Melbourne Metro Tunnel Project—Phase 1: Early Works

Tabled: 6 June 2019

1 Audit context

Melbourne's train patronage has been growing faster than the metropolitan system's ability to cope with demand.

The aim of the Melbourne Metro Tunnel Project is to free up Melbourne's central rail system by removing three of the city's busiest train lines—Pakenham, Cranbourne and Sunbury—from the City Loop. This will create capacity to run more trains across the metropolitan rail network and increase service reliability.

This $11 billion transport infrastructure project will deliver twin nine-kilometre rail tunnels through the Melbourne CBD from South Kensington to South Yarra and construct five new underground stations.

1.1 Melbourne's rail transport problem

Metropolitan train patronage has increased by 13 per cent from 213.9 million passengers in 2008–09 to 240.9 million passengers in 2017–18 (Figure 1A). This high rate of growth is putting strain on the metropolitan rail network, triggering widespread crowding and reducing service reliability across the network.

Figure 1A
Annual metropolitan train patronage, 2008–09 to 2017–18

Figure 1A shows annual metropolitan train patronage, 2008–09 to 2017–18

Source: VAGO analysis from PTV data.

For the 20 years from 2011 to 2031, PTV forecasts that patronage on metropolitan train lines will increase significantly (Figure 1B). PTV also forecasts that the average number of weekday passenger boardings will double from 750 000 to 1.5 million.

Figure 1B
Projected increase in patronage growth, 2011 to 2031

Figure 1B shows projected increase in patronage growth, 2011 to 2031

Source: Department of Economic Development, Jobs, Transport and Resources, Melbourne Metro Business Case, 2016.

To meet a growing population and increasing centralisation of jobs, Melbourne's entire public and private transport network will need to provide 23 million trips per day by 2050—an extra 10.4 million trips per day compared to now.

All trains have a standard load capacity, which is the number of passengers who can fit comfortably in the carriages. For most metropolitan trains, this is 900 people per six-car train set. When there are more than 900 people, the train load is breached or 'crush' loaded.

Forecasting by PTV found that by 2031 all lines, except Frankston and Sandringham, are expected to breach load capacity during peak hours. As the number of load breaches increases, so too does passenger dissatisfaction with overcrowding and train dwell times—the time a train is stopped at a platform while passengers get on and off. Longer dwell times lead to delays, which impact reliability and time-keeping throughout the network.

Figure 1C shows the government's analysis of the excess demand on metropolitan lines if the Melbourne Metro Tunnel Project did not proceed.

Figure 1C
Future peak hour demand compared to available capacity if the Metro Tunnel was not built

Figure 1C shows the government's analysis of the excess demand on metropolitan lines if the Melbourne Metro Tunnel Project did not proceed.

Source: VAGO, based on Department of Economic Development, Jobs, Transport and Resources, Melbourne Metro Business Case, 2016.

1.2 Identifying the need for the Melbourne Metro Tunnel Project

Analysing Melbourne's rail transport problem

In response to the growing challenge of increased public transport patronage, various state governments commissioned investigations and reports to identify, analyse and solve the issues:

  • Meeting Our Transport Challenges (MOTC), 2006
  • Investing in Transport: East West Link Needs Assessment (EWLNA), 2008
  • The Victorian Transport Plan (VTP), 2008.
Meeting Our Transport Challenges

The government described MOTC as a long‑term transport plan for Victoria. It identified that Victoria's growing population and sustained economic growth would be the most significant influence on transport demand.

Stabling yards are locations where trains can be stored when not in use on the network.

Two relevant actions resulted from this plan—action 3 and action 4—which focused on improving existing rail infrastructure, as well as providing more stations and stabling yards. The MOTC strategy did not identify a metropolitan rail tunnel to complement the City Loop.

Investing in Transport: East West Link Needs Assessment

The March 2008 EWLNA report first proposed a tunnel linking Melbourne's western and south-eastern suburbs. The government commissioned the EWLNA as part of the MOTC plan, to investigate transport solutions to connect Melbourne's eastern and western suburbs.

