Current Affairs
Spirit Replacements: Restart with the Finnish
Media release – Peter Gutwein, Premier & Michael Ferguson, Minister for Infrastructure and Transport, 15 March 2021
Putting Tasmania first in Spirit replacements
The Tasmanian Government today released the Vessel Replacement Taskforce’s report and the preferred course of action for the vessel replacement.
Following consideration of the Vessel Replacement Taskforce report the Tasmanian Government has made the decision to enter negotiations with Rauma Marine Constructions (RMC) to deliver two new steel monohull vessels with increased Tasmanian local content.
Premier Peter Gutwein said the taskforce was established to explore how we could give Tasmanian businesses a larger share and more local content supporting local jobs when it comes to the most significant Government infrastructure spend of the last decade.
“The Report demonstrates there is significant local capacity to play a greater role in the replacement of our ships, outlining three potential options,” Mr Gutwein said.
“The Tasmanian Government will move forward largely with option three which is the purchase of ships from overseas, but with an increased focus on maximising the Tasmanian spend. We believe that two steel monohull vessels are the right approach for the Bass Strait run, but that Tasmania has the capacity to contribute more to the fit out and ongoing maintenance over the life of the vessels in a way that would support hundreds of Tasmanian jobs.”
We will now enter negotiations for 30 days with RMC for the new Spirit of Tasmania vessels targeting Tasmanian local content of between $50 million and $100 million across both vessels, and we expect also an additional local spend by TT-Line in the order of $40 million as part of the Tasmanian Government’s preferred way forward.
This is a substantial increase on the current Memorandum of Understanding, which provides for $16 million of Tasmanian content across the two vessels.
Premier Gutwein said COVID-19 had meant hard decisions had needed to be taken in the best interests of Tasmania. Last year when we decided to halt the process and establish the taskforce, our forecast unemployment rate was 12.5 per cent and our economy was expected to be in reverse at this time. If ever there was a need to explore all options for jobs for Tasmanians, COVID provided it and if faced with similar circumstances again I would do the same thing.
“We are unapologetic about taking the action required to consider and secure opportunities for Tasmania and to support Tassie jobs.”
Minister for Infrastructure and Transport Michael Ferguson said, given the pre-existing relationship with Rauma Marine Constructions (RMC), TT-Line will work with the shipbuilder over the next 30 days to finalise negotiations on the construction contract with an increased Tasmanian spend to be negotiated, estimated by TT-Line to be between $50 million and $100 million of local content.
“In addition to the anticipated local content associated with the construction of the vessels, TT-Line has indicated there are also other options for local spend by TT-Line in the order of $40 million, associated with the acquisition and commissioning of the new vessels, including using the TT-Line crew as the delivery crew for the vessels,” Mr Ferguson said.
“TT-Line will now negotiate with RMC a target date for the two new vessels to be delivered in 2023 and 2024. In the event that RMC and TT-Line are not able to reach a contractual agreement in the next 30 days, the contract will proceed to open market. However, this of course is not our preferred option.”
Minister Ferguson said the Tasmanian Government is also committed to supporting our home-grown and world class shipbuilder, Incat.
“The Government will provide support towards ongoing construction at the Incat site while we await the global passenger ferry market to recover. We will discuss with Incat the best way to support local construction work during this time to ensure jobs are maintained and this iconic Tasmanian business is well positioned to grasp global opportunities into the future.”
The Tasmanian Liberal Government will continue making decisions that deliver the very best social and economic outcomes for our state in a post-COVID world, and that means thinking differently and above all else, putting Tasmania first.
The Taskforce’s full Report can be found here: Vessel Replacement Taskforce | Treasury and Finance Tasmania. Some minor parts of the Report have been redacted for commercial in confidence reasons.
Shane Broad MP, Shadow Minister for Infrastructure, 16 March 2021
Gutwein wastes $146,000 of taxpayers’ money on humiliating backflip
Peter Gutwein should be ashamed of himself for wasting $146,000 of taxpayers’ money in the embarrassing fiasco to replace the Spirit of Tasmania vessels.
