All Ears on the NSW Treasurer Today

Filed under Letters ~ by bruce227 on  21 Oct 2019

The Treasurer will answer this question on notice from Member for Newcastle, Tim Crakanthorp, on Tuesday:

When the Government signed lease agreements for Port Botany and Port Kembla on 30 May 2013, what was the Government’s source of funds to meet its contractual commitment to pay the lessee for container traffic at the Port of Newcastle above the Government’s minimal specified cap?”

The answer is not sub judice.

When the lease agreements were signed, the government did not have a source of funds to pay NSW Ports Pty Ltd for container volumes exceeding a threshold level at the Port of Newcastle. It was the government’s intention to require a developer of a container terminal at the Port of Newcastle to pay a penalty, in the form of a fee, for container volumes exceeding a threshold level. This penalty was to be the government’s source of funds for paying NSW Ports.

Initially, the government required Mayfield Development Corporation Pty Ltd to pay the penalty. However, the government terminated its negotiation with Mayfield in November 2013, because the penalty was likely to contravene the “Competition and Consumer Act 2010” (CCA). In November 2013, the government decided to lease the Port of Newcastle to exploit a loophole in the CCA allowing the government to apply the penalty outside the operation of the CCA.

The ACCC is now alleging that the penalty is illegal. The ACCC alleges that NSW Ports contravened the CCA, because Port of Newcastle Investments Pty Ltd agreed to the penalty by signing a lease agreement with the government for the Port of Newcastle in May 2014. The ACCC is seeking a court order restraining NSW Ports from claiming payment.

The ACCC’s action against NSW Ports is redundant because the lease agreements for Port Botany and Port Kembla are unlawful. The government was not authorised by the “Ports Assets (Authorised Transactions) Act 2012” to pay NSW Ports for any container shipping at the Port of Newcastle.

One container ship a week visiting the Port of Newcastle will cost the government $3 billion in payments to NSW Ports by 2063. Two container ships a week will cost $6 billion. NSW Ports paid $5.1 billion in May 2013 for its 99-year leases.

The government’s contractual obligation to pay NSW Ports was concealed from the public and the parliament, because the lease agreements are detrimental to the state’s interests.

The lease agreement for the Port of Newcastle is unlawful because the government was not authorised by the “Ports Assets (Authorised Transactions) Act 2012” to lease the port for the purpose of funding the government’s unlawful contractual obligation to pay NSW Ports.

Greg Cameron



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