The EWLNA recommended a 17-kilometre rail tunnel—'Melbourne's first "metro" style passenger line'—that should:

  • be built in two stages:
    • stage one—a nine-kilometre tunnel running from Footscray to Domain, starting with West Footscray to Parkville and then south under Swanston Street and St Kilda Road to Domain
    • stage two—an eight-kilometre tunnel from Domain to Caulfield, following an alignment down St Kilda Road and Dandenong Road
  • have a network of underground stations at Footscray, the Parkville precinct, in the central city and along St Kilda Road, with a station potentially at North Melbourne.

After this announcement, the project became a major focus of government transport plans, with several alternative alignment and station options.

The Victorian Transport Plan

In December 2008, in response to EWLNA recommendations, the government released the VTP, which replaced the MOTC strategy. The VTP consisted of a range of transport infrastructure projects, including the Melbourne Metro Tunnel Project—but only for stage one from Footscray to Domain.

The VTP stated that stage two, linking Domain to Caulfield, would be delivered after completion of stage one and would include more tracks from Caulfield to Westall.

1.3 Planning for the Melbourne Metro Tunnel Project

Submissions to Infrastructure Australia

In 2009 (after release of the VTP) and again in 2011, the state government submitted a project plan and the first business case for the Melbourne Metro Tunnel Project to Infrastructure Australia for assessment. Submitting a business case is a key step for state and territory governments to obtain Commonwealth funding for major projects.

The Regional Rail Link project constructed dedicated tracks for regional trains from West Werribee through Sunshine to Southern Cross stations. It opened in 2015.

Regional Rail Link and Melbourne Metro Rail Tunnel Stage 1

The 2009 project plan submission to Infrastructure Australia sought development funding for the Regional Rail Link and stage one of the Melbourne Metro Rail Tunnel. The state government identified these two projects as part of a seven-stage rail capacity upgrade program to double passenger capacity on the Victorian rail network over a decade.

The submission focused on:

  • the existing problems that the rail capacity upgrade program intended to address
  • the preferred solutions for both projects
  • a high-level summary of the expected outcomes and benefits from both projects.

In terms of the tunnel project, the submission focused on stage one (Footscray to Domain) and proposed a number of corridor, tunnel alignment and station options. The preferred alignment option was along Swanston Street, with four stations at Parkville, Melbourne Central, Flinders Street and Domain.

Ready to proceed means that the infrastructure proposal met all of Infrastructure Australia's criteria and is considered to deliver real economic benefits.

Real potential means that projects clearly address a nationally significant issue or problem and relevant options are being considered.

Infrastructure Australia supported the project and assessed stage one as 'ready to proceed' and stage two as 'real potential'. Victoria received $40 million from the Australian Government for the development of a business case for stage one.

Melbourne Metro Business Case

The 2011 business case proposed to deliver the project in a single stage and assessed several station and alignment options. An outcome of this process was confirmation of several key project attributes such as:

  • new underground stations would be built at Arden, CBD North, CBD South and Domain
  • the CBD alignment would be along Swanston Street
  • the previous Melbourne Metro Tunnel Project stage two route would adopt an alignment along Toorak Road, joining the Dandenong rail corridor from the east of South Yarra Station (as opposed to a tunnel from Domain to Caulfield along Dandenong Road)
  • no new stations would be built on the Toorak Road alignment.

Specifically, adopting the Toorak Road alignment meant a 'short' tunnel would connect Domain (now Anzac) to South Yarra and would be an extension to stage one—as opposed to a separate stage two involving a 'long' tunnel from Domain to Caulfield along Dandenong Road.

In 2012, Infrastructure Australia supported the project and assessed it as having 'real potential'.

Melbourne Rail Link

In May 2014, the government rebranded the project as the Melbourne Rail Link. It also announced a significant change in tunnel alignment, with a tunnel connecting Southern Cross Station and South Yarra Station via Fishermans Bend and two new underground stations at Domain and Montague.

This project did not proceed because of a change in government after the November 2014 election.

Impact of the 2014 election and 2015 announcements

The Melbourne Metro Tunnel Project was a feature of Victorian Labor Party (then in opposition) commitments at the 2014 election. According to Victorian Labor Platform 2014, the proposed alignment for the project was similar to previous announcements in November 2011.

Mined cavern refers to a construction approach where the required space for an underground structure or tunnel is excavated or 'mined' underground from a smaller access shaft sunk from the surface.

