There is no terminal in Melbourne capable of accommodating the Inland Rail service of double-stacked trains,and the federal and state governments have funded a business case to develop a new precinct with sufficient capacity from the start of services in the middle of this decade.

The new terminal and connecting transport infrastructure will be delivered to supplement,and potentially replace,an existing terminal at Dynon. The initial federal investment,which includes the option for equity or debt funding,is contingent on a matching contribution by the Andrews government.

Mr Morrison said it would boost the nation’s productivity by helping businesses access export markets faster,while taking up to 5500 trucks off Melbourne’s roads every day.

“We are supporting Victorian workers and businesses to thrive in the post-pandemic future,backing them to lead the nation’s economic recovery,” he said.

Almost $1 billion of additional funding will be put towards road projects,including an extra $20 million for the state’s “green triangle”,which will deliver upgrades across south-west Victoria with a focus on four key corridors that provide freight connections to the Port of Portland. A $17 million dairy roads package is designed to help tankers better access farmers in the region.

The package also includes funding for various projects under key Roads of Strategic Importance initiatives including the Ballarat to Ouyen,Echuca to Robinvale,Melbourne to Mildura,Stawell to the South Australian border,and Toowoomba to Seymour corridors.

Infrastructure,Transport and Regional Development Minister Michael McCormack said the funding was a key plank of efforts to help Australia bounce back from the COVID-19 pandemic.

He said a new freight terminal would “transform the way freight moves,not just in Victoria but right across the country” and create about 1350 jobs during peak construction and a further 550 jobs during peak operation.

“The Australian government looks forward to working constructively with the Victorian government to deliver this infrastructure,supporting jobs and businesses right across Victoria,” he said.