Shadow Treasurer Rob Lucas today accused the Weatherill Government of financial mismanagement and incompetence which led to SA missing out on an estimated $300-375m from the Federal Government’s Asset Recycle Bonus Fund.
The Asset Recycle Bonus Fund paid a 15% bonus to the states for approved privatisations which were then spent on eligible new infrastructure projects. The Federal Government made it clear that existing or already announced projects would not be eligible for funding.
The recent Federal Budget closed the Fund and announced that projects in 2 other States and 2 Territories were eligible and would receive funding out of the fund. SA projects were not included and the Federal Government has confirmed that SA would not receive any funding.
Under Treasurer Mr.Rowse told the Budget and Finance Committee on 28 Sept 2015 that the MAC privatization was eligible for funding and that ‘our understanding from the Commonwealth, that this is a qualifying transaction’.
Mr.Rowse confirmed on 1 Feb 2016 that last year SA had tried to get the bonus funding by promising to finish the already announced Darlington and Torrens to Torrens projects 6 months earlier. Unsurprisingly the Federal Government rejected that bid.
SA then asked the Federal Government to fund a package of almost $400m comprising already announced infrastructure and economic development projects from last year’s budget and the Mid Year Budget Review.
These projects included school upgrades, road maintenance, major event funding and the Northern Connector. Again clearly these projects were not new infrastructure projects and in some cases weren’t even infrastructure projects. How could anyone argue increased funding for major events was an infrastructure project? Unsurprisingly SA again didn’t receive approval for bonus funding.
Latest estimates for the MAC privatization are for at least $2b and possibly as much as $2.5b. Bonus funding of 15% would therefore have been at least $300m and as much as $375m. The fact that the Under Treasurer confirmed project bids of up to $400m is consistent with those estimates.
“Given the Federal Government had agreed SA was eligible for bonus funding it is simply unforgiveable that the Weatherill Government was not ready with eligible new infrastructure projects to be funded. This is especially true when SA continues to suffer from the worst unemployment rate in the nation.
“The Weatherill Government stands condemned for its financial mismanagement and incompetence which will mean SA missing out on at least $300m.”