The True Cost

In our opinion the North South Bypass Tunnel (NSBT) is not financially viable.

If the NSBT is not able to operate using only the income from tolls Brisbane City Council will have to subsidise it. How many generations of Brisbane rate payers (you and me and our children) will end up paying for this tunnel?

The current estimate of the total capital cost is $1.5B.

Brisbane City Council estimates show that an average of 60,000 vehicles per day will use the tunnel.

As each vehicle will be expected to pay an average toll of $2.00 (as promised by the Lord Mayor Campbell Newman) the annual revenue is in the order of $44M.

If it is assumed that annual operating and maintenance costs are 25% of revenue (as experienced by City Link Melbourne) this will amount to an annual cost of $11M bringing the net annual revenue to $33M.

At a 5% discount rate (ie: 5% real return over 20 years) an annual net revenue of $33M can amortise (pay off) a $432M initial investment.

What does this mean to us?

  • It means that if the NSBT has to rely on tolls for its financially viability and the toll is to be $2.00 the construction cost has to be reduced to $432M – less than one third of the current estimated capital cost.
  • It means that if construction costs remain around $1.5B or higher then the tolls will have to increase to over $4.50 per vehicle unless heavily subsidised by the State and/or Federal Government.

If the toll is too high motorists and trucks will continue to use one of the many free alternatives eg: Inner City Bypass, Hale Street Riverside express way.

What happens then?


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