Victoria’s major projects costs increase $11.6 billion in a year

A Victorian government spokesman said it would be wrong to describe the increasing cost to 53 of its major projects as a blowout, given that some increases were due to the expanded scope of capital works.

“[Total estimated investment] changes do not equal a ‘blowout’,” he said.

The government pointed to the Level Crossing Removal Project, which previously increased in cost by $2.281 billion when 10 extra level crossings were added.

VAGO found in its 2022-23 report that the total estimated investment for 101 projects had grown by $11 billion (11 per cent) to $123 billion.

Last year’s state budget forecast that Victoria would spend an average $19.6 billion a year on capital works over the four years of the forward estimates. This is four times the long-term average from a decade ago.

Treasurer Jaclyn Symes on Tuesday said “transformational projects” such as the West Gate Tunnel, Metro Tunnel and Suburban Rail Loop (SRL) created jobs and grew the economy.

She said the perception that the western suburbs had lost out to the SRL East rail project, connecting Cheltenham to Box Hill, was wrong.

“I would point to the fact that we continually invest in the west. This narrative that the west is neglected is completely false. Go out there and look at the health expenditure, the numerous new schools, the school expansions and maintenance and new facilities out there, the road improvements,” Symes said.

Premier Jacinta Allan is battling a narrative that the $34.5 billion first leg of the SRL has chewed up her government’s ability to service the basics in the west after Labor survived a 17 per cent collapse in its primary vote in the Werribee byelection.

Symes confirmed she had directed departments to find “efficiencies” and did not rule anything in or out for the budget, including new or expanded taxes. But she said the cost of living was front-of-mind while she prepared the Victorian budget, to be handed down on May 20.

“The Victorian economy is going from strength to strength,” Symes said. “Having said that, I am very conscious that that is not necessarily translating to households and family pressures. That is why, as the treasurer and as a government, we are solely focused on cost-of-living pressures on Victorian families.”

SRL Minister Harriet Shing on Tuesday, asked whether SRL West could be brought forward, said work was sequenced based on resources available.

The government in September confirmed the cost to taxpayers for the Metro Tunnel project had blown out by another $837 million, blaming inflation caused by COVID-19 and the war in Ukraine.

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