Labor’s vow to dump the East West Link has been branded a reckless stunt by the Victorian government that will cost the state $3 billion and 6200 jobs.
Opposition Leader Daniel Andrews says its legal advice suggests no safe or binding legal contracts can be entered into while a Supreme Court challenge for the "dud" project is under way.
But the state government is adamant it will sign contracts for the multibillion-dollar motorway by October, only weeks from the November 29 election.
Mr Andrews called on Premier Denis Napthine not to rush into signing contracts for the tunnel before the election so Victorians could choose.
"It is spectacularly arrogant for this premier to think he can recklessly sign up all Victorians to this project while the project itself is under challenge," he said on Thursday.
Mr Andrews said if Labor won, it would dump the project and put the money into public transport.
It would also not seek to defend the project in the December court action being brought by two inner-city councils.
Mr Andrews said Labor would honour valid contracts but was unclear on what it would do if the Supreme Court ruled in the project's favour.
Treasurer Michael O'Brien labelled Labor's move "economically insane", saying it put at risk the state's finances and the 6200 jobs the project would create, along with traffic-busting infrastructure.
"We're going to get on with negotiating the final stages of contracts and won't be held hostage by Labor," he said.
Mr O'Brien said the move would put $3 billion of taxpayer money at risk and was a stunt to defend inner-city Labor MPs from the Greens.
It would also send the message Victoria was closed for business.
Dr Napthine said Labor's decision would consign Victorians to decades of gridlock, while Deputy Prime Minister Warren Truss said the project was desperately needed.
The Greens have accused Labor of outsourcing its position on the project to a judge.
Australian Industry Group's Tim Piper said the move would undermine business confidence in government activities and raised the question of sovereign risk.
Infrastructure Partnerships Australia chief executive Brendan Lyon said it was a disappointing departure from the opposition's statement the project would proceed, even if the government changed.
Labor previously said if it won power it would honour any contracts for the project signed before the election, because tearing them up would send the wrong message to investors about Victoria.