Ask not for whom the road tolled, it tolled for Sir Li

Ask not for whom the road tolled, it tolled for Sir Li

15 February 2010

Sir Li Ka-shing is said to be Asia’s richest self-made billionaire. He’s the world’s largest operator of container terminals, the largest health and beauty retailer, a major supplier of electricity to Hong Kong and still finds time to be a real estate developer and an investor in Facebook.

They say he plays a mean game of golf, even though he’s something like 81 years old.

Mrs Helen Liu is not in quite the same league as Sir Li Ka-shing. The Chinese-born businesswoman, property developer, “benefactor” of the former defence minister Joel Fitzgibbon, his old dad, and the NSW ALP, friend of Bob and Helena Carr, has been much in the news lately, thanks to new revelations that she allegedly dudded a Chinese state-owned company of $6m back in 1996 and was, allegedly again, grooming Fitzgibbon as an “agent of influence”.

Sir Li’s stevedoring company is still involved with Port Botany but his experience with the NSW Government and its Sydney toll road tunnels has not been a happy one. In fact, thanks to the RTA and the NSW Government, the poor bloke got his fingers burned to the tune of hundreds of millions.

It’s very seedy Sydney story. Sometime back in the early naughties, somebody sold Sir Li on the idea that his company, Cheung Kong Infrastructure should go 50 per cent in the Roads and Traffic Authority’s Cross City Tunnel project. Somebody managed to persuade Sir Li that the tunnel would carry an average of 98,000 toll-paying vehicles a day as soon as it opened.

So the $64,000 question is: who introduced Sir Li to the idea that Sydney toll roads would be a cash-cow investment?

A cynic might say that Sir Li was naïve. After all, the Harbour Bridge only carries 161,000 vehicles a day, and it’s 8 lanes wide (tidal flowed) and the most heavily-used stretch of road in the nation. It connects the whole north of Sydney with the whole south, east of Victoria Road, whereas the Cross-City Tunnel connects, well, Balmain with the mighty commercial and industrial hub that is Bondi Beach. If Sir Li had spent a couple of days with a telephone and a cheap calculator he’d have found out the whole thing was a con, so no doubt he relied on what someone he trusted told him.

Thanks to the demographics, and some significant choke-points on the roads feeding the proposed tunnel, there was never the slightest chance that the road would ever meet the 98,000. When it came to the environmental impact statement the RTA went all conservative and reckoned the road would carry a daily average of 68,000.

In the result the tunnel was opened by Bob Carr in June 2005 and attracted only 20,000 vehicles a day. It still hasn’t got above 35,000. The traffic predictions had been, as the critics had insisted all along, fraudulent – a work-back calculation designed to justify the construction cost.

The tunnel was $560m in debt when it went into receivership in December 2006 and Sir Li lost, big time. He lost again this year when the Lane Cove Tunnel – another toll road justified by transparently dodgy traffic predictions went into receivership.

How did Sir Li come to make such a dumb investment? Who introduced him to the concept of investing in two controversial Sydney toll roads? Who sold him on it? The decision makes Sir Li look like he’s a pork bun short of the full yum cha, but in fact he’s the richest self-made man in Asia, and you don’t get there by being vague and overly trusting. To this possum he looks like the sort of bloke you don’t dud with impunity.

In the wake of the Cross-City debacle, in July 2005, suddenly, and totally unexpectedly, Premier Bob Carr chucked in his seat in parliament. He was immediately followed by his deputy, Andrew Refshauge and treasurer, Mike Egan. Carr painted his resignation as a decision, made over a bottle of chardonnay with his wife Helena, to “move on” after 10 years in the job, but I wasn’t the only possum to wonder about the timing.

At the time, there was a deal of speculation that Sir Li might sue over the traffic figures. He’d probably have lost, but the sordid technical details, trotted out in court, would have brought down the government.

Carl Scully, the roads minister responsible for the Cross-City and Lane Cove tunnels (and more RTA disasters besides), tried to succeed Carr but was bumped by Morris Iemma. He resigned in 2007 and now works for Evans and Peck, the lobbying firm currently trying to con the government into shouldering all debt responsibilities for private toll roads. My informants tell me that he and Paul Forward, the former RTA chief sacked over the Cross-City disaster work at adjacent desks. Ah, Public Private Partnerships. It’s an incestuous little world.

