Ms O'CONNOR - I want to talk about the Queenstown Historic Railway. Can you confirm that people who work on the Queenstown Railway are State Service employees?
Mr FERGUSON - I'm going to have to defer on this because there's some unique governance arrangements in place. I invite my delegate on this matter, the deputy secretary, Mr Swain.
Ms O'CONNOR - I'll let you know, I have spoken to people who work on the railway and have some background here.
Mr FERGUSON - I'm glad you have. I also have, it's a great community of people and it's a vital heritage asset that we've really preserved. When the private operator let go of it, we picked it up and we're investing around $20 million in it in operations and capital at the moment. If there are any questions on it I'll go straight to my -
Ms O'CONNOR - And therefore the people who work on it should be State Service employees.
Mr FERGUSON - I'll invite my delegate, who is the deputy secretary.
Mr SWAIN - It is an unusual setup. It is a ministerial corporation. Under that corporation structure there's a general manager who has day-to-day operational responsibilities for the rail. The minister has a delegate, which is me since April of this year. That delegate has certain functions in relation to employment contracts and procurement over threshold amounts.
Ms O'CONNOR - My understanding was that one of the employees challenged the department to the extent where the department did have to accept that it had some responsibilities for the people who work on the Queenstown railway; is that not correct?
Mr SWAIN - I don't think the department would deny having some responsibilities because there's a delegate who sits in the department - always has been. It used to be Bob Rutherford. On his retirement that transferred through to me. The department has always had some responsibility for the railway since its formation.
Ms O'CONNOR - Minister, are you able to tell the committee a bit about the upgrading of the tracks of the Queenstown railway and what materials were used and where those materials were procured from?
Mr SWAIN - There is a commercial matter which is the subject of some dispute at the moment which relates to the work that you're talking about. It relates to ballast, rail and sleepers that were imported into the state from a supplier who procured them himself under standards. There has been some concern about the standards of some of that material and we're working through that matter at the moment and it may be subject to legal procedures.
Ms O'CONNOR - Are you able to provide any more information to the Committee about the issues with the materials that were procured and are you alluding to potential charges being laid as a result of that procurement?
Mr SWAIN - No, I wasn't alluding to charges being laid. It's just that at this point there is a question about the quality of some of the material that has been provided. Commitments were made by the supplier that the material would meet specific standards. There was some evidence that those standards have been met. Subsequent testing of some of the material has not demonstrated that and now we're working that through with the supplier in terms of a commercial resolution.
Ms O'CONNOR - As I understand it, some of those sleepers were installed and was there any investigation into connections between the supplier and people who worked on the railway?
Mr SWAIN - There have been some employment matters and some contractual matters that relate to this subject, and I think you are indicating you have some awareness of these. They are both still live matters. There has been an employment separation that is connected to this matter but the normal privacy arrangements are in place so I can't talk to that matter.
Ms O'CONNOR - I don't need to know who the person is and don't want that - just some clarity. Can we confirm - and thank you, Chair, for your indulgence - that there has been an issue with procurement, there have been some concerns that the department has identified about the processes and, as a consequence of that, there has been an employment separation. Has that position been refilled?
Mr SWAIN - I don't want to make a causal comment about the basis of the employment separation.
Ms O'CONNOR - I can do that.
Mr SWAIN - I'm just stating a fact that there has been an employment separation and that is still a live matter. What was the second half of your - ?
Ms O'CONNOR - The threshold question for people who live in and around Queenstown and all of us who think it's the most beautiful little railway, has there been any impact on the operation of the railway or on the quality of the track?
Mr SWAIN - If I can answer it this way, the railway general manager has recruited some capabilities, both as staff and as consultants, that is bolstering the capacity of the railway to a level that, I think, is probably superior to that which has existed previously. The railway is working closely with the national regulator through this issue. They have some identified challenges, which is not uncommon for heritage rail, as Mr Blake, was talking about earlier. Rail regulation for heritage rail is a very active process, it's not a passive process so the rail regulator will regularly look at heritage rail all around the country. The Abt Railway is no different to that; that's occurring.
There are some specific areas for improvement that are currently being worked through. The matters we're talking about are commercial matters. I'm not worried about them translating into the safety of the railway.
Ms O'CONNOR - Has any referral been made to Tasmania Police or the Integrity Commission or any other body relating to the procurement?
Mr FERGUSON - I will leap in here, not because I know something that I'm trying to protect but the very nature of the question, even if it was in the affirmative, I am not sure that it would be appropriate to say so. I emphasise I am not aware of that kind of suggestion. I am saying that it is almost an unfair question to ask a public servant that because if he is aware of it, you're putting him in a position where he may not be able to answer honestly, if at all. So it could compromise an investigation. I am not saying that there is an investigation that I am aware of. I think it is an unfair question.
Ms O'CONNOR - Okay.