The peace deal signatures that confirm full steam ahead on airport rail

A three-way feud delaying Melbourne’s airport rail has been put to bed after the airport and the state and federal governments on Thursday signed a document agreeing to push the project forward.

A steering committee of senior officials from each organisation will be set up under a memorandum of understanding that agrees all sides will work together and finalise how construction on the delayed project can finally get under way.

An artist’s impression of a proposed above-ground station at Melbourne Airport.

Federal Infrastructure Minister Catherine King signed the document at Tullamarine on Thursday morning alongside Victorian Transport Infrastructure Minister Gabrielle Williams and Melbourne Airport chief executive Lorie Argus.

The Commonwealth says the project, originally expected to open by 2029 but delayed by at least four years, has taken a “big step forward” with the signing of the agreement.

“Many Victorians have spent a lifetime hearing of a rail link to the airport, and today we are telling them that we will work together in good faith to get it done,” King said.

“We want to keep this project moving, which is why we brought in an independent mediator, why we’ve been acting on his recommendations and why we’re investing to make it happen.

“Melbourne Airport Rail Link will enhance the resilience and reliability of the transport network, better connecting Melbourne’s growing population to where they live, work and play.”

On Thursday morning, Prime Minister Anthony Albanese told ABC Radio Melbourne that the construction of Melbourne’s controversial airport rail link was “a done deal”.

“We’re delivering $7 billion for the whole project. It’s all budgeted for. This is a done deal. It’s something that I’m committed to,” he said.

Although the agreement does not put a completion date on the rail line, it comes after Albanese last month committed an extra $2 billion to the project – for upgrades to Sunshine station – to accelerate development.

Victorian Transport Infrastructure Minister Gabrielle Williams (left), federal Infrastructure Minister Catherine King and Melbourne Airport chief Lorie Argus.Credit: Wayne Taylor

Victoria also agreed to bring forward $2 billion of the funding it had committed, and Premier Jacinta Allan said the announcement would allow a fresh look at resetting the construction timeline.

Details over whether the airport would be entitled to compensation had not been resolved as of last month, and major works packages outside the Sunshine upgrades are yet to be awarded.

Speaking on Thursday, the premier said there were still commercial matters the airport wanted to discuss and there was now a formal process for discussions to be held with the federal government, which owns the land, and the airport corporation, which leases it.

“I’m really pleased to see, after far too long a period, that we finally have a framework where the federal government, the airport, alongside the state government, are going to work through the issues that have been raised by the airport about how the project is delivered within the airport footprint itself,” she said.

An artist’s impression of the third runway at Melbourne Airport.

“We want to get on and deliver this project.”

In the previous state budget, the Allan government delayed the project by at least four years to 2033 and blamed a stalemate with the airport over whether a new station would be built above or below ground.

King appointed a mediator to resolve the dispute, and the airport later agreed to the above-ground option.

Argus said the memorandum of understanding formalised this compromise.

“Airport rail will increase the transport options for our passengers and staff, and we are pleased to work with the Australian and Victorian governments to progress this project for Melbourne,” she said.

Williams said the airport rail project would pave the way for faster journeys across the state.

“We are getting on with delivering the first stage of Melbourne Airport Rail, reconfiguring freight, regional and suburban tracks between West Footscray and Albion to make space for this important new rail link,” she said.

Credit: Matt Golding

The additional $2 billion from the Commonwealth takes the total committed funding for the project to $12 billion. It has been costed between $10 billion and $13 billion.

Federal opposition transport spokeswoman Bridget McKenzie said the announcement showed no progress had been made on the project since last year’s mediation process.

“Today we find out it has taken almost a year for the three parties to sign a memorandum agreeing to ‘work together’ and to establish a committee,” she said.

“The government needs to explain to the people of Melbourne why there has been no progress over all those months.”

Start the day with a summary of the day’s most important and interesting stories, analysis and insights. Sign up for our Morning Edition newsletter.