Mr EDE - 1996-02-27
On the ABC news this morning, there was a report on a meeting between the Industries Assistance Commission and Territory Treasury officials. In that meeting, public servants admitted what Country Liberal Party politicians have always refused to own up to - that the Country Liberal Party administration has no formal, rigorous means of evaluating the use of taxpayers' funds to assist large projects. Despite losses of over $800m, it still has no formal, rigorous process to evaluate the effects of past assistance. I ask the Treasurer whether this failure and the losses, which gave us not only the highest per capita debt of any jurisdiction in Australia but also took away our ability to develop much-needed housing and decent roads and give our public servants the pay and conditions that they are worth, will continue. Will it continue or will we finally see some publicly available, rigorous process in place by which the CLP can be made more accountable in the future?
ANSWER
Mr Speaker, in rejecting any assertion that expenditure of the Territory's resources is not well oversighted and cared for, I refer the question to the Minister for Asian Relations, Trade and Industry who will be able to provide a full response.
Mr EDE: A point of order, Mr Speaker! The meeting was with Treasury officials. This man is the Treasurer. The question is whether the government will put in place a rigorous process, which will be publicly available, for determining the allocation of Territory funds for these projects. The question is clearly within the bailiwick of the Treasurer and he should be able to answer it.
Mr SPEAKER: There is no point of order. No minister is obliged to answer any question that is asked.
Mr POOLE (Asian Relations, Trade and Industry): Mr Speaker, I thank the Leader of the Opposition for the question, albeit that it came to me indirectly. It is quite apparent that, from a news reporting point of view, the ABC got the wrong end of the stick. From discussing this matter with my departmental officials and Treasury officials this morning, it was quite apparent that the ABC news reported that the Northern Territory does not have a formal process for assessing industry assistance, but rather uses an informal process. What was not said, of course, was that those comments related to a specific project, the McArthur River project. I believe that, if one sat down ...
Mr Ede: No, you said any ...
Mr Stirling: You did not answer the question.
Mr SPEAKER: Order!
Mr POOLE: If you sit down and go through the transcripts of the comments that were made by the Industries Assistance Commissioner and the officers of the department who were
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being interviewed at the time, you will find that what they actually said was that, in relation to a huge project like McArthur River, there is no telephone book that you flick through page after page and tick them off. We are talking about 2 different things here, and I will come to the second part of that in a moment.
In the first instance, I believe an approach was made to the Northern Territory government by the Commonwealth government and MIM. The response to that was a whole-of-government response. The process is quite a simple one. That process started probably in the 1950s and continued on. In the last 2 or 3 years, it resulted in mountains of paperwork - files that are 4 ft high - as Treasury officials of the day assessed the project. One of the complaints the Under Treasurer has had over the last year or 2 has been that half his department were working on the investigation of the financial aspects of the McArthur River mine project. It was a one-off project of its kind.
One would expect any government in Australia, and certainly the Commonwealth government, to do exactly the same. It was involved in the process. The opposition's own party was involved in the process quite considerably.
Mr Ede: You did not lose your $800m on McArthur River. Of course we were involved.
Mr POOLE: I am talking about the question that was asked by the ABC this morning. That was the basis of your question.
That process continued for years and there is no question but that the project was exhaustively examined. At the end of the day, the long-term benefits for the Northern Territory are probably immeasurable. In 10 years time, we will be able to say that there are x number of people working there, as we can say now for the Jabiru project, the Groote project, the Nhulunbuy project - all the same type of development. Today, we see the obvious benefits of those large enterprises. At the time when they began digging bauxite from the ground, who knew whether the decision taken in relation to Nhulunbuy would be a good decision or not? The fact is that there is now a whole town of people working there. The same applies to Jabiru. I am quite sure that, in 10 years time, the same will have happened at McArthur River.
To come back to the other side of the scale, where we are talking about specific projects in relation to which people walk in the door and apply for industries assistance through the Department of Asian Relations, Trade and Industry, there is a very formal process. If the honourable member had really listened to the report this morning, he would have seen a good example of it. I believe the gentleman involved was asked a question about applying for moneys to assist in developing a project involving solar motors etc with the Indonesians. He said: `Formal process? You have to be kidding. It went on for 12 months. It was the most rigorous examination I have ever been subjected to'. There is a formal process and there has been a formal process for many years. We have a panel of people who assess every proposal.
Mr Ede: What was the formal process for Dalway? What was the formal process for Yulara?
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Mr SPEAKER: Order!
Mr POOLE: There is and has been a formal process for many years. Before an applicant receives any money, whether it be as a grant or a loan or whatever ...
Mr Ede: First, join the CLP. Second, ask.
Mr SPEAKER: Order!
Mr POOLE: ... there is a very rigorous formal process. It involves private enterprise. It involves highly-trained and highly-paid specialists who evaluate proposals. At the end of the day, they make a recommendation, through the department, to the minister of the day. Depending on what the level of funding required and the type of assistance involved, either the minister or Cabinet makes a decision. In the case of a large project, the decision goes through the whole-of-government process and is made by or ratified by the Cabinet. That was the case with the McArthur River project. There is no evidence to suggest that there is not a formal process.
