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Victoria will receive $857 million in Commonwealth funding for the Melbourne Metro Rail tunnel, but the state government says it is not new money and has accused the Turnbull government of breaking a key funding promise.
The Turnbull government will announce the funding in Tuesday's federal budget, according to News Corp reports. About $20 million will also be given to finalise funding on the Murray Basin rail project.
Last week, however, the the state government said it would go it alone to fund the $10.9 billion Metro project and the cash injection now poses interesting questions about federal government control and the right to impose conditions on the project.
Treasurer Scott Morrison has told News Corp that $857 million will be allocated in Tuesday's federal budget for the Melbourne Metro Rail project.
"Obviously this is all part of our national economic plan for jobs and growth, both in terms of increasing the productivity of the Victorian economy but also improving the livability of the city, which is also critical to national productivity," Treasurer Scott Morrison told News Corp.
The infrastructure funds will be made available from a federal asset recycling fund.
However, Victorian Treasurer Tim Pallas said the asset recycling funding was not new money.
"It is funding that even Tony Abbott was going to provide," he said.
Mr Pallas said that when the asset recycling fund was introduced, the federal government promised it would not dictate where the money should be directed as long as it went to "economy growing infrastructure".
This article first appeared on www.theage.com.au
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