Victoria is still being short-changed by the Federal Government over infrastructure funding despite the Commonwealth's decision to release $1.5 billion originally set aside for the scrapped East West Link project, the state's Public Transport Minister says.

The Federal Government unlocked the money as part of a $3 billion package for about 40 infrastructure projects across Victoria, including the Monash Freeway upgrade and Murray Basin Rail Freight Project.

It had first promised the money to help build the East West Link but the funding was withheld when the project was abandoned.

Victoria's Public Transport Minister, Jacinta Allan, said the money always belonged to the state.

"Whilst it's pleasing that Malcolm Turnbull … finally recognised that this money that should always have stayed in Victoria and should always be spent on Victorian infrastructure projects, it doesn't disguise the fact that Victoria is still receiving far less that its fair share in federal infrastructure funding," she said.

Ms Allan said the money fell under the 9 per cent of national funding Victoria received from the Federal Government and slammed the fact "not one cent" was put towards public transport.

"This is far short, far, far short of our national population share and also does not recognise the significant transport infrastructure program of the Andrews Labor Government," she said.

Ms Allen said the money was going towards projects that had already been started.

State and Commonwealth 'working together': Federal Government

Federal Minister for Infrastructure and Transport Darren Chester dismissed the idea the Commonwealth had "backed down" after holding the money from the state.

"At the start of the year I approached Victoria with a suite of projects suggesting we could unlock that $1.5 billion if they were prepared to match it," he told 774 ABC Melbourne.

"Obviously it's been a long negotiation, probably interrupted by the federal election … but now we're in a position where we're working together to make sure we're getting on with delivering the projects."

Mr Chester said Canberra was not micromanaging state-based infrastructure projects, and the upgrades were of "national significance".

"If you're stuck in traffic on the Monash Freeway or killed or injured on country roads, you don't really care who funds it just as long as governments start working together to deliver."

Third new train station to be built in Melbourne's north

The Andrews Government also announced it would build a third station as part of the $600 million rail extension to Mernda, in Melbourne's outer-north.

The station at Hawkstowe will be in addition to ones in Mernda and near Marymede Catholic College.

More than 8,000 people are expected to use the three stations when they open in 2019.

Premier Daniel Andrews said the extra station will be built within the allocated budget after discussions with the construction companies involved.

"It will be a very busy time out here, 3,000 jobs are being created as a result of this tremendous project... and three stations delivered for the price of two in effect," he said.