Page 3164 - Week 09 - Tuesday, 22 August 2017
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appropriate to sign a $27 million contract which some would say is actually worth something like $3 million or $4 million, overpriced perhaps to the tune of $22 million. It is demonstrably clear that the value of the agreements has an effect on the cost of services. When they have outgoings of $27 million, that is of course included in what they tell the ICRC. In effect, Canberrans’ bills include in the vicinity of $150 to $200 to subsidise this particular shared services agreement.
Icon Water admitted that the motivation behind the agreement was to preserve positions at ActewAGL. Therefore, effectively the taxpayer is paying to bolster a private company. And while Icon Water have a 50 per cent stake in ActewAGL, by going into this agreement they are, in effect, subsidising the other owner. By pouring all this money into ActewAGL, a joint venture, they are indirectly benefiting the other members of this joint venture.
Over recent months Icon Water has shown itself to be reluctant to demonstrate exactly where its money goes. Whilst they insist that they are not beholden to the ACT government in a meaningful way, they have received taxpayer-funded loans totalling in the vicinity of $1.6 billion. Icon Water has received a taxpayer-funded loan of this magnitude yet continues to claim that it has limited obligations to submit to public scrutiny.
Icon Water’s borrowing has been the subject of debate in previous estimates and in previous debates here in the Assembly. Non-current interest-bearing liabilities are budgeted at $1.66 billion for 2017-18 and are expected to rise to $1.83 billion by 2021. This is a real liability that the territory is on the hook for. Whilst the Chief Minister may claim that Icon is a separate entity, it is guaranteed by the taxpayer. It is, I believe, a company limited by guarantee—or, if not, it is another less common variety of company. In effect, the ACT taxpayer is underwriting this particular loan.
Icon Water holds 10 per cent of the territory’s physical assets. It is expected that there will need to be ongoing capital upgrades, particularly with new suburb development and population growth. Icon Water’s debt and assets are included in the audited financial accounts signed off by the Treasurer, the Under Treasurer and the Auditor-General. Therefore, it is a bit of a stretch to say that you should not be including Icon Water’s financial position when you are talking about the financial position of the territory.
Icon Water and the government cannot deny that the decisions and actions of Icon Water dramatically affect the territory in a significant way. The decisions by Icon Water impact on the cost of water in the territory, and the decisions by Icon Water affect the price of Canberrans’ water and sewerage bills. Given that Icon Water is the sole provider of water and sewerage services for the territory and given that the only two shareholders are both ministers in this government, I think it is untenable for the government to continue to claim that they are not accountable and are not responsible for the decisions of Icon Water. Given that they own 100 per cent of the shares and given that they appoint all the directors, I think it is clear that there is a role for the shareholders to exercise their wishes, just as shareholders of any other company can do.
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