The federal government is providing the Victorian government with $2.2 billion to support the Suburban Rail Loop, but much more is needed to complete the landmark project.
Victorian Premier Jacinta Allan said that the money can only be spent on ‘very specific things’ including ground testing, utilities and land acquisition.
Building for the first stage of the project, SRL East, is already underway between Cheltenham and Box Hill in Melbourne.
Twin tunnels stretching 26km will connect six new underground stations, and the government has said that each station will enable around 70,000 new homes to be built in these areas by the 2050s.
SRL East is expected to cost between $30 billion and $34.5 billion, with an estimated completion date of 2035.
So far, the Victorian government has committed $11.8 billion to the project and is hoping the federal government will provide a third of the overall cost.
This $2.2 billion marks the federal governments first investment in the project, with the state government advocating for the allocation of an additional $9 billion.
The final third is expected to come from ‘value capture’, a way of funding infrastructure through taxes, levies or charges associated with increases in the value of land.
In The Urban Developer, Federal Minister for Infrastructure, Transport, Regional Development and Local Government, Catherine King, said, “Infrastructure Australia and my department have now assessed that business case and recommended that money be released to the Victorian Government on the basis of very specific things that it will be going towards.”
Minister King said that the $2.2 billion was part of an election promise that has now been kept but further funding would depend on Infrastructure Australia’s advice.
“There are still some hurdles the Victorian Government will need to overcome –particularly the costings around value-capture – before the federal government can make another investment.”
