Mark McGowan warns Clive Palmer legal action could bankrupt WA

A bill aimed at killing off Clive Palmer’s $30bn legal claim has support from both sides of West Australian politics.

Clive Palmer has further alienated himself from West Australians.

West Australian Premier Mark McGowan has warned the state faces bankruptcy if it is unable to pass unprecedented legislation aimed at killing off a $30bn legal claim from billionaire Clive Palmer.

Mr Palmer, who is already running a High Court challenge to overturn WA’s hard border closure that has proved hugely popular in the state, has further alienated himself from West Australians after the government revealed he was pushing for a massive damages payout.

A bill aimed at killing off Mr Palmer’s legal challenge has drawn support from both sides of politics, as well as tacit approval from the rest of the state’s ­resources ­industry, despite the businessman arguing the legislation would deter international investors and stoke sovereign risk fears.

Mr Palmer and WA have been involved in a long-running dispute over the rejection by then-premier Colin Barnett of two development proposals for Mr Palmer’s Balmoral South iron ore project in the Pilbara. An arbitration process was recently scheduled for November to ­determine whether damages should be paid to Mr Palmer, with WA Attorney-General John Quigley warning a payout could exceed $30bn — or more than the state’s entire budget.

Mr McGowan on Wednesday warned the state faced financial ruin if it did not enact the unprecedented retrospective legislation removing all rights of appeal over the disputes and granting the government and its officers immunity from criminal prosecution over the matter.

West Australian Premier Mark McGowan. Picture: AAP

“What he is trying to do here is bankrupt Western Australia. He is trying to take our money,” Mr McGowan said. “If he is successful, that would mean mass closures of hospitals, of schools, of police stations. Mass sackings of public servants, child protection workers, of police officers. It is an extreme risk to Western Australia and we cannot allow it to stand.”

The Liberal and National parties have promised to support the government legislation, ­although Opposition Leader Liza Harvey called for the bill to be sent to a parliamentary ­inquiry for scrutiny.

Ms Harvey said the original state agreement secured by Mr Palmer over his iron ore deposits from the Gallop Labor government in 2002 showed why it was important the proposed legislation was watertight.

“If that parliament in 2002 had spent a bit more time considering what they were doing, we may not be in this position,” she said. “It’s precisely that rushed agenda that has legislation go through in a flawed way and then have unintended consequences.”

Two previous arbitrations in the Balmoral South dispute were resolved in favour of Mr Palmer and his private companies, and another arbitration this November was set to determine whether compensation should be paid.

Mr Palmer, who already collects about $1m a day in royalties from the Sino Iron mine in the Pilbara, on Wednesday disputed the $30bn damages figure, saying it was not in any documents lodged by his legal team.

He said the WA government’s proposed legislation was unconstitutional and would be “wiped out” in the High Court, and warned that the move would drive international investors away and turn WA into a “banana republic”.

“There are better ways of solving things than confrontation. There are better ways than trying to say ‘Well look, I am in a process that we’ve agreed to, and now we are going to lose that process so now I am going to use my position in parliament to make sure I don’t lose’,” he said. “That’s not a fair way to go.”

But the chief executive of the peak body representing WA’s biggest resources companies, the Chamber of Minerals and Energy WA, said the industry understood the reason for the government’s move. CMEWA chief Paul Everingham said the government had taken “very unique action against a very unique dispute”. “The resources sector does not believe that the actions by the WA government will harm investment in WA,” he said.

WA Attorney-General John Quigley. Picture: AAP

Mr Quigley on Wednesday also revealed an offer from Mr Palmer’s lawyers to drop his High Court challenge against WA’s border closures if the state agreed to shift the $30bn arbitration case outside of WA.

The proposed legislation contains several eye-catching, draconian clauses aimed at killing off the dispute, including the removal of rights to appeal and the provision of criminal immunity for the state and its agents, the ­removal of the rules of natural justice and procedural fairness, and preventing Freedom of Information applications.

Mr Palmer said the amendments should be of concern to everyone. “The bill … was ­extremely disappointing for all Australians because it gave the government exemption from criminal liability,” he said. “One may well ask, what are the criminal acts the government wants to do that they need an exemption from criminal liability?”

But Mr McGowan hit back, saying Mr Palmer was not the wronged party.

“Justice is Western Australia not giving Mr Palmer $30bn. That’s justice. Arguments that somehow he has been treated badly, that somehow he is the victim, when he is seeking to take $30bn from our state, and $12,000 from every man, woman and child, are laughable.

“We are doing the right thing by the people of our state here.”