Cut and cover construction involves digging or 'cutting' a deep trench from above, building a structure or tunnel in the trench, and then backfilling or 'covering' with the previously excavated earth and rock.

In February 2015, the newly elected government announced the establishment of the Melbourne Metro Rail Authority (now RPV). It also announced its preferred alignment along Swanston Street, with no connection to South Yarra Station from Domain.

In April 2015, the government confirmed that the Melbourne Metro Tunnel Project would have an alignment route under Swanston Street. The government noted that it also considered alternative alignments along Russell and Elizabeth streets.

In October 2015, the government confirmed the construction method of a 'deep' tunnel through the CBD and a requirement to use a 'mined cavern' excavation technique for the tunnel and stations in the CBD, rather than a 'cut and cover' technique, which had been previously proposed.

Although the government expected the new construction technique to be costly and technically complex, it also expected this technique to cause less disruption to the city, particularly the extremely busy tram lines that run from St Kilda Road through Swanston Street to The University of Melbourne and beyond.

1.4 The 2016 Melbourne Metro Tunnel Project business case

Overview of the approved project

The Melbourne Metro Tunnel Project business case was prepared by the former Department of Economic Development, Jobs, Transport and Resources (DEDJTR) (now DoT) and approved by government in February 2016.

The Melbourne Metro Tunnel Project, when completed, plans to deliver:

  • twin nine-kilometre rail tunnels from the west of the city to the south-east as part of a new Sunbury to Cranbourne/Pakenham line
  • new underground stations (North Melbourne, Parkville and Anzac) and two new CBD stations directly connected to the City Loop at Flinders Street and Melbourne Central stations
  • two portal entrances to the tunnel at South Kensington and South Yarra, where the existing above ground rail track enters the tunnel
  • a train/tram interchange at Anzac
  • high-capacity signalling to maximise the efficiency of the new fleet of HCMTs.

Figure 1D shows the tunnel alignment through the CBD and the location of the CBD stations in relation to the current CBD train lines and stations.

Figure 1D
The route of the Melbourne Metro Tunnel and the proposed stations

Figure 1D shows the tunnel alignment through the CBD and the location of the CBD stations in relation to the current CBD train lines and stations.

Key: Orange indicates the tunnel alignment. Blue indicates the new stations that are being constructed as part of the Melbourne Metro Tunnel Project. Green shows the locations of the two portals. Grey indicates the existing train lines and stations.
Source: VAGO, based on RPV, 2018.

Packaging of project works

In the 2016 business case, DEDJTR (now DoT) grouped works for the Melbourne Metro Tunnel Project into five key packages (Figure 1E).

Figure 1E
Works packages for the Melbourne Metro Tunnel Project

Figure 1E shows the works packages for the Melbourne Metro Tunnel Project

Source: VAGO, based on DEDJTR, Melbourne Metro Business Case, 2016.

In addition, a central property unit in DoT acquired, on behalf of the state, the land and properties needed for the project.

Figure 1F shows the interaction between each works package and the construction locations.

Figure 1F
Procurement strategy alignment map for the Melbourne Metro Tunnel Project

Figure 1F shows the interaction between each works package and the construction locations.

Source: DEDJTR, Melbourne Metro Business Case, 2016. Station names updated by VAGO.

Early works

In the business case, the concept of an early works phase was proposed to prepare the various project precincts for the main works.

The business case analysed certain works that needed to be delivered before the core bundle of works (tunnel and stations, rail infrastructure and rail systems) and therefore should be procured as a separate package of works.

Early works included:

  • tram diversions
  • utility relocations and protections
  • construction power
  • demolitions and relocations.

After the business case was approved, the government expanded the scope of the early works package to include tunnel and stations interface works. Figure 1G shows the scope of early works.

Figure 1G
Scope of early works

Figure 1G shows the scope of early works.

Source: VAGO, based on RPV information.

Early works package

We examined four parts of the early works package:

  • land acquisitions
  • Early Works Managing Contractor (EWMC) activities, including:
    • site preparation works at:
      • North Melbourne
      • Parkville
      • State Library
      • Town Hall
      • Anzac
    • PPP interface works at the State Library and Town Hall station precincts
    • utility service relocations across all station and portal precincts
    • NEPs
  • tram infrastructure works
  • construction power works.
Land acquisitions

The government needed to acquire land and properties in the project boundaries that it did not own. Compulsory acquisition of land and property occurred through the Land Acquisition and Compensation Act 1986.

