The federal government has cut funding previously allocated to upgrade south-west roads, including the Princes Highway between Warrnambool and Port Fairy.
Member for Wannon Dan Tehan said it was "absolutely staggering" $80 million in Roads of Strategic Importance (ROSI) funding for the region had been reduced.
"We now have information from the department that $80 million worth of funding for south-west roads is at risk," Mr Tehan said.
"We have found out - of course - that Labor kept this secret. They tried to hide it in the budget."
Former Deputy Prime Minister Michael McCormack visited Warrnambool in March 2019 to announce the funding.
The roads that were included in the upgrades were Princes Highway West - from Colac to the South Australian border, the Henty Highway, the Portland-Nelson Road and the Portland-Casterton Road.
The Standard has seen a response to a question posed by the federal opposition that states: "This project had funding reduced in the October budget 2022-23."
Mr Tehan said he was desperate to find out how much funding had been cut to the vital upgrades.
"We hope to find out from Senate estimates next week how much," Mr Tehan said.
"It was only through questioning of officials that we found out this was what they had done."
Mr Tehan said he believed the funding cut was "one of the most outrageous decisions I've ever seen from a federal government".
"I cannot believe that the Albanese government would cut funding from the south-west road network given the state of the roads and the continuing deterioration that we are seeing as a result of a long, wet winter.
"It seems that they have done this so they can afford to give $2.2 billion to Dan Andrews' pet rail project."
Mr Tehan said he was concerned more lives would be lost on the south-west's crumbling roads.
"It is beyond comprehension," he said.
"We have farmers who have stuck their legs in potholes and its gone up to their hips and now Labor is taking road funding from us.
"They deserve to be held to account for this and I'm sure that every community in the south-west will hold them to account."
The Standard reported in 2019 the amount of funding set aside for the south-west's roads of strategic importance was $80 million.
A response from the federal government was sought.
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