PM's $3b EW Link funds referred to auditor

The federal opposition has asked the auditor-general to investigate the $3 billion in Commonwealth funding for Victoria's stalled East West Link.

Labor says the project's flawed business case, released by the Victorian government this week, shows the money was wrongly allocated.

Infrastructure spokesman Anthony Albanese says it was provided "without a scrap of evidence as to whether it presented value for public money".

"Today I have written to the auditor-general calling for an investigation into Tony Abbott's allocation of $3 billion for the proposed East West Link," he said on Thursday.

"The Napthine government chose not to tell Infrastructure Australia about the facts and the Abbott government chose not to ask ... It funded the project anyway. No checks. No rigour."

The previously confidential business case, released on Monday, put the economic benefit of East West Link at as low as 45 cents per dollar spent.

Victoria's new Labor government says it will tear up contracts to build East West Link, though the federal government says it should proceed or Commonwealth funding will be diverted elsewhere.

"This project has been on the table for almost a decade and was once supported by Bill Shorten," Assistant Minister for Infrastructure Jamie Briggs said in a statement.

He said junking the contracts would increase Australia's sovereign risk, and Labor should support the coalition's investment in infrastructure because it created jobs.