Early Works Managing Contractor
Site preparation works

Site preparation works included clearing and preparing future construction sites. This included property demolition works, the removal of trees, and relocation of artworks and monuments, as well as other minor road or transport network changes at the five station and two portal precincts.

Public Private Partnership interface works

RPV describes sites with an overlap of early works and main works as 'interface' works. The works that allow the PPP consortium to undertake future construction activities, and which have a direct interface with main works, include:

  • design and construction of two deep access shafts—and associated acoustic sheds and gantry cranes—at Franklin Street and A'Beckett Street
  • demolition of the former City Square and car park, underpinning and strengthening the foundations for the Westin Melbourne hotel and apartments, and partial excavation of the future station box.
Utility service relocations

RPV needed to protect or relocate utility services located on or near station and portal precincts so they would not be disrupted during main construction works.

The EWMC relocated gas, electricity, water, sewerage, and telecommunications services during early works.

Utilities have been protected or relocated during the early works phase of the Melbourne Metro Tunnel Project. Photograph courtesy of RPV.

Utilities have been protected or relocated during the early works phase of the Melbourne Metro Tunnel Project. Photograph courtesy of RPV.

Network enhancement projects

NEPs are road-based improvements, such as extra traffic lights, variable message signs, addition or removal of traffic or turning lanes, and traffic flow monitoring equipment (such as closed-circuit television cameras or Bluetooth traffic counters).

The aim of NEPs is to mitigate disruption impacts across the road network and provide suitable routes for vehicles around construction sites. NEPs were not originally part of the early works—RPV added them after public submissions raised traffic impact concerns during the Environment Effects Statement (EES) process.

Tram infrastructure works

Through the tram franchisee agreement with PTV, Yarra Trams was contracted to adjust the tram network for the Melbourne Metro Tunnel Project works. RPV directed Yarra Trams to reroute tram services that formerly ran along Domain Road to new tracks that were built on Toorak Road West to join St Kilda Road.

Yarra Trams also constructed a new platform stop on Park Street in South Melbourne to service trams that previously stopped at the Domain Interchange, which has now been demolished.

Construction power works

The main construction works, particularly the tunnel boring machines, need large amounts of high-voltage power.

This aspect of early works involved the design, engineering and construction of two substations to supply the necessary power for the main works. The substations are located at North Melbourne and Anzac.

Budgets for the Melbourne Metro Tunnel Project

The government announced the budget for the Melbourne Metro Tunnel Project as $11 billion. Figure 1H shows each works package and its budget at the contracted stage.

Figure 1H
Estimated cost of the Melbourne Metro Tunnel Project

Works package

Cost ($ million)

Land acquisition (a)

781.2

Early works (b)

365.3

Tunnel and stations (c)

5 319.7

Rail infrastructure

1 154.7

Rail systems (i.e. high-capacity signalling)

1 384.5

Other state costs (d)

2 023.5

Total cost:

11 028.9

(a) Land acquisitions were not a contracted package. This is the approved budgeted amount.
(b) Includes EWMC, tram infrastructure works and construction power.
(c) Includes the main works, minor contracted works, as well as the EWSA, which is related to the early works phase but was funded from tunnel and stations contingency funds.
(d) Includes wider network enhancements, design development, business case and procurement activities, contingency, project management and other direct costs.
Source: VAGO, based on RPV information.

Budgets for the early works

The government used different procurement approaches for the three early works contracts. Because the government has the right to compulsorily acquire property under the Land Acquisition and Compensation Act 1986, DEDJTR (now DoT) completed this component of the early works.

Figure 1I provides an overview of the early works contracts and budgets.

