❓ Question regarding the debt servicing costs of the Southern Rail Link project, with the Minister providing a non-specific answer, questioning the opposition's commitment to the project and explaining the state's debt management practices.
AnsweredQoN 221Legislative Assembly
QuestionView source ↗
SOUTHERN RAIL LINK, DEBT SERVICING COST
I refer to the total official estimated $1.42 billion cost of Labor’s redirected south west metropolitan railway, only $300 million of which is to be funded by other than public borrowing. (1) Will the minister inform the House of the average annual cost of servicing the more than $1.1 billion debt over a 30-year period? (2) Will the minister inform the House of the total debt servicing cost associated with this project over the 30-year period? (3) What average interest rate has the minister applied to derive answers to (1) and (2)? Ms A.J. MacTIERNAN
I refer to the total official estimated $1.42 billion cost of Labor’s redirected south west metropolitan railway, only $300 million of which is to be funded by other than public borrowing. (1) Will the minister inform the House of the average annual cost of servicing the more than $1.1 billion debt over a 30-year period? (2) Will the minister inform the House of the total debt servicing cost associated with this project over the 30-year period? (3) What average interest rate has the minister applied to derive answers to (1) and (2)? Ms A.J. MacTIERNAN
AnswerView source ↗
(1)-(3) I thank the member for some notice of this question. It is one of those questions that makes us wonder whether the mob opposite, had it been returned to government, ever intended to build the rail. The same issue of borrowings would have applied to that Government. The coalition Government agreed that its figures were based on 1998 and 1999 figures. The Leader of the Opposition has admitted that they would have had to be escalated. We are not talking about a very different sum of money between the Kenwick deviation and the faster direct route. Nevertheless, the Opposition now has a problem with our borrowing money to deliver the promise it made year after year and never delivered. Ms K. Hodson-Thomas interjected. Ms A.J. MacTIERNAN: I have every intention of answering this question. However, we must put this in context. Was it the intention of the coalition Government not to develop this railway line? The debt associated with the Perth urban rail development project will be drawn as part of the total portfolio of state borrowings and the interest will vary with market rates over the term of the debt. The debt is drawn from the Western Australian Treasury Corporation’s debt portfolio and, like any other corporation debt portfolio, it is funded through a variety of financial instruments. These are structured to limit the State’s overall interest exposure. It has been ever thus. The WA Treasury Corporation’s debt pool funds the overwhelming majority of state capital works. I understand that the Treasury Corporation has never attributed a discrete cost of debt to a specific project. This is no different from any other state-funded capital infrastructure project. It applied to projects undertaken by the previous Government - God, I am sounding like Nedlands, here - such as the Northbridge tunnel and the duplication of the Narrows Bridge. The debt associated with the Kenwick deviation and stage 2 of the Kwinana Freeway bus project also would have been paid off over 30 years and would have been subject to the same market rates, presuming the coalition Government intended to build it. I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
(1) Will the minister inform the House of the average annual cost of servicing the more than $1.1 billion debt over a 30-year period? (2) Will the minister inform the House of the total debt servicing cost associated with this project over the 30-year period? (3) What average interest rate has the minister applied to derive answers to (1) and (2)? Ms A.J. MacTIERNAN replied: (1)-(3) I thank the member for some notice of this question. It is one of those questions that makes us wonder whether the mob opposite, had it been returned to government, ever intended to build the rail. The same issue of borrowings would have applied to that Government. The coalition Government agreed that its figures were based on 1998 and 1999 figures. The Leader of the Opposition has admitted that they would have had to be escalated. We are not talking about a very different sum of money between the Kenwick deviation and the faster direct route. Nevertheless, the Opposition now has a problem with our borrowing money to deliver the promise it made year after year and never delivered. Ms K. Hodson-Thomas interjected. Ms A.J. MacTIERNAN: I have every intention of answering this question. However, we must put this in context. Was it the intention of the coalition Government not to develop this railway line? The debt associated with the Perth urban rail development project will be drawn as part of the total portfolio of state borrowings and the interest will vary with market rates over the term of the debt. The debt is drawn from the Western Australian Treasury Corporation’s debt portfolio and, like any other corporation debt portfolio, it is funded through a variety of financial instruments. These are structured to limit the State’s overall interest exposure. It has been ever thus. The WA Treasury Corporation’s debt pool funds the overwhelming majority of state capital works. I understand that the Treasury Corporation has never attributed a discrete cost of debt to a specific project. This is no different from any other state-funded capital infrastructure project. It applied to projects undertaken by the previous Government - God, I am sounding like Nedlands, here - such as the Northbridge tunnel and the duplication of the Narrows Bridge. The debt associated with the Kenwick deviation and stage 2 of the Kwinana Freeway bus project also would have been paid off over 30 years and would have been subject to the same market rates, presuming the coalition Government intended to build it. I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