The evidence that was asked for at the time was evidence about McArthur River. While there is no manual of instructions for large projects like the one at McArthur River, they are taken at face value in a 1-off, 1-of-a-kind assessment that involves many government departments. There are many comments in annual reports throughout the public service. I believe the Office of the Chief Minister, in respect of the environment, the Department of Mines and Energy and the Power and Water Authority were involved in the assessment of the McArthur River project. That is what the question by the ABC this morning related to. In relation to smaller projects, there is a very rigorous process of monitoring company performances on a 3-monthly or 6-monthly basis. I can assure the Northern Territory population that it is a very tight system, involving private enterprise in the assessment of the worth of the projects presented.
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ANSWER
Mr Speaker, in rejecting any assertion that expenditure of the Territory's resources is not well oversighted and cared for, I refer the question to the Minister for Asian Relations, Trade and Industry who will be able to provide a full response.
Mr EDE: A point of order, Mr Speaker! The meeting was with Treasury officials. This man is the Treasurer. The question is whether the government will put in place a rigorous process, which will be publicly available, for determining the allocation of Territory funds for these projects. The question is clearly within the bailiwick of the Treasurer and he should be able to answer it.
Mr SPEAKER: There is no point of order. No minister is obliged to answer any question that is asked.
Mr POOLE (Asian Relations, Trade and Industry): Mr Speaker, I thank the Leader of the Opposition for the question, albeit that it came to me indirectly. It is quite apparent that, from a news reporting point of view, the ABC got the wrong end of the stick. From discussing this matter with my departmental officials and Treasury officials this morning, it was quite apparent that the ABC news reported that the Northern Territory does not have a formal process for assessing industry assistance, but rather uses an informal process. What was not said, of course, was that those comments related to a specific project, the McArthur River project. I believe that, if one sat down ...
Mr Ede: No, you said any ...
Mr Stirling: You did not answer the question.
Mr SPEAKER: Order!
Mr POOLE: If you sit down and go through the transcripts of the comments that were made by the Industries Assistance Commissioner and the officers of the department who were
Page 1211
being interviewed at the time, you will find that what they actually said was that, in relation to a huge project like McArthur River, there is no telephone book that you flick through page after page and tick them off. We are talking about 2 different things here, and I will come to the second part of that in a moment.
In the first instance, I believe an approach was made to the Northern Territory government by the Commonwealth government and MIM. The response to that was a whole-of-government response. The process is quite a simple one. That process started probably in the 1950s and continued on. In the last 2 or 3 years, it resulted in mountains of paperwork - files that are 4 ft high - as Treasury officials of the day assessed the project. One of the complaints the Under Treasurer has had over the last year or 2 has been that half his department were working on the investigation of the financial aspects of the McArthur River mine project. It was a one-off project of its kind.
One would expect any government in Australia, and certainly the Commonwealth government, to do exactly the same. It was involved in the process. The opposition's own party was involved in the process quite considerably.
Mr Ede: You did not lose your $800m on McArthur River. Of course we were involved.
Mr POOLE: I am talking about the question that was asked by the ABC this morning. That was the basis of your question.
That process continued for years and there is no question but that the project was exhaustively examined. At the end of the day, the long-term benefits for the Northern Territory are probably immeasurable. In 10 years time, we will be able to say that there are x number of people working there, as we can say now for the Jabiru project, the Groote project, the Nhulunbuy project - all the same type of development. Today, we see the obvious benefits of those large enterprises. At the time when they began digging bauxite from the ground, who knew whether the decision taken in relation to Nhulunbuy would be a good decision or not? The fact is that there is now a whole town of people working there. The same applies to Jabiru. I am quite sure that, in 10 years time, the same will have happened at McArthur River.
To come back to the other side of the scale, where we are talking about specific projects in relation to which people walk in the door and apply for industries assistance through the Department of Asian Relations, Trade and Industry, there is a very formal process. If the honourable member had really listened to the report this morning, he would have seen a good example of it. I believe the gentleman involved was asked a question about applying for moneys to assist in developing a project involving solar motors etc with the Indonesians. He said: `Formal process? You have to be kidding. It went on for 12 months. It was the most rigorous examination I have ever been subjected to'. There is a formal process and there has been a formal process for many years. We have a panel of people who assess every proposal.
Mr Ede: What was the formal process for Dalway? What was the formal process for Yulara?
Page 1212
Mr SPEAKER: Order!
Mr POOLE: There is and has been a formal process for many years. Before an applicant receives any money, whether it be as a grant or a loan or whatever ...
Mr Ede: First, join the CLP. Second, ask.
Mr SPEAKER: Order!
Mr POOLE: ... there is a very rigorous formal process. It involves private enterprise. It involves highly-trained and highly-paid specialists who evaluate proposals. At the end of the day, they make a recommendation, through the department, to the minister of the day. Depending on what the level of funding required and the type of assistance involved, either the minister or Cabinet makes a decision. In the case of a large project, the decision goes through the whole-of-government process and is made by or ratified by the Cabinet. That was the case with the McArthur River project. There is no evidence to suggest that there is not a formal process.
The evidence that was asked for at the time was evidence about McArthur River. While there is no manual of instructions for large projects like the one at McArthur River, they are taken at face value in a 1-off, 1-of-a-kind assessment that involves many government departments. There are many comments in annual reports throughout the public service. I believe the Office of the Chief Minister, in respect of the environment, the Department of Mines and Energy and the Power and Water Authority were involved in the assessment of the McArthur River project. That is what the question by the ABC this morning related to. In relation to smaller projects, there is a very rigorous process of monitoring company performances on a 3-monthly or 6-monthly basis. I can assure the Northern Territory population that it is a very tight system, involving private enterprise in the assessment of the worth of the projects presented.
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Last updated: 09 Aug 2016