And again the taxpayer loses

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Border Times: Opinion – And again the taxpayer loses. 1 October 2014

The Victorian government and opposition have both put the state’s taxpayers in an unwinnable position over how much they will pay for Melbourne’s East West link — whether or not the road is built.

Voters will baulk at news they could be liable for more than $1 billion in compensation if contracts for the road are ripped up; on top of the $2 billion they will shell out for its construction.

Premier Denis Napthine yesterday outlined the final design for the $6.8 billion 6.6 kilometre link road that will be funded by the Victorian and federal governments with the successful bidder, East West Connect, spending $3.3 billion on the project.

But the Victorian government has also drafted a compensation deal, agreeing to a payment to East West Connect that will ensure the consortium is no worse off financially if court cases against the road succeed.

That’s in addition to the contract’s “kill clause”, believed to be worth about $500 million.

Opposition leader Daniel Andrews is resolute about Labor’s promise to terminate the contract should it win government next month but all the deals done seem to favour the contractor rather than the taxpayer.

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