Figure 1I
Contracts and values for early works

Works component

Contractual agreement

Procurement process

Contract/ budgeted value
($ million)

Start date

Managing Contractor Agreement

Managing Contractor Agreement

Public tender

324.1

24 June 2016

Construction Power

Engineer, Procure, Construct and Maintain Agreement

Select tender

10.3

28 February 2017

Tram Infrastructure Works

Franchisee Agreement

Existing contract

27.6 (a)

8 June 2016

Other RPV costs

N/A

N/A

3.3

N/A

Total cost

   

365.3

 

Key: N/A = not applicable.
(a) Tram infrastructure works were not contracted—this is the budgeted amount.
Note: Figures do not include RPV risk and contingency amounts.
Source: VAGO, based on RPV information.

Time line for the project

Development of the current alignment began in 2015, when the Melbourne Metro Rail Authority (now RPV) was established. The government expects the tunnels to open in 2025 (Figure 1J).

Figure 1J
Time line of major Melbourne Metro Tunnel Project events

Source: VAGO, based on RPV and publicly available information.

Integration with other rail network initiatives

The Melbourne Metro Tunnel Project is not a standalone project. Once complete, this project and supporting projects are expected to provide the basis for future rail network improvements.

Figure 1K shows current and future projects that intersect with or complement the Melbourne Metro Tunnel Project and contribute to increasing Melbourne's metropolitan rail capacity.

Figure 1K
Current and future projects that contribute to growing Melbourne's metropolitan rail capacity

Project

Status (a)

Budget

Cranbourne line upgrade and duplication

Underway

$750 million (announced)

Electrification of the metropolitan rail network to growth areas including Melton and Wyndham

Planned

Not yet announced

Electrification to Baxter

Planned

$225 million (estimated)

Fast Rail to Geelong

Planned

Not yet announced

HCMTs and high-capacity signalling

Underway

$3.3 billion (announced)

Level Crossing Removal Program (original 50 crossings)

Underway

$7.6 billion (announced) (b)

Level Crossing Removal Program (additional 25 crossings)

Planned

$6.6 billion (announced)

Melbourne Airport Rail Link

Planned

$8–13 billion (estimated)

Rail infrastructure upgrades between Upfield and Somerton on the Craigieburn line

Planned

Not yet announced

Regional Rail Revival

Underway

$1.75 billion (announced)

Suburban Rail Loop

Planned

$50 billion (announced)

(a) Planned: announced projects. Underway: projects that are fully funded and/or have commenced.
(b) VAGO's Managing the Level Crossing Removal Program audit found that the estimated cost, as of July 2017, was $8.3 billion.
Source: VAGO, based on Transport for Victoria, Growing Our Rail Network 2018–2025, 2018, and ministerial press releases.

1.5 Environment Effects Statement and statutory planning processes

Environment Effects Statement process

The EES process under the Environment Effects Act 1978 allows statutory decision-makers to decide whether a project with potentially significant environmental effects should go ahead. This requires the project proponent to prepare and release an EES for public comment. The EES process ends when the Minister for Planning releases an assessment of the project's environmental effects. This is known as the Minister's Assessment.

The Minister for Planning decides whether a project needs to undergo the EES process. On 3 September 2015, the Minister for Planning declared the Melbourne Metro Tunnel Project as 'public works' under the Act. This declaration meant that RPV had to undertake the EES process to identify the project's environmental effects and any necessary mitigation measures.

The EES was available for public review between May and July 2016, and RPV received 379 submissions. DELWP established a joint Inquiry and Advisory Committee (IAC) to consider the EES, public submissions and draft planning controls for the project. In November 2016, the IAC provided its report to the Minister for Planning supporting the Melbourne Metro Tunnel Project.

The EES process concluded in December 2016, when the Minister for Planning released the Minister's Assessment, which found that the environmental effects of the project were acceptable, subject to recommended actions.

After the EES process finished, the Minister for Planning approved a suite of environmental management and planning controls for the project.

Statutory planning approvals

The planning process for the project under the Planning and Environment Act 1987 ran concurrently with the EES process. The Minister's Assessment and subsequent statutory approvals allowed the Melbourne Metro Tunnel Project to begin major construction.

The planning schemes for the cities of Maribyrnong, Melbourne, Port Phillip and Stonnington govern the land required for the project. The Minister for Planning approved Planning Scheme Amendment GC45 in December 2016, which introduced an Incorporated Document to exempt the project from the four local planning schemes. This planning scheme amendment also made the Minister for Planning the responsible authority for planning provisions applicable to the project, which means that local government is not involved in approving any planning matters related to the project.

