❓ Mr Cook questions the Minister for Health regarding Serco's financial viability to run Fiona Stanley Hospital after a significant drop in share price. The Minister assures that Serco's finances are strong and they will fulfill their obligations.
AnsweredQoN 934Legislative Assembly
QuestionView source ↗
FIONA STANLEY HOSPITAL — SERCO CONTRACT — FINANCIAL VIABILITY
934. Mr R.H. COOK to the
Minister for Health:
I refer to media reports that shares in Serco, the private
operator of Fiona Stanley Hospital, have fallen by over 30 per cent and the
company's value was written down by $2.7 billion following the collapse
of Serco's profit forecasts for 2014–15, including the further
provision of $1.6 billion in writedowns.
(1) Is the
minister concerned that Serco will be unable to fulfil its obligations to run
Fiona Stanley Hospital given its now parlous financial position?
(2) Has the
minister sought reassurances from Serco that it is financially viable enough to
run our premier tertiary hospital facility; and, if not, why not?
934. Mr R.H. COOK to the
Minister for Health:
I refer to media reports that shares in Serco, the private
operator of Fiona Stanley Hospital, have fallen by over 30 per cent and the
company's value was written down by $2.7 billion following the collapse
of Serco's profit forecasts for 2014–15, including the further
provision of $1.6 billion in writedowns.
(1) Is the
minister concerned that Serco will be unable to fulfil its obligations to run
Fiona Stanley Hospital given its now parlous financial position?
(2) Has the
minister sought reassurances from Serco that it is financially viable enough to
run our premier tertiary hospital facility; and, if not, why not?
AnswerView source ↗
(1)–(2) Yes, there has been
considerable communication from Serco Australia about its state of affairs, and
the advice is that it has a new chief executive who is having a major look at
the services that are provided. It is quite clear from the report and from what
has happened with its share price that its expansion into a number of areas,
particularly within the private sector, has caused it financial difficulties.
It has now cut its cloth. It will reduce the number of alternative services
that it provides and focus on the services that it provides in corrective
services and health. We have a very solid contract. Our work with Serco on the
opening has been very good. Its performance on the opening has been very good.
We have been reassured that it has the financial capacity. What the member has
said about its parlous financial state is not true. Its shares have gone down
significantly, but its finances are still strong. We believe that it will ride
through these difficulties and continue to provide the services for which it
has been contracted.
considerable communication from Serco Australia about its state of affairs, and
the advice is that it has a new chief executive who is having a major look at
the services that are provided. It is quite clear from the report and from what
has happened with its share price that its expansion into a number of areas,
particularly within the private sector, has caused it financial difficulties.
It has now cut its cloth. It will reduce the number of alternative services
that it provides and focus on the services that it provides in corrective
services and health. We have a very solid contract. Our work with Serco on the
opening has been very good. Its performance on the opening has been very good.
We have been reassured that it has the financial capacity. What the member has
said about its parlous financial state is not true. Its shares have gone down
significantly, but its finances are still strong. We believe that it will ride
through these difficulties and continue to provide the services for which it
has been contracted.
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