April 20, 2016
Editor(s): Sarah Abell
Writer(s): Edward Lim, Brydon McLeod, Kael McLeod, Sidharth Varadarajan

In contemporary society, globalisation represents the ongoing development of technology in order to optimize several facets of human life including mundane aspects such as commutation. Due to this rapidly expanding phenomenon, there is a need to “future-proof” new initiatives and solutions in order to keep up with developments and build a sustainable future. Transportation in particular has been an area of continual innovation as people seek to find new ways to reduce travel time. Melbourne in particular has seen a massive growth in population over the last decade, amounting to nearly a million more people. This clearly has had an impact on both roads and the usage of public transport. The increase in the number of cars has caused roads to become extremely congested during peak periods, resulting in huge delays for commuters. In order to ease such congestions, the Victorian state government has recently put forth a $1.6b proposal in the form of Skyrail. This project seeks to elevate sections of railway across Melbourne in order to do away with level crossings and therefore regulate the flow of road traffic more effectively. Seeking to emulate several major cities across the world, Skyrail offers a future with the scope of expanding roads without worrying about railway lines in order to further ease the problem of congestion and therefore is considered a “future-proof” initiative by several individuals. However, certain other individuals feel this project could have implications on safety, privacy and would be an “eyesore”, therefore sparking a lot of debate within Melbourne.

Benefits of sky rail? Are we now closer to ‘Plan Melbourne’?

The government’s plan to implement the sky rail project has caused heated controversy ever since it was announced. Mixed findings were found among the public. Carey (2016) reported that Andrews government’s plan to remove nine of Melbourne’s worst level crossings was endorsed by various parties- the Royal Automobile Club of Victoria (RACV), Bus Association Victoria, Bicycle Network, Victoria Walks, and the Public Transport Users Association. However, the project was challenged by local residents, who brought their anger and dissatisfaction onto the street through protests (Griffin, 2016).

So, is the sky rail project really beneficial to Melbourne? What drives the government to insist on it?

Stone and Woodcock (2016) highlighted some potential benefits of a consummated elevated rail. These include:

  • Opportunities for multi-scale economic and social development around stations
  • Extended networks of linear parks and quiet streets for safer walking and cycling
  • Opportunities to reorganise Melbourne’s bus system and its rail connections
  • Superior passenger experience, views and way-finding
  • Greater efficiency
  • Less disruption to traffic and trains during construction

The success of elevated rail around the world has proven its value; it can be delivered with less disruption, produce less noise, and create new spaces beneath the viaduct to deliver better public facilities for the community (Carey, 2016; Carey, 2016). According to Edwards (2016), the nine level crossing removals of the project is expected to create 2000 employment opportunities, incorporating at least 200 apprentices or graduate engineers. Moreover, the partnership between the government and the Chisholm Institute would create jobs for retrenched car industry workers and local high school students (Edwards, 2016; Willingham, 2016). These employment opportunities may work as a multiplier to stimulate consumer spending, thereby boosting the Australian economy.

On top of that, Zhou (2016) emphasized on the potential to have new facilities with the freed up space due to elevated rail. Woodcock (2016) proposed that the space under the viaduct can be used for commerce and recreation integrated with stations, and the concept has achieved great success in world’s best-practice station.

Next, with the reduction of rail and road travel times, multiple parties will benefit from the greater efficiency. For instance, companies will have a reduction in their lead time delivery, as they will now be able to optimise their supply chain management. The convenience that the sky rail provides could create a pipeline of investment opportunities, aiding the Australia economy in a long run.

The authors mentioned that in a time of rapid population growth, sky rail project is an innovative way to keep Melbourne moving. Besides, it can be argued that the potential benefits that sky rail may bring conform to the key concepts of Plan Melbourne, the Victorian Government’s planning strategy that will guide the city’s growth to 2050.

Costs of the project

The sky rail project, despite having substantial benefits, will have significant associated costs. These costs include but are not limited to; costs of short-term inefficiencies (such as time wastages for commuters and additional congestion on substitute transport alternatives during development), funding for purchase of real estate off those who have houses backing onto rail, cost of re-routing transport and the cost of local funding for maintenance of sky rail building sites (including the proposed parks and recreational areas where grounded rail once was).

The estimated total cost of the project, presented by the government, is roughly $1.6 billion; however it is exceedingly unclear as to what this figure has accounted for (Carey, 2016). That is, it may just include the cost associated with building the sky rail itself, and the cost of replacing transport with buses, and thus may not include the loss of efficiencies, cost of land purchases and fence creation, and the creation and maintenance of parks and recreational facilities below the proposed rail.

