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Public Accounts Committee PUBLIC ACCOUNTS COMMITTEE REVIEW OF SELECTED WESTERN AUSTRALIAN INFRASTRUCTURE PROJECTS Report No. 14 in the 38th Parliament 2011 Published by the Legislative Assembly, Parliament of Western Australia, Perth, December 2011. Printed by the Government Printer, State Law Publisher, Western Australia. Public Accounts Committee Review of Selected Western Australian Infrastructure Projects ISBN: 978-1-921865-30-5 (Series: Western Australia. Parliament. Legislative Assembly. Committees. Public Accounts Committee. Report 14) 328.365 99-0 Copies available from: State Law Publisher 10 William Street PERTH WA 6000 Telephone: (08) 9426 0000 Facsimile: (08) 9321 7536 Email: [email protected] Copies available on-line: www.parliament.wa.gov.au PUBLIC ACCOUNTS COMMITTEE REVIEW OF SELECTED WESTERN AUSTRALIAN INFRASTRUCTURE PROJECTS Report No. 14 Presented by: Hon J.C. Kobelke, MLA Laid on the Table of the Legislative Assembly on 1 December 2011 PUBLIC ACCOUNTS COMMITTEE COMMITTEE MEMBERS Chairman Hon J.C. Kobelke, MLA Member for Balcatta Deputy Chairman Mr J.M. Francis, MLA Member for Jandakot Members Mr A. Krsticevic, MLA Member for Carine Ms R. Saffioti, MLA Member for West Swan Mr C.J. Tallentire, MLA Member for Gosnells COMMITTEE STAFF Principal Research Officer Dr Loraine Abernethie, PhD until 30 June 2011 Mr Mathew Bates, BA (Hons) from 1 July 2011 Research Officer Mr Mathew Bates, BA (Hons) until 30 June 2011 Mr Foreman Foto, BA (Hons), MA from 1 July 2011 COMMITTEE ADDRESS Public Accounts Committee Legislative Assembly Tel: (08) 9222 7494 Parliament House Fax: (08) 9222 7804 Harvest Terrace Email: [email protected] PERTH WA 6000 Website: www.parliament.wa.gov.au/pac - i - PUBLIC ACCOUNTS COMMITTEE TABLE OF CONTENTS COMMITTEE MEMBERS ................................................................................................................................ i COMMITTEE STAFF........................................................................................................................................ i COMMITTEE ADDRESS ................................................................................................................................. i COMMITTEE’S FUNCTIONS AND POWERS.............................................................................................. v CHAIRMAN’S FOREWORD......................................................................................................................... vii ABBREVIATIONS AND ACRONYMS ......................................................................................................... ix EXECUTIVE SUMMARY .............................................................................................................................. xi CHAPTER 1 INTRODUCTION.......................................................................................................................... 1 CHAPTER 2 THE ORD-EAST KIMBERLEY EXPANSION PROJECT ...................................................... 3 2.1 BACKGROUND.................................................................................................................................... 3 2.2 EXAMINING THE NEED..................................................................................................................... 3 (a) Indigenous disadvantage ....................................................................................................... 5 (b) Uncertain future: the economy of the East Kimberley.......................................................... 6 2.3 ASSESSING THE RESPONSE ............................................................................................................. 7 (a) Examining the economics ..................................................................................................... 7 (b) Agricultural production in the ORIA .................................................................................... 8 (c) Targeting Indigenous disadvantage..................................................................................... 11 2.4 THE LONGER TERM ......................................................................................................................... 14 (a) Will agriculture work? ........................................................................................................ 14 The search for a base crop.............................................................................................................. 16 Sandalwood.................................................................................................................................... 19 So, will it work? ............................................................................................................................. 20 (b) When projects finish ........................................................................................................... 21 2.5 CONCLUSION .................................................................................................................................... 23 CHAPTER 3 COLLGAR WIND FARM .......................................................................................................... 25 3.1 BACKGROUND.................................................................................................................................. 25 3.2 THE WIND FARM .............................................................................................................................. 25 3.3 THE NEED FOR RENEWABLE ENERGY SUPPLY........................................................................ 27 3.4 PROCUREMENT PROCESS .............................................................................................................. 28 (a) Project Scope....................................................................................................................... 29 3.5 ASSESSMENT OF TENDERS............................................................................................................ 30 3.6 SYNERGY’S POWER SUPPLY AGREEMENT WITH COLLGAR WIND FARM......................... 31 3.7 STATE BUDGET TREATMENT........................................................................................................ 32 CHAPTER 4 THE PERTH WATERFRONT REDEVELOPMENT ............................................................. 33 4.1 THE PROJECT..................................................................................................................................... 33 Project budget................................................................................................................................. 33 A priority of government................................................................................................................ 33 4.2 WHY THE STRATEGIC ASSET MANAGEMENT FRAMEWORK MATTERS............................ 34 4.3 HOW SAMF IS BEING APPLIED...................................................................................................... 35 Need ............................................................................................................................................ 35 Consideration of options ................................................................................................................ 36 Concept definition.......................................................................................................................... 37 Project delivery .............................................................................................................................. 38 4.4 CONCLUDING REMARKS................................................................................................................ 38 CHAPTER 5 PERTH CITY LINK.................................................................................................................... 39 5.1 BACKGROUND.................................................................................................................................. 39 5.2 CURRENT COSTS .............................................................................................................................. 40 5.3 SCOPE CHANGES RESULT IN COST INCREASES....................................................................... 41 Public Transport Authority............................................................................................................. 41 East Perth Redevelopment Authority ............................................................................................. 43 The impact of changing scope........................................................................................................ 43 - iii - PUBLIC ACCOUNTS COMMITTEE 5.4 COST-BENEFIT ANALYSES .............................................................................................................43 Land revenue generation.................................................................................................................44 Transport revenue generation..........................................................................................................44 5.5 RISK......................................................................................................................................................45 PTA .............................................................................................................................................45 EPRA .............................................................................................................................................46
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