Peninsula Link

Early planning

The freeway has been proposed numerous times over the years, appearing in the 1969 Melbourne Transportation Plan. The Mornington Peninsula Freeway was progressively opened at each end by the 1980s, with the Frankston Freeway also opened running south from Seaford into Frankston itself. The contract for the construction of the EastLink Tollway north from Seaford was signed in 2004, with construction starting the following year.

In early 2006 operator of EastLink, ConnectEast, offered to build the bypass by June 2009, but was rejected by the state government. The government would be required to contribute $100 million to the project, which would also have been funded through a 1c-2c increase in tolls. ConnectEast also wanted the EastLink concession period extended from 39 to 49 years. A leaked report sent by VicRoads to the City of Frankston in 2006 and obtained by the State Opposition in 2008 showed the cost of building the Frankston bypass was $240 million.

In October 2006 $6.5 million was allocated by the Bracks Government towards extra ramps at the Frankston end of EastLink to cater for a future bypass. Recommended by the Southern and Eastern Integrated Transport Authority (SEITA), the Transport Minister said that "no decision has been made about the requirement for a bypass of Frankston". For the 2006 State Election Liberal opposition leader Ted Baillieu promised $250 million to build a 22 kilometre long road toll free. Peter Batchelor responded that the costing did not add up, with smaller projects costing more.

Also in October 2006 then Transport Minister Peter Batchelor announced that an Environment Effects Statement would be carried out by SEITA for the bypass, and $20 million would be spent on changes to the Cranbourne-Frankston Road and Moorooduc Road intersection. Work on the EES started in March 2007 at a cost of $5 million.

Post EastLink

The opening of EastLink and the interchange with the northern section of the Mornington Peninsula Freeway in 2008 led to speculation of congestion on the Frankston Freeway, especially at the southern terminus at McMahons Road on the Moorooduc Highway. VicRoads however did not publicly anticipate such congestion would actually occur, with Federal MP Bruce Billson raising this issue in the local press and in parliament. The Victorian Transport Minister Peter Batchelor has stated that simply because the freeway's projected path appears on a map (referring to the route shown in the Melway), that this does not mean that the road is intended to, or will ever actually be built. City of Frankston councillors however, along with Mr. Billson, are pushing for the bypass to be built.

On 28 October 2007 the Federal Liberal Party pledged a maximum of $150 million towards constructing the road toll free if elected, to be matched by Victorian Government. They were defeated at the election. In April 2008 the Southern and Eastern Integrated Transport Authority (SEITA) decided that the preferred option for a Frankston Bypass was a high standard, continuous, duplicated road in the existing road reserve from Carrum Downs to Mount Martha. A group of Moorooduc residents claimed they were not consulted in the first phase of the project, and the figures had been skewed to show public support for the selected preferred option.

The report said:

Traffic on the Moorooduc Highway through Frankston is expected to increase from 45,000 vehicles per day to around 60,000 vehicles per day in 2031....it would take 75 minutes to travel between the southern end of Eastlink and the Mornington Peninsula Freeway at Mount Martha during peak periods in 2031. A high standard, continuous, duplicated road from the southern end of Eastlink to the Mornington Peninsula Freeway at Mount Martha would reduce travel time in 2031 to around 20 minutes. These projected traffic conditions would arise, even with planned upgrades to roads such as the widening of Western Port Highway. 84% of people who provided feedback during Phase 1 supported a bypass.

The Frankston Bypass would be a 25 km freeway standard road with two lanes in each direction with a speed limit of 100 km/h. A full grade separated junction would be provided with EastLink and the Frankston Freeway, along with full grade separated diamond interchanges at Dandenong-Frankston Road, Cranbourne-Frankston Road, Golf Links Road, Frankston-Flinders Road, Bungower Road and Old Moorooduc Road / Mornington Peninsula Freeway. Interchanges at Skye Road and Mornington-Tyabb Road will have half diamond grade separated with northbound entry, southbound exit ramps. The cost was estimated between $500 million to $750 million.

In September 2008 ConnectEast held talks with Roads Minister Tim Pallas, but the State Government refused to discuss the issue with the media, or promise to build it without tolls. On 16 October 2008 State Premier John Brumby announced the bypass would be built. Costing $700 million and now 27 kilometres long, work would start by the end of 2009. The State Government expected the project would be paid for in partnership with the Federal Government, and confirmed that it would be toll free.

Public Private Partnership

Throughout 2008 and early 2009 the State Government examined a number of Public Private Partnership (PPP) models for the delivery of the project, selecting the Partnerships Victoria 'Availability' model, where the private sector company designs, builds, finances and operates the project for an agreed period of time, with the State Government making regular payments to the company based on performance against a set of key performance indicators, which avoided any charges being imposed on road users.

An invitation for Expressions of Interest was issued in March 2009 followed by a Request for Proposals, with two bidders short listed by November 2009. Final bids were received a month later, with the Southern Way consortium (made up of construction companies Abigroup and Bilfinger Berger, along with financier Royal Bank of Scotland) being awarded the contract to design, build and operate the freeway on 20 January 2010.

Under the Public Private Partnership, the consortium is required to operate and maintain the freeway for a 25-year period, with the government making quarterly service payments to Southern Way once the freeway has been certified as completed in accordance with the Project Deed.

These payments are adjusted on an availability basis, with reductions being made when each half-hour of unavailability, weighted according to the nature and severity of the unavailability. Failure to meet key performance indicators for emergency contact points, incident response, compliance with operational plans, maintenance inspections and works, reporting and environmental management will also results in the government deductions being applied to the service payments.

The delivery cost of the project is $759 million: made up of Southern Way's construction costs, along with the Linking Melbourne Authority's land acquisition, project management, environmental effects statement and Environment Protection and Biodiversity Conservation Act costs.