A fast rail link cutting train trips between Canberra and Sydney to three hours has emerged as a spending priority for the NSW government as it readies to splash out $4.2 billion in proceeds from its Snowy Hydro sale.
The NSW government has marked the long-awaited rail upgrade among several regional infrastructure projects set to receive cash from a fund created after the federal government bought the state's share of the hydroelectricity scheme.
Profits from the sale would fund a rail corridor for a "very fast train" between the capital cities, cutting the four-and-a-half hour trip by about 90 minutes.
The announcement signals bipartisan support in NSW for a fast rail link, and puts funding towards the project on the list of both government and opposition promises ahead of the state election expected next year.
ACT chief minister Andrew Barr on Thursday said the announcement gave cause for optimism that Canberra and Sydney would be connected by fast rail.
"For the first time in a while there will actually be a significant source of funding that could be allocated to trackwork and to buy new trains," he said.
"I hope my Labor colleagues in NSW would be equally supportive of a significant proportion of that $4.2 billion fund being allocated to improve the rail service."
He also called for both sides of federal politics to commit funding for the project, which would quicken a train journey that takes longer than driving to Sydney, depending on traffic.
The NSW Labor opposition responded to the state government's announcement by repeating its support for a faster train service between Sydney and Canberra.
NSW Labor and the ACT government have each committed $5 million to a business case assessing the feasibility of faster rail between Sydney and Canberra.
Labor’s plan promised to reduce travel times to three hours and provide residents of Queanbeyan and Goulburn with improved access to employment and services in both Sydney and Canberra.
Mr Foley made the joint pitch for $10 million in funding at Queanbeyan, in the Monaro electorate held by Deputy Premier John Barilaro.
The federal government's decision to purchase NSW's share of the Snowy Hydro Scheme, a move that will let it pursue its Snowy 2.0 energy project, gave the state $4.2 billion to spend. The funds came with a condition that it went towards infrastructure.
Fast rail between Canberra and Sydney, a project that has fallen into and out of policy and business agendas, may be the major beneficiary.
Mr Barilaro said the $4.2 billion reaped from the sale of NSW’s share of the Snowy Hydro Scheme would be used to deliver "transformational projects" that would "help secure a future" for young people in regional NSW.
"These are big picture projects that generations before us have dreamed of and generations that follow us will benefit from," he said.
The NSW government is expected to announce more details about the fast rail link soon.
Its funding promise comes after a joint NSW-ACT report found that operational and infrastructure improvements to the rail corridor could cut the journey time for train passengers by up to one-and-a-half hours between Sydney and Canberra.
At present, a train journey between the two cities is slower than an hour-long trip by plane or three-and-a-half hours by bus.
The study also suggested that faster rail connections will allow more people to shift to more affordable regional areas such as Goulburn while maintaining jobs in the capital cities.