Treasurer Michael O'Brien. Photo: Michael Clayton-Jones
State Treasury's independent risk assessment unit has scrutinised the business case for the east-west road and concluded the $6 billion to $8 billion project would deliver substantial benefits for Victoria, Treasurer Michael O'Brien said on Thursday.
With details of the impact of the controversial project set to be released next week, he revealed Treasury's ''high value high risk'' team found the controversial road would reduce congestion, improve access to business and jobs and generally improve the inner north.
Since plans to build the road were ramped up in the budget, the project has faced strong criticism, with the state government refusing to release key information such as the business case.
Mr O'Brien said the unit - set up to minimise the risk of cost blowouts and bad decisions - had found the six-kilometre link from the end of the Eastern Freeway to the Tullamarine Freeway was in the public interest.
''The process determined that the project can be delivered for the estimated cost, and that the process for developing and refining cost estimates has been comprehensive and rigorous,'' Mr O'Brien said.
He said State Treasury had also concluded the best way to deliver the project was through a public-private partnership, with a company paid regular payments over time to build, operate and maintain the road.
''The current city end of the Eastern Freeway is a bottleneck in the state's productivity and deposits tens of thousands of vehicles daily onto Hoddle Street, Alexandra Parade and surrounding streets,'' he said.
The government has asserted the project will deliver $1.40 worth of benefits for every $1 invested, although it has not released any analysis to back these claims.
It is believed that Treasury's assessment of the project departs from standard benefit-cost analyses by claiming a large ''agglomeration effect'', where economic activity generated by scale is included.
The so-called comprehensive impact statement, examining the broader effects of the project on the community and the environment, is also due to be released next week.