New Spirit of Tasmania IV continues to rack up berthing bills in Scotland amid calls for TT-Line review
As the state government continues to pay berthing costs to keep the first of two new Spirit of Tasmania vessels in Scotland, the Opposition is calling for the urgent finalisation of a review into TT-Line’s finances.
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A review of TT-Line’s finances is still not complete despite the central financing authority’s vow last month to audit the company’s books “as quickly as possible” amid concerns about its capacity to pay back debt associated with the disastrous Spirit of Tasmania replacement project.
Built in Finland, the new Spirit of Tasmania IV has been languishing at Leith in Scotland since early December as TT-Line seeks to lease it out due to a lack of suitable port infrastructure in Devonport.
The second vessel is under construction, with the cost of both ships estimated to be about $900m.
It is costing the Tasmanian government an average of $23,915 a week – plus ancillary costs – to keep Spirit IV berthed in Scotland.
TT-Line’s lease for the berth was extended for a further 30 days earlier this month.
In December, the Tasmanian Public Finance Corporation (TASCORP) told a government business enterprise hearing that TT-Line had been in breach of its debt agreement since June last year and was not meeting its interest coverage ratio.
TASCORP chairman Tony Ferrall told the hearing that this was an “early warning” that the state-owned company was “not operating in a manner consistent with its original business case”.
He said the identification of the breach had prompted a review of TT-Line’s finances, which would be completed “as quickly as possible”.
Labor Treasury spokesman Josh Willie said on Tuesday that the review should be released imminently and an update should be provided on whether a revised business case for the new Spirits had been finalised.
He also said the public deserved to know whether TT-Line’s loan facility had been increased.
“A bailout for TT-Line would add another sorry chapter to this whole fiasco. The Liberals already face a potential credit downgrade for their record debt – are they planning to add the bailout payment to the credit card bill for future generations to deal with?” Mr Willie said.
The company’s current borrowing limit is $990m, with a working capital facility of $45m.
Transport Minister Eric Abetz was tight-lipped on the review, saying it was up to TASCORP to inform the community of any developments.
“That [review] is under way as we speak. I’ll allow [TASCORP] to indicate when they’re ready to make an announcement but clearly there will be issues that need to be dealt with and that’s what’s occurring as we speak,” he said.
Mr Ferrall said last month that there had been no formal request from TT-Line to increase its loan facility and that TASCORP was “comfortable where we are now in terms of TT-Line’s capacity to meet its debt and the requirements in the short-term”.
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Originally published as New Spirit of Tasmania IV continues to rack up berthing bills in Scotland amid calls for TT-Line review
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