The Incorporated Document sets out the project land, the permitted project activities and the conditions that RPV and its contractors must follow. It also sets out requirements for, and gives statutory weight to, the following overarching environmental and planning management strategies or frameworks:

  • an Environmental Management Framework (EMF), which includes 125 Environmental Performance Requirements (EPR), Business Support Guidelines for Construction and Residential Impact Mitigation Guidelines
  • an Urban Design Strategy
  • a Community and Stakeholder Engagement Management Framework.

The EMF provides a governance framework to manage the environmental effects of the project. The EPRs detailed in the EMF are environmental outcomes that must be achieved by RPV and its contractors during design, construction and operation of the Melbourne Metro Tunnel.

Figure 1L shows the EES processes and planning approvals relevant to this audit.

Figure 1L
Relevant EES processes and planning approvals

Figure 1L shows the EES processes and planning approvals relevant to this audit.

Source: VAGO.

Part 3 of this report further examines the EES and statutory planning processes for the Melbourne Metro Tunnel Project. Part 4 discusses compliance with the EPRs during the early works phase.

1.6 Agency roles

The following departments are responsible for facilitating the early works of the Melbourne Metro Tunnel Project or have some involvement with the early works.

Department of Environment, Land, Water and Planning

DELWP brings together Victoria's planning, local government, environment, energy, forests, emergency management, climate change and water functions into a single department.

DELWP's Impact Assessment Unit administers the EES process and provides advice to the Minister for Planning, including drafting content for the Minister's Assessment.

The Impact Assessment Unit also advises the Minister for Planning on statutory planning matters for this project.

Department of Premier and Cabinet

DPC leads whole-of-government policy and performance and helps the government achieve its strategic objectives by assisting the Premier and members of the Cabinet.

DPC is also the secretariat of a key interdepartmental committee relevant to the project and leads the whole-of-government policy agenda for major transport projects.

Department of Transport

DoT is responsible for policy and planning for all transport matters. DoT works closely with the Major Transport Infrastructure Authority to coordinate major transport construction activities and network disruptions. DoT is the client for the Melbourne Metro Tunnel Project and is responsible for setting the scope and intended network benefits for the project.

The Gateway Review process examines nominated projects at key decision points during a project life cycle.

The High Value High Risk Framework is a series of checks and processes to assess whether an infrastructure project of high value and/or high risk will achieve its stated benefits on time and within budget.

DoT also acts as the state's lead transport agency and aims to bring together the planning and coordination of Victoria's transport system and agencies, including VicRoads and PTV, and to integrate Victoria's transport system to connect people, places and opportunities.

Department of Treasury and Finance

DTF provides economic, financial and resource management advice to help the Victorian Government deliver its policies.

DTF is the owner of the State Budget process, which is key to funding approval for major infrastructure projects such as the Melbourne Metro Tunnel Project. DTF also runs the Gateway Review and High Value High Risk project assurance processes, which both apply to the project.

Rail Projects Victoria

Previously known as the Melbourne Metro Rail Authority, RPV has responsibility for all delivery aspects of the Melbourne Metro Tunnel Project, including procurement, construction and project commissioning.

In January 2019, RPV became a project team under the Major Transport Infrastructure Authority, which is an administrative office under DoT.

Public Transport Victoria

PTV is a statutory authority that acts as a system coordinator for all public transport in Victoria. It aims to promote public transport and improve it by ensuring better coordination between modes, facilitating expansion of the network, and auditing public transport assets.

PTV oversees public transport operators that act under franchise and services agreements.

VicTrack

VicTrack is a state-owned organisation operating under the Transport Integration Act 2010. It owns Victoria's rail transport assets—such as railway land, signalling and tracks—and leases them to rail and tram operators through PTV. VicTrack commercialises unused transport assets for re-investment purposes, such as through leasing land.

VicTrack made parcels of land it manages available for the Melbourne Metro Tunnel Project.

Yarra Trams

Yarra Trams is operated by Keolis Downer, which is a private sector transport company that has managed Victoria's tram network since 2009. Some Melbourne Metro Tunnel Project construction sites have impacted the tram network.

Working under its franchise agreement with PTV, Yarra Trams has carried out tram infrastructure works to reroute affected tram services.

