PM tipped to back new rail funding method

The prime minister is reportedly preparing to take to voters a new funding approach to national projects including plans for high-speed rail links on the east coast to boost regional centres and ease capital city congestion.

To fund the rail projects, and potentially a Melbourne Metro, the government will promote value capture financing, which leverages the increase in land value resulting from new transport infrastructure to contribute to its cost, The Australian reported on Monday.

Another option under consideration is to levy a so-called betterment tax on property owners, who would receive a substantial financial boost from the new transport infrastructure.

The Australian says Malcolm Turnbull is set to unveil a sweeping cities policy ahead of next month's budget that will also transform the funding of Australian infrastructure projects.

A key plank of the new policy will be to use high-speed rail developments to encourage population growth in regional centres and ease growth pressures in Sydney and Melbourne.