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House of Assembly - Fifty-Fourth Parliament, First Session (54-1)
2018-11-28 Daily Xml
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Grievance Debate

Adelaide Oval Hotel Development

The Hon. S.C. MULLIGHAN (Lee) (15:14): There is an unfortunate saying amongst some people, usually amongst those who feel disenfranchised or disenchanted—in fact, it is quite contemporaneous to the matter I just raised—and that is: 'It's not what you know; it's who you know.' It is the lament of those people who see others in life unfairly given preference or advantage over those who are equally and sometimes more worthy than those who are enjoying such preference.

Unfortunately, as recently as this past weekend, we have seen another shining example of this in Adelaide. The announcement by the Marshall Liberal government that it will provide a $42 million taxpayer-funded loan to the Stadium Management Authority is an outrage. It is an outrage to those hoteliers who have done the hard graft, building their businesses, working with their investors and their banks to secure private finance for their developments, now only to be trumped by a taxpayer-funded hotel. It is an outrage that this loan has been provided without any process.

There was no opportunity for other hoteliers to come forward and make their case for similar support, and it must be an outrage to the Liberal Party's base that the supposed party of the free market is using taxpayers' funds to compete with the private sector. It is certainly an outrage, given how this loan came about because in this case, again, it is not what you know; it is who you know for the Stadium Management Authority. There have been grumblings and complaints that until only very recently we could possibly have a situation where the president of the Liberal Party is also the president of the SANFL and the chair of the Stadium Management Authority at the same time.

Those interested in corporate governance might wonder what controls were in place and exercised by the Stadium Management Authority to manage the inherent conflict between being chair of both the SANFL and the Stadium Management Authority. But what might also cause outrage is what role this same person played in facilitating the taxpayer-funded loan from the Liberal government. Was the Liberal Party president the person to organise a $42 million taxpayer-funded loan from the new Liberal government? We might well ask what controls were in place and exercised to manage this inherent conflict of interest.

These are interesting questions, and we look forward to discovering the answers during the investigations into the hotel loan deal as well as the Stadium Management Authority's management of the oval in the coming weeks and months during a select committee inquiry to be conducted in the other place. Of course, what makes this whole loan affair worse is that it is not the first time 'it's not what you know; it's who you know' has been realised with this government. The engagement of KordaMentha with no process and no probity is another example.

How were they a walk-up start for what was, on 21 September, apparently, an $880,000 contract; then, only six weeks later, a $2 million contract; and now, on Monday, we learned, a further $18.9 million contract? What we are being told on this side is that the appointment of KordaMentha without any process was most definitely a 'it's not what you know; it's who you know' scenario to secure that work. We look forward to teasing out the appointment of KordaMentha in the coming months, too.

We also have Mitsubishi Motors Australia—again, a walk-up start with this government for a $2 million grant to maintain their retail business here in Adelaide. Are any of these value for money? Of course they are not. Mitsubishi: $2 million to secure a further 20 extra positions or $100,000 a job. The hotel at Adelaide Oval: a $42 million loan apparently to secure an extra hundred jobs or $420,000 per job. KordaMentha: apparently $821,000 on average for each of the 23 interstate liquidators now working in SA Health as part of their $18.9 million walk-up start contract without any process. This government does not just pick winners; it drowns them in taxpayers' cash.

Putting aside for a minute the many unanswered questions that remain about how the $42 million loan came about, it also raises the question about what exactly the Liberal Party stand for. It cannot be the free market, as they wish now for the state, apparently, to compete against the market in the hotel industry. These hoteliers who had to secure commercial loans from banks based on their business plans are now contacting the media and contacting us to complain, and we look forward to prosecuting this issue in the weeks and months ahead.

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