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Infrastructure and Transport – Spirit of Tasmania Replacements


Cassy O'Connor MP

Cassy O'Connor MP  -  Tuesday, 24 November 2020

Tags: TT-Line

Ms O'CONNOR - Minister, have you read the Eslake report on building Spirit replacements? Before you potentially succumb to a desire to diss Mr Eslake - we got a bit of that from the Premier yesterday - he is a very highly regarded national economist and a very proud Tasmanian. Perhaps in your answer you could tell us whether you have read the report because you certainly should.

He states, and this is in relation to the proposal to potentially build the Spirits not in Australia but at Cebu in the Philippines, and the fit out in Australia -

In summary it seems that having the replacements for the Spirit of Tasmania built 'in Australia' contrary to the recommendations of the board and management of TT-Line and indeed contrary to the settled position of the Tasmanian Government itself until mid July, would inevitably result in Tasmanian taxpayers paying a higher price, and potentially a considerably higher price, for ships that will inevitably commence operations at a later date than if TT-Line had been permitted to proceed as it originally intended. Any decision to have the replacements for the Spirits built 'in Australia' could well turn out to be the most ill advised decision, certainly in financial terms, any Tasmanian Government has made since January 1983.

We know that that related to the Franklin Dam.

What is your response to Mr Eslake's report and his informed observations and warning to your Government about the proposal?

Mr FERGUSON - Ms O'Connor, I will risk the urge to attack the author of the report. It is not hard. I do not need to do that. I have read it and I was disappointed with the report that Labor commissioned because it was based on rumour and assumption. It is already out of date. The report was dated 16 November. Interestingly Labor had that report, no doubt, and it was the basis for a range of questions in the House of Assembly which were debunked by the Government. The report is already out of date. The report is further based on rumour.

Ms O'CONNOR - What do you mean, you have debunked it?

Mr FERGUSON - The questions and the assumption has been very clearly laid out by individuals, including Mr Eslake and certainly by Dr Broad, that Austal is the preferred ship builder by the Government. That's not true. It has been proven wrong. The Government does not have a preferred ship builder. We have a task force. The task force has a job to do. The task force will provide advice to Government. Furthermore, when I read the report, let's call it a report, it also drew a false link alleging that somehow the Morrison Government had in some way obligated the state Government to do this. That is not true. Again, Mr Eslake is wrong. Third there was an attempted link by Mr Eslake which linked Marinus Link to our willingness to do an Australian-built ship. That is not true. Those things are all wrong in the report. Therefore I think the report is pretty disappointing.

Ms O'CONNOR - Can we just go then to the heart of the question. Forget potential players like Austal or even Incat. Let us go to the heart of the question.

Do you believe that Australia has the capacity to build a mono hull steel vessel to replace the Spirits? The information we have, even presented by Mr Eslake, setting aside the players and those statements that you made before, is that the only thing that Australia could do in terms of providing local jobs is for the fit out and that Tasmania might have role to play there. Will you concede there is no place in Australia where we could build a replacement for the Spirits?

Mr FERGUSON - It is not a concession; it is a statement of fact. I have said it before and I am happy to say it again. Interestingly, the company that the Labor Party continues to attack, Austal, has said that. There are some things that apparently we don't disagree on.

Dr BROAD - What?

Mr FERGUSON - No, no you have had your chance. This is Ms O'Connor's question. This is your false allegation. The Government is committed, and I hope you support it, Ms O'Connor, to allowing the task force to tell us what this country can do. It may not be the complete job.

Ms O'CONNOR - It won't be.

Mr FERGUSON - It might be some of the job. It might be more of the job than was previously the case, bearing in mind that regardless of where the hulls are built the global economy has taken a walloping. Wouldn't you think that in the shipbuilding industry, particularly given what has happened in the cruise ship sector globally, the market conditions are completely different. I haven't yet had advice on that because we are awaiting the advice of the task force.

We have very impressive people on there who actually understand the industry. We have shipbuilding capabilities in this country. We have shipbuilding capabilities just five kilometres from here where we're sitting and they get caught up in the Labor Opposition as being incapable of helping us build our replacement Spirits.

