Senate Environment and Communications Legislation Committee, , 8:56:37 to 9:03:30
A debate between committee members and the Minister regarding political responsibility for the project's mismanagement and the findings of ANAO reports.
Topics: Integrity, Government spending
Speakers: Hon Sarah Henderson, Dennis Barnes, Hon Murray Watt, Varun Ghosh, Unknown Speaker
>> Yes.
>> Could we have a copy of that advice?
>> Uh the the question would probably be best placed with the
>> No, I'm seeking the copy of the advice from you, Mr. Barnes.
>> There's a confidential document which has an incredible amount of uh potentially damaging information for our relationship with our contractor if it were to be made public.
>> Well, well, um that's not a reason in itself. the fact that it's confidential is not a reason not to provide that document.
>> I think I think to help Mr. Barnes out the appropriate thing for Mr. Barnes to do would be to take that notice.
>> I was about to say that Minister if you wish to take that on notice but we would be asking this is a very important document for our scrutiny of this massive project and including the cost blowout. So if if if you could take it on notice and I I I I do also want to say that Minister Bowen said that he would make this public. I mean we're talking about potentially billions of additional dollars that taxpayers are being asked to stump up as a result of what I would put to you is gross mismanagement. And and I would say Mr. demands that the renegotiation of the contract in 2023, despite what Minister said before, shifted a lot of the liability from the contractor to Snowy in a way that has exposed taxpayers to potentially billions of dollars of more money. So these are critical questions in terms of the job that we are doing in Senate can I ask in relation to this additional support when is this required by because time I imagine is of the essence.
>> Well I mean we've obviously got to go through a process with departments. Uh Snowy Hydro is uh as we test in our annual report as solvent and liquid and can accommodate the costs uh for the
>> Uh and and in terms of what contingencies have you made in terms of this additional funding and is there are >> have you got any backup plan? Uh I mean
if we we we will need support by the middle of next year
>> by the sorry the middle of next year >> and and why that timing Mr. funds.
>> Well, we the spend I mean it's a combination of the spend on the project, how much we earn and what private debt we can access.
>> And have you had any indications that you are going to be able to access private debt? Because I would have thought that a lot of potential lenders would be running a mile from this project.
>> We find that the debt capital markets actually provide a degree of liquidity to Snowy Hydra. uh so we don't see people running away
>> and
>> but the excuse me the the objective of the support is to maintain our credit rating to continue our incredibly important role in the electricity market.
And so can you uh guarantee I did address this with you before that no more than $25 billion will be required to complete this project.
>> As I said before uh I believe the $2.8 billion of risk and contingency uh will allow us to complete the project. However, there are no guarantees when we're dealing with something so complex. Minister, in
relation to this additional ask which it could be $5 billion, could be more uh is this a consideration for myo or for the next budget for the May budget?
>> Well, I think Mr. Barnes has indicated that um Snowy Hydro um would be seeking a decision on that by the middle of next year. So, I'm not going to commit the government um to a particular time frame without having taken advice on that. But I mean, I think what this all shows is that to use Barnaby Joyce's words, it would have been best if this wasn't all worked out on the back of a beer coaster all those years ago when Mr. Taylor was the energy minister.
>> Yeah. Look, I I I appreciate that you know you you're so desperate, Minister, that that's all you can say. That's where this all started. But the fact of the matter is that when this project left the coalition's hands in 2022, the ANO gave this a tick of approval. the the project cost of Excuse me, Minister, I'm speaking.
>> That's no ANAO report I've read. Do you
want me to tell you what the ANAO report the 2022 >> the 2022 I don't even know the difference between the 26 report and the 22 report? The 2022 report at $5.9 billion, the ANAO said the project was on budget, on time, and it raised no concerns in stark contrast to 2026. This project has gone. Excuse me. I'm Minister I'm actually speaking. I'm speaking. >> So, Minister, I would say to you very clearly, this project has gone off the rails in the most dramatic fashion under your government.
>> I think you could question whether it was ever on the rails in the first place.
>> Well, the ANAO, an independent agency, gave this project the tick of approval under the coalition government in 2022.
Have you read the more recent report from NAO which says the 2023 report um which found that as early as January 2020 when Mr. Taylor was the energy minister the project was facing significant cost warnings. Um they also found that the 2023 reset was worth doing saying that the negotiation of the project reset in 2023 was informed by a largely sound approach to planning and advice etc etc. I mean, I know you're not a fan of Malcolm Turble. Um, but
this goes back to his announcement of $2
billion, which Barnaby Joyce's words was dreamed up on the back of a beer coaster. That's where these issues began. And that's >> what you should be also taking into
>> Minister, your own energy minister, Chris Bowen, who should resign because of this horrendous cost blowout, he said in February of this year that the project was on track. He even made a social media video about it. >> So your own government is lying to the Australian people about this project
>> should be withdrawn. Share
>> your own government. That I am saying your government.
>> Senator Henderson, I think we're getting close to the line of what we usually accept as parliamentary, but also conscious that we are running incredibly fast.