Hot off the press. It seems that the dopes in the Victoriamn Labor government are in panic mode and are now looking to cancel or at least pause for years the biggest white elephant public infrastructure project in Australia's history, the Suburban Rail Loop stage 1 from Cheltenham to Box Hill. Currently costed at a lazy $34 billion.
Maybe thay cannot find Dan's Business Case and the Fed's won't play ball on funding. Or as I suspect it is an electoral disaster driving votes away from Labor in Victoria.
see below article just published by the Herald Sun.
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SRL bombshell: Lawyers brought in to explore rejigging rail loop
Lawyers have been brought in to start assessing the pros and cons of continuing with the controversial $34.5bn Suburban Rail Loop project.
Shannon Deery and
Carly Douglas
2 min read
August 29, 2024 - 1:12PM
Herald Sun
Lawyers have begun assessing the potential
cost of altering contracts connected to the controversial Suburban Rail Loop project, government sources have claimed.
Sources familiar with the high level work say the Allan government has engaged lawyers to assess the
pros and cons of continuing with the $30-34.5bn project, and the potential cost of pausing works.
A leading law firm – which provided commercial and transaction advice in 2020-21 for the project – is understood to again be involved with works to assess contracts.
Multiple contracts have been signed including a $3.6bn one for the first stage of tunnelling has been awarded.
A preferred bid has also been announced for the second major contract for tunnelling.
Sources inside the Suburban Rail Loop Authority said there was now a
realisation internally that change is coming and necessary.
Jacinta Allan has repeatedly committed to pushing ahead with the project, despite warnings that doing so without further federal funding would seriously jeopardise the state’s AA credit rating.
A further downgrade, to AA-, would increase borrowing costs and make it significantly harder to start paying down the state’s project $188bn debt.
Industry sources connected to the project said they were continuing on a “business as usual” basis despite increasing uncertainty around the project.
At least one major construction firm that had expressed interest in the project is understood to be now considering backing away from it.
Government sources said calculating the cost of cancelling or significantly amending the contracts could be used to quell a deepening divide within the Premier’s cabinet room over the project, particularly if it showed it would cost too much to back away from the work.
A number of senior ministers are opposed to the project at this time because of its cost.
Pollster Kos Samaras, who was the ALP assistant secretary and deputy campaign director from 2005-19, told the Herald Sun last week focus groups in the eastern suburbs, where people would directly benefit from the first stage of the 90km SRL, did not think it was essential.
At the same time the project risked an electoral backlash, with focus groups showing voters in the western suburbs felt abandoned by the state government.
Transport Infrastructure Minister Danny Pearson on Thursday said he was confident that stage one would be delivered by 2035 within the $30 to $34.5 billion price range, despite soaring construction costs blowing out every other major project.
He said the government was banking on the growth of construction costs slowing over the next decade.
“What we’ve seen is construction has increased across the eastern seaboard by 22 per cent since 2021 but when you take that long term horizon, there’s peaks of troughs,” he said.
The price point for stage one of the loop was set before recent price hikes.
Mr Pearson also refused to confirm whether the government had provided Infrastructure Australia with information that has been touted as the key to unlocking much-needed Commonwealth funding for the project.
“We’ve provided 1000 pages worth of documentation to date to Infrastructure Australia, both the business case as well as the attached appendices to that documentation,” he said.
