Julia Gillard to take over from Jeff Kennett, page-50

I was sending Brumby emails to justify his decision of the winning tenderer and he fled!!

The ALP are incorrigible and corrupt and have just burdened taxpayers with a greater drain on the public purse by guaranteeing water orders each year, even when not needed!


Victorian desalination plant a $20bn drain on taxpayers

• MILANDA ROUT, VICTORIAN POLITICAL REPORTER
• TheAustralian
• 12:00AM March 1, 2011
• THE secret cost of Victoria's desalination plant has been revealed, with new figures showing householders will pay nearly $20 billion over the next three decades even if they do not buy any of the water it provides.

As the wettest Victorian summer on record closed, Premier Ted Baillieu announced he could not break the former Labor government's contract for the country's largest desalination plant.

Figures compiled by PriceWaterhouseCoopers for the Coalition government show the plant will cost as much as $23.9bn in nominal terms over the next 30 years if the maximum annual amount of 150 gigalitres is bought by the state's water authority.
If no water is bought from the plant's owners and operators, Aquasure, the state will still have to pay $19.37bn for "annual service" payments in nominal terms over the same period.

These controversial payments - which the former Brumby government refused to make public, claiming commercial-in-confidence - start next year at $654 million for no water bought, and reach $763m if the maximum of 150 gigalitres is purchased.
The massive cost burden of the plant will fall on the city's 1.7 million households as Melbourne Water is responsible for the payments to Aquasure.

Mr Baillieu said water bills would at least double over the next five years as a result.
"This desalination plant will cause unprecedented increases in Victorian water bills, leaving Victorian families struggling from the legacy of Labor incompetence and mismanagement," he said. "This is an extraordinarily expensive desalination plant, providing water to Melburnians at great cost."

The figures come as Melbourne's water storages reached 54.1 per cent, up from their lowest point of 25.6 per cent in June 2009.
The Sugarloaf reservoir, which holds 96,000 megalitres - and is the fourth-largest water storage in the city - is 99.3 per cent full.
In June 2009, it was at 15.7 per cent capacity. Melbourne's Thomson reservoir, which holds more than a million megalitres, is only 37 per cent full.

Mr Baillieu said the state was stuck "with a very expensive white elephant" because breaking the contract with Aquasure would cost billions of dollars in legal fees and the sovereign risk for the government would be too high.
He warned against breaching contracts becoming a habit, as "no one would seek to enter into a contract with that state in the future without factoring in enormous premiums".

Mr Baillieu said the only way the state could save money was to not buy any water from the Wonthaggi plant.
"We contemplated almost every possible change and the view is there is no feasible material savings available under the contract," he said.

"It will be the classic Yes, Minister response - it will be cheaper to have this desalination plant if we never order any water."
The desalination plant has been controversial since it was announced in 2007. The then Brumby government refused to release all cost details of the public-private partnership, construction workers were paid huge sums to finish the job by this year and there was an outcry over police agreeing to hand over sensitive information about protesters to the company.

The plant's workforce walked off the Wonthaggi site just before November's state election after The Australian revealed construction giant Theiss, which is building the plant, hired a strike breaker to spy on the workforce and union activists. Theiss is now investigating claims that some workers had been selling lucrative jobs.

The debate over the cost of the plant intensified last year after the Department of Sustainability and Environment estimated that it would cost $15.8bn in nominal terms over 28 years and the Auditor-General found it would cost $18bn over the same time frame.
Opposition water spokesman John Lenders - who was treasurer when the project was signed off under the former Labor government - said the cost of the plant had not changed.

"This is just another stunt from Ted Baillieu to disguise the fact that his government is paralysed by indecision," he said.
"The cost of the contract has not changed since it was signed in 2009."