The state and federal governments have poured an extra $150 million into the $1.7 billion Perth City Deal to safeguard its projects as costs spike, with Multiplex to build the new ECU CBD campus.
The state and federal governments have poured an extra $150 million into the $1.7 billion Perth City Deal to safeguard its projects as costs spike, with Multiplex to build the new Edith Cowan University CBD campus.
During a press conference this morning, Prime Minister Scott Morrison said the federal government would commit further funding to the Perth City Deal to ensure the delivery of the ECU campus near Yagan Square and the Swan River Bridge project.
The ECU campus, a key part of the deal, was initially anticipated to cost $695 million, but Premier Mark McGowan indicated today the project would be closer to $853 million.
The project had already received $245 million from the federal government and $150 million from the state government, with the remainder funded by ECU.
It is understood the state and federal governments have each contributed an additional $49 million, with the university providing the remaining $60 million.
Mr McGowan said the cost hike was a product of the state’s economy and heated construction market, with a tight labour market and heightened materials costs.
The announcement coincided with the awarding of the construction contract to Multiplex today.
Both parties are committed to pursuing the project, despite Infrastructure Australia flagging that its benefits may have been overestimated and may not align with the deal’s objectives.
Mr Morrison confirmed the federal government remained committed to delivering the projects, despite the challenges posed by rising costs caused by the pandemic.
“We’ve had a very practical, strong partnership to deliver for WA,” he said.
“There have been some challenges, including dealing with rising costs caused by the pandemic, but we intend to stick with our commitment.
“There has been no other state government we have had a more productive working relationship with and we have worked hard to overcome regulations that stymie investment.
“We’re both passionate about jobs and unemployment has fallen to four per cent nationally - that’s the lowest in 50 years.”
Similarly, Mr McGowan touted both projects as major job creators, with 7,500 jobs expected to be delivered in the construction of the ECU campus alone.
He also highlighted the benefits to the city’s CBD, with the development expected to draw 10,000 students into the heart of Perth.
Meanwhile, the pair indicated the Swan River Bridge project had also experienced an escalation in cost.
Transport Minister Rita Saffioti confirmed that the cost of the bridge development had doubled from $50 million to $100 million amid increases in steel costs, manufacturing costs and the implementation of design improvements.
Mr McGowan said it was important that both the state and federal government share the burden of cost increases.
The announcement comes just 24 hours after it was revealed the cost of the Midland Station project had almost doubled, a cost increase that was also attributed to the state of the construction market.