$5bn federal funding allocated to Melbourne’s Airport Rail Link after long-awaited review

The Albanese government has offered to cover half the bill for Melbourne’s $10bn Airport Rail Link, but 12 other key Victorian projects have been cancelled.

The Albanese government has thrown the $10bn Airport Rail Link a lifeline, recommitting to pay for half the project following a long-awaited review of federal infrastructure funding.

The move puts pressure back on the Victorian government to get the massive public transport project back on track, after it was mothballed during the Commonwealth inquiry.

It comes as 12 other Victorian projects have been dumped while the federal government tries to claw back cash amid $33bn in cost blowouts in its $120bn infrastructure pipeline.

Geelong Fast Rail and Frankston to Baxter rail are among billion of dollars worth of infrastructure projects being axed across the country.

Other scrapped projects include work on the Calder Freeway between Gap Rd to the M80 Ring Road, Goulburn Valley Highway Shepparton bypass stage one, McKoy St and Hume Highway intersection upgrade, Mornington Peninsula Freeway upgrade.

The Western Freeway upgrade between the M80 Ring Rd and Ferris Rd, Rutherglen heavy vehicle alternative route, two business cases and Victorian faster rail corridor investigations have also been canned.

However, the funding for the works will remain in Victoria and can be used to address pressures in other projects.

Axing fast rail a ‘bitter blow’

Greater Geelong Mayor Trent Sullivan has vowed to look towards the state for transport funding after the federal government canned the Geelong Fast Rail project.

Mr Sullivan said the federal government’s decision to ditch the project is a “bitter blow” for the people of Geelong.

“Having promised our community a world-class rail system, the federal government has now abandoned those promises,” he said.

“As one of the fastest growing regions in Australia, Geelong desperately needs public transport investment. Our rail service is under extreme pressure and a high-speed rail is long overdue.

“Commuters are tired of disrupted timetables, long journeys and overcrowding. Geelong people have waited long enough and the need for this service is urgent.”

Corio MP and acting Prime Minister Richard Marles said: “The concept of the Geelong Fast Rail is another example of the Liberal Party promising pie in the sky projects without proper funding”.

“They never gave the project the funding it needed to be taken seriously,” Mr Marles said.

“The Albanese-Labor Government is focused on delivering feasible projects that will improve the lives of people right across the wider Geelong region.”

The long-awaited federal infrastructure review recommends cancelling 82 of 274 projects nationwide.

Infrastructure Minister Catherine King on Thursday announced that at least 50 would not proceed.

“The independent strategic review found that the Infrastructure Investment Program inherited from the former Coalition government was undeliverable,” Ms King said.

“Following consultation with the states and territories, we now have a forward plan of projects that are properly planed and targeted to unlock significant economic, social and environmental objectives.”

The pressure is now on the Allan government to get the transport project back on track. Picture: Valeriu Campan

But under a new approach, funding will be allocated to “road corridors” which contain lots of existing projects.

This will apply to the $262m worth of works along Princes Highway, and almost $1bn worth of works along the Western Highway.

It will then be up to the Victorian government to work with the Commonwealth on a strategy to deliver the projects in the “corridor” with the funding already allocated.

This means uncertainty remains over smaller projects.

Ms King also announced $100m for the Ballarat to Stawell duplication along the Western Highway, $500,000 for the Geelong-Portarlington Rd and Wilsons Rd intersection upgrade, and $185,000 for the Surf Coast Highway, Reserve Rd and Felix St intersection works.

Prior to the release of the report, Ms King told the Herald Sun that the infrastructure program needed to be “fit for purpose, fiscally responsible and above all, deliverable”.

The Albanese government has thrown the $10bn Airport Rail Link a lifeline.

“The independent review found that the Infrastructure Investment Program we inherited could not be delivered,” she said.

“With the co-operation of the states and territories we now have a forward plan of projects that are properly planned and targeted to unlock significant economic, social and environmental objectives.

“We are delivering infrastructure that creates jobs and helps wages grow, and makes our communities better connected and more liveable.”

The independent review, announced as a 90-day inquiry but commissioned almost 200 days ago, did not assess the merits of federal Labor’s controversial $2.2bn commitment to Suburban Rail Loop – ostensibly because the party’s ­election commitments and projects under construction were exempt from its terms of reference.

Infrastructure Minister Catherine King says the infrastructure program needs to be ‘fit for purpose, fiscally responsible and above all, deliverable’. Picture: Martin Ollman

But former premier Daniel Andrews is understood to have pushed for the Airport Rail to be included in the review, despite it being an election commitment and $700m having been spent on early works.

The project’s inclusion in the review not only resulted in workers being laid off, but halted talks between the state government and airport about whether a Tullamarine station would be underground or elevated – which had become increasingly tense.

Senior industry figures believe a two to three year delay remains on the cards.

But the pressure is now back on the Allan government to explain whether it wants to put the project on the backburner, meaning it won’t be opened until the 2030s, or whether it backs the link being built.

A state government source said on Wednesday night that the federal response on airport rail had been “weak” from the outset and rejected assertions Victoria wanted to delay the project.

As well as recommending 82 projects not yet under construction be dumped, the review of federally-funded infrastructure projects says work on 36 projects could be rescoped to free up funding.

State and territory governments were able to write to Ms King during the consultation period in order to save projects in the 10-year pipeline, including those that would improve safety or had expiring tenders.

The full review will not be released as it includes confidential information provided by states and territories.

More than $14bn worth of cost pressures were identified in projects not yet under construction. Changes to Infrastructure Investment Program sub-programs including the Roads to Recovery and Black Spot programs will be announced in coming days.