While pinning the blame for the forecast cost increases squarely on a"red-hot"market,Mr Constance said amajor underground walkway beneath Central Station and an enhanced temporary transport plan had been added since the government forecast in 2015.

He also said"three different waves in the property market"had affected the cost of the project,because land needed to be acquired for it.

But Labor leader Jodi McKay said the admission was the latest confirmation of the government's incompetence in carrying out big infrastructure projects,adding that the cost of the metro rail line – just like that forSydney's new light rail line – would continue to blow out.

"Are they going to keep lying about it when that happens or will they commit to publicly admitting when they’ve blown through their new estimate of $2 billion to $3 billion over the original $12.5 billion budget?"she asked.

Ms McKay said it"flies in the face of any kind of propriety"that the Transport Minister was not aware of this massive problem before the state election in March last year,if the state's transport department knew about it more than 18 months ago.

But Mr Constance rejected the Opposition's claims,saying he was"absolutely not"aware of the forecast cost increases before the election.

"That only came to light after the election to Gladys[Berejiklian] and I. I can point to the pre-election budget update ... to show evidence of that,"he said.

The internal budget review by Sydney Metro that forecast the $4.3 billion cost increase was completed about 18 months ago.

But Mr Constance said there was a difference between the government being alerted to the extent of problems with a project versus"the workings of bureaucracy".

Asked how he could be confident that the final cost will be limited to an extra $2 billion to $3 billion,he cited theMetro Northwest rail line,which was built for $1 billion less than forecast,and the fact that"we are only halfway through the build"of City and Southwest.

"I am not happy about it. My expectation with the[Sydney] Metro team is that they are constantly looking at every best way they can to put downward pressure on prices,"he said.

He also sought to cast blame on Labor for"raising sovereign risk"during the last state election when it vowed,if it won government,to scrap a part of the metro project which involves converting an existing rail line between Sydenham and Bankstown to carry single-deck metro trains.

"Labor can point the finger but they also need to recognise that political risk ties into sovereign risk,which can have an effect in the market,"he said.