Carroll scraps secret $8 billion levy on public transport fares

A levy secretly slapped on commuters last year, which was due to raise $8 billion and help fund the Suburban Rail Loop and other Big Build projects, will be scrapped by Premier Ben Carroll.

The levy’s existence was revealed in a scathing report released on Wednesday by the Victorian Auditor-General, which also detailed how the SRL East tunnel between Cheltenham and Box Hill was already at risk of missing its 2035 completion date and exceeding its $34.5 billion budget.

The levy, which was introduced on January 1 last year, involves a 1 per cent annual increase on all public transport fares on top of existing adjustments in line with inflation. The Age reported that it was ticked off by a government budget committee led by former premier Jacinta Allan in December 2023.

Speaking to reporters on Thursday morning, Carroll said he would abolish the so-called “rail improvement charge”.

“Victorians do deserve better public transport. They also deserve to know what their money is buying.

“This charge was created and implemented without transparency and accountability.”

Carroll was the public transport minister in 2021, when the levy was first conceived internally, according to the Auditor-General’s report. But he said on Thursday that he was not involved in that decision.

Carroll’s decision creates a major funding headache for the Suburban Rail Loop, given the Auditor-General’s report said the levy was the single biggest component of the value capture plan that is supposed to cover a third of the construction cost for the tunnel under Melbourne’s eastern suburbs.

The report said 60 per cent of the revenue raised by 2062, totalling $4.8 billion, was to be directed to the SRL.