Victorian government secretly raised public transport fares for rail loop project

Victoria's government covertly raised public transport fares to finance the controversial Suburban Rail Loop (SRL) and other "Big Build" projects, according to a report by the state's auditor-general. The report also casts doubt on whether the first stage of the multibillion-dollar project, SRL East, can be completed on schedule and within its budget.

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is not transparent and some funding sources are uncertain.

The auditor-general found the funding plan for SRL East, which relies on $11.5 billion each from the Commonwealth and state governments plus $11.5 billion from "value capture" methods, lacks transparency and has uncertain funding sources. While the government announced five value capture measures in December, including land taxes and developer contributions, it failed to disclose a levy imposed on all metropolitan Melbourne and regional Victoria public transport fares starting January 1, 2025.

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The government plans to allocate 60% of the revenue it collects through the levy, estimated at $4.8bn in net present value (NPV) terms to 2062, to fund SRL East.

This levy involves a 1% annual increase on fares, in addition to existing inflation adjustments. The government plans to allocate 60% of the revenue generated by this levy, estimated at $4.8 billion in net present value terms by 2062, to fund SRL East. This makes the levy the project's most significant source of value capture revenue.

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This levy will be the project’s largest source of value capture revenue.

Despite the levy being the largest funding source, the government and Transport Victoria did not acknowledge it in public communications regarding fare increases for 2025 and 2026. As of June 2026, the levy remains unannounced. Furthermore, the report revealed that the project has already faced delays of up to six months in early works, with station contracts yet to be awarded, jeopardizing the promised 2035 completion date for SRL East.

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The government and Transport Victoria did not acknowledge the levy in their public communications about the 2025 and 2026 annual fare increases. As at June 2026, they still have not announced it.