Land sale as Tonsley debt hits taxpayers
LAND for housing on the former Mitsubishi site is now on sale, as it emerges that taxpayers stumped up $700,000 to cover the bad debt of a company lured there by the State Government.
The Government bought the land in 2009 at a cost of $32.5 million and then-treasurer Kevin Foley said it would become a “clean tech” hub that would create many jobs.
Manufacturing and Innovation Minister Kyam Maher yesterday helped launch the sales of about 850 homes to be built on the former industrial site. He said there were 1200 people working on the site daily, up from 800 when Mitsubishi closed its factory.
However, documents obtained by the Opposition show taxpayers were short-changed by $695,421 as Government department Renewal SA gave up on a debt owed by Tier 5.
Premier Jay Weatherill, pictured, announced in 2014 the ICT company was moving to Tonsley, heralding it as one of the first in a wave of companies that would set up in the precinct. Minutes from a 2016 board meeting show Renewal SA deemed the Tier 5 debt “wholly uncollectable” as there was no bank guarantee.
The company went into liquidation in 2015. A short note in the minutes says the board discussed “due diligence” requirements and liabilities for similar future agreements.
In the same year, Renewal SA was also forced to slash its estimates for the value of the site after conceding its expected rental returns from tenants had been wildly optimistic.
Opposition Deputy Leader Vickie Chapman said taxpayers were paying for “more Labor Government incompetence” at Tonsley, as the development failed to deliver what was promised.
Ms Chapman said a Freedom of Information application for Renewal SA documents was stalled for two years and only released after intervention from the Ombudsman. “Once again, the Weatherill Government has left taxpayers to foot the bill for its failure to undertake basic due diligence,” she said.
Mr Maher said “to suggest that Tonsley has been anything other than a success is just ridiculous” and the Liberals were “relentlessly negative” about any change in SA. He said 118 businesses and start-ups were now based on the 61ha site.
Peet Development director Alan Miller said his company would offer housing pitched in the affordable bracket, while offering residents an “inner urban character”.