(2) Will the minister inform the House of the total debt servicing cost associated with this project over the 30-year period? (3) What average interest rate has the minister applied to derive answers to (1) and (2)? Ms A.J. MacTIERNAN replied: (1)-(3) I thank the member for some notice of this question. It is one of those questions that makes us wonder whether the mob opposite, had it been returned to government, ever intended to build the rail. The same issue of borrowings would have applied to that Government. The coalition Government agreed that its figures were based on 1998 and 1999 figures. The Leader of the Opposition has admitted that they would have had to be escalated. We are not talking about a very different sum of money between the Kenwick deviation and the faster direct route. Nevertheless, the Opposition now has a problem with our borrowing money to deliver the promise it made year after year and never delivered. Ms K. Hodson-Thomas interjected. Ms A.J. MacTIERNAN: I have every intention of answering this question. However, we must put this in context. Was it the intention of the coalition Government not to develop this railway line? The debt associated with the Perth urban rail development project will be drawn as part of the total portfolio of state borrowings and the interest will vary with market rates over the term of the debt. The debt is drawn from the Western Australian Treasury Corporation’s debt portfolio and, like any other corporation debt portfolio, it is funded through a variety of financial instruments. These are structured to limit the State’s overall interest exposure. It has been ever thus. The WA Treasury Corporation’s debt pool funds the overwhelming majority of state capital works. I understand that the Treasury Corporation has never attributed a discrete cost of debt to a specific project. This is no different from any other state-funded capital infrastructure project. It applied to projects undertaken by the previous Government - God, I am sounding like Nedlands, here - such as the Northbridge tunnel and the duplication of the Narrows Bridge. The debt associated with the Kenwick deviation and stage 2 of the Kwinana Freeway bus project also would have been paid off over 30 years and would have been subject to the same market rates, presuming the coalition Government intended to build it. I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
(3) What average interest rate has the minister applied to derive answers to (1) and (2)? Ms A.J. MacTIERNAN replied: (1)-(3) I thank the member for some notice of this question. It is one of those questions that makes us wonder whether the mob opposite, had it been returned to government, ever intended to build the rail. The same issue of borrowings would have applied to that Government. The coalition Government agreed that its figures were based on 1998 and 1999 figures. The Leader of the Opposition has admitted that they would have had to be escalated. We are not talking about a very different sum of money between the Kenwick deviation and the faster direct route. Nevertheless, the Opposition now has a problem with our borrowing money to deliver the promise it made year after year and never delivered. Ms K. Hodson-Thomas interjected. Ms A.J. MacTIERNAN: I have every intention of answering this question. However, we must put this in context. Was it the intention of the coalition Government not to develop this railway line? The debt associated with the Perth urban rail development project will be drawn as part of the total portfolio of state borrowings and the interest will vary with market rates over the term of the debt. The debt is drawn from the Western Australian Treasury Corporation’s debt portfolio and, like any other corporation debt portfolio, it is funded through a variety of financial instruments. These are structured to limit the State’s overall interest exposure. It has been ever thus. The WA Treasury Corporation’s debt pool funds the overwhelming majority of state capital works. I understand that the Treasury Corporation has never attributed a discrete cost of debt to a specific project. This is no different from any other state-funded capital infrastructure project. It applied to projects undertaken by the previous Government - God, I am sounding like Nedlands, here - such as the Northbridge tunnel and the duplication of the Narrows Bridge. The debt associated with the Kenwick deviation and stage 2 of the Kwinana Freeway bus project also would have been paid off over 30 years and would have been subject to the same market rates, presuming the coalition Government intended to build it. I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
Ms A.J. MacTIERNAN replied: (1)-(3) I thank the member for some notice of this question. It is one of those questions that makes us wonder whether the mob opposite, had it been returned to government, ever intended to build the rail. The same issue of borrowings would have applied to that Government. The coalition Government agreed that its figures were based on 1998 and 1999 figures. The Leader of the Opposition has admitted that they would have had to be escalated. We are not talking about a very different sum of money between the Kenwick deviation and the faster direct route. Nevertheless, the Opposition now has a problem with our borrowing money to deliver the promise it made year after year and never delivered. Ms K. Hodson-Thomas interjected. Ms A.J. MacTIERNAN: I have every intention of answering this question. However, we must put this in context. Was it the intention of the coalition Government not to develop this railway line? The debt associated with the Perth urban rail development project will be drawn as part of the total portfolio of state borrowings and the interest will vary with market rates over the term of the debt. The debt is drawn from the Western Australian Treasury Corporation’s debt portfolio and, like any other