Engagement on large infrastructure projects – Sydney Metro Northwest
Stakeholder engagement #9
‘The impact of not doing stakeholder engagement, far outweighs the time spent to align stakeholders onto the same page.’
Stakeholder engagement is a critical success factor in infrastructure projects. El-Gohary (2006) discusses public opposition has been reported as one of the main reasons infrastructure projects fail. The causes are as relevant today as when the article was written and include, the public not being aware of the project, not sufficiently educated about the project and denied access to detailed information contained in the consortium proposal. This results in the public not trusting infrastructure projects.
This importance of stakeholder engagement is further supported with a shift within the industry to structure projects as a public private partnership (PPP). The World Bank defines a PPP as “a long-term contract between a private party and a government entity, for providing a public asset or service, in which the private party bears significant risk and management responsibility, and remuneration is linked to performance”. With private consortiums taking on more risk as part of delivering an infrastructure project, their exposure is even higher as stakeholder engagement in a PPP environment becomes even more complex.
Effective stakeholder engagement is fundamental to delivering a successful infrastructure project. The impact of not doing it, far outweighs the time spent to align stakeholders onto the same page.
Sydney Metro Northwest
‘Sydney Metro Northwest will deliver, for the first time, a reliable public transport service to a region which has the highest car ownership levels per household in Australia’
Stakeholder engagement on large infrastructure projects is very complex. To help understand these complex relationships, we will use a recent case study, our goal is to make the discussions relevant by relating back to the case study. Sydney Metro is Australia’s largest public transport infrastructure project. The $8.3 Billion Sydney Metro Northwest, formerly the North West Rail Link, is the first stage of Sydney Metro. Metro City & Southwest is the second stage (refer Sydney Metro North West home page)
Sydney Metro Northwest will be the first fully-automated metro rail system in Australia. It is on track to open to customers in the first half of 2019. It will deliver eight new railway stations and 4,000 commuter car parking spaces to Sydney’s growing North West. Trains will operate every four minutes in the peak with at least 15 trains an hour. Customers won’t need a timetable, you’ll just turn up and go.
Sydney Metro Northwest will deliver, for the first time, a reliable public transport service to a region which has the highest car ownership levels per household in Australia. Over the coming decades, an extra 200,000 people will move into Sydney’s North West, taking its population above 600,000, twice the size of Canberra. The project includes construction of twin 15 km tunnels from Bella Vista to Epping which are Australia’s longest rail tunnels.
The Sydney Metro Northwest project is a wonderful example of a complex infrastructure project that we can use to understand the complexity of stakeholder engagement.
Relationships on large projects
‘Large infrastructure projects have different types of relationship that need to be effectively managed’
Projects are made up of both internal and external stakeholders.
‘Often there is a high level of mistrust within external stakeholders’
Often there is a high level of mistrust within external stakeholders, as they feel they have limited control, and say in the decision-making process within the project. For example, community groups feel the project has an already defined agenda, regardless of their input. Neighbouring residential property owners who happen to fall on the proposed rail line, feel they will have their properties taken and be unfairly treated. An adjacent primary school feels the commuter car parking will increase traffic flow and place their children at increased risk. Because of the high levels of mistrust, De Schepper (2014) stresses the importance of including external stakeholders upfront when planning large infrastructure projects.
‘Internal stakeholders have three possible types of relationships’
When considering internal stakeholders on large projects, De Schepper discusses three possible types of relationships, a public/public relationship, a public/private relationship and private/private relationship.
Public / public relationship
A public/public relationship is between the government department responsible for successful project delivery, in the Sydney Metro Northwest case study, this is the ‘Transport for NSW’s relationship with participating government agencies. For example, in building the new rail line, ‘Transport for NSW’ will need to involve various state ministers, agencies such as Department of Primary Industries – Fisheries, Sydney trains, Roads and Maritime services, EPA and several local councils. Already the level of complexity is apparent, all these agencies must come to some form of agreement for the project to progress and there will be conflicting priorities.
Public / private relationship
A public/private relationship is between the initiator of the project, ‘Transport for NSW’ and private consortiums. For example, in building the rail line, ‘Transport for NSW’ divided the work into several major packages, this work was tendered and a number private consortiums were formed such as Thiess, John Holland and Dragados who successfully won the contract to build the tunnels, stations and civil works. This relationship is often described as the client/contract relationship.
Private / private relationship
A private/private relationship is between the players within the private consortium partners and their subcontractors. For example, the Thiess, John Holland and Dragados consortium has engaged several specialised subcontractors to help with environmental requirements, design and construction work. Each party will have their own interests as a priority.
Stakeholders have a relationship with each other
‘It’s important to recognize internal stakeholders have a relationship with each other and a relationship with external stakeholders’
It’s important to recognize internal stakeholders have a relationship with each other, and also have a relationship with external stakeholders. As the internal stakeholders progress the project, they will impact the external stakeholders, at the same time the external stakeholder will impact the project and internal stakeholders. For this reason, on large infrastructure project the different types of relationships need to be effectively managed if the project is to become a success.
The next post in this series will explore these relationships mapped to the project lifecycle.