Private transport firms kept afloat using $400m of taxpayer cash

Taxpayers have spent more than $400 million keeping private companies running the state’s public transport network afloat and paying for extra cleaning of the state’s trains and trams.

The government forked out the huge spend as commuters deserted the network during extended lockdowns, with annual patronage dropping by up to 60 million people on the city’s trains.



The $438 million in relief funds and support for extra cleaning – disclosed for the first time in the Victorian 2020-21 budget – surpasses previous indications that Metro was lent more than $50 million between June and December this year.

The news comes after an anti-corruption inquiry heard evidence the cleaning company paid millions for extra work during the COVID-19 pandemic failed to properly clean trains on the suburban and regional networks.

The $438 million COVID-19 package adds to $20 million spent covering the loss in commercial rental revenues for properties owned or operated by the Transport Department, resulting from the government’s rent relief policy for commercial tenants.

Annual spending on transport services blew out the government’s targets this year – by $100 million to $1.2 billion on city train services and $40 million on regional trains, the budget reveals.

While spending on public transport operations soared, commuter numbers plummeted, by 60 million people on the metropolitan train and tram networks and by 6 million on regional services last financial year.

However, the government forecasts that commuters will return to pre-pandemic levels next year.

Key rail programs received funding in this year’s budget, including the $2.2 billion Suburban Rail Loop and $2 billion for Geelong Fast Rail.

However, none of the $2 billion for the Geelong upgrade has been allocated over the forward estimates, pending negotiations with the Commonwealth government, while $420 million was set aside for the Suburban Rail Loop this financial year. More than $1 billion was allocated over the next two years.

This adds to about $1.5 billion allocated to 100 next-generation trams to be manufactured at a new facility in Melbourne’s north-west, creating 1900 jobs. This will include some E-class trams and another class of tram that is yet to be decided as the government phases out the ageing A- and Z-class fleets.

There was no new money for more accessible tram stops, even though the state is about to breach requirements in the Disability Discrimination Act 1992 for all tram stops to be wheelchair-accessible by December 2022 and trams to be accessible a decade later.

More than $60 million was set aside for pedestrian and cycling upgrades, but this likely falls short of the growth in demand created by changing travel patterns during COVID-19, with cycling set to rise by 55 per cent, making up 3 per cent of all work-related trips, a recent Monash University study showed.

The government also tipped in $1.6 billion in road network and infrastructure initiatives, including a "Summer Streets" program to provide traffic management during COVID-safe outdoor events.

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