"We won't kill ourselves to stop or postpone transport infrastructure projects," is the position of the Ministry of Finance's Budget Department and Accountant General with regard to the cuts required in the 2013-14 budgets.
One reason, according to top Ministry of Finance sources, is that precisely in hard times, it would be wrong to stop infrastructure projects - on the contrary. Another reason is that Minister of Transport "Yisrael Katz has quickly breathed life into all the projects, and they cannot be cut." In other words, the Ministry of Transport expeditiously published tenders and contractors have won them. This makes it legally difficult to stop projects which have gotten underway. A top transport source quotes Prime Minister's Office director general Harel Locker as saying, "This time, you've got me cornered."
The Ministry of Finance is trying to find transport projects which can be postponed to save up to NIS 2 billion on them, while keeping everyone quiet. Israel National Roads Company Ltd. is struggling to obtain permission for tenders for three ready and budgeted projects that it wants to publish: a NIS 800 million project to widen Road 38 between Sha'ar Hagai and Beit Shemesh; a NIS 200 million to upgrade Road 3 between Ashkelon and Kiryat Malakhi; and the NIS 300 million four-year ITS project for a nationwide traffic monitoring and control system.
Katz strongly opposes any budget cut. In the face of Ministry of Finance pressure, he says that savings can be made by using a private sector financing model. Some transportation projects cannot be cut under any circumstances, such as the construction of interchanges and the widening of roads where major residential projects are planned (a position which conforms to that of Prime Minister Benjamin Netanyahu as presented to the directors general forum). These include an interchange and improvements on Road 5 to handle the massive construction planned for Rosh Ha'Ayin, the widening of Road 38, and the extension of Road 6 (the Cross Israel Highway) north and south.
The widening of Road 1 (the Tel Aviv-Jerusalem Highway) and the high-speed railway to Jerusalem are outside Katz's purview, despite concerns about congestion on Road 1 and on the alternative road to the capital, Road 443.
Another option which has been dropped was to cancel construction of the Acre-Carmiel railway. Over the past 20 years, every time transport projects were cancelled because of budget restraints, this NIS 1.5 billion project was the first to be axed. The project has been inaugurated several times over the years, and then cancelled within months, due to budget constraints. Experts believe that the railway can be postponed now, saving NIS 500 million, but the Ministry of Transport refuses to budge, insisting that it must be built because it is a social project.
One option acceptable to top transport officials is to postpone construction of the NIS 6 billion 35-kilometer Haifa-Nazareth railway, and operate a bus rapid transit (BRT) network instead, which has both passenger and transport advantages. A BRT project would cost a tenth of a railway line.
Published by Globes [online], Israel business news - www.globes-online.com - on February 25, 2013
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