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Legislative Assembly for the ACT: 2001 Week 5 Hansard (2 May) . . Page.. 1343 ..

MR SPEAKER: Thank you, Chief Minister.

Questions without notice

Impulse Airlines

MR QUINLAN: My question is to the Chief Minister. In April 2000 the government and Impulse Airlines entered into an agreement to develop a regional airline industry in the ACT. In return for $10 million in government funding, taxpayers' funding, and payroll tax waivers Impulse agreed to develop a heavy engineering facility at Canberra Airport, a training centre of excellence, to transfer its regional headquarters to Canberra Airport and to establish a call centre in the ACT. $8 million of the government's incentive was in the form of a loan to be written off as Impulse reached an agreed list of milestones. Yesterday, Impulse announced a joint venture with Qantas, a move that has been reported nationally as a takeover. Can the Chief Minister tell the Assembly whether in fact Impulse received the full $8 million, or what part they did receive? If so, how much has been written off as a result of the airline reaching agreed milestones, and which milestones remain unachieved?

MR SMYTH: Mr Speaker, rightly that question is mine. I am responsible for the management of that part of the portfolio. The loan in fact was $8 million and there were waivers of $2 million. I would like to read from the combined Impulse/Qantas press release yesterday to put this into context. I quote:

Mr McGowan said Impulse intends to honour all agreements it had established with governments, including the positioning of its national reservations centre in Newcastle under a Commonwealth grant, and support packages obtained from the Tasmanian and ACT Governments.

Mr Speaker, it was a loan. There were 18 milestones in that loan. As the milestones were reached, debt was forgone. Currently they have reached two milestones and they are concerned with the delivery of air routes between Canberra and Sydney, and Canberra and Melbourne. That saw $900,000 forgone. There is a third milestone which is under consideration. They have applied to say they have reached that milestone. There are milestones four to 18, some 15 milestones, remaining, and they account for $6.7 million. If those targets are not achieved that money is returned or paid off.

MR QUINLAN: I have a supplementary question. In that case, can the minister assure this Assembly that the contract is watertight, unlike the contracts for ActewAGL and a gas-fired power station or a GMC 400 where the additional costs have been dictated by the promoter? Is this contract watertight?

MR SMYTH: Mr Speaker, it is a contract that has been approved by the Government Solicitor's Office. It is a contract that the government has signed, and we expect it to be honoured.


MRS BURKE: My question is to the Treasurer, Mr Humphries. I refer to claims made by Mr Quinlan in the media in his speeches over the past 24 hours that the ACT budget would put the ACT in a dangerous financial position and that the budget surplus was not

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