Construction of a $16 billion Melbourne toll road may be managed by the Victorian government if it can't find a private sector builder whose terms it is happy to accept.

A tender process is underway to find a company to build significant parts of the $16 billion North East Link.

Industry giant John Holland is planning to submit a bid but wants the state government to be financially liable for any cost blowouts or problems arising from the project’s design, The Age reported on Thursday.

Victorian Treasurer Tim Pallas says the government is speaking with the private sector about how risk can be managed for a project of North East Link’s size.

But if only one genuine bidder emerges for the project and the government isn’t happy with their conditions, it would consider leading the charge and hiring diggers itself.

“All my public life, I’ve taken a view that we do so much better when we work with the private sector to deliver things,” Mr Pallas told reporters on Thursday.

“But I won’t do it at all costs or under no condition. So if the state has to manage these projects, we will.”

Victorian Premier Daniel Andrews insists whatever the outcome of the tender process, taxpayers will get a good deal.

“We’ll get a contract signed which is in the best interest of Victorian taxpayers,” he told reporters.

A state government-owned company is already planned to manage North East Link tolls, with the Andrews government introducing legislation to parliament to set up the State Tolling Corporation on Wednesday.

Some early construction is underway for the North East Link, which will connect the M80 Ring Road to the Eastern Freeway.

It is expected to carry up to 135,000 vehicles daily, taking 15,000 trucks off local roads and cutting travel times by 35 minutes.

John Holland is currently contracted to build Melbourne’s West Gate Tunnel, along with joint venture partner CPB Contractors.

But it has tried to terminate its contract with project leader Transurban over an issue with contaminated soil at the site, including its disposal, a step Transurban rejected.