Liberals criticise ‘unimpressive and underwhelming’ rail loop plan as Victorian premier pushes ahead after hinting at pause

The Victorian opposition has described Ben Carroll’s plan to scale back new train stations along the Suburban Rail Loop to shave just over 5% off its total cost as “incredibly unimpressive and underwhelming”.

The premier on Tuesday announced changes to the scope of the first stage of the state’s largest-ever infrastructure project, known as SRL East – a 26km stretch of tunnels between Cheltenham and Box Hill – estimated to save $1bn. He also ordered an “independent, technical review” to identify a further $1bn in savings.

Combined, the two measures would reduce the total cost of SRL East by just 6% to about $32.3bn, from a maximum $34.5bn contained in the project’s 2021 business and investment case.

Carroll, who took on the Labor leadership a month ago, vowed not to rip up the $14.5bn in construction contracts already signed, despite reportedly not being a fan of the proposed 90km orbital train line. That line is planned to eventually travel from Cheltenham, in the city’s southeast, to Werribee, in the west, via Melbourne airport.

The project was first announced by then-premier Daniel Andrews ahead of the 2018 election, when it was estimated to cost $50bn. His successor, Jacinta Allan, was the minister initially responsible for overseeing its development and championed it while premier. The government has not released a total estimated cost for the entire project but the Parliamentary Budget Office estimated in 2024 that the first two stages would cost $96.4bn and an additional $120.2bn would be required to operate the line for 50 years.

In radio appearances on Monday, Carroll suggested other projects were more important to Victorians than SRL, including filling potholes, electrifying Melbourne’s V/Line Melton corridor and a train to Melbourne airport. In an interview with Guardian Australia, Carroll described Melbourne Airport Rail as his top infrastructure priority.

Following Tuesday’s announcement, Carroll’s mentor, former Victorian senator Stephen Conroy, described SRL as a “dog of a project the previous leadership committed to” which had “totally sabotaged the budget”.

He told News24 that he hoped further savings would be found as part of the technical review and “that as much of it [that] can be scrapped is scrapped”.

The Coalition public transport spokesperson, Matthew Guy, accused Carroll of treating Victorians like “mugs” over his changing position on the project.

“Today’s announcement is just another piece of chaos from this premier. You know his approach for the last month or so has been incredibly unimpressive and underwhelming … he said he’s going to find savings into the Suburban Rail Loop, but those savings are cabinet-in-confidence and he won’t tell you where they’re coming from. Really?” Guy said.

Guy urged the government to make all SRL contracts public so the Coalition could form a position on whether it should continue prior to the election.

Estimated cost of the entire the Suburban Rail Loop when announced by Daniel Andrews in 2018

Length of the loop, which would run from Cheltenham in Melbourne’s south-east to Werribee in the west, via Melbourne airport

Cost of stage one of the loop, dubbed SRL East, as promised by new premier Ben Carroll on 25 August 2026. It was estimated to cost $30-34.5bn in 2021

Worth of contracts signed, according to Labor’s May budget

Length of SRL East, which runs from Cheltenham to Box Hill

The year SRL East is due to open

stimated cost of building SRL East and SRL North, the second stage of the project, based on a 2024 Parliamentary Budget Office analysis

Estimated cost of operating SRL East and North for 50 years, according to PBO

SRL North, which runs from Box Hill to Melbourne airport, due to open

Completion of SRL West, the final stage of project, running from Sunshine to Werribee

The changes in scope to SRL East include scrapping underground station interchanges at Box Hill and Glen Waverley, a second station entrance at Clayton, “complex” pedestrian bridges in Burwood and Cheltenham and a multilevel car park at Glen Waverley.

Grants to support local community groups during construction will end at the completion of the current round and some future precinct works intended to transform the areas around the new stations into housing hubs will be scaled back.

The Suburban Rail Loop Authority, the agency responsible for planning and delivering the project, will also be folded into the Victorian Infrastructure Delivery Authority. This follows 64 redundancies at the SRLA in June, along with 99 vacant positions being replaced by just 17 roles.

Carroll described the changes as removing “bells and whistles” from the project.

“Overpasses, walkways, car parks, community grants are nice to have but they are not needed to build the orbital railway line,” he told reporters. “This is a common sense decision we have made as a government, valuing taxpayers’ dollars, delivering this project on time, within budget.”

No further contracts will be awarded until the review is complete but the government has stressed all current works will continue as scheduled, with tunnelling between Burwood and Glen Waverley set to begin soon.

Guy said if the Coalition is elected in November they would immediately halt tunnelling and order a review into the project.

The state government has allocated $11.8bn to SRL East while the federal government has handed over $6bn, including $3.8bn in May’s federal budget.

Scrutiny of the project will continue in parliament this week, with the Victorian auditor general expected on Wednesday to release the results of a years-long investigation into whether SRL East is “on track to meet the government’s cost, time and benefit targets”.