February 2026

One of the most baffling aspects of government administration in Australia is the way the cost of major infrastructure projects always exceeds the original estimates – not by a little, but usually by massive margins.

It seems it’s impossible for governments and their bureaucrats to accurately pinpoint the cost of building a motorway or a hospital or rail link.  The original numbers are always – always – an under-estimate, never an over-estimate.

And just how much this costs the public purse has been revealed by research by global professional services firm Deloitte.

The report published in February 2026 found that public infrastructure projects across the country have blown out by $130 billion.

The big four firm reviewed 13 huge infrastructure development nationwide – each valued at $10 billion or more – and found lifetime cost overruns tallied more than the annual value of Australia’s home-building sector.

Big rail projects were particularly in the spotlight for massive cost over-runs, including Brisbane Cross-River Rail, the Inland Rail Link, Perth’s Metronet and Sydney Metro lines. Other big enterprises put under the Deloitte microscope included the CopperString 2032 project in Queensland, the Snowy Mountains Hydro Scheme 2.0, the west Gate tunnel in Melbourne, the Torrens to Darlington toads project in Adelaide and the Queensland Hospital Capacity Expansion.

You have to ask: how can 13 infrastructure projects cost $130 billion MORE than the original analysis expected?

Deloitte suggested that the regular under-estimation of project costs was caused by budgets being set before projects were fully planned, as well as increasing complexity and labour shortages.

Report lead author Sheraan Underwood said cost revisions were not new for major projects.

“However, the frequency and magnitude of recent upward revisions indicate that cost pressures are reshaping the project pipeline, with potential implications for already-stretched state government finances,” he said.

“The scale of Australia’s current infrastructure investment program, combined with increasingly constrained state government budgets, has heightened the fiscal consequences of cost overruns.”

Underwood said governments would have to borrow more money, or narrow the scope of projects, or defer low-priority ones.

The Inland Rail Link – connecting Melbourne to Brisbane via regional Victoria, NSW and Queensland – is Australia’s biggest national infrastructure project at present. It provides a case study on how cost blow-outs can reach insane proportions …

• The original cost estimate, based on the initial feasibility studies conducted between 2008 and 2010, was around $4.8 billion.
• The 2015 Business Case came up with an estimated cost ranging from $9.6 billion to $10.7 billion.
• A 2023 review found the cost had escalated to at least $31 billion.
• The 1,700km project, on which construction work started in December 2018, is still under construction with an estimated completion date in 2030.

So, the cost has increased from the original estimate of less than $5 billion to over $30 billion – with another 4-5 years of cost over-runs yet to come.