THE Bendigo Airport was the region's big winner in Tuesday night's federal budget.
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The federal government committed $5 million to build a new 1.6 kilometre runway in Bendigo.
City of Greater Bendigo Council last week approved an amendment to rezone land needed to expand the airport.
The revamped airport will be capable of receiving aircraft carrying up to 70 passengers.
Senator Bridget McKenzie said the upgrades would provide better access for emergency and medical aircraft.
“This investment will transform Bendigo Airport and recognises Bendigo’s position as one of Victoria’s most important regional centres,” Senator McKenzie said.
“The major upgrade has been among the City of Greater Bendigo's most important current projects and one we are proud to support," she said.
“This project will help grow business development and attraction and create better air links between Bendigo, Melbourne and other major regional centres.
“I am thrilled we have been able to secure this $5 million investment for Bendigo and it reaffirms the Coalition government’s commitment to the region.”
Bendigo Mayor Peter Cox said the project was an example of all three tiers of government working together.
"It's most welcome for the Bendigo economy because it provides surety for emergency services at Bendigo Airport and is a real boost for businesses," he said.
"We believe connecting Bendigo to places like Sydney is so important. We need our major businesses to be able to connect easily and quickly.
"We're really looking forward to using this money, as well as the money from the council and the state government."
Councillor Cox said he anticipated construction would begin in the next financial year.
Labor Member for Bendigo Lisa Chesters said the funding was "great news".
"It's great the government has listened to the concerns of local council and partnered with the state government," she said.
The money for the airport project will be delivered through the $1 billion National Stronger Regions Fund.
The project is awaiting final approval by the state Planning Minister.