The bigger-than-expected gain from the 50-year lease will allow the Andrews government to unleash billions of dollars for road and rail projects in the lead-up to the 2018 election.

The government was also expecting a further $1.45 billion for infrastructure under the federal government's asset recycling scheme, offering payments equivalent to 15 per cent of the sale price for public assets, provided the proceeds are reinvested in productive infrastructure.

But Treasurer Scott Morrison's office said Victoria would get only $877.5 million – equivalent to 9 per cent of the price – claiming Victoria had failed to finalise a deal by June 30.

"An agreement was not finalised with Victoria, despite them having the time to do so," he said.

"Notwithstanding the absence of this agreement, the Commonwealth will now work in good faith with the Victorian government to determine an agreement on how the $877.5 million of ARI [asset recycling] funds set aside for Victoria could be allocated."

Victoria is furious, having long argued it is being short-changed on infrastructure funding. State Treasurer Tim Pallas said the money was owed to Victorian taxpayers and must be spent on Victorian projects.

"This Sydney-centric prime minister is yet again breaking his commitments and short-changing Victoria," Mr Pallas said.

"It's not the fault of hard-working Victorians that Malcolm Turnbull and Scott Morrison can't manage their budget properly."

After months of wrangling, the 50-year lease was won by a consortium including the Queensland Investment Corporation, the Future Fund, infrastructure fund manager GIP and Canadian pension fund OMERS.

A fund managed by GIP will hold a 40 per cent stake in the port. Investors in the fund include one of China's biggest sovereign wealth funds, the $200 billion CIC Capital, which will hold the equivalent of a 20 per cent stake in the port by virtue of owning half of the shares in the fund.

Premier Daniel Andrews said the long-term lease – a pre-election promise – represented "a massive vote of confidence" in the state economy.

"This represents extraordinary value for Victorian taxpayers – a great day for our state," he said.

The proceeds from the sale have already been factored in to the budget bottom line to pay for Victoria's promise to remove 50 level crossings over two terms, but that was based on expectations of a much lower sale price.

The extra cash will give the government even more leeway to deliver future infrastructure, including big road projects such as the "missing link" connecting the Ring Road and Greensborough with EastLink.

Ten per cent of lease proceeds, about $970 million, will be invested in regional and rural infrastructure projects.

Mr Pallas said he had expected "a number closer to $7 billion".

"To say that this is a good day – that it was a pleasant surprise – I think would be an understatement," he said.

Initially the money will be parked in the Victorian Transport Fund, and will show up as an asset offsetting public debt. Under laws introduced in State Parliament, the fund must be spent on productive infrastructure.

Mr Pallas said the government would go through a rigorous process to determine the best projects to invest in, with Infrastructure Victoria due to hand over a list of recommendations at the end of the year and the government due to respond by the middle of next year.

Opposition leader Matthew Guy welcomed the $9.7 billion lease, claiming the better-than-expected price had been achieved because the port was a great asset.

The opposition is claiming the $9.7 billion windfall means there is now no reason to put a levy on Victorians to cover the cost of implementing the recommendations of the Royal Commission into Family Violence. It also claims the government can afford to build a new station at South Yarra as part of the Melbourne Metro project.

It is demanding that the East West Link is built and that the government scraps its "cheap and nasty" sky rail proposal to eliminate level crossings along the Cranbourne-Pakenham rail corridor.

Greens leader Greg Barber warned that local exporters would pay a heavy price for the privatisation.

"The bigger the sale price, the bigger the long-term damage to our export economy," Mr Barber said "These new owners will want a return on investment and that will come from squeezing Victorian exporters."