Suburban Rail Loop 'bells and whistles' cuts never counted in project cost, audit finds

Proposed cuts to the Suburban Rail Loop (SRL) project, including station interchanges and a multi-level car park, were never factored into the initial $34.5 billion cost estimate, according to a report by the Victorian Auditor-General's Office (VAGO). This finding challenges Premier Ben Carroll's recent claim of identifying $1 billion in savings by removing these "bells and whistles."

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These items represent potential future scope options, not approved project costs.

Premier Carroll announced on Tuesday that the cost of SRL East would be reduced from $34.5 billion to $33.3 billion by foregoing two underground station interchanges and a multi-level car park. However, the VAGO report, released Wednesday, revealed that these specific items were not included in the original costings. The Suburban Rail Loop Authority (SRLA) explained that these elements represented "potential future scope options, not approved project costs."

The SRLA stated that it is standard practice for major infrastructure projects to assess optional scope elements separately until a final decision is made on their inclusion. "Accordingly, no cost liability exists until government determines whether these items will proceed," the authority told VAGO. Despite this, a government spokesman insisted that removing "unnecessary scope" would indeed reduce the total estimated investment.

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It is standard practice on major infrastructure projects for optional or additional scope elements to be identified, assessed and considered separately from the approved scope until a final decision is made regarding their inclusion.

The audit also highlighted potential cost blowouts, noting that not enough had been budgeted for the proposed multi-level car park at Glen Waverley. VAGO confirmed that authorities had been preparing to abandon the interchanges at Glen Waverley and Box Hill for months. The SRLA had advised VAGO that a Box Hill interchange was not projected to be needed for decades, and an interchange at Glen Waverley might not offer value for money due to the existing station's age and upgrade costs. The interchanges at Cheltenham, Glen Waverley, and Box Hill were estimated to cost $1.7 billion in total, yet only $104 million was included in the project's overall estimated cost.

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Accordingly, no cost liability exists until government determines whether these items will proceed.