1.7 Relevant legislation

Major Transport Projects Facilitation Act 2009

The Major Transport Projects Facilitation Act 2009 provides a 'one-stop shop' to assess, approve and deliver major transport projects in Victoria. The declaration of a project means that the Premier can determine which aspects of the Major Transport Projects Facilitation Act 2009 apply.

On 4 September 2015, the government appointed the Minister for Public Transport as Project Minister and the Secretary of DEDJTR (now DoT) as project proponent.

Environment Effects Act 1978

The Environment Effects Act 1978 can require an assessment of the potential environmental impacts or effects of a proposed development through preparation of an EES.

This is not an approval process but supports statutory decision-makers, such as government ministers, to make decisions about whether a development should go ahead. The Minister for Planning determines whether a project needs to undergo the EES process under the Environment Effects Act 1978.

Section 1.5 of this audit details the EES process for the Melbourne Metro Tunnel Project.

Planning and Environment Act 1987

The Planning and Environment Act 1987 sets out the administrative processes that regulate the planning, use and development of Victorian land.

This law empowers the Minister for Planning to exempt the Melbourne Metro Tunnel Project from the four municipal councils' planning schemes, and also allows the Minister for Planning to act as the responsible authority for planning decisions related to the project.

Land Acquisition and Compensation Act 1986

The Land Acquisition and Compensation Act 1986 provides the legal power and sets out the process for state authorities to compulsorily acquire land for a public purpose.

It also sets out the process for paying compensation for compulsorily acquired properties.

1.8 Auditing the Melbourne Metro Tunnel Project

This performance audit is the first in a series of audits examining the Melbourne Metro Tunnel Project.

The rationale for this staged approach is to examine a major transport infrastructure project at key life cycle stages so that audit observations and findings can maximise our impact to improve the next stage of the project. It also provides timely learnings for other similar projects.

This first audit focused on project planning and early works for the Melbourne Metro Tunnel Project.

The second audit will focus on the main tunnel and stations works, as well as other critical enabling projects such as a new high-capacity signalling system, rail infrastructure connection works for the tunnel—combined with wider rail network improvements—and the introduction of HCMTs.

We expect the third audit to focus on the commissioning of the tunnel and stations, as well as an assessment of the likely realisation of benefits across the rail network that were identified in the 2016 business case.

1.9 Why this audit is important

When completed and commissioned, the Melbourne Metro Tunnel will be a major public transport infrastructure asset that will impact most rail users across Melbourne.

This project is meant to be the start of an interconnected metro-style public transport system like those seen in other major international cities. The improvement in public transport into the CBD, if achieved, will support increased business, leisure and educational activity.

Large transport infrastructure projects are complex, expensive and risky. Historically, they have not always delivered benefits within time, cost and quality targets.

Independent audit scrutiny gives assurance to Parliament, the government and taxpayers that public resources are used well and that the Melbourne Metro Tunnel Project is performing as expected.

1.10 What this audit examined and how

The objective of this audit was to determine whether the Melbourne Metro Tunnel Project planning processes and early works have adequately prepared the project for the main tunnel and stations works.

Specifically, we examined whether:

  • the transport problem that the Melbourne Metro Tunnel Project is expected to solve was adequately understood in the 2016 business case
  • the reference design of the Melbourne Metro Tunnel Project was informed by robust modelling that was supported by realistic and validated data for demography, land use and travel patterns
  • the project's reference design demonstrates a flexible future-proofed solution
  • the EES and statutory planning processes adequately considered environmental risks and site-specific issues, and recommended effective mitigations and/or controls
  • the various early works packages proceeded to plan and have been delivered within expected time, cost, scope, quality and environmental parameters.

We conducted our audit in accordance with section 15 of the Audit Act 1994 and ASAE 3500 Performance Engagements. We complied with the independence and other relevant ethical requirements related to assurance engagements. The cost of this audit was $920 000.

1.11 Report structure

The remainder of this report is structured as follows:

  • Part 2 examines the project's strategic planning and options analysis.
  • Part 3 examines the project's detailed design, environmental assessment and planning approvals processes.
  • Part 4 examines the project's progress to date, focusing on the scope, cost, time, quality and environmental outcomes.

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