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We've been online since 1997. Check out the archives or … powered by FreeFind © Nick Possum/ Brushtail Graphics	Ask not for whom the road tolled, it tolled for Sir Li 15 February 2010 Sir Li Ka-shing is said to be Asia’s richest self-made billionaire. He’s the world’s largest operator of container terminals, the largest health and beauty retailer, a major supplier of electricity to Hong Kong and still finds time to be a real estate developer and an investor in Facebook. They say he plays a mean game of golf, even though he’s something like 81 years old. Mrs Helen Liu is not in quite the same league as Sir Li Ka-shing. The Chinese-born businesswoman, property developer, “benefactor” of the former defence minister Joel Fitzgibbon, his old dad, and the NSW ALP, friend of Bob and Helena Carr, has been much in the news lately, thanks to new revelations that she allegedly dudded a Chinese state-owned company of $6m back in 1996 and was, allegedly again, grooming Fitzgibbon as an “agent of influence”. Sir Li’s stevedoring company is still involved with Port Botany but his experience with the NSW Government and its Sydney toll road tunnels has not been a happy one. In fact, thanks to the RTA and the NSW Government, the poor bloke got his fingers burned to the tune of hundreds of millions. It’s very seedy Sydney story. Sometime back in the early naughties, somebody sold Sir Li on the idea that his company, Cheung Kong Infrastructure should go 50 per cent in the Roads and Traffic Authority’s Cross City Tunnel project. Somebody managed to persuade Sir Li that the tunnel would carry an average of 98,000 toll-paying vehicles a day as soon as it opened. So the $64,000 question is: who introduced Sir Li to the idea that Sydney toll roads would be a cash-cow investment? A cynic might say that Sir Li was naïve. After all, the Harbour Bridge only carries 161,000 vehicles a day, and it’s 8 lanes wide (tidal flowed) and the most heavily-used stretch of road in the nation. It connects the whole north of Sydney with the whole south, east of Victoria Road, whereas the Cross-City Tunnel connects, well, Balmain with the mighty commercial and industrial hub that is Bondi Beach. If Sir Li had spent a couple of days with a telephone and a cheap calculator he’d have found out the whole thing was a con, so no doubt he relied on what someone he trusted told him. Thanks to the demographics, and some significant choke-points on the roads feeding the proposed tunnel, there was never the slightest chance that the road would ever meet the 98,000. When it came to the environmental impact statement the RTA went all conservative and reckoned the road would carry a daily average of 68,000. In the result the tunnel was opened by Bob Carr in June 2005 and attracted only 20,000 vehicles a day. It still hasn’t got above 35,000. The traffic predictions had been, as the critics had insisted all along, fraudulent – a work-back calculation designed to justify the construction cost. The tunnel was $560m in debt when it went into receivership in December 2006 and Sir Li lost, big time. He lost again this year when the Lane Cove Tunnel – another toll road justified by transparently dodgy traffic predictions went into receivership. How did Sir Li come to make such a dumb investment? Who introduced him to the concept of investing in two controversial Sydney toll roads? Who sold him on it? The decision makes Sir Li look like he’s a pork bun short of the full yum cha, but in fact he’s the richest self-made man in Asia, and you don’t get there by being vague and overly trusting. To this possum he looks like the sort of bloke you don’t dud with impunity. In the wake of the Cross-City debacle, in July 2005, suddenly, and totally unexpectedly, Premier Bob Carr chucked in his seat in parliament. He was immediately followed by his deputy, Andrew Refshauge and treasurer, Mike Egan. Carr painted his resignation as a decision, made over a bottle of chardonnay with his wife Helena, to “move on” after 10 years in the job, but I wasn’t the only possum to wonder about the timing. At the time, there was a deal of speculation that Sir Li might sue over the traffic figures. He’d probably have lost, but the sordid technical details, trotted out in court, would have brought down the government. Carl Scully, the roads minister responsible for the Cross-City and Lane Cove tunnels (and more RTA disasters besides), tried to succeed Carr but was bumped by Morris Iemma. He resigned in 2007 and now works for Evans and Peck, the lobbying firm currently trying to con the government into shouldering all debt responsibilities for private toll roads. My informants tell me that he and Paul Forward, the former RTA chief sacked over the Cross-City disaster work at adjacent desks. Ah, Public Private Partnerships. It’s an incestuous little world.