Taxpayers stung for $3bn to get Melbourne Metro rail tunnel project out of a hole
Victorians face a cost blowout of up to $3bn to complete the Melbourne Metro rail tunnel.
Victorians face a cost blowout of up to $3bn to complete the Melbourne Metro rail tunnel, as settlement talks between the project’s builders and the Andrews government draw to a head.
The Andrews government said on Monday night discussions were “still continuing” with Cross Yarra Partnerships and its subcontractors “on a range of issues regarding the Metro Tunnel Project”.
Asked whether a deal was imminent to lock in the size of the taxpayer-funded bailout to ensure the cross-city project was completed, a government spokeswoman said: “We have no announcements to make at this time.”
The Andrews government has for months refused to reveal the extent to which the public-private partnership has exceeded its budget, despite reports late last year that the consortium was seeking up to $3bn extra.
The Australian believes the government was close to striking a deal with the tunnel builders amid a costly impasse on another of the Andrews government’s signature projects: the $6.7bn West Gate Tunnel. More than 200 workers on the road project were stood down last week, with the jobs of a further 400 at risk while toll road operator Transurban struggles to reach agreement with the government and its builders CPB and John Holland over the disposal of toxic soil.
Asked in February whether Victorian taxpayers were likely to be looking at a bill in the billions of dollars to pay for the Metro Tunnel blowout, Transport Infrastructure Minister Jacinta Allan said it was a “big and complex” project, and refused to give a direct answer.
“As we’ve indicated before, whether it’s this project, whether it’s other projects, we are having continual conversations with our builders, the people who partner with us to deliver these big and complex tasks, and … 3000 people are working right now delivering these projects,” Ms Allan said.
“We’ll continue those discussions, we’ll continue to work through the issues that they confront that come up.”
Premier Daniel Andrews said at the time: “If and when we need to update you on those discussions and any impact on cost, we will. Today’s not a day to do that.”
An audit last year revealed the cost of initial construction-focused works on the Metro Tunnel had increased by hundreds of millions of dollars. The project involves the construction of twin 9km rail tunnels between South Kensington station, northwest of Melbourne’s CBD, and South Yarra, southeast of the city, with five new underground stations.
The stations will include Arden in North Melbourne, Parkville near the University of Melbourne and hospital precinct, State Library and Town Hall in the CBD, and Anzac on St Kilda Road near Melbourne’s War Memorial. The tunnel will also allow for the existing Pakenham and Cranbourne rail lines in Melbourne’s southeast to connect with the Sunbury line in the north by bypassing Flinders Street Station and the City Loop.
The Melbourne Metro Rail Authority was established in February 2015, with early works beginning in 2016. The project is due to be completed by 2025.
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