With this uncertainty, it is difficult to pinpoint whether the figure is somewhat accurate, or far from the actual costs associated with such a project. But, it is likely that total costs faced by society and the government, whether it is through efficiencies or through actual costs faced, will be greater than the $1.6 billion figure that is currently estimated. In order for this to gain proper detail, it is imperative to inspect further associated costs in more detail than are currently readily available.

Now in terms of the cost of running replacement buses, one can compare to the closest available measure; that is approximately $250,000 per day for the closure of the V-Line (Carey, 2016). Whilst this is obviously not easily related to a central closure, it is still something to start with.

Numerous parties have portrayed the sky rail project as very costly; this notion is hard to disagree with. However, the ultimate question is do the strengths outweigh the weaknesses? Do the benefits outweigh the costs? You decide.

Further, with roughly 130 houses that may require purchase, and an average house price in Melbourne of about $700,000 according to Domain (2015), the total cost of purchasing houses can be approximated to $91,000,000, which is just less than $100 million.

A proposed alternative to the method is train trenches which rather than having trains elevated, has them run under bridges. These trenches are recognised to be 40% more expensive than the sky rail (Permezel, Nicholl and Meysztowicz, 2016).

Regardless, to increase capacity and hence avoid issues associated with increasing population, such as congestion, methods such as sky rail or the alternatives are required.

(Note that this article is not referring to the monorail sky rail, which may elicit memories of a particular “Simpsons” episode, and can be viewed at http://www.monorailsaustralia.com.au/melbourne.html)


Carey, A. (2016). Cost of V Line meltdown mounting by the million for governments and commuters. The Age. Retreived 14/04/16, from http://www.theage.com.au/victoria/cost-of-vline-meltdown-mounting-by-the-million-for-government-and-commuters-20160129-gmh5z7.html

Carey, A. (2016). Friends in high places: transport groups back elevated rail planThe Age. Retrieved 12 April 2016, from http://www.theage.com.au/victoria/sky-rail-on-a-high-as-transport-groups-back-elevated-rail-plan-20160307-gnccpt.html

Carey, A. (2016). Many questions remain on Andrews government’s sky rail planThe Age. Retrieved 12 April 2016, from http://www.theage.com.au/victoria/melbourne-sky-rail-many-questions-remain-about-andrews-government-plan-20160208-gmo67k.html

Edwards, J. (2016). Premier defends sky rail project, saying residents were consultedABC News. Retrieved 12 April 2016, from http://www.abc.net.au/news/2016-02-16/premier-defends-skyrail-project-saying-residents-were-consulted/7174156

Griffin, M. (2016). Can we tell the difference between petitions and parody any more?The Age. Retrieved 12 April 2016, from http://www.theage.com.au/victoria/skyrail-can-we-tell-the-difference-between-petitions-and-parody-any-more-20160215-gmuo9y.html

Permezel, P., Nicholl, M., Meysztowicz , E. (2016). You deserve to know more. Retrieved 14/04/16, from  http://daviddavis.com.au/wp-content/uploads/2016/01/You-deserve-to-know-more.pdf

Stone, J., & Woodcock, I. (2016). The ‘sky rail’ saga: can big new transport projects ever run smoothly?The Conversation. Retrieved 12 April 2016, from http://theconversation.com/the-sky-rail-saga-can-big-new-transport-projects-ever-run-smoothly-54383

Willingham, R. (2016). Sky rail: Premier Andrews stands by consultation process in face of angerThe Age. Retrieved 12 April 2016, from http://www.theage.com.au/victoria/skyrail-premier-andrews-stands-by-consultation-process-in-face-of-anger-20160216-gmv6ou.html

Zhou, C. (2016). Melbourne’s median house price pushes through $700,000. Domain. Retrieved 14/04/16, from http://www.domain.com.au/news/melbournes-median-house-price-pushes-through-700000-20151021-gkdgii/

Zhou, C. (2016). Melbourne sky rail: what does the city need from new underpasses?Domain. Retrieved 12 April 2016, from http://www.domain.com.au/news/melbourne-sky-rail-what-does-the-city-need-from-new-underpasses-20160211-gmpone/

The CAINZ Digest is published by CAINZ, a student society affiliated with the Faculty of Business at the University of Melbourne. Opinions published are not necessarily those of the publishers, printers or editors. CAINZ and the University of Melbourne do not accept any responsibility for the accuracy of information contained in the publication.

Meet our authors:

Sarah Abell
Edward Lim
Brydon McLeod
Kael McLeod

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Sidharth Varadarajan

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