Federal officials say Canada’s planned high-speed rail line in central Canada will stay on budget, despite warnings that megaprojects of similar scale routinely face delays and cost overruns.Blacklock's Reporter says in a report to senators, the Transport Canada department insisted the government’s proposed Alto rail system —expected to cost between $60 billion and $90 billion — will remain within its financial limits even as officials acknowledge the massive project will face challenges.“How will Transport Canada make sure the project stays on budget, avoids major delays and manages performance risks?” asked senators on the Senate Standing Committee on National Finance.“Transport Canada will ensure the high speed rail initiative stays within budget, avoids major delays and manages performance risks across all phases,” the department replied in its report.The planned electric rail system, branded Alto high-speed rail project, would run trains capable of reaching 300 kilometres per hour between major cities including Toronto, Peterborough, Ottawa, Laval, Montréal, Trois-Rivières and Québec City.Cabinet has already allocated $4.3 billion for early planning and development work. A briefing note prepared by the department last June estimated the full cost of the rail system could range from $60 billion to $90 billion once construction is complete..In its submission to senators, Transport Canada acknowledged the undertaking would be complex.“Canada acknowledges the initiative is a large, complex mega project and challenges are expected consistent with global evidence on mega project risk,” the department wrote. Officials added that structured federal oversight has been put in place to reduce the risk of delays and rising costs.The department said it will require a single detailed project plan outlining scheduling, resources and management before major contracts are awarded. According to the report, the plan is intended to create clear expectations and financial consequences for contractors in an effort to keep the project on track.However, the head of the rail venture has acknowledged the current price estimates are uncertain. Appearing before the Senate finance committee in February, Martin Imbleau, chief executive of Alto, said accurate cost projections cannot be produced until the final route and engineering work are completed.“If you have got one hand in the fridge and the other in the oven, you don’t get zero degrees in the middle,” Imbleau told senators. “Once I have a route planned and the engineering information, then I can come up with a cost estimate.”.Under the current schedule, construction on the first phase — an electrified 200-kilometre line between Ottawa and Montréal — would begin in 2029, with completion expected in 2037.Transport Canada also acknowledged that taxpayers will not recover the full cost of building the rail system. In its report to senators, the department said operating profits would cover only part of the construction expenses.Officials argue that once the line is fully operational, revenue from Alto could at least eliminate the federal subsidies currently required to support passenger service in the busy corridor run by VIA Rail. Those subsidies currently total about $297 million per year, according to the department.
