ALP dishes $2.2 billion for Victoria’s Suburban Rail Loop

The Albanese government has approved funding for Victoria’s controversial rail plan, marking a significant step for the project.

Concept designs for Suburban Rail Loop stations have been released.

The Albanese government has approved $2.2 billion in funding for Victoria’s contentious Suburban Rail Loop, marking a significant step forward for the controversial project.

The federal and Victorian governments have long been at odds over funding the SRL, which carries an estimated $35bn price tag for its first stage.

The $2.2bn funding was part of existing federal commitments for the mega-project. However, additional funding for the broader $35bn project — designed to connect Cheltenham to Box Hill via a 26km tunnel — remains under consideration.

An artist's concept of a Suburban Rail Loop train Source: Suburban Rail Loop Authority

The Allan government requested a total of $11.5bn from the Commonwealth, arguing that the project will stimulate development around new stations and help deliver 70,000 new homes. 

If granted, the state government pledged an equal amount from its own funding, with the remaining costs expected to be covered through development levies or land value capture taxes.

Infrastructure Minister Catherine King confirmed that both Infrastructure Australia and the federal infrastructure department had assessed the project, allowing the funds to be released.

Ms King’s office could not provide details about what the money would be going towards.

“Infrastructure Australia and my department have now assessed that and recommended that money be released to the Victorian government on the basis of very specific things that it will be going towards,” she said.

“And so I have now signed that off and the Victorian government, I’m sure, will be receiving the news of that now.

“That’s the existing money that we’ve had on the table for Suburban Rail East.

Ms King said further federal funding was contingent on additional assessments, with some “hurdles” along the way.

“There are still some hurdles that the Victorian government will need to overcome in relation to advice that I will receive from Infrastructure Australia about particularly the costings around value capture before the Commonwealth can make another decision,” she said.

It’s understood strict conditions have been placed on what the money can be spent on.

In a statement released on Wednesday night, SRL Minister Harriet Shing declared the “good news”.

“Australia’s largest housing project, our Suburban Rail Loop, has just received $2.2bn in good news from the Albanese government. This means more homes and more opportunities, closer to where people want to live,” Shing said.

“As the federal government again made clear today, this is a good project. This is an important project. We agree.”

The Australian revealed this year that Victorian taxpayers were stung with a bill of almost $10m for legal and financial consultants working on the controversial project.