I am very agnostic on this. We want to see what the advice says. We will share as much of that advice as we are allowed to with the Tasmanian community. What we won't be doing, and I think you would support this, is rushing into a contract, which Labor wants us to do. We want to be prudent with other people's money. We want to be sensible but we want to find a way to create jobs.

That is what we are about. I hope I have answered the question adequately. There is capability in our state right now.

Ms O'CONNOR - To do what? To do the fit out?

Mr FERGUSON - There is capability in our state right now to build ships, but there is not the capability to build 200-metre steel monohulls. That is a matter of record. Unfortunately, with Labor's determination to rubbish the Government, they are in the process also rubbishing Austal, they are rubbishing Incat, they are rubbishing the north west coast businesses that might want to build some of the -

Dr BROAD - I am not.

Mr FERGUSON - You are. Who might want to build some of the components for a different procurement. We will not be bullied nor rushed on this and nor intimated by a report that is based on a rumour and assumption and has a range of incorrect statements in it which really ought to be corrected. That is a matter for Dr Broad because it is his report. He paid for it. Hopefully not too much.

 

Ms O'CONNOR - Minister, I refer you to the ABC article, 'Who are Tasmania's political lobbyists?' which you may have read. It's an Emily Baker story. It quotes you as saying you've had no direct contact or discussion with Austal or Font PR about this proposal and, for the Hansard record, one of Font PRs directors is the former Premier's Chief of Staff, Mr Brad Stansfield. Could you update the committee on whether or not you have had any contact with Austal - with Font PRs client, Austal, and will you confirm that Austal is pitching hard to secure the contract for the replacement vessel? In fact, at the Budget breakfast the other morning there was Austal material on our tables. They are obviously going hard for the contract. Have you met with them and will you confirm that is the case?

Mr FERGUSON - Thanks, Ms O'Connor and Chair, I do not know the date of that article, but I do recall it. I think that it is the case that Emily Baker would have been quoting my comments from the House, at the time, which I totally stand by. At that time, whenever it was, I certainly had not met with them. In so saying, I also reserve the right to do so, because it would be entirely proper for a minister, including during the period of the task force, which we have actively encouraged any proponents - not that the task force is looking for bids, but if anybody wants to pitch a bid, I have actively encouraged them, go to the task force and pitch there, let them know what your capability is. Having said that, I do reserve the right, because I think it is reasonable to meet with the businesses and their lobbyists.

Dr BROAD - You have not met with Rauma Marine Constructions?

Mr FERGUSON - I have not met with an RMC lobbyist, I have not met with Austal, and I have met with Font PR.

Ms O'CONNOR - Over the ship replacements? Do you want to provide a little bit more detail on that?

Mr FERGUSON - They have contacted me, I have spent time with them, but it has been very much appropriate and above board, noting that travel to Western Australia and to Tasmania has not been possible.

Ms O'CONNOR - What you are saying is, just for clarity, you met with Font PR about the vessel replacement. They have Austal on their books as a client. It does raise the question about lobbyists and special insight or access and all of that, but we will park that for a minute.

Mr FERGUSON - You have actually interrupted my answer, but that is okay.

Ms O'CONNOR - I want some clarity here: was Font PR meeting you in relation to Austal's bid for the ferry replacement?

Mr FERGUSON - I have said that already, yes, and it is entirely appropriate that occur. If RMC have a lobbyist, I treat them the same. I would also like to say I have also met with Incat on numerous occasions, a proud Tasmanian business. I would be prepared to meet them any other time they would care to meet me. I am not aware if they have a lobbyist at all. They possibly do or do not, I am not sure. If there are any other businesses or their lobbyists, my door is open to them so they can pitch any proposals. But I will make it very clear to you, as I have to others, it is a matter for the task force to consider those proposals. Unlike some, we are not going to be accusing them of breaking the law, underpaying staff, therefore no good to build our ships. I just want to encourage proposals to come forward, it will assist the work of the task force if proponents are actively letting them know what they believe they have the capability of delivering. I hope that is allowed to continue unimpeded.