Page 4044 - Week 11 - Wednesday, 16 Sept 2009
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The shareholders, through cabinet, have sought and received assurances that the enlarged Cotter Dam project remains economically viable. We have also been assured that Actew has undertaken all necessary steps to provide us with confidence that the board had appropriately scoped the project and thoroughly costed the works. We also sought and received assurances that Actew could adequately manage the risk of the project, and that the board had adequately considered issues such as alternatives to this project or undertaking a smaller project.
All of these factors persuaded us not to intervene in the actual board decision making on this project. While we were very much taken aback by the quantum of the increased costs—which I think is a view shared by Assembly members—and conveyed in the strongest terms our concern, the government realised that the project must continue to proceed. We recognise and share the concerns that the public will have, as this will result in further water price increases for consumers. We have made it clear to Actew that we will require regular and detailed reports on the progress of the dam and other water security projects.
I would like to reaffirm some comments I have made earlier. The enlarged Cotter Dam remains economically viable and it will continue to provide a net economic benefit to the ACT community. The costing of the dam is no longer an estimate but an agreed contractual price between Actew and its contractor partners in the Bulk Water Alliance. The costing has been based on many months of detailed work and has been validated by independent experts.
Of course, the total project costs will be subject to further scrutiny by the Independent Competition and Regulatory Commission, with the assistance of expert consultants. The ICRC undertakes a full review of Actew’s capital works program to ensure that expenditure is prudent in determining the regulated prices to enable Actew to recover its efficient costs only. In addition, Actew’s agreement with its contractors provides incentives for bringing the project in under budget.
The enlarged Cotter Dam, as with other major water security projects, will be paid for by borrowings to be undertaken by Treasury on Actew’s behalf. The cost of these borrowings will be spread over the life of the assets, so the cost will be borne not just by the current generation of users but also by future generations, who will benefit from these assets.
Debate (on motion by Mr Smyth) adjourned to a later hour.
Sitting suspended from 12.12 to 2 pm.
Points of order
Ruling by Speaker
MR SPEAKER: Members, yesterday during question time, I undertook to review Hansard following a point of order raised by the Chief Minister in relation to an interjection made by Mr Hanson while the Minister for Health was answering a question without notice asked by Ms Bresnan about concerns, within the sale of
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