Thursday, June 11, 2015

'Economic Lunacy' Federal Minister on Canberra Liberals light rail contract cancellation letter

The ALP were quick to seize on the federal Liberals comments

On June 10 2015 the Canberra Liberals sent a letter to the media the consortia bidding for the Capital Metro light rail project. They felt that until this point that the consortia may not have been aware that the Canberra Liberals were opposed to investment in Canberra, better public transport, transit oriented development, decreased road congestion and urban renewal.

Their action has infuriated the federal Liberal government:

Federal Assistant Infrastructure Minister Jamie Briggs has warned the ACT opposition not to cancel contracts for Canberra's light rail line after the 2016 election, describing the move as "economic lunacy".

Mr Briggs said the Abbott government's firm position was that contracts lawfully entered into by governments to build infrastructure projects must be honoured.

His comments came a day after Opposition Leader Jeremy Hanson and Liberal transport spokesman Alistair Coe wrote to two international consortiums to explain a Hanson government would stop the $783 million project after the October 2016 election because it was not viable.

Mr Briggs' comments follow Prime Minister Tony Abbott's criticism of the Victorian Labor government's decision to tear up contracts for a controversial tunnel project.
"As we have seen with the East West Link disaster in Victoria, tearing up legally binding infrastructure contracts raises sovereign risk, damages investor confidence and stifles economic growth," Mr Briggs said.

"Australia needs more private sector involvement in infrastructure, not less. In this respect threatening to tear up contracts is bad enough but to follow through with this threat is simple economic lunacy that will damage not just the jurisdiction involved but the broader economy."

Read the full Canberra Times article here.

Capital Metro Minister Simon Corbell has also responded accusing the Canberra Liberals of holding the Government to ransom.

Minister for Capital Metro Simon Corbell said he would not be held to ransom by the Opposition's demands.
"We have a clear mandate to [build light rail], we have a clear election policy that we're implementing," he said.
"What's important to me is that we get on with the delivery of this project.
"Liberals really should be writing to the hundreds and hundreds of Canberra families who are going to lose jobs and lose opportunity from this project if they tear up these very important contracts."
The minister also called on the opposition to put a figure on how much they would be willing to spend in compensation, despite conceding that arriving at such a cost would be a "complex" task even for the Government.
"It would depend on what stage the contract is at, when and if [cancellation] occurs," Mr Corbell said.
"I don't think the consortia are concerned about these issues, but I think Canberrans should be concerned." 

Read the ABC Online article here.

For more frequent updates on Capital Metro and light rail related news, please visit our Facebook page 'Light Rail for Canberra'.  

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