The final cost to Victoria for the scrapped East West Link toll road is $420m and negotiations with the consortium of developers contracted to build the road has been finalised, the state government has said.

In April the premier, Daniel Andrews, announced the government would avoid paying millions in compensation to the consortium, despite the contracts for the project already being signed under the previous Coalition government.

The only cost to the state would be $339m already spent on the project before the project was scrapped, Andrews said at the time.

But on Monday the treasurer, Tim Pallas, told reporters that as well as the $339m, an additional $81m spent to establish the credit facility for the project could not be recouped. However, the negotiations were now final, Pallas said.

The government had also negotiated a $3.1bn bond agreement with members of the East West Link consortium banking group, which would be made available for the Melbourne Metro rail project, the government’s alternative to the toll road.

While the $420m in costs were “not a cause for celebration”, Pallas said the finalised deal “allows Victorians to move forward and focus on projects that stack up”.

At an estimated cost of between $9bn and $11bn, the Melbourne Metro would require significant funding from private investors and the federal government, and would require Swanston Street in the CBD to be dug up.

The rail project has now secured $4.5bn in funding, including the $1.5bn provided in the last Victorian budget.

However, the opposition said the true cost to taxpayers of scrapping the East West Link was up to $881m. The figure accounts for an additional $200m spent in land acquisitions and $176m spent on project development such as drilling, soil testing, and engineering, legal and professional services.

The shadow treasurer, Michael O’Brien, who signed a controversial side letter guaranteeing payout to the consortium if their project was abandoned, called the walkaway costs a “monstrous” waste of public funds.