Page 2275 - Week 08 - Tuesday, 12 August 2014
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MR COE (Ginninderra) (10.54): I, too, want to add my concern regarding the state of the financial statements presented in the budget annexed to ACTEW Corporation. The fact that we have interest which is capitalising should be of tremendous concern to all people of the ACT but especially to those in the Legislative Assembly. To have spent as much money as we have on the enlarged Cotter Dam—well over $600 million—and to not have a strategy in place as to how to deal with the debt goes to the core of this government’s mismanagement when it comes to the financial affairs of the territory.
As can be seen in table 4 of the ACTEW budget statement, to have interest bearing liabilities going from $1.42 billion to $1.48 billion to $1.59 billion, to $1.41 billion with an addition of $325 million in current liabilities and then out to $1.78 billion in 2017-18 should be of tremendous concern to the people of Canberra. At some point I would think the government will either have to write down the assets or write off some of the debt. One way or another, we have something which is going to drive up the price of water for all Canberra households.
We saw that just in the last year when the ICRC said, “Now we’ve got water security and, in effect, copious supply, we should be able to drop the cost.” Instead the government and ACTEW kicked up a song and dance to say, “No, you can’t do that; we’re banking on the price going up and up and up,” because they overspent on the Cotter Dam. That is why Canberra households are already paying too much for their water and will continue to pay too much, and I would suggest it will be at an accelerating rate in order to meet the very high interest bearing liabilities the government has on the books of ACTEW.
With that said, I join with others in eagerly awaiting the Auditor-General’s report on the enlarged Cotter Dam. That is, of course, as you well know, Madam Speaker, a project by which the dam wall was meant to cost around $119 million but has blown out to more than $410 million. I understand that considerable remediation is being done on the dam as we speak due to excessive leaking of the dam wall. We may not have seen the last of the capital expenditure when it comes to the enlarged Cotter Dam project.
I reiterate the concerns conveyed by Mr Smyth about the state of the books of ACTEW Corporation, and I hope the government will articulate a clear plan as to how they plan to bring the interest bearing liabilities under control.
MR BARR (Molonglo—Deputy Chief Minister, Treasurer, Minister for Economic Development, Minister for Housing and Minister for Tourism and Events) (10.58): ACTEW’s strategies for the period 2014-15 to 2017-18 centre around six main areas: safety management, asset management, customer management, governance, workforce management, and financial management, which appears to have exercised those opposite. ACTEW’s budget for 2014-15 was developed based on the Independent Competition and Regulatory Commission’s water and sewerage pricing determination of June 2013, with the new pricing taking effect on 1 July this year.
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