The Victorian government has “overstated” the benefits of sections of its controversial Suburban Rail Loop project, according to Australia’s peak infrastructure body, Infrastructure Australia. The organization suggests that blowouts to the $34.5 billion price tag for the first section are likely and has recommended that the federal government withhold further funding until an updated cost-benefit analysis is conducted.

Infrastructure Australia’s assessment of the Suburban Rail Loop (SRL) East section has been critical, stating that the economic appraisal is not detailed enough to understand the economic impacts of SRL East and that the results of the appraisal are overstated. There are concerns about the rigor of the submitted business case, and the تخت assessment attributes these issues partly to the fact that initial estimates were made in 2020, before the cost escalations seen across the construction industry.

Cost overruns are likely due to these factors, with Infrastructure Australia expressing low confidence in the cost estimate for SRL East, citing a major risk to the project and the program as a whole. Infrastructure Australia has also noted that the Victorian government plans to fund one-third of the project and is seeking to generate the remaining third through value capture—a tax on land and property sales near the stations.

The evaluation suggests that for the federal government to continue funding the SRL project, an updated analysis and more information on the use of value capture to fund the project are needed. Additionally, Infrastructure Australia has called for the development of an “exit strategy” in case the project cannot be delivered successfully, at this stage or in the future.

Source: https://www.theguardian.com/australia-news/2025/mar/21/victorian-government-urged-to-prepare-exit-strategy-for-suburban-rail-loop-as-report-finds-benefits-overstated