Business groups are urging the Andrews government to consider ramping up debt to fill an infrastructure backlog needed to tackle worsening congestion.

With government borrowing costs at historic lows, there is a growing consensus that the public private partnership model, which relies on ongoing payments to the private sector to build and maintain infrastructure, should be re-examined.

Melbourne is in need of new infrastructure projects. Credit:Jessica Shapiro

Ahead of the May 5 state budget, the Andrews government is facing mounting pressure to spell out how it intends to deliver a pipeline of road and rail projects without jeopardising Victoria's coveted AAA credit rating after its controversial decision to axe the East West Link.

Net debt is expected to peak at $21.1 billion – equivalent to 6.0 per cent of the state economy – this financial year. Next year, it is expected to taper off to a relatively modest $17.5 billion, or 4.6 per cent of the state economy.