‘Under the Heads of Agreement, signed yesterday, the $10.7 billion East West Link will not proceed, revealed the Premier of Victoria Daniel Andrews.
With no compensation being paid to the consortium, under the agreement, the State will purchase the companies in the consortium (‘EWL Project Co’) for one dollar. All assets owned by Project Co will transfer to the State.
‘$339 million of net costs had already been drawn down and paid to the consortium for the bid process, and design and pre-construction. These costs have already been incurred and cannot be retrieved. They will be retained by the consortium subject to a certification process between it and the State,’ statement.
The ABC reported, the Victorian Opposition believes the ultimate cost to the taxpayer will be higher than the $339 million being paid to the consortium.
‘Opposition Leader Matthew Guy said between $400 million and $500 million had already been spent on planning, preliminary works and other fees connected to the project,’ ABC.
“The Government has been shown to lie, to mislead and to spin their way out of what is an exceedingly ridiculous, short-sighted and stupid pledge to get rid of infrastructure Melbourne so desperately needs…This is the first time we have seen a government in Victoria actually seek to rip up an existing contract,” said Mr Guy, ABC.
Treasurer of Victoria Tim Pallas believes the outcome was nothing to celebrate.
“This isn’t a day for celebration. The previous Liberal Government deliberately left Victoria with only a handful of options – none of them good,” said Mr Pallas
“We worked hard to get Victoria out of this mess, cleanly and fairly. $339 million is equivalent to one year of payments for this dud project. This would have been repeated every year for 25 years if Michael O’Brien had his way.”
Mr Andrews said “Today’s agreement is the best possible result we could have achieved and it puts the interests of Victorians first – no ten billion dollar tunnel, no compensation and far more funding available for the Melbourne Metro Rail Project.”