News: the competition-winning design by Herzog & de Meuron and Hassell to revamp Melbourne's iconic Flinders Street Station is unlikely to go ahead, according to the state government.

The Swiss and Australian firms won a contest organised by the former coalition government of Victoria to overhaul the 19th-century railway station and its surroundings, including restoration of the historic dome and clock tower.

Over AU$1 million (£534,000) has already been spent, but the new Labor government for the south eastern region of Australia has told ABC News that the project will still cost AU$2-billion (£1 billion), which it considers a lot of money for little gain.

"The previous government put millions of dollars into a design competition; we were quite critical of it when we were in opposition and we said that design competition didn't accord with the community's priorities," stated treasurer Tim Pallas.

Pallas said a final decision has not been made, but that he believes only 20 per cent of the cost could be funded through commercial input. "It would be an inordinate burden upon taxpayers," he added.

Herzog & de Meuron and Hassell saw off competition from Zaha Hadid and Grimshaw to win the high-profile contest back in 2013, with a proposal that included the construction of a new barrel-vaulted roof structure over the station concourses.

The architects also planned to add a new public art gallery dedicated to oceanic and contemporary art, a public plaza, a marketplace, an amphitheatre and a permanent home for some of the city's cultural festival organisations.

The government's financial statement, released two days before the state election in November, details budget for several redevelopment projects but makes no mention of Flinders Street Station.

Herzog & de Meuron declined to comment on what the studio describes as "an on-going political decision-making process".