Legislative Assembly for the ACT: 2010 Week 10 Hansard (Thursday, 23 September 2010) . . Page.. 4401 ..
The government has been very thorough in its negotiations. Indeed, it was my request, in the almost successful completion of negotiations around our purchasing the hospital, that led to getting some very high-level advice around whether the proposal as it stood—that is, we buy it and Calvary operate it—would mean that we were able to capitalise our investment in it. I did not want to get to the position where we appropriated money for the facility but we could not demonstrate economic control and therefore could not capitalise the money going into that building.
It coincided with the release of exposure draft 194, the Australian accounting standards forward release, which was a proposed international public sector standard, which again proposed that the government apply the same rights as private operators when accounting for service concession arrangements. This advice has been checked and rechecked against whether or not a service concession arrangement exists.
Our advice is that a service concession arrangement does exist under this new exposure draft, which is not yet an accounting standard. Because of the changes that will happen in the future, the government terminated the discussions around purchasing the hospital from Little Company of Mary Health Care immediately, as we should have.
Mr Smyth: Why didn’t you do your work before you did this?
MS GALLAGHER: Because it was an exposure draft which was released in April this year. The issues that are covered in the exposure draft, which is not yet an accounting standard, did not apply and have not ever applied to the relationship between the ACT government and Little Company of Mary Health Care. Indeed, your government, Mr Smyth, did not capitalise money going into Calvary. This is the relationship that has always existed.
A proposed change is coming. It is not yet in. It is coming. It was flagged in April. Based on that proposed change that emerged in April, the government terminated those negotiations to purchase the hospital immediately, as I should have.
It is good to see that the Liberal Party support the service concession arrangement, that they have done their own analysis.
Mr Smyth: Give us the advice.
MS GALLAGHER: No. You have already decided that it operates, because I have been criticised by you for potentially wasting $77 million. If you are going to accuse me of potentially wasting $77 million, the logic of that is that you agree we should not pay for it.
Mr Smyth: You are saying, “Trust me.”
Mr Hanson: But we shouldn’t trust you. Should we trust you or shouldn’t we trust you?