Melb Metro needs $4.5b in federal cash

Victoria wants $4.5 billion in federal cash to build the Melbourne Metro Rail project and transform the city's train network.

The business case for the $10.9 billion rail project relies on what the opposition says is the most federal money ever handed over for a Victorian infrastructure project.

"Victorian tax dollars should be paying for Victorian projects. There are no more excuses - it's time for the prime minister to show his commitment to public transport," Premier Daniel Andrews said on Tuesday.

But federal Major Projects Minister Paul Fletcher says Victoria's announcement is a tactic to pressure Canberra to hand over the cash.

"As Premier Andrews is aware, any project with a commonwealth contribution of more than $100 million requires a full assessment by Infrastructure Australia before funding commitments are made," Mr Fletcher said.

The Victorian government will contribute $1.5 billion in cash - the same amount it got from Canberra for the axed East West Link - and $3 billion already borrowed for the same dumped road tunnel.

Melbourne Metro Rail will create two new stations in the CBD and three new stations in the inner suburbs, connected by twin underground tunnels.

It would increase capacity and allow the network to hold 39,000 extra passengers in peak periods.

The business case shows a $1.10 return for every dollar put into the project, increasing to $1.50 when wider economic benefits are taken into account.

But the opposition says it also shows that if costs overrun by more than $600 million, the cost-benefit ratio drops below $1.

The project relies on the private sector chipping in $1.9 billion, to run the new line, develop the new stations and advertise on site.

"We think there are great opportunities for private sector involvement," Mr Andrews said.

"You're actually creating brand new urban environments."

Mr Andrews said Victoria has 25 per cent of Australia's population but gets just nine per cent of infrastructure funding.

He refused to be drawn on what Victoria would do if the federal government doesn't contribute the money.

Opposition leader Matthew Guy supports the project, but says the government's blunt approach demanding federal cash was all wrong.

"What's being asked for today is the largest amount of money from the commonwealth government ever to build a project of any description in Victoria," Mr Guy told reporters.