The tunnel-boring machines excavating the Metro Tunnel have been halted in their tracks, as the consortium argues with the government over who will cover the cost of the project's multi-billion dollar blowout.

Sources familiar with the negotiations say the Cross Yarra Partnership consortium building the $11 billion rail project beneath Melbourne's CBD has threatened to quit the project entirely unless the government agrees to help pay for up to $3 billion in blown out costs.

Metro Tunnel's first Tunnel Bore machine. Credit:Jason South

Tunnelling crews were told by the consortium's upper management on Monday morning that workers would not operate the tunnel boring machines and would instead receive two weeks of training.

The crews will continue to be paid despite not doing any work until Christmas, sources in the construction industry said.