corporation debt portfolio, it is funded through a variety of financial instruments. These are structured to limit the State’s overall interest exposure. It has been ever thus. The WA Treasury Corporation’s debt pool funds the overwhelming majority of state capital works. I understand that the Treasury Corporation has never attributed a discrete cost of debt to a specific project. This is no different from any other state-funded capital infrastructure project. It applied to projects undertaken by the previous Government - God, I am sounding like Nedlands, here - such as the Northbridge tunnel and the duplication of the Narrows Bridge. The debt associated with the Kenwick deviation and stage 2 of the Kwinana Freeway bus project also would have been paid off over 30 years and would have been subject to the same market rates, presuming the coalition Government intended to build it. I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
(1)-(3) I thank the member for some notice of this question. It is one of those questions that makes us wonder whether the mob opposite, had it been returned to government, ever intended to build the rail. The same issue of borrowings would have applied to that Government. The coalition Government agreed that its figures were based on 1998 and 1999 figures. The Leader of the Opposition has admitted that they would have had to be escalated. We are not talking about a very different sum of money between the Kenwick deviation and the faster direct route. Nevertheless, the Opposition now has a problem with our borrowing money to deliver the promise it made year after year and never delivered. Ms K. Hodson-Thomas interjected. Ms A.J. MacTIERNAN: I have every intention of answering this question. However, we must put this in context. Was it the intention of the coalition Government not to develop this railway line? The debt associated with the Perth urban rail development project will be drawn as part of the total portfolio of state borrowings and the interest will vary with market rates over the term of the debt. The debt is drawn from the Western Australian Treasury Corporation’s debt portfolio and, like any other corporation debt portfolio, it is funded through a variety of financial instruments. These are structured to limit the State’s overall interest exposure. It has been ever thus. The WA Treasury Corporation’s debt pool funds the overwhelming majority of state capital works. I understand that the Treasury Corporation has never attributed a discrete cost of debt to a specific project. This is no different from any other state-funded capital infrastructure project. It applied to projects undertaken by the previous Government - God, I am sounding like Nedlands, here - such as the Northbridge tunnel and the duplication of the Narrows Bridge. The debt associated with the Kenwick deviation and stage 2 of the Kwinana Freeway bus project also would have been paid off over 30 years and would have been subject to the same market rates, presuming the coalition Government intended to build it. I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
Ms K. Hodson-Thomas interjected. Ms A.J. MacTIERNAN: I have every intention of answering this question. However, we must put this in context. Was it the intention of the coalition Government not to develop this railway line? The debt associated with the Perth urban rail development project will be drawn as part of the total portfolio of state borrowings and the interest will vary with market rates over the term of the debt. The debt is drawn from the Western Australian Treasury Corporation’s debt portfolio and, like any other corporation debt portfolio, it is funded through a variety of financial instruments. These are structured to limit the State’s overall interest exposure. It has been ever thus. The WA Treasury Corporation’s debt pool funds the overwhelming majority of state capital works. I understand that the Treasury Corporation has never attributed a discrete cost of debt to a specific project. This is no different from any other state-funded capital infrastructure project. It applied to projects undertaken by the previous Government - God, I am sounding like Nedlands, here - such as the Northbridge tunnel and the duplication of the Narrows Bridge. The debt associated with the Kenwick deviation and stage 2 of the Kwinana Freeway bus project also would have been paid off over 30 years and would have been subject to the same market rates, presuming the coalition Government intended to build it. I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
Ms A.J. MacTIERNAN: I have every intention of answering this question. However, we must put this in context. Was it the intention of the coalition Government not to develop this railway line? The debt associated with the Perth urban rail development project will be drawn as part of the total portfolio of state borrowings and the interest will vary with market rates over the term of the debt. The debt is drawn from the Western Australian Treasury Corporation’s debt portfolio and, like any other corporation debt portfolio, it is funded through a variety of financial instruments. These are structured to limit the State’s overall interest exposure. It has been ever thus. The WA Treasury Corporation’s debt pool funds the overwhelming majority of state capital works. I understand that the Treasury Corporation has never attributed a discrete cost of debt to a specific project. This is no different from any other state-funded capital infrastructure project. It applied to projects undertaken by the previous Government - God, I am sounding like Nedlands, here - such as the Northbridge tunnel and the duplication of the Narrows Bridge. The debt associated with the Kenwick deviation and stage 2 of the Kwinana Freeway bus project also would have been paid off over 30 years and would have been subject to the same market rates, presuming the coalition Government intended to build it. I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
Several government members: Hear, hear!
