South Australian Auditor General launches major inquiry into SAHMRI’s embattled Adelaide Bragg Centre cancer bunker

The crisis engulfing a proposed world-leading Adelaide cancer facility has deepened as the state’s spending watchdog investigates the mounting taxpayer debacle.

The crisis engulfing a proposed world-leading Adelaide cancer facility has deepened as the state’s spending watchdog investigates the mounting taxpayer debacle.

In a significant development, Auditor-General Andrew Blaskett has launched an official inquiry into a proton beam therapy unit for the $500m Australian Bragg Centre’s basement.

The wide-ranging review emerged amid grave fears the South Australian Health and Medical Research Institute project – using a $68m public grant – will collapse.

While SAHMRI is not usually subject to Auditor General inquiries because it's a not‐for‐profit health body, state law allows for such a formal investigation.

The Treasury Department and SAHMRI said they are co-operating in the inquiry, which Mr Blaskett believes is of sufficient public interest given taxpayer risks of at least $100m.

The proposed Australian Bragg Centre proton therapy unit was due to be open this year. Picture: supplied by SAHMRI.

Auditors, who began their probe in recent weeks, are investigating the financial, legal, commercial and operational exposures to the state government and how this is being managed.

Documents tabled in parliament reveal taxpayers have already paid $45.8m under an agreement with US firm ProTom International (PTI), which is now locked in an international dispute with SAHMRI.

Boston-based PTI, which filed for voluntary “Chapter 11” bankruptcy in 2015, wants extra funds of up to $US50m ($75.7m), and an extra year, to install its Radiance 330 machine.

SAHMRI, acting on state Treasury advice, is refusing to pay more public funds to PTI, which denies any wrongdoing.

Senior government sources said Treasury was notified of the probe on October 9.

The Bragg centre, formerly SAHMRI 2, was this year due to operate the southern hemisphere’s first proton beam therapy unit in a fortified, four-storey concrete bunker.

The proposed facility is now the subject of an international dispute with American firm ProTom International. Picture: supplied by SAHMRI.

The North Tce facility, which has created conflict between the Labor Commonwealth and state government, was hailed as pioneering treatment for more than 700 patients – mostly children – a year.

State government officials are concerned SA’s chances of hosting Australia’s first proton beam therapy facility is under threat, especially from Queensland’s moves to build a similar cancer unit, meaning it would lose its exclusivity.

PTI, which blames Covid-19 and the Ukraine war for its financial woes, operates its cutting-edge technology only at Massachusetts General Hospital, in Boston.

Hitachi is now in talks as a potential white knight.

Mr Blaskett’s spokesman said he had the power to conduct the inquiry under the Public Finance and Audit Act 1987.

He declined to say who was to be interviewed or what documents would be requested but the inquiry would report once the audit and procedural fairness process finished.

“The arrangements comprising the SAHMRI 2 project and the state’s involvement are of public interest and we intend to provide a status update … in a separate report to parliament,” he said in a statement.

Treasurer Stephen Mullighan’s spokeswoman said his department was “co-operating fully with the Auditor General’s office as it conducts its inquiry”.

Auditor General Andrew Blaskett believes the inquiry is of public interest. Picture: state government

Even though SAMHRI and the Australian Bragg Centre, pictured on North Tce, are not public agencies and therefore subject of such public reviews. Picture: Matt Loxton

A SAHMRI spokesman added: “We will co-operate with what the Auditor General needs”.

PTI has not publicly commented.

Originally published as South Australian Auditor General launches major inquiry into SAHMRI’s embattled Adelaide Bragg Centre cancer bunker