Subjects: Subjects: Adelaide to Alice Springs railway; Mitsubishi.
E&OE................................
Well Premier, Leo Selleck, can I say to everybody associated with this project how delighted I am and how delighted the Commonwealth Government is, that there was financial closure yesterday and today the announcement of the first contract going to One Steel.
The importance of this to Whyalla can not be overstated. It'll be a huge injection of financial hope, new jobs, optimism, building for the future. All of that will be of enormous benefit to the City of Whyalla. During the construction phase the direct and indirect job generation of the Darwin to Alice Springs rail project will be 7,000 jobs. Two thousand directly, five thousand indirectly.
As everyone knows this has been a century old dream. That dream has now become a reality. I've always been a strong personal supporter of this project because I believe there are occasions when national governments must be willing to back huge national infrastructure projects even though from a strict economic theory point of view there may be arguments against the commitment being made.
The Commonwealth is committing up to $191 million for this project and I know that in years to come people will look back and say that that was money well spent.
This project has not only an important freight and infrastructure dimension. It also has a defence dimension. It will provide opportunities for the Port of Darwin. It will provide linkages between South Australia and the Northern Territory and I believe it will capture the imagination not only of Australians living in South Australia and the Northern Territory but of Australians living everywhere in our country.
We need to invest and to take risks for the long term benefit of the regions of Australia. And that is what the Commonwealth decided when it resolved some years ago to back this project.
I want to congratulate John Olsen on his persistence and his tenacity. The co-operation between John Olsen and Denis Burke and myself in piloting this project to where it is today is a model of co-operation between the Commonwealth and State governments.
Most importantly of all I am excited for the people of Whyalla because it is a city from time to time about which people have expressed doubt and said gloomy things. And people have cast doubt on its future economic viability. This will provide twenty months continuous work. It will provide a huge injection of money and it will provide a great sense of hope and a great sense of optimism. And in the end it's the role of governments to provide hope and encouragement and investment prospects for our people.
I couldn't be more delighted to fortuitously be in South Australia over the last couple of days when financial closure of this project has occurred. John, it's a great moment for you and a great moment for your Government. You've shown great commitment, great zeal and great vision and it is tremendous to be associated with you in this very important project for our entire Nation.
Thank you.
JOURNALIST:
Prime Minister there are critics who say the Government will inevitably have to subsidise the operating costs of the railway down the track, if you'll pardon the pun. How confident are you that won't happen.
PRIME MINISTER:
I am very confident. The Consortium has laid out a plan. I believe that that plan is fully achievable otherwise we wouldn't have backed it. I mean we believe in this project. And this project is going to work, it is going to be a huge success and in years to come people will look back and say why on earth did we have any doubts.
JOURNALIST:
Do you think the public has grasped your enthusiasm? All three governments are facing fairly tough elections within the next six to eight months, how significant an impact will this have?
PRIME MINISTER:
Well, I decided to back this project long before I focused on the nature of the electoral challenge ahead of my Government at the end of this year. It really has very little to do with that. I mean, I announced Commonwealth support for this project about four years ago. So it's got nothing to do with the election at the end of the year, don't come that. It's got everything to do with my Government's long term commitment to Nation building. I mean there is a role for the national government in involving the public sector in supporting major infrastructure projects. And if ever there was a major infrastructure project it's this one, and that's why we're backing it. Now a lot of people disagree with me, I don't care about that I believed in this project from the time I became Prime Minister and that's why I was determined to see the Commonwealth put money into it. It's got nothing to do with the election.
JOURNALIST:
Combined industries in the Spencer Gulf, they're wanting to know when are their contracts going to be signed? This is one of.
PRIME MINISTER:
Well I'm not running the consortium, I'm only providing $191 million. You'll have to get the people who are running the details of it to answer that question.
PREMIER OLSEN:
Well can I just indicate we have a number of people with us today, David Quinburg who heads up partners in rail on behalf of the Government, the overarching linking business with the consortium. Walt who is part of the consortium and in fact letting the contract, as I understand it, to One Steel. And Leo Selleck, you obviously know, His Worship the major John Smith, Barry Wakelin of course, local federal member, and Terry Stevens who is a candidate for us. We also have Rodger Hartley who is involved with the development of the contracts and the link between partners in rail and businesses in the state. I mentioned in my remarks a moment ago, $240 million is due to go out in this first phase, the largest single contract is here at One Steel. Some $160 million will be to South Australian based businesses and they'll be announced as soon as the arrangements are in place shortly.
JOURNALIST:
[inaudible] extend to the 2000 construction jobs?
PREMIER OLSEN:
You would have noticed that with the announcement yesterday in Sydney, the South Australia/Northern Territory content of the contract has increased from 70 to 75%. We certainly welcome that. To date we've had some 2000 South Australians register for work on the construction of the line. Between South Australia and the Northern Territory some 75% of goods and services purchased, that includes the workforce, will be sourced out of the Northern Territory and South Australia and of course there are commitments related to the respective land councils through which the corridor will traverse.
JOURNALIST:
What's the Commonwealth's position, given Daimler-Chryslers position last night in regards to further reducing tariffs on Mitsubishi? And also the further decreasing the Australian content when it comes to Mitsubishi.
PRIME MINISTER:
I haven't seen everything that was said by the Daimler-Chrysler man, but we have already created a climate in relation to tariffs that is very conducive to investment. We already have of course since that decision has been taken, we have an exchange rate movement that has hardly been disadvantageous to local manufacturing. In other words the change in the exchange rate has made local manufacturing even more attractive. And both the South Australian and Commonwealth Governments have been very encouraging. Beyond that I don't have any further comment to make because I've had no particular, I've not had a proposition put to me and I don't react on something as sensitive and important as that to investment in South Australia. I never react on the basis of one interview, I won't until a proposition has been put to the Commonwealth Government.
JOURNALIST:
The regions been screaming out for job creation.
PREMIER OLSEN:
Sorry?
JOURNALIST:
The regions been screaming out for new job creation in the regional area. How much of these contracts will go to regional companies?
PREMIER OLSEN:
I can't give you, Rodger can you indicate what percentage of the contracts that go into South Australia might go to the regional areas?
HARTLEY:
We can't say at this stage. There's nearly 200 companies from the Spencer Gulf who've actually registered with Partners in Rail. And we'll be working closely with the consortium as contracts come up to ensure that those companies have as good a chance as possible.
PREMIER OLSEN:
You might be aware that with Partners in Rail which was formed in 1999 to make sure South Australian businesses could get access to information on the tendering process. The group has been working through this last 18 months, 2 years, linking the information and looking at the capability of South Australian businesses to assist them to meet the tender requirements of the consortium. A lot of that background work has been done. And we'll see now a range of different contracts be awarded as a result of signing the deal last night. Look it's less than 24 hours, the ink is only just dry on the contract, we've got the first one off, you'll see others unfold in the next couple of weeks.
PRIME MINISTER:
Can I just add one other thing that I should mention to you that in the lobbying that went on inside the federal government prior to us making a decision to back the project four years ago, there was no louder proponent of Commonwealth Government support than my colleague Barry Wakelin, the Federal Member for Grey. And somebody who has very close family and personal links with Whyalla. And I do want to record my appreciation of the role that he played in warmly advocating Commonwealth Government support.
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