Treasurer Rob Lucas orders Treasury to audit deals signed by former Labor government

CONTRACTS worth tens of millions of dollars that were signed in the former Labor government’s final weeks are under review to check whether the deals offer value for taxpayers.

• Saab Australia to develop future frigate missile defence systems
• Pirate Life to open SA’s biggest craft brewery at Port Adelaide
• Special effects company Technicolor to set up in Adelaide
• German stake: Defence job growth is no supa shock
• Australian Crane and Machinery job hopes for Holden workers

CONTRACTS worth tens of millions of dollars that were signed in the former Labor government’s final weeks are under review to check whether the deals offer value for taxpayers.

Treasurer Rob Lucas has told the Sunday Mail that “dozens and dozens” of publicly-funded deals unveiled by Jay Weatherill’s administration ahead of last month’s State Election are under a Treasury microscope.

The audit will determine if the new State Government has to follow through with the deals if they do not stack up.

Treasurer Rob Lucas says dozens of publicly-funded deals unveiled by Jay Weatherill’s administration ahead of last month’s State Election are under Treasury microscope.

In its final weeks, Labor announced multimillion-dollar deals with several companies, including an automotive firm, a major defence business, a brewery and an animation studio.

Mr Lucas said the audit was in line with his commitment from Opposition on how a Marshall-led government would do business.

“There is going to be much less emphasis on picking winners and much more focus on bringing down the cost of business in South Australia so that our small businesses, in particular, are nationally and internationally competitive,” Mr Lucas said.

“The audit will consider which are the (contracts) where you have the flexibility to reconsider and which are the ones where there is no possibility to reconsider.”

Mr Lucas said he could not speak about individual deals.

However, in the lead up to the State Election the then Jay Weatherill-led Government announced a raft of deals including funding for:

SAAB Australia ($4.4 million) and Raytheon Australia ($8 million over nine years) to expand its footprints at Technology Park in Mawson Lakes;

PIRATE Life Brewing ($2 million) to move operations and expand in Port Adelaide;

TECHNICOLOUR ($6 million) to establish a visual effects centre in Adelaide;

SUPASHOCK ($2 million) to consolidate its operations and move from Magill to northern Adelaide; and

AUSTRALIAN Crane and Machinery ($2.2 million) to expand its operations into South Australia at the former Holden site at Elizabeth.

The Advertiser revealed how ProTom, an American company which makes cancer treatment devices, was given $10 million in taxpayer help to set up shop here despite revealing it was moving here anyway.

The former government had admitted officials did not precisely know how many jobs were created by its investment attraction agency despite saying it has “shot past its target to create 6000 jobs by 2017’’.

During the campaign Mr Weatherill defended government spending to lure employers to South Australia.

“You can’t sit back and wait, you’ve got to invest and attract jobs,” he said.

But Labor did not respond during the week when contacted by the Sunday Mail.

Mr Lucas said Treasury officials will investigate whether:

THERE is a legal obligation to the Government to honour and proceed with any signed contract;

ANY letter of offers, or similar type of arrangements, was made and if this has triggered any company investments as a result;

DEALS are worthwhile and will deliver jobs for South Australians.

Two companies, the Sunday Mail, understand will be subject to the review expressed confidence in their pre-election deals being honoured.

Raytheon Australia’s managing director, Michael Ward, said his company had a proud history of investing in South Australia.

“We are excited about the opportunity to work with the newly elected Government in South Australia and Premier Marshall in relation to future opportunities and potential further investment in South Australia,” he said.

A Saab Australia spokesman said its deal was approved by the former government and the company had a signed formal offer.

“We are yet (to) meet with the new Liberal government, however we are continuing discussions at officer/departmental level,” he said.

The audit will be undertaken alongside another inquiry that will determine what information the new government can publicly publish about business deals.

“We will be getting an urgent report from Treasury in terms of an audit as to what we can put on the public record about all of these last minute … deals that the Labor Party did,” Mr Lucas said.

“People then can make their judgments about whether it was an effective way of doing business or not.”