Tuesday, 1 April 2025

Suburban Rail Loop

Evan MULHOLLAND (Northern Metropolitan) (12:19): (871) My question is to the Minister for the Suburban Rail Loop. The Infrastructure Australia report on the Suburban Rail Loop East says the Victorian government failed to provide clarity on operating costs, with cost assumptions failing to reflect recent industry-wide construction escalation. Your own budget papers indicate that there has been a 22 per cent blowout in costs on construction since 2021, when the SRL business and investment case was first published. Given Infrastructure Australia’s criticism and its acknowledgement of the economic reality of costs in the construction sector, does the government stand by its position that the SRL East is immune from sector-wide cost escalation?

Harriet SHING (Eastern Victoria – Minister for the Suburban Rail Loop, Minister for Housing and Building, Minister for Development Victoria and Precincts) (12:20): I am not sure, Mr Mulholland, whether you are asking for an opinion, but let us talk to the Suburban Rail Loop project and in fact the Auditor-General’s own assessment that the project is on time and on budget. It is really important to note, Mr Mulholland, that when we first started having this conversation about the Suburban Rail Loop you actually had not read the budget papers from 2019–20, which contained that $300 million that you were unable to find and therefore based a faulty argument on about costs and insufficient funding being provided for the purpose of those early works. That speaks perhaps more to the preparation that has gone into your assessment as to the merit of this project.

We know that communities need infrastructure and need projects and support and services that will help us to grow and to grow well. The alternative is urban sprawl, Mr Mulholland –

Evan Mulholland: On a point of order, President, on relevance, my question is on whether the government stands by its previous position that the Suburban Rail Loop will be immune from cost escalation.

The PRESIDENT: I think the minister was being relevant to the question, and I feel she answered it in the first 30 seconds of her response, so I will not uphold the point of order.

Harriet SHING: Mr Mulholland, it is unfortunate that yet again you are unable to understand the way in which major contracts for major projects are developed and are delivered, and I suspect that that has something to do with the fact, as I have said before, that you never delivered any major projects when you were in government. As I said, the project remains on time and on budget. We are powering ahead as we get ready for the launch of tunnel-boring machines next year, Mr Mulholland. I look forward to seeing you out there on the sites as they get underway.

All major projects build in contingencies to account for variations across the projects, and the Suburban Rail Loop East is no different. We said it would cost between $30 billion and $34.5 billion, and that has not changed. The project is on time; the project is on budget. We do have work that goes into making sure that the contracts that we develop are developed in accordance with established processes – but, Mr Mulholland, you would not know anything about established processes, because you could not even read the budget from 2019–20.

David Davis: On a point of order, President, the minister keeps attacking Mr Mulholland. It has nothing to do with the answer to the question. Her job is to answer the question and not to attack the opposition.

The PRESIDENT: I have already ruled on the previous point of order that I believe the minister did answer the question within the first 30 seconds when she stood up. I think it is hard for the minister, when she gets constant interjections, not to respond to them, but I ask the minister not to respond to interjections and I ask people making interjections not to make them. Then we will be in a good place.

Harriet SHING: What I would again direct you to, Mr Mulholland, is the business case. I have got probably –

Members interjecting.

Harriet SHING: It is a business and investment case. It is a significant volume of information, Mr Mulholland. Just like a number of your colleagues, you have not read it. You do a quick word search, and you think that you know what is in it. I would definitely suggest that you have a look through it and that you go through the detail, which Infrastructure Australia has relied upon in recommending release of the $2.2 billion. Of course we develop and we deliver our contracts in accordance with established principles, Mr Mulholland. Again this is about making sure that we deliver this project on time and on budget, and that is precisely what is happening.

Evan MULHOLLAND (Northern Metropolitan) (12:24): I will repeat the fact that Infrastructure Australia says the Victorian government failed to provide clarity on operating costs, with cost assumptions failing to reflect industry-wide cost escalations – that is a fact. Will the government now update its targeted range of $30 billion to $34.5 billion for the SRL East to factor in the 22 per cent increase in construction costs?

Harriet SHING (Eastern Victoria – Minister for the Suburban Rail Loop, Minister for Housing and Building, Minister for Development Victoria and Precincts) (12:24): Thanks, Mr Mulholland. Again, the Infrastructure Australia report is not a particularly long document, but what you have done, in referring to a couple of very select parts of it, is ignore the first sentence of that report, which I took you to earlier, recommending an allocation of $2.2 billion in a funding commitment toward tangible elements of the Suburban Rail Loop East project scope. The work that we do is underpinned by rigorous approaches to contract negotiation and the execution of terms, as has occurred with these early works and tunnelling packages, to ensure that, as we deliver a contract on time and on budget, that remains the case. Again, we are looking forward to having tunnel-boring machines in the ground next year; looking forward to continuing to work with colleagues in the Commonwealth, depending on whether Peter Dutton decides he supports or does not support the project; and making sure that we are building something, Mr Mulholland, that is bigger than you or indeed me.