Victorian government drowns in Suburban Rail Loop lies

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Recent polling undertaken by SEC Newgate Australia suggested that Victorians do not see the $200 billion Suburban Rail Loop (SRL) as a high-priority project.

The Orwellian Victorian Labor government has responded with propaganda, declaring the SRL “Australia’s largest housing project”:

SRL gaslighting

The gaslighting is unbelievable. The SRL is a rail project, and not a very good one.

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The independent Victorian Parliamentary Budget Office (PBO) estimated that every dollar spent on the first two stages of the SRL (60 km) will result in social benefits ranging from only $0.60 to $0.70.

An investigation from the Australian National Audit Office (ANAO), which is responsible for ensuring all federal government funds are spent legally, advised that the business case used to request $11.5 billion in federal funding for the SRL’s first stage had information gaps and used spurious methods to quantify the SRL’s benefits.

ANAO stated that the project’s first stage (SRL East) did “not present a reasonable investment”.

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The SRL is not a housing project. It won’t deliver a single home.

The enormous cost of the SRL will plunge Victoria deeper into debt, resulting in further credit rating downgrades and soaring interest costs.

Victoria's net debt
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The project will also consume most of the state’s infrastructure budget, starving growth areas of funding for decades, ensuring they become increasingly crush-loaded.

Melbourne’s west has absorbed significantly more population growth than any other part of the city, increasing at twice the rate of the east since 2001.

Melbourne population growth
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The Labor government has also set some of the highest housing targets for the west of Melbourne over the next decade, meaning their populations will continue to explode.

The number of dwellings in Melton is expected to increase by 190%, Maribyrnong by 114%, and Wyndham by 110%.

However, many communities already lack infrastructure, which will worsen as their populations grow.

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Leaked modelling of future demand on the SRL revealed a woeful underutilisation of the line.

The leaked analysis shows that by mid-century—when Melbourne houses eight million people—there would be only 24,000 trips a day between the first two SRL stations, Cheltenham and Clayton, in Melbourne’s southeast.

It shows that by the same year, trains running between Sunshine and Footscray in Melbourne’s booming west, would be crammed with a whopping 270,000 passengers…

Labor ministers say the data was not shared with Cabinet, which was kept in the dark during key decision-making processes for the SRL…

One Labor minister said the data was not shared with other MPs at the time and that there was little information provided about modelling during decision-making.

“This is exactly why they didn’t bring the SRL to the general Cabinet … at the decision-making point,” they said.

Meanwhile, in true authoritarian fashion, the Victorian government has gagged criticism of the SRL.

Local charities, schools and sporting clubs signed agreements barring them from criticising the Suburban Rail Loop or doing anything to damage the Victorian government’s name – in exchange for grant money…

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“The organisation will ensure that the conduct in relation to the performance of the activity is professional, and recipients do not do anything that may damage, bring into disrepute or ridicule the SRL project, or the authority’s or the Victorian government’s name, messages or reputation,” says the agreement with not-for-profits.

By rejecting expert advice and approving contracts to build the SRL, the State Labor government has committed Victorian taxpayers to decades of crushing debt and lower living standards in exchange for a ghost train to nowhere.

Taxpayer funding is limited and must be spent prudently on projects that deliver the most significant returns.

The SRL fails this basic test and diverts scarce funding away from projects that would benefit Melbourne’s growth corridors in the west.

Residents in Melbourne’s west will suffer the most due to Labor’s waste and mismanagement.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.