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Labor to scrap Melbourne's East West Link if elected in November Labor to scrap Melbourne's East West Link if elected in November
(about 3 hours later)
The Victorian Labor party would scrap Melbourne’s controversial East West Link toll motorway if elected in November, despite expectations that contracts for the $8bn first stage would be signed next month. The Victorian Labor party would scrap Melbourne’s controversial East West Link toll motorway if elected in November, even though contracts for the $8bn first stage are expected to be signed next month.
The opposition leader, Daniel Andrews, said he took the decision after advice from former federal court judge Ray Finkelstein, administrative law expert Richard Niall QC, and contract law expert Siobhan Keating, Fairfax Media reported. The decision means voters have a clear choice between Labor and the government over transport policy for the city, with the government saying the link is essential to improve traffic congestion and Labor concentrating on rail projects.
Labor had previously said it would honour any contracts for the 18km road which were signed before the election for fear of alienating investors in Victoria. Opposition leader Daniel Andrews said he took the decision after seeking advice from the former federal court judge Ray Finkelstein, administrative law expert Richard Niall QC and a contract law expert, Siobhan Keating.
But, if it wins the November election, it now plans to use a supreme court challenge by Moreland and Yarra councils to render the contract invalid. Labor has repeatedly said that while it opposes the link, it would honour any valid contracts signed before the election for the $6bn to $8bn first stage of the cross city road. Shadow treasurer Tim Pallas has said tearing up the contract could damage Victoria’s credit rating and that it was “a well-accepted practice that future governments accept and honour contracts signed by a previous government’’.
The councils claimed the planning process that led to the East West Link being approved was flawed because key legislative requirements had not been met. In a decision that effectively reverses that position, Labor is now relying on a supreme court challenge to the link by Moreland and Yarra councils, due to be heard on 15 December, two weeks after the state election. Labor argues that any contract cannot be validly entered into while the issue is before the supreme court.
The support of Labor means that court action is now likely to succeed should Andrews be elected. The legal advice states that if the court found that the approval of the project by the government was invalid, “there is no power to enter into contracts for the project and any contracts entered into will be beyond power and unenforceable”.
“[Premier] Denis Napthine has no authority, no mandate and no right to sign Victorians up to this tunnel just two weeks before the election,” Andrews said on Thursday. “Labor will have no part of it. Victorians must be given a choice.” The advice is only in the event that the councils’ court case succeeds.
Andrews later said Labor would install its own transport plan rather than “proceed with Denis Napthine’s dud tunnel”. “Instead, Labor will transform Victoria’s public transport system by doubling the size of the City Loop with Melbourne Metro and removing our 50 most dangerous and congested level crossings,” he said. Asked at a media conference what would happen if the court found the planning decision was valid, Andrews said a Labor government would not defend the court case, meaning the councils would be likely to win. The legal advice acknowledges that any consortium that had signed a contract could seek compensation if the project failed to go ahead.
Stephen Jolly, a Yarra councillor who is behind the legal case and is a spokesman for the community campaign against the project, said the community should be congratulated for making it an election issue. Labor’s decision puts pressure on the Napthine government not to sign a contract before the election. “If we want to resolve the uncertainty the best way is to not sign contracts and let Victorians choose [at the election],” Andrews said.
“If it wasn’t for the community campaign Labor would never have come to this conclusion,” Jolly said. “We will not build this project. This project is a dud.”
“Let us not forget that this project was their idea back in 2008. Under pressure they were forced to come out against it last year but they always said they would honour any contracts signed.” The government responded furiously, saying it remained committed to sign the contracts in October. This week it announced a preferred consortium, led by the construction company Lend Lease, to build the first stage of the link, a 6km road linking the Eastern Freeway to the Tullamarine Freeway.
Mark Stone, the chief executive of the Victorian Employers’ Chamber of Commerce and Industry, said he was disappointed by Andrews’ comments and that he would request a meeting with him to understand why Labor’s position had changed. “This threat to rip up contracts is the most reckless and irresponsible statement any opposition leader has ever made,” the treasurer, Michael O’Brien, said. The decision would cost $3bn in compensation, he claimed, including $2bn already provided by the federal government and $1bn to the successful consortium.
Labor had sent a “strong message to the national and international business community that under a Labor government Victoria is closed for business, creating a sovereign risk for businesses that enter into contracts with the state”.
At a media conference to mark the start of geotechnical drilling on the second stage of the link, Napthine said the project would create 6,200 jobs and the government was confident the project and its approval process had been carried out responsibly and thoroughly.
There was now a “a real difference between the Coalition government that is decongesting Melbourne, and helping families and individuals get to work quicker and get home quicker … in contrast to Daniel Andrews and Labor who want to condemn Melbourne and Victoria to decade after decade of congestion and gridlock”.
Opinion polls indicate that most voters oppose the East West Link, but business strongly supports it.
The chief executive of the Victorian Employers’ Chamber of Commerce and Industry, Mark Stone, said he would request a meeting with Andrews to understand why Labor’s position had changed.
“There’s overwhelming support among major business and motoring groups and unions who all want it to go ahead,” Stone said.“There’s overwhelming support among major business and motoring groups and unions who all want it to go ahead,” Stone said.
“[We have] consistently supported East West Link as it will create jobs and be a vital part of our transport network.”“[We have] consistently supported East West Link as it will create jobs and be a vital part of our transport network.”
Business confidence would take a hit if the project did not come into fruition, he said.Business confidence would take a hit if the project did not come into fruition, he said.
Jamie Briggs, the federal assistant minister for infrastructure and regional development, Victoria’s treasurer, Michael O’Brien, and the state minister for roads, Terry Mulder, said on Tuesday the East West Connect consortium had been selected to enter final negotiations, with contracts expected to be signed next month. The mayor of Yarra council, Jackie Fristacky, said it was “gratifying that we finally have clarification of the ALP position ... voters now have a clear choice between a government that is determined to build the East West link at all cost irrespective of the consequences, and a Labor opposition that has declared it does not support the project.”
The court case will be heard on 15 December, two weeks after the state election.