From an original estimated investment of $4.7 billion in 2015, the cost for the freight rail route between Melbourne and Brisbane blew out nearly 10 times that amount to $45.6 billion by 2025.
But that eye-watering figure, which prompted the federal Labor government to scrap the route north of Parkes in central NSW, was only a modest estimate of the surging cost, a Senate estimates hearing has been told.
Infrastructure department secretary Jim Betts on Monday tabled the independent analysis that informed the government's decision to vastly curtail the original route.
The biggest sticking points identified in the report by advisory ACIL Allen, which itself cost $1.87 million, were several pending approvals for the Queensland route.
"The $45.6 billion is the lower-end estimate," Mr Betts told the hearing in Canberra.
"(It is) based on some reasonably optimistic assumptions, for instance, that work would commence during 2025, which it clearly hasn't on some of those key packages."
The government was "flying blind" on route planning in Queensland, which could have been subject to further approvals and consent conditions, he said.
Environmental consent, land acquisition, delayed approvals, community push-back and "unexpected technical matters" were identified as some of the most significant risks to the project.
The northern corridor has been "preserved" to allow any future government to take up the project again, Mr Betts said.
Undertaking the analysis was a recommendation from a 2023 review, which found construction had begun "somewhat surprisingly" without knowing where the route would start or finish.
It followed a 2021 Senate report, called Inland Rail: derailed from the start, that raised fundamental questions about the business case and cost of the project.
Mr Betts said the government had decided it was wiser to upgrade the existing government-owned Australian Rail Track Corporation network, which spans more than 9,600km across five states.
There were 200 days of weather-related shut downs on that network in the last five years, including a 14-day closure of a key corridor between WA and the rest of the country in January.
"It's well documented that there have been some significant challenges with that network in recent times, prolonged outages as a result of historic under investment," Mr Betts said.
"What industry have said to us is that the priority is to invest in the integrity of the existing network."
The scrapping of the full inland rail project is likely to be dominate regional and rural Senate estimates, which are scheduled to run until Thursday.
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