The Victorian Coalition Government will lease the operations of the state-owned Port of Melbourne, to help fund a record state-shaping infrastructure program for Victoria.
Treasurer Michael O’Brien and Minister for Ports David Hodgett said commercial advice received from the port scoping study had recommended a medium-term lease of the Port of Melbourne as the most effective way to generate a significant commercial return for the Victorian community and support the future development of the Port of Hastings.
“Following the completion of the port scoping study, the Coalition Government has determined that a medium term lease of the Port of Melbourne is in the best interest of all Victorians,” Mr O’Brien said.
“Today’s announcement means that we can continue investing in job-creating state shaping infrastructure projects right across the state.
“The Coalition Government has considered all the complexities relating to the future of our state-owned ports before making our decision.
“A medium term lease of the Port of Melbourne will provide the best outcome for the Victorian community, as well as the future operations of the Port of Melbourne and the Port of Hastings,” Mr O’Brien said.
Mr Hodgett said today’s announcement supports the Coalition Government’s $110 million investment in developing a new international container port at Hastings.
“It is vital that as part of leasing the Port of Melbourne the Coalition Government is able to continue developing the Port of Hastings to cater for Victoria’s long term freight needs,” Mr Hodgett said.
“The Coalition Government will ensure that the Port of Hastings can be brought on line in a suitable time frame to ensure that Victoria remains Australia’s freight and logistics capital, driving the Victorian economy.
“Today’s announcement also means that the Coalition Government can maximise the value of the land in the Port of Melbourne precinct at approximately the same time the CBD will be ready to expand into areas currently occupied by the Port.
“We will continue to develop both the Port of Melbourne and Port of Hastings together, strategically, to build on Victoria’s status as the freight and logistics capital of Australia,” Mr Hodgett said.
Mr O’Brien said the lease transaction is expected to be bolstered by the Commonwealth Government’s new asset recycling initiative.
“The Commonwealth’s financial incentives for the recycling of State assets such as this into productive new infrastructure will further support our record infrastructure investment program,” Mr O’Brien said.
“We are about to embark on a significant infrastructure program and the proceeds of this divestment, together with the Commonwealth’s contribution, will be invested directly back into new job creating infrastructure.
“This will include the East West Link, that will improve our freight and logistics network, including access to the Port, benefiting exporters right across the State.
“We welcome the decision of the Commonwealth Government to initiate its asset recycling initiative measures, which has been an important factor in the decision of the Victorian Coalition Government to put the Port of Melbourne to market,” Mr O’Brien said.
The expected effect of the lease of the Port of Melbourne will be in the 2014-15 State Victorian Budget. However, to preserve the State’s commercial interests ahead of a leasing process, the specific expected results will not be separately identified.
An expression of interest process is expected to commence in early 2015.
Press Release, May 5, 2014