Shadow Infrastructure Minister Shane Broad said the Premier’s humiliating backflip has angered local shipbuilders and created uncertainty and anxiety in the tourism and freight sector.
“After a delay of almost a year, Peter Gutwein today revealed in Parliament that he spent $146,000 of taxpayers’ money on a report he completely ignored when he backflipped right back to square one – announcing the ships will be built in Finland after all,” Dr Broad said.
“Peter Gutwein has turned the replacement of the Spirit of Tasmania vessels into an absolute farce.
“The Premier has managed to bitterly disappoint local ship builders and delayed the delivery of additional capacity on Bass Strait by at least two years – which will ultimately cost the state jobs.
“We know from Saul Eslake’s report that each year of delay means at least $350 million in tourism dollars will not be spent in Tasmania, 6,000 new jobs will not be created and freight customers will continue to miss sailings because the ships are full.
“This ridiculous episode has seriously called into question the Premier’s judgement, and his government’s ability to deliver major infrastructure projects.
“Given the government’s sorry record of incompetence, how can Tasmanians have any confidence that the Spirits of Tasmania will be delivered by the new deadline of 2023-24?”
Media release – Independent Member for Clark, Andrew Wilkie, 15 March 2021
NO REAL END IN SIGHT TO SPIRITS OF TASMANIA FIASCO
Independent Member for Clark, Andrew Wilkie, has called on the State Government to start doing its job, actually make a decision and get on with the job of replacing the Spirit of Tasmania ferries.
“This essential project, the largest single infrastructure investment in Tasmania, has been hit by delay after delay to the point of high farce,” Mr Wilkie said.
“The new vessels were originally due to be up and running in early 2021 before the deal with the German shipbuilder went spectacularly belly up. Then the Government pulled the plug on a memorandum of understanding with a Finnish company in July last year.
“Now Premier Peter Gutwein has rejected the recommendations of his own taskforce and decided to resurrect the Finnish deal for an ambitious delivery date in 2023-24. Talk about déjà vu! But if the contract can’t be sorted in the next 30 days, it’s back to the taskforce’s recommendations and an even longer time lag.
“While I fully supported the taskforce’s investigation of options within Tasmania and Australia, I do question how long it is going to take to end the flip-flopping and get the job done. We simply can’t afford to suffer any more setbacks.
“As any Tasmanian will tell you, a reliable and affordable passenger and freight link across Bass Strait is crucial to our island’s prosperity. But based on past performances it’s clear that this on-again, off-again State Government would struggle to organise a sausage sizzle.”
Media release – Madeleine Ogilvie MP, Independent Member For Clark, 16 March 2021
Only Ogilvie Standing Up For Tasmanian Jobs
Madeleine Ogilvie MP, Independent Member for Clark today secured a commitment from the Government for contractual requirements for local content and transparency to be incorporated into the contract for the Spirits build.
“It is disappointing that a local business has not been chosen to deliver a solution to the freight and tourism constraints experienced on Bass Strait. I am continuing to fight for Tasmanian jobs. That is why I asked the Premier to ensure that $100 million in Tasmanian Local Content (TLC) be incorporated into the contract with the prime tenderer and include specified job numbers that would be reported on quarterly to ensure that Tasmanian jobs are delivered,” Ms Ogilvie said.
“TLC is essential in the build of the Spirits of Tasmania. I have unashamedly been pursuing jobs and investment in businesses in Clark and across Tasmania in the delivery of new Spirits.
“I am pleased that the Premier agreed that transparency was essential and measures like these would be included within the contract. The number of jobs created must be an integral measure in this process, which is why it is critical that stakeholders like the Tasmanian Maritime Network are consulted in establishing the measures.
“It is positive that I am no longer alone in arguing to support Tasmanian jobs and businesses. Tasmanians may agree though that it would have been more helpful had other parties been lobbying for Tasmanians during the process.”