train line

The Australiasian Railway Association (ARA) has backed the completion of the Victorian Government’s Suburban Rail Loop (SRL), after new analysis from the Parliamentary Budget Office’s (PBO) estimates the build and operation costs for the project will be $200 billion. 

The PBO’s analysis found that building costs could be as high as $125 billion, with a further $75 billion generated in operating costs. Total spending on the project would therefore reach $200 billion. 

The multi-stage project was first announced in 2018 as a Labor election commitment, to be delivered in three major sections:

  1. SRL East – Cheltenham to Box Hill
  2. SRL North – Box Hill to Melbourne Airport
  3. SRL West – Melbourne Airport to Werribee

The Victorian Government has so far allocated $11.8 billion to the project, covering development and planning costs, initial and early works and a provision towards main works.

The Federal Government has indicated that it will contribute $2.2 billion.

In the 2022-23 budget, the Victorian Government estimated that SRL East, the first section of the project, would cost between $30 and $34.5 billion. PBO estimated that SRL East would cost $36.5 billion, with the bulk of the cost (91 per cent) comprising asset expenses.

PBO analysed two options for the delivery of the second stage, SRL North:

  • Option A – Box hill to Reservoir segment opening for services in 2043, and the Reservoir to Melbourne Airport segment opening for services in 2053
  • Option B – Box Hill toReservoir segment opening for services in 2038, and REservoir to Melbourne Airport segment opening for services in 2043

PBO’s economic appraisal found that Option A was likely to have a higher benefit-to-cost ratio.

In May 2022, Opposition Leader, Matthew Guy, requested an independent analysis from the PBO about the total cost of building and operating the SRL, announcing his intentions to scrap the project if elected.

Victorian Liberals Shadow Treasurer, David Davis, said the cost outlined in the analysis proved the project should be stopped. 

“This is an alarming revelation but completely unsurprising given Labor’s record of cost blowouts that raises serious questions about the viability of this project,” Mr Davis said.

“Instead of tying up hundreds of billions for decades to come, we will shelve this project and put every cent into fixing the health crisis.”

Victorian Premier, Daniel Andrews, said that the project is one that Victorians voted for, and one that will transform the state’s public transport infrastructure.

“SLR will create thousands of jobs and connect our suburbs making it easier, faster and more convenient for all Victorians to access our fastest growing employment, health, education and retail centres.”

The ARA has warned that any plan to shelve the Suburban Rail Loop could shake industry confidence in Victoria’s infrastructure pipeline and lead to poorer outcomes for public transport users. 

ARA Chief Executive Officer (CEO), Caroline Wilkie, said the construction and delivery of the Suburban Rail Loop would create a long-term pipeline of work, generate thousands of local jobs, and help train the next generation of skilled workers in Victoria.

“The rail industry needs certainty to attract and retain skilled workers to support the successful delivery of transformational projects like the Suburban Rail Loop,” Ms Wilkie said.

“Having a clear pipeline of upcoming projects is vital, particularly with the significant number of major infrastructure projects underway or planned across the country.

“Stopping a key project like this when early works have already started would set a worrying precedent that could see industry and Victoria’s skilled workers look to other states in the future.”

Ms Wilkie said the project is expected to create up to 24,000 jobs during construction, which would provide a major boost to Victoria’s economy.

“Once complete, the 90km orbital rail line is projected to improve travel efficiency for more than 80 per cent of Melburnians,” Ms Wilkie said.

“This will take 600,000 cars off the road each day and slash travel times for the people of Melbourne and its regional centres, making it easier for them to get to work, education and essential services.”

Monash University has also supported the continuation of the project, noting that it has been advocating for and promised an efficient and effective public transport rail network since the University was established in the 1960s.

“We support the current Suburban Rail Loop project which we have been working on with the Victorian Government and see this as the best possible solution for the Monash community, our partners in the Monash Technology Precinct and broader South East community,” the University said in a statement. 

“The Monash SRL station will provide great benefit for the 55,000 students, staff, researchers and wider community who commute to Monash’s Clayton campus on any given day.

“As a major education, employment, arts and innovation hub, Monash University attracts people from across Melbourne, nationally and internationally.

“Providing improved public transport options while limiting traffic congestion will benefit the many thousands of people who visit and rely on employment from our University, the organisations in the wider Monash Technology Precinct and the surrounding areas on a daily basis, and the communities that we serve and that surround us, as well as the environment.

As the largest employment node outside of the CBD, the Monash Precinct is one of Victoria’s most important engines of innovation, employment generation and skills development. Currently, 30,500 people are employed in the Monash Precinct and this is forecast to grow to 162,000 by 2056.

“Within the next few years, major investments such as the Moderna facility, Victorian Heart Hospital, the Monash Smart Manufacturing Hub and the Medicine Manufacturing Innovation Centre will be completed, and further add to employment growth in the precinct, therefore improved public transport connections are essential,” Monash University said. 

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