Lawyers are currently evaluating the financial implications of altering contracts related to the Suburban Rail Loop project, according to government sources.
The Allan government has engaged legal experts to weigh the pros and cons of continuing with the $30-34.5 billion project versus the cost of pausing it.
A leading law firm that advised on the project in 2020-21 is reportedly involved again to assess the existing contracts, including a significant $3.6 billion tunnelling contract for the first stage.
Internally, the Suburban Rail Loop Authority acknowledges that changes are imminent. Despite these warnings, Jacinta Allan remains committed to the project, though it risks damaging the state’s AA credit rating without additional federal funding.
A downgrade to AA- could increase borrowing costs and complicate efforts to manage the state’s $188 billion debt.
Industry sources indicate that while work continues “as usual,” some major construction firms are reconsidering their involvement. The government is using the cost assessment to address internal disagreements, particularly among senior ministers concerned about the project’s high costs.
Transport Infrastructure Minister Danny Pearson maintains confidence that stage one will meet its budget and completion timeline, despite rising construction costs. He also confirmed that 1,000 pages of documentation have been provided to Infrastructure Australia, which is crucial for securing federal funding.
