The interchange connecting Sydney's new airport to two motorways will still be built, but the state budget will be $1.4 billion short after the federal government cut infrastructure funding.
Last week, federal Infrastructure Minister Catherine King announced funding would be cut for 50 "high-risk" infrastructure projects nationwide to curb spending after a $33 billion budget blowout.
Australia's most populous state New South Wales (NSW) felt the biggest impact, with cuts to 17 out of 50 affected projects.
NSW Treasurer Daniel Mookhey said it was disappointing that $110 million had been slashed from the $1.6 billion interchange linking the M7 and M12 motorways to the airport.
"It's a project that construction is already underway on, and when [Ms. King] had said that the federal government wouldn't be yanking funding from projects that were already under construction, we expected, therefore, for that money to be safe," Mr. Mookey told ABC radio.
"This is a road that is due to open in three years ... right now, we are moving earth out on this project; we need to get this project done much like we need to get some other projects in that area done, too," he said.
However, he said the project had already been contracted between Transurban and NSW, so it had "to be delivered."
The NSW treasurer said it seemed the federal government had pulled the money "knowing full well that we were going to have to still deliver the project."
Yet Ms. King had a different version of the situation.
"We’ve put money obviously into the M12, some $1.2 billion, but these interchanges were part of an agreement between Transurban and New South Wales that we’re not a party to," Ms. King explained.
"There was an amount of money that was provisioned for which we don't actually know what it was actually for," she said. "We can't get clarity on it."
Mr. Mookey said in response, "Often, the federal government will make a contribution, and they don't necessarily need to be a direct contractual party,"
However, he said those contributions were "faltering" and "it's not clear whether the Commonwealth has been listening" in conversations with the state about the Commonwealth infrastructure review.
"Going back to 2015, the NSW government's share of commonwealth infrastructure spending has just been dropping year after year," he added.
He said the state previously received 30 cents from every dollar the commonwealth spent.
"We're now down to 23 (cents)."
NSW Roads Minister John Graham weighed in, saying the state government will push to retain the funding for the interchange immediately.
Meanwhile, State Labor MP for Penrith Karen McKeown described the cut as a "dumb decision."
"We were promised that we would have the connectivity to that airport, and that's not happening," she said.
"I'm absolutely shocked."
NSW Premier Chris Minns said he was "very concerned" about how the cut would impact Australia's most populous state.
Opposition Says Minns Government Should Have Anticipated CutsNSW Opposition Leader Mark Speakman said the state government should have anticipated significant cuts, particularly to the M7-M12 link.
“It defies belief that any competent state government could be blindsided by the cancellation of funding for such an important project,” Mr. Speakman told the Sydney Morning Herald.
“[Premier] Chris Minns has failed to stand up to Anthony Albanese [and] the federal government and its savage cuts to funding in NSW.”
He called for Mr. Minns to confirm that his government will find a way to fund these critical projects.
Meanwhile, Infrastructure Shadow Minister Natalie Ward said, “Western Sydney commuters will be outraged that funding for two of their key road upgrades has been cut."
“These cuts mean more congestion, less productivity, and more pain for commuters and businesses," she said.
Regional Transport and Roads Shadow Minister Sam Farraway added the move would impact residents, tourists, and businesses.
“These significant upgrades are needed to provide a safer and more reliable journey for the thousands of residents, commuters, and freight operators, including those who travel between Sydney and the Central West every single day,” Mr. Farraway said.