(1) Will the minister inform the House of the average annual cost of servicing the more than $1.1 billion debt over a 30-year period? (2) Will the minister inform the House of the total debt servicing cost associated with this project over the 30-year period? (3) What average interest rate has the minister applied to derive answers to (1) and (2)? Ms A.J. MacTIERNAN replied: (1)-(3) I thank the member for some notice of this question. It is one of those questions that makes us wonder whether the mob opposite, had it been returned to government, ever intended to build the rail. The same issue of borrowings would have applied to that Government. The coalition Government agreed that its figures were based on 1998 and 1999 figures. The Leader of the Opposition has admitted that they would have had to be escalated. We are not talking about a very different sum of money between the Kenwick deviation and the faster direct route. Nevertheless, the Opposition now has a problem with our borrowing money to deliver the promise it made year after year and never delivered. Ms K. Hodson-Thomas interjected. Ms A.J. MacTIERNAN: I have every intention of answering this question. However, we must put this in context. Was it the intention of the coalition Government not to develop this railway line? The debt associated with the Perth urban rail development project will be drawn as part of the total portfolio of state borrowings and the interest will vary with market rates over the term of the debt. The debt is drawn from the Western Australian Treasury Corporation’s debt portfolio and, like any other corporation debt portfolio, it is funded through a variety of financial instruments. These are structured to limit the State’s overall interest exposure. It has been ever thus. The WA Treasury Corporation’s debt pool funds the overwhelming majority of state capital works. I understand that the Treasury Corporation has never attributed a discrete cost of debt to a specific project. This is no different from any other state-funded capital infrastructure project. It applied to projects undertaken by the previous Government - God, I am sounding like Nedlands, here - such as the Northbridge tunnel and the duplication of the Narrows Bridge. The debt associated with the Kenwick deviation and stage 2 of the Kwinana Freeway bus project also would have been paid off over 30 years and would have been subject to the same market rates, presuming the coalition Government intended to build it. I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
(2) Will the minister inform the House of the total debt servicing cost associated with this project over the 30-year period? (3) What average interest rate has the minister applied to derive answers to (1) and (2)? Ms A.J. MacTIERNAN replied: (1)-(3) I thank the member for some notice of this question. It is one of those questions that makes us wonder whether the mob opposite, had it been returned to government, ever intended to build the rail. The same issue of borrowings would have applied to that Government. The coalition Government agreed that its figures were based on 1998 and 1999 figures. The Leader of the Opposition has admitted that they would have had to be escalated. We are not talking about a very different sum of money between the Kenwick deviation and the faster direct route. Nevertheless, the Opposition now has a problem with our borrowing money to deliver the promise it made year after year and never delivered. Ms K. Hodson-Thomas interjected. Ms A.J. MacTIERNAN: I have every intention of answering this question. However, we must put this in context. Was it the intention of the coalition Government not to develop this railway line? The debt associated with the Perth urban rail development project will be drawn as part of the total portfolio of state borrowings and the interest will vary with market rates over the term of the debt. The debt is drawn from the Western Australian Treasury Corporation’s debt portfolio and, like any other corporation debt portfolio, it is funded through a variety of financial instruments. These are structured to limit the State’s overall interest exposure. It has been ever thus. The WA Treasury Corporation’s debt pool funds the overwhelming majority of state capital works. I understand that the Treasury Corporation has never attributed a discrete cost of debt to a specific project. This is no different from any other state-funded capital infrastructure project. It applied to projects undertaken by the previous Government - God, I am sounding like Nedlands, here - such as the Northbridge tunnel and the duplication of the Narrows Bridge. The debt associated with the Kenwick deviation and stage 2 of the Kwinana Freeway bus project also would have been paid off over 30 years and would have been subject to the same market rates, presuming the coalition Government intended to build it. I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
