Bidders on the first stage of the mega rail loop have been told by the Allan government to keep their spending within tight limits until at least 2028, as the state manages its cash flow.
Bidders on the first stage of the Suburban Rail Loop are being asked by the Allan government to keep their spending for the $35 billion project within tight limits until at least 2028 to ease the impact on the state’s finances.
Three industry sources, who asked not to be identified so they could speak about confidential contract details, toldtenderers and successful bidders on the first SRL stages had been asked to restrict their spending as the state manages budget shocks, aims to prevent further cost overruns on the Big Build, and pays down debt that is expected toThis includes two contracts to build the project’s six stations that are currently being negotiated.
Under timelines outlined in tender documents, the contract for the construction of the first three stations will be signed by the end of 2025, and work on the first station, Box Hill, will begin by the middle of 2026.The first tranche of government money, a payment of $400 million, is expected to come online in the 2025-26 financial year.that Victoria’s failure to submit a credible business case was holding back the release of this cash.
“A shortfall in federal funding would increase pressure on Victoria’s rating if it pushes ahead with the project. This would reduce headroom at the AA rating level. The rail loop’s business and investment case floated that by 2025 Victoria would introduce an uplift charge on non-residential properties whose value is improved by the loop, and also introduce development contributions for projects around SRL stations.
“The Victorian and Commonwealth governments have already committed $14 billion to Suburban Rail Loop – that’s more than enough to start main works and have tunnel boring machines in the ground in 2026,” a state government spokesperson said.
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