Victoria’s premier, Daniel Andrews, has refused to say how much it will cost to build the first two stages of the Suburban Rail Loop, after independent analysis was released that suggested it was more than double the government’s initial estimate for the entire project.
Analysis from Victoria’s Parliamentary Budget Office (PBO), released overnight, estimates the cost of constructing the first and second stages of the mega project will reach $125bn by 2084-85.
This is more than double the $50bn the government said it would cost to construct the entire 90km underground railway – running between Cheltenham and Werribee via Melbourne airport – when it announced the project in 2018.
The PBO estimates the first stage of the project from Cheltenham to Box Hill, dubbed SRL East, will cost $33bn.
This is in line with the figure contained in the government’s business and investment case, released in August last year, which forecast it will cost between $30bn and $34.5bn.
Construction is already under way on SRL East and is expected to be complete by 2035. The state government has allocated $11.8bn to this part of the project, with the remaining funds to come from the federal government and private sector.
The second stage of the project, from Box Hill to Melbourne airport and dubbed SRL North, is expected to be completed between 2043 and 2053, with the option of bringing works forward.
The 400-page business and investment case said the two sections of the loop would have a positive benefit-cost-ratio between 1 and 1.7, meaning for every dollar spent on the project the government would get a return of between $1 and $1.70.
The PBO’s analysis arrived at the same cost estimate as the government’s business case.
The PBO analysis and the business case did not detail the cost of SRL West, between Melbourne airport and Werribee, which was the final stage of the project.
The PBO provides independent and non-partisan policy costing and advisory services at the request of Victorian MPs.
The analysis was prepared at the request of the opposition leader, Matthew Guy, who on Wednesday announced he would halt work on SRL East if elected in November and divert the money into the state’s health system.
Andrews said the government had been upfront that the first stage would cost up to $34.5bn.
“It’s costed, it’s funded, it’s happening and the only way to make it cost more is to scrap it,” he said.
Asked how much the other stages of the project would cost, Andrews replied: “It will not be for our government to build the second and third stages.
“We’ve been very clear that we would start it but ultimately, [it’s] a multi-decade project that will be finished by somebody else.”