{"id":62445,"date":"2026-07-31T13:19:29","date_gmt":"2026-07-31T13:19:29","guid":{"rendered":"https:\/\/www.europesays.com\/australia\/62445\/"},"modified":"2026-07-31T13:19:29","modified_gmt":"2026-07-31T13:19:29","slug":"suburban-rail-loop-could-save-victoria-21bn-economists-urge-ben-carroll","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/australia\/62445\/","title":{"rendered":"Suburban Rail Loop could save Victoria $21bn, economists urge Ben Carroll"},"content":{"rendered":"

New Victorian Premier Ben Carroll has been urged to use more than $20bn in savings from cancelling or overhauling the controversial Suburban Rail Loop<\/a> to reduce the state\u2019s ballooning debt, as the resignations of two senior Jacinta Allan loyalists give him an opportunity to reset the government\u2019s agenda.<\/p>\n

The call from economists comes as Mr Carroll prepares to unveil a cabinet reshuffle, including the appointment of a new Treasurer, after the departures of senior ministers Lily D\u2019Ambrosio and Harriet Shing on Thursday. <\/p>\n

Mr Carroll has also moved quickly to install a new chief-of-staff, former Steve Bracks adviser Julie Ligeti, as he reshapes his leadership team two days after challenging Ms Allan and being elected Premier.<\/p>\n

A Parliamentary Budget Office analysis commissioned by Libertarian MP David Limbrick found scrapping the $34.5bn first stage of the Suburban Rail Loop, known as SRL East, would generate net savings of $21.06bn over the next decade. <\/p>\n

While Victoria would incur more than $1.8bn in contract termination costs, the state\u2019s budget position would still improve by $5.48bn by 2029-30.<\/p>\n

The modelling is based on the project\u2019s official $34.5bn cost estimate, which has not been revised since 2020 despite years of high inflation and escalating construction costs. <\/p>\n

Economists said the true cost of the project was likely to be substantially higher, suggesting the savings from cancelling or significantly scaling it back could exceed current estimates. This underscored the need for Mr Carroll to establish the project\u2019s full cost before deciding whether to pause, scrap or overhaul the project. <\/p>\n

Tunnelling has already started on the 26km line between Cheltenham and Box Hill in Melbourne\u2019s eastern suburbs.<\/p>\n

Independent economist Saul Eslake said Mr Carroll needed to establish the updated cost estimate and reassess the business case, which had overly optimistic forecasts on population growth and assumed SRL East and SRL North were being built at once.<\/p>\n

\u201cProvided the Victorian government can come to a mutually acceptable settlement with contractors \u2026 and move on, then that\u2019s probably a good thing to do,\u201d Mr Eslake said.<\/p>\n

He said he hoped the Carroll government would use any savings to pay back Victoria\u2019s debt faster \u2013 currently approaching $199.3bn by 2029-30 \u2013 but there was a case to put some of it into the long mothballed Melbourne Airport Rail project, which Mr Carroll hasn\u2019t ruled out.<\/p>\n

\u201cUltimately, a key test will be whether Carroll can persuade all of his colleagues to go along with what appears to be a different outlook from his two predecessors \u2026 I think his cabinet would be crazy not to go along with him,\u201d he said. \u201cThey would be inviting the public to vote for a different government.\u201d <\/p>\n

Economist Stephen Anthony said Mr Carroll needed to know the full net policy cost of the project in 2026 dollars, and be careful not to honour existing contracts \u201cwilly-nilly\u201d if contracts had been awarded through illegality or corruption.<\/p>\n

\u201cThe original SRL East policy costing was for a total spend $34.5bn estimated in 2019 dollars,\u201d Mr Anthony said. \u201cThat is equivalent to somewhere between $44bn and $51bn in 2026 dollars. <\/p>\n

\u201cFurther the original estimate could not have included the full cost of subterranean tunnelling and environmental remediation which were unknown pre-feasibility studies. Then there are costs like so-called voluntary acquisitions and stakeholder inducements, along the now much-expanded project footprint that were not known back in 2019 but are now. They are likely to add another $10bn to $15bn to the project in 2026 dollars.\u201d<\/p>\n

State opposition transport infrastructure spokesperson Evan Mulholland said \u201cabsolute confusion\u201d reigned over the project\u2019s future.<\/p>\n

\u201cIt was just in 2024 when Ben Carroll stood next to the then-premier Jacinta Allan and said he supported this project because it was a good investment, because they\u2019d won two elections on it,\u201d Mr Mulholland said. <\/p>\n

Mr Carroll will receive a briefing on SRL East from the Department of Treasury and Finance in coming days in a bid to find out its true cost and develop options on reviewing the project.<\/p>\n

He is also said to be deeply concerned about the secret package of works to connect the new SRL stations to existing transport hubs, which has been kept in the dark from ministers, and how much that increases the cost of the project. <\/p>\n

If the project were cancelled, Mr Carroll would need to convince Anthony Albanese to unlock $6bn it had committed towards the project.<\/p>\n

Mr Carroll said he did not discuss SRL East with the Prime Minister when they spoke on Wednesday, but he refused to explicitly back in the $34.5bn project.<\/p>\n

\u201cWhat I can say is that every dollar of my government will be invested where it delivers the greatest value for Victorians, and it will be invested responsibly, transparently and respectfully,\u201d Mr Carroll said.<\/p>\n

The Premier also said on Thursday he still planned to legislate the right to work from home two days per week, but was open to considering \u201csensible changes\u201d. It\u2019s understood a carve-out for small businesses is being considered.<\/p>\n

Mr Carroll will settle on his cabinet over the weekend, before ministers are sworn in on Monday morning ahead of their first meeting under the new regime.<\/p>\n

It\u2019s expected Jaclyn Symes will be moved out of Treasury, with Industry Minister Colin Brooks speculated as a likely replacement candidate along with Deputy Premier Gabrielle Williams and Police Minister Anthony Carbines.<\/p>\n

The resignations of Ms Shing and Ms D\u2019Ambrosio, along with Ms Allan, open up three more cabinet positions in the Left faction. It\u2019s understood Tim Richardson will enter cabinet, while MPs Sonja Terpstra, Sheena Watt, Josh Bull and Ryan Batchelor have been mentioned as potential candidates for promotion. It is also unclear whether more Allan loyalists will quit. <\/p>\n

Mr Carroll thanked his long-time cabinet colleagues Ms Shing and Ms D\u2019Ambrosio for their service, saying they have \u201cbrought compassion, determination and a strong sense of purpose to their roles\u201d.<\/p>\n

Ms Shing said it had been an incredible honour to serve as the member for Eastern Victoria since 2014, and as a minister for the past four years.<\/p>\n

\u201cIt has always been my view that we are custodians of these roles for the time that we have them, and it is now time for me to pass these opportunities and obligations on to the next person,\u201d she said.<\/p>\n

Ms D\u2019Ambrosio, responsible for the Andrews and Allan governments\u2019 renewable energy transition, said her public service \u201cshows all girls what is possible for them no matter their faith, what they look like or the way they speak\u201d.<\/p>\n

Read related topics:Daniel Andrews<\/a>Victoria Politics<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"New Victorian Premier Ben Carroll has been urged to use more than $20bn in savings from cancelling 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