(3) What average interest rate has the minister applied to derive answers to (1) and (2)? Ms A.J. MacTIERNAN replied: (1)-(3) I thank the member for some notice of this question. It is one of those questions that makes us wonder whether the mob opposite, had it been returned to government, ever intended to build the rail. The same issue of borrowings would have applied to that Government. The coalition Government agreed that its figures were based on 1998 and 1999 figures. The Leader of the Opposition has admitted that they would have had to be escalated. We are not talking about a very different sum of money between the Kenwick deviation and the faster direct route. Nevertheless, the Opposition now has a problem with our borrowing money to deliver the promise it made year after year and never delivered. Ms K. Hodson-Thomas interjected. Ms A.J. MacTIERNAN: I have every intention of answering this question. However, we must put this in context. Was it the intention of the coalition Government not to develop this railway line? The debt associated with the Perth urban rail development project will be drawn as part of the total portfolio of state borrowings and the interest will vary with market rates over the term of the debt. The debt is drawn from the Western Australian Treasury Corporation’s debt portfolio and, like any other corporation debt portfolio, it is funded through a variety of financial instruments. These are structured to limit the State’s overall interest exposure. It has been ever thus. The WA Treasury Corporation’s debt pool funds the overwhelming majority of state capital works. I understand that the Treasury Corporation has never attributed a discrete cost of debt to a specific project. This is no different from any other state-funded capital infrastructure project. It applied to projects undertaken by the previous Government - God, I am sounding like Nedlands, here - such as the Northbridge tunnel and the duplication of the Narrows Bridge. The debt associated with the Kenwick deviation and stage 2 of the Kwinana Freeway bus project also would have been paid off over 30 years and would have been subject to the same market rates, presuming the coalition Government intended to build it. I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
Ms A.J. MacTIERNAN replied: (1)-(3) I thank the member for some notice of this question. It is one of those questions that makes us wonder whether the mob opposite, had it been returned to government, ever intended to build the rail. The same issue of borrowings would have applied to that Government. The coalition Government agreed that its figures were based on 1998 and 1999 figures. The Leader of the Opposition has admitted that they would have had to be escalated. We are not talking about a very different sum of money between the Kenwick deviation and the faster direct route. Nevertheless, the Opposition now has a problem with our borrowing money to deliver the promise it made year after year and never delivered. Ms K. Hodson-Thomas interjected. Ms A.J. MacTIERNAN: I have every intention of answering this question. However, we must put this in context. Was it the intention of the coalition Government not to develop this railway line? The debt associated with the Perth urban rail development project will be drawn as part of the total portfolio of state borrowings and the interest will vary with market rates over the term of the debt. The debt is drawn from the Western Australian Treasury Corporation’s debt portfolio and, like any other corporation debt portfolio, it is funded through a variety of financial instruments. These are structured to limit the State’s overall interest exposure. It has been ever thus. The WA Treasury Corporation’s debt pool funds the overwhelming majority of state capital works. I understand that the Treasury Corporation has never attributed a discrete cost of debt to a specific project. This is no different from any other state-funded capital infrastructure project. It applied to projects undertaken by the previous Government - God, I am sounding like Nedlands, here - such as the Northbridge tunnel and the duplication of the Narrows Bridge. The debt associated with the Kenwick deviation and stage 2 of the Kwinana Freeway bus project also would have been paid off over 30 years and would have been subject to the same market rates, presuming the coalition Government intended to build it. I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
(1)-(3) I thank the member for some notice of this question. It is one of those questions that makes us wonder whether the mob opposite, had it been returned to government, ever intended to build the rail. The same issue of borrowings would have applied to that Government. The coalition Government agreed that its figures were based on 1998 and 1999 figures. The Leader of the Opposition has admitted that they would have had to be escalated. We are not talking about a very different sum of money between the Kenwick deviation and the faster direct route. Nevertheless, the Opposition now has a problem with our borrowing money to deliver the promise it made year after year and never delivered. Ms K. Hodson-Thomas interjected. Ms A.J. MacTIERNAN: I have every intention of answering this question. However, we must put this