Massive losses and write downs for key Government projects

Shadow Treasurer Rob Lucas said today the Chief Executive of Renewal SA (RSA) John Hanlon had revealed massive multimillion dollar losses and financial write-downs on key Government development projects.

Mr Hanlon told the Legislative Council Budget and Finance Committee that RSA had lost $153 million last year following losses of $123 million in 14/15 and $39 million in 13/14.

Mr Hanlon confirmed that last year RSA had a total write-down of their assets of $142.5m comprising:

Tonsley project - $53.7m

Playford project - $51.2m

Bowden project - $17.4m

Woodville West project - $5.5m

Other projects - $14.4m

In fact, the value of the major Tonsley project redevelopment had been written down by almost 30% of the original $188m cost of the project.

“The Weatherill Government massively overestimated the revenue to be achieved by this project and over this three-year period revenue is expected to be about $30 million instead of in excess of $60 million,” said Mr Lucas.

“Total debt for RSA resulting from these losses and also the transfer of assets from TAFE SA is now expected to be doubled to about $980 million.

“Sadly after the Gillman financial disaster this is yet another example of the financial mismanagement and incompetence of the Weatherill Government in managing government projects and taxpayers’ money.