Vic Libs earmark rail loop cash for health

Plans to build a Melbourne rail loop worth up to $34.5 billion would be shelved under an election promise by Victoria's opposition that could shape the campaign.

Liberal leader Matthew Guy on Wednesday vowed to redirect money for the Suburban Rail Loop to fixing Victoria's health system.

A win for the coalition at the poll in November would put on ice the stretch of rail between Cheltenham and Box Hill in Melbourne's east.

"When the state can afford it, we might be able to build it," Mr Guy told reporters.

The first 26 kilometres of the project are estimated to cost between $30 billion and $34.5 billion.

So far $2.3 billion has been allocated in the budget for early works, which began this year and are scheduled to be completed by 2025.

The opposition would not rip up those contracts as they are already budgeted and signed, Mr Guy said.

"What's the priority now? You can't do both," he said.

"You can't go and borrow tens of billions of dollars from the federal and state government and rebuild the health service."

In question time, Premier Daniel Andrews was among four Labor cabinet members to defend the project, saying it wasn't a choice between one or the other.

"You need to do more than one thing at a time. That, it would seem, is beyond the capability of some," he told parliament, noting the project would become more expensive if put off.

With the savings, the opposition has pledged to upgrade hospitals across the state and build major health centres in Melton, Mildura, West Gippsland and Wodonga, as well as a dedicated infectious diseases response centre.

It has also committed to halving Victoria's elective surgery wait lists within four years if elected, and providing free public transport to more than 260,000 healthcare workers.

Deputy Premier and Transport Infrastructure Minister Jacinta Allan said scrapping the project was akin to Mr Guy cutting 24,000 jobs.

"Victorians voted for this project that will create thousands of jobs - and today Matthew Guy has finally come clean," she said.

Construction on the first phase of the loop is expected to be completed by 2035 and the state has committed to stump up $11.8 billion for it, with the rest coming from federal and private investment as well as value capture.

Prime Minister Anthony Albanese pledged another $2.2 billion before the May federal election after the Morrison government rejected a request for $11.5 billion over 10 years, arguing the project didn't stack up.

Ms Allan declined to say how much it would cost taxpayers if the project was suddenly dropped.

"That's up to Matthew Guy to explain," she said.

If the loop is built, trains would take three to four minutes between six stations, with a journey from Cheltenham to Box Hill totalling 22 minutes.

The eastern and northern stretches of the loop would take about 606,000 car trips off Victoria's roads per day by 2056 and the project would deliver up to $58.7 billion in benefits, according to the government.

The 90-kilometre orbital rail line's second section would run from Box Hill to Melbourne Airport.