Page 4923 - Week 13 - Thursday, 12 November 2009
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money in the ACT context. In fact, we are talking about a massive amount of money. We are talking about a threefold blow-out. We are not talking about a 10 per cent or a 20 per cent or a 30 per cent increase; we are talking about a threefold blow-out from the numbers we were given just a couple of years ago.
That needs to be put into the context of what could be done with this money. What are the consequences? The consequences, of course, are that, in not managing these projects properly, in not ensuring that we get best value for money right throughout the process, Canberrans will pay more. That is the one certainty to come out of this: Canberrans will pay more for their water because of this cost blow-out—and not just for a little while, not just for a year or two; they will essentially in perpetuity be paying more for their water as a result of this cost blow-out. The figure of $243 million represents three GDE duplications, several high schools or a quarter of what the government is planning on spending over 10 years on capital in health. The figure needs to be put into that context. This is a massive cost blow-out and a massive amount of money.
We need to look partly also at the process that we have seen to date. We have seen numbers everywhere—numbers all over the place. It is difficult to keep up with all of the different numbers that have been provided, even in recent times, even in recent weeks and months. We know that in April 2005 Actew Corporation’s future water options report estimated the cost to enlarge Cotter would be $120 million. We know that in October 2007 the Chief Minister announced that Cotter Reservoir would be enlarged at a cost of $145 million. In April 2008 the Halcrow Pacific report noted that Actew “believe that the final outturn cost may be up to 30 per cent greater than the current estimate” or $188.5 million. On 18 May 2009, Mr Sullivan from Actew told the estimates committee that same number: $188.5 million. On 30 May 2009 the Canberra Times reported Mr Sullivan as suggesting that the cost could now be up to $246 million, and indeed on 3 September 2009 it was announced that the total out-turn cost was $363 million.
But that is not where it ends. That is not where the different numbers end. We had Actew’s managing director saying that the out-turn costs of the enlarged Cotter Dam would be $299 million. The report of the independent review, undertaken by Deloitte, estimated it would be $312.6 million. The Deloitte report notes the TOC2 is $310.9 million. Abigroup, one of the alliance partners, in a media release dated 23 September said it will be $262 million. Numbers, numbers everywhere, and not a lot of clarity as to why, and not a lot of clarity as to how, we got there. That is what we need to get to the bottom of.
It is worth touching on some of the findings of the Deloitte report. This Deloitte report needs to be put into context. This Deloitte report is a review, commissioned by Actew, which essentially tells one side of the story. It is a review which gives an analysis, but it has been commissioned by Actew and it needs to be seen in that context. But it does make some critical findings and it is worth highlighting some of those concerning findings:
Findings and recommendations are not always actioned in a timely manner, potentially diminishing value.
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