❓ Dr. Steve Thomas questions Synergy's significant financial losses due to onerous contracts, seeking details on these contracts and requesting a review of financial viability payments. The Minister declines to provide contract details citing commercial confidentiality and refuses to review the payments.
AnsweredQoN 1157Legislative Council
QuestionView source ↗
SYNERGY — CONTRACTS
1157. Hon Dr STEVE THOMAS to the parliamentary secretary
representing the Minister for Energy:
I
refer to the Synergy annual report 2023 tabled in the Legislative Council on 21
September 2023 and to the statement on page 9 by CEO David Fyfe that
Synergy recorded a net loss before tax of $732.6 million —
� predominantly due to onerous
contracts of $773.7 million, where the unavoidable costs of meeting the
obligations under the contract exceed the economic benefits received under the
contract.
(1) Which are the specific onerous
contracts referred to by the Synergy CEO?
(2) When were the
onerous contracts entered into, what is the longevity of the contracts and who
or whom authorised or signed off on the contracts?
(3) How many of
the onerous contracts are ongoing and what is the termination date of each of
the contracts?
(4) With Synergy
as an entity now worth less than zero, will the minister review the $267 million
of financial viability payments allocated to Synergy in the 2023–24
budget?
1157. Hon Dr STEVE THOMAS to the parliamentary secretary
representing the Minister for Energy:
I
refer to the Synergy annual report 2023 tabled in the Legislative Council on 21
September 2023 and to the statement on page 9 by CEO David Fyfe that
Synergy recorded a net loss before tax of $732.6 million —
� predominantly due to onerous
contracts of $773.7 million, where the unavoidable costs of meeting the
obligations under the contract exceed the economic benefits received under the
contract.
(1) Which are the specific onerous
contracts referred to by the Synergy CEO?
(2) When were the
onerous contracts entered into, what is the longevity of the contracts and who
or whom authorised or signed off on the contracts?
(3) How many of
the onerous contracts are ongoing and what is the termination date of each of
the contracts?
(4) With Synergy
as an entity now worth less than zero, will the minister review the $267 million
of financial viability payments allocated to Synergy in the 2023–24
budget?
AnswerView source ↗
I thank the member for some notice
of the question. The following answer has been provided to me by the Minister
for Energy.
(1)–(3) Under the accounting standards, Synergy is required
to recognise a provision for any contracts that have rising costs
associated with their underlying operational contracts. These are non-cash
accounting adjustments. As Synergy operates in a regulated competitive market
with other market competitors, further details regarding contractual agreements
are commercial-in-confidence.
(4) No.
of the question. The following answer has been provided to me by the Minister
for Energy.
(1)–(3) Under the accounting standards, Synergy is required
to recognise a provision for any contracts that have rising costs
associated with their underlying operational contracts. These are non-cash
accounting adjustments. As Synergy operates in a regulated competitive market
with other market competitors, further details regarding contractual agreements
are commercial-in-confidence.
(4) No.
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