Road and rail project budgets across Victoria have blown out by an eye-watering $12.7bn since December – costing taxpayers an extra $83.6m a day.
The expected costs of 28 joint state and commonwealth projects have risen in the past six months, figures produced during parliamentary hearings on the federal budget show.
This includes three regional rail upgrades, a suite of suburban roads projects, the state’s most expensive toll road the North East Link, and major highway interchanges.
A Herald Sun analysis of the commonwealth’s Infrastructure Investment Program – which lists all jointly-funded projects – shows the federal government has injected an extra $5bn into Victoria’s major builds to ensure works are completed.
Road and rail projects have blown out. Picture: David Crosling
The biggest blowout was the North East Link, which Premier Jacinta Allan revealed last year would now cost up to $26.1bn, up from $15.8bn.
But a further $2.4bn worth of overruns since a December 13 budget update was released by Treasurer Jim Chalmers – about $15.8m a day – were also revealed in the documents.
Most were not included in the state budget, released a week before the federal one.
Federal Infrastructure Minister Catherine King blamed the taxpayer-funded pain on global supply chain constraints and labour shortages, but opposition infrastructure spokeswoman Bridget McKenzie said the new spending was to “pay off Jacinta Allan’s infrastructure credit card”.
The federal government has injected an extra $5bn into Victoria’s major builds to ensure works are completed. Picture: Andrew Henshaw
One of the biggest budget blowouts was for upgrading suburban roads in Melbourne’s north and southeast, which will now cost $3.1bn – an increase of $874.5m.
The Camerons Lane interchange on the Hume Freeway, a key route for freight transport using the Beveridge precinct, has also blown out from $300m to more than $1bn.
The federal share of the payment for that project also increased dramatically, from 50 per cent to 86 per cent.
The Gippsland Rail Line upgrade which includes new signalling equipment and station works has ballooned by $345.3m to $878.1bn, prompting a $290.1m federal cash injection.
The North East Link is set to cost up to $26.1bn, up from the earlier budget estimate of $15.8bn.
A spokeswoman for minister King said the federal government wanted the projects delivered and had worked constructively with states and territories in the lead up to last month’s budget to identify funding priorities.
“Through the 2024-25 budget, we invested additional funding in a range of existing projects across the country to ensure they could be delivered,” she said.
“The construction sector has been affected by cost increases, supply-chain constraints and labour shortages, challenges being experienced by industry globally.”
Some of the $5bn in extra federal funding was redirected from projects dumped following a contentious review of federally-funded infrastructure, such as a Geelong fast rail project.
Twelve Victorian infrastructure projects were among 50 projects axed by Canberra to claw back $7bn.
But Ms McKenzie said $4.5bn of the $5bn was just to pay off Jacinta Allan’s infrastructure credit card, with not one additional kilometre of road built for the money.
“The only way to describe the infrastructure spend is throwing money at Victorian Labor to cover their cost blowouts and debts,” Senator McKenzie said.
The figures have exposed a series of cost blowouts on the $4bn Regional Rail Revival, which was a joint federal-state program to upgrade every country railway line in Victoria. As revealed by the Herald Sun in March, the program veered off track, with delays on the Warrnambool, Gippsland and Shepparton line upgrades due to labour and material shortages and signalling problems.
As well as the Gippsland line upgrade blowout, the commonwealth documents show the Shepparton line stage three upgrade will cost an extra $14m, and South Geelong to Waurn Ponds upgrades are $41m higher.
The state budget did not reveal these new estimates, and listed completion dates as to be confirmed.
A Victorian government spokesman said the state budget was published before the commonwealth budget so the extra investment was not known at that time.
But Victorian opposition transport infrastructure spokesman David Southwick said the Allan government had been caught cooking the books to cover up its financial mismanagement.
“Every time projects blow out, it means taxpayers end up footing the bill and missing out vital services,” Mr Southwick said.
“Labor needs to come clean and release the true costings for each of these projects.”
HeraldSun
Amazingly the North East Link is $10.3b over budget and is not finished in fact it has years to go meaning that number is probably the 1/2 of what it will be once completed.