Australia sets aside $3bn to restart scrapped road contract

The Australian government has confirmed its commitment to the construction of Melbourne’s East West Link, despite the state government tearing up the project contract.

Lend Lease had won the contract, but it was cancelled last month (link opens in new tab).

The Commonwealth government said that it regards the link as a project of national significance that will create thousands of jobs and reduce congestion. It will provide AU$3bn (£1.5bn) to the first Victorian government willing to build the East West Link and recorded this commitment as a contingent liability in yesterday’s federal budget.

“The Victorian Government will waste over half a billion dollars not to build this world class project but the East West Link may still be reinstated at a later date by a government willing to do the right thing by the people of Victoria,” said minister for infrastructure and regional development Warren Truss. “To this end, the Commonwealth Government has revised the forward estimates, including the return of $1.5 billion of unspent funding from the Victorian government, consistent with obligations under the memorandum of understanding between the Victorian government and the Commonwealth.”