The Victorian Government is trying hard to convey that SRL East will come within its $34,500 million budget. Let's check the State government's own #infrastructure track record to see whether this is possible.
(It's actually $36.7 billion, including $2.2 billion of prep works which were recently re-costed at ~$2.4 billion).
🚧SRL East is one of four mega infrastructure projects in Victoria in the last decade (ignoring level crossing removals).
🚆All comprise twin tunnels of various lengths, and all experienced substantial cost increases, ranging from 24% at the low end on Metro Tunnel (albeit there is smoke and mirrors here too), to 162% on North East Link!
Based on the math: • Metro Tunnel = ~$750 million per km of tunnel (inc. 5 underground stations).
• North East Link = ~$2.0 billion per km, plus 3.5km of at-grade road + onramps etc.
• West Gate Tunnel = ~$2.5 billion per km, plus some road improvements, interchanges etc.
🛣️Sure, road projects have components such as at-grade road, highway interchanges and intersections, but they don't have the cost of underground stations, which likely cost $250-$500m each. I would argue these overall rates are comparable to understand orders of magnitude.
So Victorians are expected to believe that SRL East, for 52km of tunnels and 6 stations, through lengths of varying geological conditions, will cost less than Metro Tunnel – a project substantially constructed prior to the 50%+ COVID construction cost escalation? And the cost estimates from the 2021 Business Case, which was before major escalation, remain realistic?
That's before you get into misguided assumptions about #value capture and $10B of AWOL Federal Government funding meant to cover ~$24 billion of the pricetag.
Meanwhile, the 2025 State Budget shows TBC allowance – hardly confidence-inspiring (I wish I were joking 🤡).
🤔 I estimate SRL East is on track (ha) to cost closer to $70B by 2035 than $36.7B. This would leave Victorian taxpayers with a net shortfall of $46B compared to ~$12B – if you are kind and assume the full value capture is achieved and the Federal Government funding is forthcoming.
Tell me how a purported Benefit-Cost ratio of 1.1 to 1.7 looks if construction costs double?
Suburban Rail Loop Authority The Age Kieran Rooney
—- Addendum —-
In case it isn't clear from the table – North East Link 2021 business case was $15.6 Billion. Now it's $26.2 Billion, a 68% increase.
But SRL is just 10% higher since the same date?
#mathaintmathin.