A deal approved by former Labor Ministers Stephen Mullighan and Tom Koutsantonis, which promised thousands of jobs at Gillman and more than $70 million in revenue, has been another spectacular failure.
Just prior to the last state election, the then Housing and Urban Development Minister Stephen Mullighan – the architect of the deal – trumpeted a deal with waste company Veolia Environmental Services (Australia) Pty Ltd to develop Gillman promising ‘hundreds of jobs during construction and thousands of ongoing jobs.’
South Australians were promised that Gillman would include:
- Veolia’s new SA head office with 450 employees
- An environmentally efficient logistics and employment precinct
- A nation leading Energy from Waste (EFW) plant
- Adelaide’s largest solar farm (75 – 100MW)
Mr Mullighan’s Gillman deal claimed about $70 million in revenue to Renewal SA with net profit of more than $40 million.
Also, the then Treasurer Tom Koutsantonis, just 5 weeks before the election, signed off on Renewal SA entering into a profit-sharing arrangement with Veolia which contemplated even higher profit margins for Renewal SA.
Treasurer Rob Lucas said: “Sadly, for taxpayers, this Mullighan deal has been an absolute stinker.”
The end result for taxpayers of Mullighan’s deal has been:
- $39 million revenue for Renewal SA written off in this year’s Budget ($12m expected in 2020-21, $13m in 2021-22 and $14m in 2022-23)
- No Veolia head office at Gillman with 450 jobs
- No industrial precinct with thousands of jobs
- No Energy from Waste plant
- No Adelaide’s largest solar farm
The only return to Renewal SA has been the Veolia purchase of 18.7ha of land for $7 million.
“What is even more damning is that our legal advice indicates that Mr Mullighan’s deal was not negotiated in such a way as to ensure any of these promises by the Labor government of thousands of jobs and millions in revenue would be delivered,” said Mr Lucas.
“This is the latest sorry chapter in the long-running saga of scandals and failure in Labor’s mishandling of the Gillman site.”
South Australians will remember that just prior to the 2014 state election (22/11/13) the then Labor Minister Koutsantonis promised thousands of jobs at Gillman: “Up to 6000 jobs could be created in a new employment precinct at Gillman… the plan envisages a range of businesses… including distribution centres, warehouses, transport logistics, manufacturing industries, service industries and a variety of small to medium-sized businesses.”
Mr Lucas said: “Mr Mullighan, who wants to be considered as a future State Treasurer, must be held to account for his responsibility for this disastrous deal.”
“The spectacular failure of this Mullighan deal is a clear warning sign to South Australians should Mr Mullighan ever be in a position to approve similar deals in the future.”