TRAIN commuters will get extra services, upgraded stations and faster trips thanks to a long-awaited $1.6 billion injection into Victoria’s ageing regional rail network.

Prime Minister Malcolm Turnbull will today unveil a major funding package for nine railway lines running to all corners of Victoria.

The Herald Sun can reveal the PM contacted Premier Daniel Andrews last night to offer $1.42 billion for the project, ending a stalemate in which Canberra had refused to put in more than $1 billion and Victoria had baulked at providing its own funding.

The biggest winners are the Ballarat and Gippsland lines, where almost $1 billion is to be spent on upgrades, including major track duplications. The North East, Surf Coast and Warrnambool lines will benefit, as will Bendigo, Echuca and Shepparton, and the Murray Basin freight network.

Another $95 million is to be spent upgrading the Avon River bridge in Stratford.

Work on the seven-year project, expected to begin within months, will create more than 1000 jobs.

media_camera Prime Minister Malcolm Turnbull contacted Premier Daniel Andrews on Monday night to offer $1.42 billion. Picture: Quinn Rooney/Getty

BUDGET TO SPLURGE $1.4BN ON REGIONAL RAIL UPGRADES AND NEW SURF COAST LINE

The deal also includes $30 million to develop a business case for the building of a rail link to Melbourne airport.

Mr Turnbull told the Herald Sun that Victorians “deserve better public transport no matter where they live” and his government was “determined to deliver the road and rail projects to set the state up for future decades”.

“Victorians deserve quality roads and rail projects. My government will deliver them,” he said.

The PM has said all civilised cities should have a train to an international airport.

The Herald Sun understands that now that Canberra has upped its initial pledge, the state has also agreed to put $150 million towards the $1.6 billion package.

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MOBILE PHONE SIGNAL TECHNOLOGY ON REGIONAL VICTORIAN TRAINS TO BE ROLLED OUT

The package is the result of month of talks between federal Infrastructure and Transport Minister Darren Chester and his Victorian counterpart, Jacinta Allan, over how to spend proceeds of the Port of Melbourne sale.

Mr Chester said: “It’s pleasing the Coalition has been able to deliver for all Victorians. Our funding allows the regional rail network to be better linked.”

Mr Andrews had announced a $1.45 billion “regional rail revival” on the eve of this year’s federal Budget though the governments were yet to agree about the money.

The federal and state governments had been warring since Victoria sold the Port of Melbourne last year for a mammoth $9.7 billion, well above earlier predictions.

It meant Victoria was owed $1.4 billion from the Commonwealth’s asset-recycling fund, which was set up to pay states a 15 per cent bonus for selling off public assets.

But the PM and Treasurer Scott Morrison had been willing to put in only $877 million, claiming Victoria had missed a deadline for a deal on the asset-recycling cash. They later tried to force it to spend the money on the Melbourne Metro rail tunnel.

Melbourne Metro Rail Overview Melbourne Metro Rail Overview

Extra money for regional rail was provided in May’s federal Budget but the governments had still not resolved the dispute on the $1.4 billion.

This prompted Mr Andrews to call Mr Turnbull the “Prime Minister for Sydney” who had “ratted” on Victoria.

Mr Turnbull has now challenged the Andrews Government to release $70 million in interest it has earned from the Commonwealth’s initial $1.5 billion investment in the scrapped East West Link, saying it could be “immediately deployed” for suburban road upgrades if an agreement with Victoria could be reached.

He said the federal offer of $3 billion for East West remained on the table for any future state government.

rob.harris@news.com.au