in context. Was it the intention of the coalition Government not to develop this railway line? The debt associated with the Perth urban rail development project will be drawn as part of the total portfolio of state borrowings and the interest will vary with market rates over the term of the debt. The debt is drawn from the Western Australian Treasury Corporation’s debt portfolio and, like any other corporation debt portfolio, it is funded through a variety of financial instruments. These are structured to limit the State’s overall interest exposure. It has been ever thus. The WA Treasury Corporation’s debt pool funds the overwhelming majority of state capital works. I understand that the Treasury Corporation has never attributed a discrete cost of debt to a specific project. This is no different from any other state-funded capital infrastructure project. It applied to projects undertaken by the previous Government - God, I am sounding like Nedlands, here - such as the Northbridge tunnel and the duplication of the Narrows Bridge. The debt associated with the Kenwick deviation and stage 2 of the Kwinana Freeway bus project also would have been paid off over 30 years and would have been subject to the same market rates, presuming the coalition Government intended to build it. I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
Ms K. Hodson-Thomas interjected. Ms A.J. MacTIERNAN: I have every intention of answering this question. However, we must put this in context. Was it the intention of the coalition Government not to develop this railway line? The debt associated with the Perth urban rail development project will be drawn as part of the total portfolio of state borrowings and the interest will vary with market rates over the term of the debt. The debt is drawn from the Western Australian Treasury Corporation’s debt portfolio and, like any other corporation debt portfolio, it is funded through a variety of financial instruments. These are structured to limit the State’s overall interest exposure. It has been ever thus. The WA Treasury Corporation’s debt pool funds the overwhelming majority of state capital works. I understand that the Treasury Corporation has never attributed a discrete cost of debt to a specific project. This is no different from any other state-funded capital infrastructure project. It applied to projects undertaken by the previous Government - God, I am sounding like Nedlands, here - such as the Northbridge tunnel and the duplication of the Narrows Bridge. The debt associated with the Kenwick deviation and stage 2 of the Kwinana Freeway bus project also would have been paid off over 30 years and would have been subject to the same market rates, presuming the coalition Government intended to build it. I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
Ms A.J. MacTIERNAN: I have every intention of answering this question. However, we must put this in context. Was it the intention of the coalition Government not to develop this railway line? The debt associated with the Perth urban rail development project will be drawn as part of the total portfolio of state borrowings and the interest will vary with market rates over the term of the debt. The debt is drawn from the Western Australian Treasury Corporation’s debt portfolio and, like any other corporation debt portfolio, it is funded through a variety of financial instruments. These are structured to limit the State’s overall interest exposure. It has been ever thus. The WA Treasury Corporation’s debt pool funds the overwhelming majority of state capital works. I understand that the Treasury Corporation has never attributed a discrete cost of debt to a specific project. This is no different from any other state-funded capital infrastructure project. It applied to projects undertaken by the previous Government - God, I am sounding like Nedlands, here - such as the Northbridge tunnel and the duplication of the Narrows Bridge. The debt associated with the Kenwick deviation and stage 2 of the Kwinana Freeway bus project also would have been paid off over 30 years and would have been subject to the same market rates, presuming the coalition Government intended to build it. I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
I will acknowledge one difference between the two projects; namely, the coalition Government had made a commitment to lease the rail cars. It would have been obligated to pay another lump of expenditure determined as a lease rather than as debt servicing. This Government did not take that approach because the advice we received from Treasury was that it would have cost the taxpayers of this State $25 million to remove it from the state debt register. We proudly acknowledged that from day one. We were prepared to be honest and transparent about this budgeting process. The Government will need to borrow approximately $1 billion to fund this project. There is no other way of doing it. The State cannot afford not to develop this project. Several government members: Hear, hear!
Several government members: Hear, hear!
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