The minister responsible for Victoria’s Suburban Rail Loop can’t say how much the underground railway will cost, despite lashing an independent analysis that suggested building and running the first two stages will total more than $216bn.
Analysis from Victoria’s Parliamentary Budget Office, prepared for the state’s opposition leader, John Pesutto, suggested that building the first two stages of the railway from Cheltenham to Box Hill and then on to Melbourne Airport would cost $96.4bn. An additional $120.2bn would be required to operate the line for 50 years.
This was $16.5bn more than was forecast by the PBO in 2022, and well above the $50bn the government said it would cost to construct the entire 90km underground railway when it announced the project in 2018.
Pesutto said the latest analysis was further proof the project should not go ahead.
“The Labor government told the Victorian people that the SRL would cost $50bn,” he said on Wednesday. “We’re now seeing with each new report, the cost continues to blow up.
“The sensible and responsible thing for the Allan Labor government is to stop this project urgently.
“To proceed stubbornly, hell bent on a project that just doesn’t stack up but will rack up the debt is highly irresponsible”
But the Suburban Rail Loop minister, Danny Pearson, rubbished the costings and said the government was forging ahead.
“John Pesutto is making yet another tired, lazy attempt to discredit a project that Victorians have voted for at the last two previous elections,” Pearson said.
Pearson said the opposition’s request to include operating costs for the project up to 2084 was “deliberately misleading” given “governments of all persuasions” operate on four-year budget cycles.
“It’s like being asked, ‘what’s the cost of a house and you have to include 50 years of bills, three major renos and a lifetime of expenditure at Bunnings?’. It’s just laughable,” he said.
“It’s just disingenuous to suggest that you should be factoring in running costs in the 2080s. I’m not sure many of us are going to be around in the 2080s.”
Unlike the 2022 advice, also prepared for the opposition, the PBO in its latest analysis separated the construction and operating costs.
It estimated SRL East, which will run between Cheltenham and Box Hill, would cost $32.8bn to construct.
Pearson said this was in line with the government’s range, forecast in the 2021 business case to be between $30bn and $34.5bn.
SRL North, however, was not costed in the government’s business case.
In the PBO analysis, it was estimated it would cost $63.7bn to construct the line between Box Hill and Melbourne Airport.
While conceding he did not know how much SRL North will cost, Pearson cast doubt on the PBO’s estimate.
“I reckon they got out the tape measure, they looked at the distance of SRL East, they looked at the distance of SRL North, which is basically double the size, therefore its double the cost,” he said.
He said construction on SRL North would probably begin “in the lead up to or following the commissioning of SRL East” in 2035.
Both the PBO analysis and the governments business case do not detail the cost of SRL West, between Melbourne airport and Werribee.
Pearson on Wednesday was unable to say when this final stage of the project would begin. He also could not provide a total figure for the entire rail loop, arguing it was a matter for future governments.
“These projects take a long time. By their very nature, they are bold, visionary projects, that meet the needs not just for Victorians now but into the future,” he said.
Construction has already begun on SRL East, with the government announcing its first major contract for tunnelling works between Cheltenham and Glen Waverley in late 2023.
The government has allocated $11.8bn to SRL East, while the federal government has contributed $2.2bn.
