MPs on Wednesday were warned that the Gautrain rapid rail project may be suffering from “optimism bias” where the project may pan out to be far more expensive — and less popular in the eyes of the consumers — than the project planners envisaged.
The MPs, serving on the National Assembly transport portfolio committee, were told by the Development Bank of Southern Africa’s Dr Andrew Shaw that this is the sort of bias suffered by a project team “when designing a project” such as the Gautrain.
He said a recent report of 27 rail projects around the world showed that by far the majority of these had overestimated consumer demand — and in some cases by up to 80%. He also noted that Gauteng drivers are notoriously reluctant to leave their motorcars at home — despite increasing congestion on Gauteng roads.
Shaw noted, too, that the cost of the project — which would link Johannesburg to Tshwane/Pretoria — had started at R7-billion and this rose to R12-billion. During public hearings of the committee this week, this figure edged up to at least R20-billion.
Shaw said there are many positive sides to the project, but it has to be taken into consideration whether the multiplier effects — such as the creation of jobs — would not be higher if the investment was put into another sector, such as agriculture, health or education. The appraisal methodology of the project has not necessarily looked closely enough at other rail alternatives.
It is also not clear whether the benefit stream of the project — on which the Cabinet needs to take a decision in December — would surpass the costs, he said.
Nevertheless, on the plus side he said that the project is very innovative as it would create a multimodal form of public transport — integrating minibus taxis and buses — while involving the private sector through a public-private partnership in revenue and demand risks.
“While the Gautrain may be called into question around its costs, it can’t [be questioned] around how the public-private partnership is formulated,” he said.
He also said the corridor around the intended route forms a natural growth point for residential high-density housing — particularly south of Tshwane — which would bring those forced out to the periphery of the economy during apartheid closer to the economic hub of the two cities.
The Bombela Consortium is the preferred project bidder. It includes Absa, Standard Bank and Murray & Roberts. — I-Net Bridge