That nonentity, the Mr Nobody of Victorian politics, Andrew Daniels, will bankrupt Victoria.
He's just Joan Kirner with bad posture.
Andrews Government faces massive compensation bill to axe East West Link
James Campbell, Matt Johnston and Ellen Whinnett
Herald Sun
January 20, 2015 12:00AM
The government of Daniel Andrews could be forced to pay compensation for the scrapped East West Link.
THE State Government is bracing for a gigantic East West Link compensation bill, running into the hundreds of millions of dollars, despite Premier Daniel Andrews’ insistence that tearing up the contract wouldn’t cost a cent.
The Herald Sun can reveal that key members of the consortium that signed the contract to build the Link want at least $1.2 billion to walk away from the dumped project.
Banks and superannuation funds that financed the deal are leading the hardline push.
But they are at odds with partner and construction giant Lend Lease, which is understood to be taking a more cautious approach for fear a fracas may dent its chances for future government jobs in Victoria.
It’s understood that Lend Lease favours a settlement amount in the hundreds of millions of dollars.
The Herald Sun can confirm that, in the wake of weeks of frantic negotiations with the consortium, there is a dawning acceptance within the Labor Government that it will have to write a taxpayer-funded cheque to rip up the contract for the 6.6km road.
The Government has engaged businessman and former MCG Trust chairman John Wylie and gun Arnold Bloch Leibler lawyer Leon Zwier to help it argue its case.
An artist’s impression of the tunnel’s entrance.
Mr Wylie was heavily involved in complex government business cases such as the privatisation of Qantas and of the state’s power industry.
Uncertainty about the looming cost to taxpayers of compensation poses problems for Budget planning.
It could also embarrass Mr Andrews, who repeatedly said the contracts — signed by the Napthine Government in September — were worthless.
Four days before the election, he said: “Be very clear about this: there will be no compensation paid.”
Mr Andrews revealed in September that he planned to dump the $6.8 billion toll road and said then he expected “some modest compensation”.
The consortium that won the contract for the $6.8 billion toll road includes Lend Lease, French group Bouygues, and Spanish company Acciona.
A complex network of institutions, including local and international banks and super funds, financed the deal.
A source said CEOs of the major partners, including from overseas, came to Melbourne before Christmas, and “made clear they would be pursuing their legal rights as contained in the contracts’’.
This was understood to relate to the sum the group believed it would be owed.
Some CEOs expressed their displeasure.
“It was a really ugly meeting,’’ the source said.
Treasurer Tim Pallas’s office said commercial-in-confidence negotiations were under way.
“Mr Wylie and Mr Zwier have agreed to work towards a fair and appropriate outcome for Victorian taxpayers in the circumstances where the Government has decided that the project will not proceed.”
A spokesman for the consortium declined to comment.
