Federal government agrees to help bankroll new state-run quarantine facility

Scott Morrison will help Victoria fund the long-awaited alternative to the state’s problem-plagued hotel system — here’s where it will be built.

A deal has been done to build a village-style quarantine facility in Victoria, with Scott Morrison agreeing to help bankroll the long-awaited alternative to the state’s problem-plagued hotel system.

The state-run facility, which is set to be based near Avalon airport, is expected to cost at least $200m to build and could be open to overseas arrivals by the end of the year.

The Prime Minister handed a memorandum of understanding to Acting Premier James Merlino this week to confirm his support for the quarantine centre.

Final talks are now underway about construction costs, with the state government insisting the federal government pick up the $200m tab to build the facility, in return for the state paying hundreds of millions of dollars in operational costs. The Herald Sun understands Mr Morrison has been keen for Victoria to share some of the upfront costs.

Construction would begin in September with an aim to opening in January.

Sources close to the deal said the other sticking point related to the numbers of overseas travellers permitted to re-enter the country, with the commonwealth hoping the new hub would allow for a rapid increase.

However, the state government wants to maintain a steady flow of people into quarantine to ensure the risk of infection outbreaks was minimised.

It’s believed the federal government prefers Avalon for the site of the facility.

Mr Merlino had initially pitched for the 500-bed village-style facility to be located next to the Mickleham animal quarantine centre.

But the federal government prefers Avalon because of its proximity to the airport, while concerns have also been raised about quarantining people so close to animals which could be carrying diseases.

The Herald Sun has been told Avalon is also better equipped with basic infrastructure including sewerage, meaning the facility could be up and running more quickly.

Mr Morrison spoke to Mr Merlino about his quarantine proposal on Wednesday night after he told parliament: “We are very close to coming to a position which will enable us to go forward with that ­facility.”

The state government is comfortable with either site being selected, and has released an expressions of interest document for construction companies to prepare bids to build the “alternative quarantine accommodation hub in Victoria”.

The documents show the government is looking for a head contractor to design and build modular buildings, subject to approvals.

The Department of Premier and Cabinet has also been holding online webinars about the proposal as it pushed ahead with pre-planning works ahead of an agreement with the commonwealth.