Carroll scales back rail loop amid opposition criticism of 'underwhelming' cost cuts

Ben Carroll took the Victorian premiership a month ago and immediately inherited a problem: a 90-kilometer orbital train line that was supposed to reshape the state's transport network but had become a political liability. On Tuesday, he announced he would keep the project alive—but smaller. The first stage, known as SRL East, a 26-kilometer tunnel corridor running from Cheltenham to Box Hill, would shed $1 billion in costs by removing what he called "bells and whistles." Underground station interchanges at Box Hill and Glen Waverley would disappear. So would a second entrance at Clayton, the pedestrian bridges at Burwood and Cheltenham, and a multilevel car park at Glen Waverley. Community grants supporting local groups during construction would end after the current round. The cuts amounted to just over 5 percent of the total cost, bringing SRL East down to approximately $32.3 billion from a maximum of $34.5 billion.

Carroll also ordered an independent technical review to find another $1 billion in savings, which would bring the total reduction to about 6 percent. The premier framed this as common sense—stripping away amenities that were "nice to have but not needed" to build the core railway. He stressed that all current construction contracts, worth $14.5 billion, would remain intact and that tunnelling between Burwood and Glen Waverley would begin as scheduled. No new contracts would be awarded until the review was complete.

The problem was timing and tone. Just a day before the announcement, Carroll had suggested on radio that other projects mattered more to Victorians: filling potholes, electrifying the V/Line Melton corridor, and building a train to Melbourne Airport. In an interview with The Guardian, he named airport rail as his top infrastructure priority. The shift was jarring enough that his own mentor, former senator Stephen Conroy, called SRL "a dog of a project the previous leadership committed to" and hoped "as much of it as can be scrapped is scrapped." The project had been championed by two previous premiers—Daniel Andrews, who announced it before the 2018 election when it was estimated at $50 billion, and Jacinta Allan, who oversaw its development. Now Carroll seemed to be running from it.

The opposition seized on the contradiction. Matthew Guy, the Coalition's public transport spokesperson, accused Carroll of treating Victorians like "mugs" over his shifting position. He called the announcement "just another piece of chaos" and criticized the premier for keeping the savings details "cabinet-in-confidence" rather than making them public. Guy demanded that all SRL contracts be released so the Coalition could form a position before the November election. He also warned that if his party won, they would immediately halt tunnelling and order a full review.

The restructuring extended beyond the project itself. The Suburban Rail Loop Authority, the agency responsible for planning and delivering the work, would be folded into the Victorian Infrastructure Delivery Authority. This followed 64 redundancies at the SRLA in June, when 99 vacant positions were replaced by just 17 roles. The consolidation signaled a significant scaling back of the institutional apparatus built to manage what was once the state's largest-ever infrastructure commitment.

The financial picture remained staggering. The Parliamentary Budget Office had estimated in 2024 that the first two stages alone would cost $96.4 billion, with an additional $120.2 billion required to operate the line for 50 years. The state government had allocated $11.8 billion to SRL East, while the federal government had contributed $6 billion, including $3.8 billion in May's budget. Yet the government had never released a total estimated cost for the entire 90-kilometer project.

Scrutiny was about to intensify. The Victorian auditor general was expected to release the results of a years-long investigation on Wednesday into whether SRL East was "on track to meet the government's cost, time and benefit targets." That report could either validate Carroll's cost-cutting measures or expose deeper problems with the project's viability. Either way, the premier's attempt to thread the needle—keeping the project alive while signaling it was not his priority—seemed unlikely to satisfy anyone.