‘Big and bad’: Calls grow to scrap Melbourne Suburban Rail Loop megaproject

Calls are growing to axe a transport megaproject that could be the biggest infrastructure scheme ever built in Australia.

The Victorian government is being urged to scrap a massive transport project that could soak up $200 billion of public money, because it has “never stacked up” and the cash could be better spent elsewhere.

An economist has said Melbourne’s Suburban Rail Loop (SRL) was the “biggest and baddest” infrastructure project in Australia and had “not a lot of benefit”. There are doubts its huge cost will be worth the benefits it provides.

But state premier Jacinta Allen said the plan “absolutely stacks up” and billions had already been spent on it. It has also been welcomed by public transport users.

The megaproject will eventually see a 90km railway line built that would stretch from Frankston, in the city’s east, to Werribee, in the west via Tullamarine Airport and Monash and Deakin universities.

It will enable commuters to cross Melbourne, intersecting with every current rail line, without going through the congested CBD.

It’s eye-wateringly expensive, however, with estimates for its building and operation ranging from about $125bn to as much as $200bn.

That would likely make the SRL Australia’s most expensive infrastructure project ever – dwarfing the Sydney Metro estimated at $25bn, about $20bn for Sydney’s WestConnex motorways and $12bn for Melbourne’s Metro Tunnel.

Victoria is on the verge of awarding a contract worth up to $4bn to do the first tunnelling works.

An artist’s impression of the Suburban Rail Loop. Picture: Supplied

‘Close to $200 billion’

Leading economist Chris Richardson said the project should be scrapped as budgets tighten.

“We are talking a lot of dollars with construction cost over time probably over $100 billion,” he told ABC’s 7.30 on Monday night

“By the time you add in a bunch of running costs, you’re starting to talk something closer to $200 billion.”

The SRL became a major election issue in Victoria earlier this year with the Liberals vowing to axe it. But with Labor victorious, it’s been full steam ahead.

Last month Premier Allen, who was minister for the project before taking over from Daniel Andrews, urged the federal government to give Victoria its “fair share” of funding for infrastructure and said $14bn had been spent on the SRL.

Then minister for the Suburban Rail Loop, Jacinta Allan, inspects early works in 2022. Picture: NCA NewsWire / Wayne Taylor

“It is underway,” she said. “I would argue that this is a project that absolutely stacks up and we’ve released a comprehensive business and investment case.”

“We can’t afford not to deliver the Suburban Rail Loop,” she added.

Proposed Cheltenham Station on the SRL.

Feds want more scrutiny of megaproject

But Ms Allen’s Labor colleagues in Canberra are seemingly less impressed by the project’s fantastic cost.

Last month, the federal government cut $7bn from its share of funding for proposed rail and road projects.

Infrastructure minister Catherine King said the current pipeline of major projects, put in place by the previous Coalition government was “undeliverable” and needed to be trimmed.

She pointedly said more work needed to be done to show the case for the SRL was watertight before more funding was made available. To date, $2.2bn of federal funds has been given to the scheme.

“It’s a long-term project. We’ve put money into that first bit. We haven’t made any decisions about putting any money into it further,” Ms King said.

Economist Chris Richardson has said the SRL should be scrapped.

The Grattan Institute's Marion Terrill has said the SRL is a ‘political project’.

The Victorian Government has insisted that the SRL makes sense. A report by consultants KPMG said it would deliver between $1.10 and $1.70 of income for every $1 spent on building and running the train line.

But a review by the Victorian Auditor-General found that report to be not “sufficiently robust or comprehensive”.

The SRL has never been fully assessed on its merits by Infrastructure Australia which advises the federal government of what projects are worth funding with taxpayers’ money.

A study into improving Melbourne’s “middle and outer suburban transport connectivity” of which the SRL is part of, is listed by Infrastructure Australia as merely an “early stage proposal”.

The SRL route map.

‘Never stacked up’

Transport and cities program director at think tank the Grattan Institute Marion Terrill has long been critical of the SRL.

“This project has never stacked up because no one is seems to be clear about what problem it’s trying to solve,” she told 7.30.

“But its blowing a generation’s worth of infrastructure money”.

Previously, Ms Terrill has said for most Melburnians commute times are not so onerous that the SRL would make a large difference. The stations, for instance, aren’t located in noted job hotspots.

While the line could boost housing and jobs near stations it was “riddled with risks” of cost blowouts that may not be worth the expense.

Ms Terrill has added it’s an example of a big budget project announced as an election sweetener without being properly scrutinised.

And that can lead to boondoggles – expensive infrastructure that doesn’t live up to its promise.

“The SRL looks like a very political project to me,” she said. “The timing of its announcement and the manner of its development are hard to explain in any other way.”

The rail loop does have its fans.

Victoria’s Public Transport Users’ Association has said that it was “the type of project that can help the shift from a car dependent to a sustainable transport community,” which was in sharp contrast to new motorways.

But Mr Richardson said the SRL was an obvious project to be dropped if government coffers were squeezed.

“(It’s) the biggest and baddest infrastructure program we have,” he told the ABC.

“The suburban rail loop is a lot of dollars (but) not a lot of benefit.”

Originally published as ‘Big and bad’: Calls grow to scrap Melbourne Suburban Rail Loop megaproject