❓ Question regarding the accuracy of claims about the financial performance of the freight rail system prior to privatisation and the implications of its sale. The Minister disputes the claim that it was costing taxpayers $100 million annually, asserting it was profitable.
AnsweredQoN 918Legislative Assembly
QuestionView source ↗
FREIGHT RAIL SYSTEM - PRIVATISATION
According to The West Australian , Hon Murray Criddle claims that the coalition had to privatise the freight rail system as it was costing the taxpayer $100 million a year. Is there any truth to the claim? Ms A.J.G. MacTIERNAN
According to The West Australian , Hon Murray Criddle claims that the coalition had to privatise the freight rail system as it was costing the taxpayer $100 million a year. Is there any truth to the claim? Ms A.J.G. MacTIERNAN
AnswerView source ↗
I thank the member very much for the question. I know the perils of relying on as gospel anything that is reported in The West Australian . It appears from what we see in The West that the only defence that Hon Murray Criddle can mount for this disgraceful botched privatisation, which could result in up to 1 000 kilometres of rail line closed, is that the debt was costing the state $100 million a year. That is completely incorrect. An analysis of the accounts of the Westrail freight business over the five years leading up to its sale shows quite clearly that the Westrail freight business was not only covering its operational costs, but also covering a very solid depreciation figure and all its debt servicing, and, on top of that, it was making a modest profit, probably averaging around $25 million a year. It was actually paying for its debt and its depreciation. After all those things were paid for, it was still returning a profit to the state. What did the coalition government do? It sold it at a bargain basement price that did not even cover the debt. That left us with a $330 million debt and no revenue stream whatsoever to pay for it. It was the worst deal of the century.
Ms A.J.G. MacTIERNAN replied: I thank the member very much for the question. I know the perils of relying on as gospel anything that is reported in The West Australian . It appears from what we see in The West that the only defence that Hon Murray Criddle can mount for this disgraceful botched privatisation, which could result in up to 1 000 kilometres of rail line closed, is that the debt was costing the state $100 million a year. That is completely incorrect. An analysis of the accounts of the Westrail freight business over the five years leading up to its sale shows quite clearly that the Westrail freight business was not only covering its operational costs, but also covering a very solid depreciation figure and all its debt servicing, and, on top of that, it was making a modest profit, probably averaging around $25 million a year. It was actually paying for its debt and its depreciation. After all those things were paid for, it was still returning a profit to the state. What did the coalition government do? It sold it at a bargain basement price that did not even cover the debt. That left us with a $330 million debt and no revenue stream whatsoever to pay for it. It was the worst deal of the century.
I thank the member very much for the question. I know the perils of relying on as gospel anything that is reported in The West Australian . It appears from what we see in The West that the only defence that Hon Murray Criddle can mount for this disgraceful botched privatisation, which could result in up to 1 000 kilometres of rail line closed, is that the debt was costing the state $100 million a year. That is completely incorrect. An analysis of the accounts of the Westrail freight business over the five years leading up to its sale shows quite clearly that the Westrail freight business was not only covering its operational costs, but also covering a very solid depreciation figure and all its debt servicing, and, on top of that, it was making a modest profit, probably averaging around $25 million a year. It was actually paying for its debt and its depreciation. After all those things were paid for, it was still returning a profit to the state. What did the coalition government do? It sold it at a bargain basement price that did not even cover the debt. That left us with a $330 million debt and no revenue stream whatsoever to pay for it. It was the worst deal of the century.
Ms A.J.G. MacTIERNAN replied: I thank the member very much for the question. I know the perils of relying on as gospel anything that is reported in The West Australian . It appears from what we see in The West that the only defence that Hon Murray Criddle can mount for this disgraceful botched privatisation, which could result in up to 1 000 kilometres of rail line closed, is that the debt was costing the state $100 million a year. That is completely incorrect. An analysis of the accounts of the Westrail freight business over the five years leading up to its sale shows quite clearly that the Westrail freight business was not only covering its operational costs, but also covering a very solid depreciation figure and all its debt servicing, and, on top of that, it was making a modest profit, probably averaging around $25 million a year. It was actually paying for its debt and its depreciation. After all those things were paid for, it was still returning a profit to the state. What did the coalition government do? It sold it at a bargain basement price that did not even cover the debt. That left us with a $330 million debt and no revenue stream whatsoever to pay for it. It was the worst deal of the century.
I thank the member very much for the question. I know the perils of relying on as gospel anything that is reported in The West Australian . It appears from what we see in The West that the only defence that Hon Murray Criddle can mount for this disgraceful botched privatisation, which could result in up to 1 000 kilometres of rail line closed, is that the debt was costing the state $100 million a year. That is completely incorrect. An analysis of the accounts of the Westrail freight business over the five years leading up to its sale shows quite clearly that the Westrail freight business was not only covering its operational costs, but also covering a very solid depreciation figure and all its debt servicing, and, on top of that, it was making a modest profit, probably averaging around $25 million a year. It was actually paying for its debt and its depreciation. After all those things were paid for, it was still returning a profit to the state. What did the coalition government do? It sold it at a bargain basement price that did not even cover the debt. That left us with a $330 million debt and no revenue stream whatsoever to pay for it. It was the worst deal of the century.
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