By Kieran Rooney and Rachel Eddie
Electromagnetic interference blamed for the relocation of the Arden hospital precinct could continue to haunt the $14 billion Metro Tunnel as authorities continue to test mitigation measures around other stations and costs continue to blow out.
A new report released on Thursday said the government would have to pay more to complete the project as construction pushes past its contract date.
Premier Jacinta Allan (right) and MP Katie Hall in the Metro Tunnel last year. Credit: Eddie Jim
The third report into the Metro Tunnel by the Victorian Auditor-General’s Office was tabled in parliament on Thursday. It focuses on the integration of signalling systems, testing and commissioning that form the final stages of the project.
Auditor-General Andrew Greaves warned that the impact of electromagnetic interference on sites such as the Royal Melbourne Hospital and the Peter Doherty Institute, first detailed publicly in 2018, had not been fully resolved by Rail Projects Victoria, the government agency overseeing the project.
Mitigation measures including moving equipment to new areas have been completed or are in progress. But the report said the builders, government and affected health and research institutions “do not have agreed solutions for several pieces of equipment”.
It also said they needed further evidence to confirm the effectiveness of some possible solutions, such as protective barriers around electrical substations and installation of magnetic active cancellation systems.
Cancellation systems were of particular concern. The report said there were limited examples of them effectively shielding MRI machines from trains in the Metro Tunnel. The technology has been tested at Peter MacCallum Cancer Centre.
The report said that to date Peter Mac and the Royal Melbourne Hospital had not accepted magnetic active cancellation systems as a permanent solution for their MRI machines.
“The April 2024 testing also shows inconclusive results on the effectiveness of MACS,” it said.
Further tests are taking place this month. Metro Tunnel contractors have agreed not to run test trains when the Royal Melbourne’s intraoperative MRI machine needs to be used.
The Auditor-General’s Office said there were four areas where there were risks of delays or blowouts to the cost of the project because electromagnetic problems were more significant than expected – or because the proposed solutions at these sites did not work.
A spokesperson for the Peter MacCallum Cancer Centre said testing was still underway to understand the potential impact of electromagnetic interference and what mitigation measures may be required.
“Importantly, our patients are still able to access the highest quality MRI and other imaging services at Peter Mac Imaging East Melbourne,” they said.
A University of Melbourne spokesperson said it was also working with the project to “find a solution to mitigate the impacts... on sensitive medical and research equipment located now and in future at the University”.
Rail Projects Victoria estimates there is a 10 to 50 per cent likelihood of these risks becoming a reality. It has advised the government about how much money it needs to prevent these problems and the funding has been approved through extra emergency funds that were not used in the upgrade of the Sunbury railway line.
Transport Infrastructure Minister Danny Pearson said the government acknowledged that electromagnetic interference was a problem, but he expected issues related to the Metro Tunnel would be resolved this year.
A promised hospital precinct over the future Arden station was instead moved to Parkville this year because of the cost of tackling this problem in the area.
The Auditor-General’s Office report found Metro Tunnel builders would not meet the September completion date outlined in the contract. Rail Projects Victoria is working to a new schedule that shows work being finished in June 2025.
This is not expected to disrupt the government’s promise that the project will be open to passengers in 2025.
But the report said it did expose the project to cost blowouts, with the Auditor-General’s Office told the delay was driven by shortages of construction workers, hold-ups in supply chains and ironing out issues identified during testing of the tunnel’s high-tech signalling and how it integrated with the older parts of the rail network
“The state will need to pay more to address remaining issues and finish the project,” the report said. “The project has insufficient contingency funds to cover these costs.”
The project was initially costed at $10.9 billion, but is now valued at $14 billion following negotiations with the state government and its contractors. The state’s contribution is $12.8 billion, with another $1.37 billion paid by builders.
The Auditor-General’s Office report found Rail Projects Victoria had advised the government how much backup funding was needed to complete the project, but as of April, had not sought money from the state to cover these costs. The agency was expected to update its cost forecast after negotiating with contractors.
The agency told the Auditor-General there was not enough contingency funding left in the project’s budget and the state government’s $12.8 billion contribution did not include further funding for additional risks.
Pearson, the transport infrastructure minister, said there was some contingency funding left, but would not be drawn on if it was enough to deal with the cost pressures. He said the government was in “regular dialogue with our construction partner”.
He said the Town Hall and State Library stations had the most delays because they had to be integrated into the existing rail system.
Opposition transport infrastructure spokesman David Southwick called on the Allan government to be upfront about the size of cost overruns and what impact they would have on the state’s finances.
“Reports of major projects running out of money are just more of the same from a decade-old government that has lost control of Victoria’s transport infrastructure pipeline,” he said.
On top of the initial $10.9 billion pledged for the Metro Tunnel, the government has paid an extra $1.37 billion in its settlement with the builders, $388 million in settlements over COVID delays in 2023 and $166 million for changes to the trial of high-capacity signalling.
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