This afternoon I would like to make some comments in relation to the Auditor-General’s report that was tabled in December 2015 on the east–west link (EWL) project. In fact it was tabled in this place on 9 December last year. The Acting Auditor-General, Dr Peter Frost, notes in the letter to the Presiding Officers accompanying the report, and I quote, and this is right at the beginning of the report:
… the EWL business case did not provide a sound basis for the government’s decision to commit to the investment and that key decisions during the project planning, development and procurement phases were driven by an overriding sense of urgency to sign the contract before the November 2014 state election.
Dr Frost’s words are a damning indictment of the former government’s handling of the project. They demonstrate a significant cost to the Victorian taxpayer from the short-sighted actions of the former government in seeking to pursue a political objective. They show why we must not and cannot in good conscience abdicate our duties to the taxpayers of this state for short-term political gain, as was sadly the case in relation to this project.
In addition to this, as we have learnt from the federal Auditor-General’s report that was released on 14 December last year, the federal coalition government was just as inept and irresponsible in its decision to sign over $1.5 billion. It did so despite its own public servants warning as to the merits of the project. The headline figures from the Auditor-General’s report speak for themselves in demonstrating the ineptitude of the former government’s handling of this project, as well as the simple fact that given the weaknesses of the business case, it should never have gone ahead.
Signing the contract was, in the circumstances, and I quote, ‘imprudent and exposed the state to significant cost and risk’. As is noted in the report’s conclusion, the total cost of the project would have been close to $23 billion. For every $1 of these $23 billion spent, 55 cents would have been lost. As the Treasurer noted, the handling of the east-west link is a lesson in how not to govern. And, as aforementioned, the merits of the east-west link were also questioned by public servants in Canberra. In spite of this, just like their state colleagues, federal coalition members threw caution to the wind and committed a total of $3 billion in federal funding to the project.
This occurred even though, as the federal Auditor-General notes, and I quote:
Neither stage of the east-west link project had proceeded fully through the processes that have been established to assess the merits of nationally significant infrastructure investments …
The initial tranche of $1.5 billion was allocated by the federal government even though the money simply was not yet needed, so that the federal government could score cheap political points.
So just what have we learnt from this report? We have learnt that you do need to have specialist staff who understand infrastructure build. You need to have public servants who are prepared to be bold and provide advice. You need to have a government that is prepared to listen.
Above all, in terms of infrastructure, you try to make sure that the politics, as much as you can, are taken out of it and that at the very least you do not look at the election cycle and the timetable of the state election of 2014 as the reason to disregard what the population in this state wanted. But as it turned out it actually was a very important time for the Labor government, given that it did turn into a referendum on roads and public transport — and I am pleased to announce yet again to the opposition that it was Labor that won that referendum.