Page 375 - Week 01 - Thursday, 11 December 2008
Next page . . . . Previous page . . . . Speeches . . . . Contents . . . . Debates(HTML) . . . . PDF . . . .
MR SMYTH: This is the Chief Minister and the Deputy Chief Minister, the Stanhope government. The report states:
The government has the role of shareholders of ACTEW.
They are the shareholders. I continue:
There was no evidence that the shareholders, or ACT Treasury, in its monitoring role of ACT government business enterprises, sought advice from the ACTEW Board on its views of the proposal, the business case and any risks this proposal may present to ACTEW. This is despite the fact that in the original proposal (which included the peaking power station), ActewAGL was expected to have a significant investment in the proposal.
So we have this failure of process inside the government. But what the Auditor-General alludes to here is that the shareholders in Actew did not do their job. She goes on to say:
Actew advised Audit that:
The Actew Board was appraised of the project and considered papers on two occasions, in December 2007 and April 2008. The Board only agreed to provide funding of $300,000 to the development of the business case. There was no decision, and there have not been any since that time, by the ACTEW Board to invest in infrastructure or land.
So where is the probity? Where is the governance here? Where are the shareholders who, in this case, are particularly important as there are only two of them and they hold all the shares? Where are they and are they doing their job? They are nowhere to be seen. There was Rhodium. Now we have got the power station. I see a pattern here of neglect from the shareholders.
The audit report makes a great deal about the process, and it is interesting because the Chief Minister ignored the advice of his own department. If we go to page 17, at paragraph 2.34, it states:
In June 2007, the Department of Treasury…expressed caution in relation to the project and noted that ‘while the existence of external investors may give some comfort in regards to the merits of the proposal, this was also thought to be the case with the Government’s $60m investment in Transact’ (which now had significant diminished value).
So, the warnings were there but they were ignored. Paragraph 2.35 states:
ActewAGL prepared an economic impact statement for the initial CTC proposal. Treasury indicated its view that that this document was unreliable, and suggested a cost benefit analysis be included in the CMD brief to the Chief Minister. Treasury and ACTPLA also questioned if the need—
and this is the nub of it—
Next page . . . . Previous page . . . . Speeches . . . . Contents . . . . Debates(HTML) . . . . PDF . . . .