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Kew Cottages Coalition Reg # A0044698

2013 Denis Napthine and Lang Walker 2014  Kew Cottages Development loss soars past $45 million..
Lang Walker, Kew Development Corporation  & Denis Napthine, Premier of Victoria

It is Australia Day January 2014.

Melbourne the Place to
                                            BeMajor Projects in Victoria are in a mess, and the mess looks like it is getting bigger, much bigger.



Chronology


In 2006 the Victorian Government promised intellectually disabled Victorians that its  Main Drive Kew PPP  (public-private partnership) with Walker Corporation would be "a nice little earner" for the disabled..

It projected a $60 million return to Government from building a new upmarket $400 million housing estate on their Kew Cottages Public Land.

The Government promised to pump all of that $60 million profit into services for intellectually disabled Victorians by 2014.

It has not happened.

It appears now that there is still no profit for the Government, and there never was any profit for the Government.

Instead,  according to Major Projects Victoria annual reports,
accumulated Government losses from the Kew Cottages PPP now exceeds $45 million...

The Challenges...

1. Maladministration of Major Projects in Victoria.

In simple dollar terms the $400 million Kew Cot
tages Walker Development fiasco now appears relatively small besides some of the State's other contentious 'big ticket' items.
For example major projects and proposals such as the:What about the
                                                  water
However, despite differences in scale, many of the State's major projects appear to have some of the same significant ingredients of failure built into them by the Government - failures now documented by the Victorian Auditor General's Office (VAGO).

For example, many State projects,  like the Kew Cottages Development, are managed by the 'Major Projects Victoria' (MPV) Business Unit of the Department of Business and Innovation (DBI).

MPV
 

The Auditor General has been highly critical of  MPV's practices and has gone so far as to say  'MPV's maladministration' means that there is likely to be an increased risk of fraud.

MPVs management of its internal contracts is seriously deficient. There are multiple
weaknesses with most of the contracts that have occurred through MPVs
maladministration. The absence of appropriate checks and balances means that there
is likely to be an increased risk of fraud. While DBI has a fraud risk register that
includes generic fraud risks for MPV, this is not based on the findings in this audit
around the weak controls and needs to be revised. (VAGO MPV 2012, p.18)

VAGO
F
or example that when VAGO asked MPV  to provide copies of the 15 MPV contracts in place at the time of the 2012 audit, MPV could only 'locate' 10 of the 15 contracts. MPV  simply had no record of the other 5 contracts !



2. Systemic secrecy surrounding Major Projects in Victoria.

And now the cancer has started to spread...

In its November 2013 Annual Report to Parliament the Auditor General, John Doyle,  noted that the Baillieu/Napthine government has decided to stop disclosing budgets for all major projects at the time of the project announcement.

John Doyle,
                                                Auditor General
"In December 2012, the government signalled its intention to cease disclosing budgets for major projects at the time of project announcement, citing commercial sensitivities and the potential to inflate tender prices. However, the government has not informed Parliament and the public as to when project costs will be announced."
VAGO

The Auditor General was not impressed and concluded that:

John Doyle Auditor General
Recent changes to the information provided by government to Parliament and the public regarding major projects has reduced transparency. A move away from publicly disclosing project budgets and costs decreases government accountability over a significant area of public spending.



At the stroke of a pen accountability for all major government projects in Victoria is now out, and government secrecy is back in.

After ten years in opposition calling for more accountability and transparency in the management of major projects in Victoria, the Government has had a change of heart.

The Baillieu/Napthine Governmen apparently not only approves of the Kew Cottages Development PPP secrecy model after all, but is now committed to promoting the model and extending it more widely to all major projects throughout Victoria.

Whats Victoria
          Doing

 

Links:
MPVThe Developer's Contract
Major Projects Victoria Contract - 3669
Lang Walker, Developer,
                                            and Ted Baillieu, Premier of
                                            Victoria
Kew Residential Services Development Agreement
Documents

1.     Part 1 Deed of Variation signed 28 August 2009 .pdf     (5210 KB, PDF)
2.     Part 2 Deed of Variation signed 28 August 2009.pdf     (4074 KB, PDF)
3.     Part 3 Deed of Variation signed 28 August 2009.pdf     (5483 KB, PDF)
4.     Part 4 Deed of Variation signed 28 August 2009.pdf     (4329 KB, PDF)
5.     Section 1.pdf     (4500 KB, PDF)
6.     Section 2.pdf     (4895 KB, PDF)
7.     Section 3.pdf     (6109 KB, PDF)
8.     Section 4.pdf     (5235 KB, PDF)
9.     Section 5.pdf     (3709 KB, PDF)
10.   Section 6.pdf     (1809 KB, PDF)

Baillieu/Napthine Government Variations
11. Development Agreement - 2nd Deed of Variation - 13 June 2012
12.
Development Agreement 3rd Deed of Variation 8 April 2013.pdf


Public Land Development Committee Recommendations 2008

Victorian Ombudsman's
Recommendations 2010

Video Interviews
Baillieu's Ministers:



For further information just follow the links...
(Note: Your PDF software may require you to manually enter some of the PDF Page Reference Numbers provided. )


More...

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2003 Kew Cottages Coalition
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