport.nsw.gov.au/newsroom/media-releases/rebuilding-nsw-government-declares-war-congestion; http://www.transport.nsw.gov.au/sites/default/files/b2b/media/Rebuilding%20NSW%20-%20Massive%20investment%20for%20regional%20NSW.pdf