National Security Office Precinct could cost federal government more than $1 billion, industry experts estimate

The Albanese government's first budget on Tuesday pulled back the curtains on a top secret proposal to develop a new office complex in Barton, bringing together various national security and Commonwealth agencies.

Defending the mystery price tag on Wednesday, Treasurer Jim Chalmers said Australians should trust the the "significant" national project will be "value for money" after scant details were revealed in the federal budget.

It's expected the new National Security Office Precinct, or the "Barton project", will house around 5000 staff once built in its prime location on State Circle, next to York Park.

But the projected cost of constructions remains unknown due to national security and commercial sensitivities.

A number of industry insiders have told The Canberra Times a building of this size in the Parliamentary Triangle would safely exceed the $1 billion mark based on the cost of previous projects.

The budget papers revealed that a detailed business case, planning, design work and "early market testing" had started in 2020 under the Morrison government.

A new car park would also be built adjacent to the John Gorton Building as part of the project's first phase.

Stephen Oxford, a former Finance Department official and head of Australian Strategic Property Advisers, said the Australian Security Intelligence Organisation's $700 million headquarters, which finished construction in 2012, gave a good indication of the expected cost.

"Given prices have escalated significantly since, this building's going to cost something significantly higher," he said.

"We're looking at a billion dollar price tag."

The domestic spy agency's office, which is situated in Canberra's suburb of Campbell, was plagued with budget blowouts and delivery delays.

The building's blueprints were also reportedly stolen by Chinese spies before it was occupied, although ASIO dismissed any hacking claims.

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The rising cost of construction in recent years and supply constraints meant that billion-dollar price tag could increase in the coming years too, Mr Oxford said.

"Any construction project involves risk," he said.

"The pricing of various building components is fluctuating, there's huge workforce capacity constraints in the sector, and there's external forces that are placing risk on any construction project."

Dr Chalmers assured taxpayers he and Finance Minister Katy Gallagher would focus on ensuring the project delivered value for money at his National Press Club appearance on Wednesday.

"We need to make sure that we have got world-class facilities for our national security agencies," he said.

"Obviously, we're aware of the history of some of these big projects and it's not talking out of school to say that the focus that Katy [Gallagher] and I have brought to some of these discussions and some of the others is to make sure we get value for money.

"Beyond that, it's a really important investment that I support. We need to do this for all of the right reasons and we will, and we'll try to deliver it as efficiently as we can."

Minister Gallagher had earlier said it was the most significant infrastructure announcement for the nation's capital.

"It's much bigger than the light rail [project], like a lot," she said.

ACT Chief Minister Andrew Barr said it would also offer new retail and hospitality amenities, describing it as a "major" project.

"This investment will create thousands of jobs during the construction period 2023-2028," he said.

The federal budget also allocated $86 million for the next stage of light rail and delivered funds to reopen the mothballed AIS Arena.

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