Cost of Bunbury Outer Ring Road blows out to more than $1 billion

The cost of completing the Bunbury Outer Ring Road project has climbed to more than $1 billion. (ABC South West: Sam Bold)

The cost of completing one of Western Australia's biggest infrastructure projects has blown out by hundreds of millions of dollars, with taxpayers now set to fork out $1 billion for a new bypass freeway. 

Work is already under way to build the 27-kilometre Bunbury Outer Ring Road, which will take trucks off local roads and reduce travel time for people driving to Busselton and Margaret River by up to 15 minutes.

The project was slated to cost $852 million but figures released ahead of today's federal budget have revealed the road will now cost just over a billion dollars – or $37 million per kilometre. 

Construction is already underway on the northern section of the 27-kilometre Bunbury Outer Ring Road project. (ABC South West: Sam Bold)

The Commonwealth has promised $320 million more than initially allocated for the road, which has been planned for decades. 

The road has been jointly funded by the federal and state governments, but is being managed by the state.

Infrastructure costs rise nationwide

It is the latest Western Australian infrastructure project to get more expensive, with labour shortages and supply delays taking its toll on projects around Australia.

The Perth METRONET rail building project, which was also given millions of dollars of new funding ahead of the federal budget, has been heavily criticised by the state opposition for incurring cost blowouts in recent years.

South West Liberal MP Steve Thomas said given the increasing expense of METRONET, he was unsurprised to see the cost of the Bunbury Outer Ring road climb.

Steve Thomas has called on the state government to explain how the cost blowouts will impact the project's scope. (ABC News: James Carmody)

Mr Thomas urged the state government to be transparent about future cost blowouts and what this would mean for the scope of project.

"Is [the minister] meeting the original scope of the project? Or is she reducing the scope and getting the extra money."

Bunbury Mayor Jason Miguel said it was unclear whether the cost of the project would rise, but welcomed the extra funding from the Commonwealth to get the road finished.

"I don't know what price contracts they've got locked in," he said. 

Transport Minister Rita Saffioti has yet to explain exactly what the extra $320 million will pay for. (ABC News: Richard Glover)

A spokeswoman for WA's Transport Minister Rita Saffioti confirmed the rising costs of projects had taken its toll, but would not be drawn on whether the billion-dollar price tag could rise even further or how the scope of works would be impacted.

"The Commonwealth government, as in other states, has also sought to respond to the increasing costs of delivering projects," she said.