Southern Outlet project costs climb again, according to reports

The ABC has reported the cost of the Southern Outlet’s fifth lane has blown out to $95 million, a figure that has risen multiple times over the project's life.

By Shoreline News Desk · 23 June 2026 AI-assisted

a scenic view of the River Derwent estuary and Hobart's Eastern Shore, Tasmania

Illustrative image

The cost of the controversial fifth transit lane on Hobart’s Southern Outlet has increased again, with a recent news report putting the new total at $95 million for the project’s northern section.

ABC News reported on Tuesday that the budget for the northbound transit lane had blown out by a further $32 million. This follows a history of escalating costs for the project, which is designed to ease peak-hour traffic congestion for commuters travelling into the city from southern suburbs.

The project’s cost has been a moving target since its inception. The Tasmanian Government’s 2026-27 State Budget, released in May, allocated $25.5 million to “finalise the Hobart Southern Outlet Transit Lane project,” according to a media release from the Premier’s office.

Official budget papers from previous years show the project’s estimated cost has grown significantly over time. A parliamentary committee report initially priced the works at $35 million. This was later revised to $51 million. By September 2024, reporting from Pulse Tasmania indicated the cost for the initial phase had jumped to $62.5 million.

The project involves constructing a new northbound lane from the Olinda Grove interchange at Mount Nelson, connecting to the existing bus lane further down the outlet. It is intended for use by buses, emergency vehicles, taxis, and cars with three or more occupants.

Construction has already had a visible impact in the suburb of Dynnyrne, where several homes were acquired and demolished to make way for the road widening, as reported by ABC News in late 2023. The Department of State Growth has also previously flagged the need for rockfall protection works along the adjacent rock face before major construction could begin.

The Southern Outlet widening is one part of a broader traffic management plan for the Greater Hobart area, which includes park-and-ride facilities in Kingborough and bus improvements on Macquarie and Davey Streets, according to the Department of State Growth.

The original story can be found on the ABC News website.