The budget for the controversial Australian War Memorial redevelopment has blown out in the face of rising construction costs.
The Morrison Government quietly slipped a further $50 million to the Memorial in March so it could manage the cost pressures, which are being felt across many projects in Canberra.
The government budgeted $498 million across 10 years for the project, which attracted widespread criticism for its scale, cost and the demolition of the award-winning Anzac Hall to make way for a bigger building capable of housing large war artefacts and telling the story of more contemporary conflicts.
The approvals process also came into question after an overwhelming number of submissions to a parliamentary inquiry and the National Capital Authority works applications.
The NCA gave the project’s so-called Early Works the all-clear in June last year and work started soon after felling trees and demolishing Anzac Hall.
In November, it approved the Main Works, including the new Anzac Hall and glazed link, realignment of the eastern road running parallel to the main building and alterations to the parade ground so it is an extension of Anzac Parade.
Director Matt Anderson said the site excavation and design work was on budget and on time, but unforeseen increases in construction costs had forced the Memorial to ask for more money to cover them.
“Due to the significant and unprecedented market cost variations, the former government provided $50 million in March 2022 to manage these increases,” he said.
“We appreciate this support greatly.”
While costs are increasing, the project would continue to proceed as planned and not be scaled back, Mr Anderson said.
He did not rule out the need for further cash injections if cost rises did not abate.
“These significant increases in supply costs are consistent with market movement across the entire construction and development industry. It is important to note, the scope of our works has not changed,” Mr Anderson said.
“The impacts of inflation and shipping continue to put pressure on construction costs. We will continue to do everything we can to value manage the project.”
Labor has offered bipartisan support for the project, but there has been disquiet in its ranks about the cost and the loss of Anzac Hall.
In 2021, MPs Tony Zappia and Canberra’s David Smith dissented from the Parliamentary Works Committee report supporting the project, calling for other options to be explored that did not involve demolishing Anzac Hall and less expensive alternatives such as an overhaul of the War Memorial’s Mitchell facility.
The Albanese Government has not indicated whether it would provide additional funding for the War Memorial project if further funding requests were submitted.