Cosgrove Clayton: Questions for Oral Answer — Questions to Ministers 
Text is incorporated into the Bound Volume 
Cosgrove Clayton: Questions for Oral Answer — Questions to Ministers 
[Sitting date: 14 March 2013. Volume:688;Page:8554. Text is incorporated into the Bound Volume.] 
5. 
Hon CLAYTON COSGROVE (Labour) 
 to the  
Minister for State Owned Enterprises 
: Does he stand by all the statements he his predecessor and other Ministerial colleagues have made regarding the State-owned Enterprises portfolio? 
Hon TONY RYALL (Minister for State Owned Enterprises) 
: 
 Yes within the context they were made though. I suspect in the next 30 seconds I may want to change my mind. I can vouch for most of my predecessors though I probably could not vouch for Mr Mallard when he said: “It will be up to SOEs to come up with robust business plans that can preferably be funded off their own balance sheet …” . 
Hon Clayton Cosgrove 
: If the intent of the 2009 letter to Solid Energy penned by his predecessor in respect of increasing gearing and dividends was not to encourage borrowing by Solid Energy at increased levels or a demand for increased dividends why was it sent? What was its purpose? 
Hon TONY RYALL 
: Letters were sent to all State-owned enterprises in 2009— 
Hon Clayton Cosgrove 
: Solid Energy. 
Hon TONY RYALL 
: —including Solid Energy. They are—[ 
Interruption 
] To make it clear that the Government did expect— 
Hon Clayton Cosgrove 
: I raise a point of order Mr Speaker. My question was about the letter sent directly to Solid Energy—not letters sent to a variety of State-owned enterprises but the letter that was sent which the Minister has to Solid Energy directly. 
Mr SPEAKER 
: I appreciate that and the Minister was answering the question— 
Hon Clayton Cosgrove 
: No he wasn’t. He was talking about the other letters. 
Mr SPEAKER 
: Order! 
Hon TONY RYALL 
: The Government wrote to Solid Energy as it did to every other State-owned enterprise seeking to have improved levels of performance and contribution to the economy. It is up to the boards— 
Hon Members 
: More debt. 
Hon TONY RYALL 
: Members opposite seem to think that the debt is the problem for Solid Energy. I have said so many times today that it is not the cause of Solid Energy’s problem. It is the board’s responsibility to manage the structure of the balance sheet. The purpose of the Minister’s letter was to say just as Mr Mallard wrote to them a year earlier that we expect better performance in dividends. 
Hon Clayton Cosgrove 
: Is he aware of the Treasury proposal document of 2009 the recommendations of which his Government signed off whose purpose was to increase the gearing of Solid Energy and to quote the document was designed to “stretch” the State-owned enterprise; if so has that stretch been successful or has in reality that stretch perpetrated the almost total breakdown of that company at his Government’s hands? 
Hon TONY RYALL 
: No. As I have said earlier on it is not the debt that is the cause of Solid Energy’s problems; it is the fact that a number of investments were made that have not generated the level of return to sustain those investments or their continuing coupled with the collapse in world coal prices. In respect of the Treasury advice it would not surprise me because Mr Mallard in 2008 told the company— 
Hon Clayton Cosgrove 
: I raise a point of order Mr Speaker. The document and advice that I referred to was not from one Trevor Mallard. It was the 2009 advice— 
Mr SPEAKER 
: I appreciate that. 
Hon Clayton Cosgrove 
: —that talks about stretching— 
Mr SPEAKER 
: Order! But if you think about the member’s question it started with whether he was aware of the Treasury document. The Minister was just going on to talk about what was in that Treasury document. If the member is satisfied with the answer we will move to the next supplementary question. 
Hon Clayton Cosgrove 
: Is former Chairman of Solid Energy John Palmer correct when he told the select committee clearly today that contrary to the Prime Minister’s claim that Solid Energy had asked for a billion-dollar capital injection and that the Prime Minister had refused that billion-dollar capital injection no billion-dollar capital injection request was ever made—no figures were mentioned? 
Hon TONY RYALL 
: I would have to accept what the Prime Minister and Mr Palmer said because I do not think they are necessarily divergent. What I can tell you is I do know that the Prime Minister received advice on the financial implications of what was being discussed with Solid Energy. I have got to remind the member again that the company’s problems come from the investments that were made and the lack of return and the collapse of coal prices. 
Hon Clayton Cosgrove 
: Is he aware that former Chairman of Solid Energy John Palmer confirmed to the select committee today that no action none was taken by any Minister in this Government since 2009 to require a change in direction—in business direction—no request was made to change business direction or to reduce expansion and the only action that one can find on the record was 18 months of discussions with the company which generated in zero action by this Government as it was asleep at the wheel? 
Hon TONY RYALL 
: I am advised by comments made by colleagues on this side of the House that that is not a fair representation of what Mr Palmer said and therefore— 
Hon Clayton Cosgrove 
: I raise a point of order Mr Speaker. Nick Smith was not on the select committee other Ministers were not at the select committee and yet again this Minister makes it up. 
Mr SPEAKER 
: Order! But that is very much now debatable. I was not at the select committee—[ 
Interruption 
] Order! The Minister is attempting to answer the question and I would like to hear the answer to the question. 
Hon Clayton Cosgrove 
: I raise a point of order Mr Speaker. The Minister has questioned my word. First that is out of order. Secondly he has said that from comments around him— 
Mr SPEAKER 
: Order! Frequently Ministers disagree with words that are quoted by an Opposition member. That happens quite frequently in this House. 
Hon Clayton Cosgrove 
: I raise a point of order Mr Speaker. 
Mr SPEAKER 
: Is it a fresh point of order? I will take a fresh point of order. If the member is intending to continue a repeat of the same point of order then no I have ruled that the question was being answered. I will give the Minister the opportunity to further answer the question if the member so wants. But if he does not want a further answer he does not have to have one. 
Hon Clayton Cosgrove 
: I raise a point of order Mr Speaker. 
Mr SPEAKER 
: Is it a fresh point of order? 
Hon Clayton Cosgrove 
: Yes it is. With respect I am not challenging your ruling at all. 
Mr SPEAKER 
: Would the member just come to the fresh point of order. 
Hon Clayton Cosgrove 
: Certainly. You stated that it is a precedent in this House that members say the member is incorrect and you are absolutely right. That Minister did not say that. He challenged my word— 
Mr SPEAKER 
: Order! I think we are now relitigating what I have already ruled on. I am giving the Minister the opportunity to complete the answer that was interrupted if the member so wants. If the member does not then we will move to further supplementary questions or to the next question. 
Hon Clayton Cosgrove 
: Yes I do. Get him to answer. Yes I do. I have accepted your invitation. 
Mr SPEAKER 
: Does the Minister want to further elaborate on the answer that the Minister had given? 
Hon TONY RYALL 
: The Government has made it very clear and this is certainly my view that following the scoping study in 2011 this Government took action to deal with the issues that were raised in Solid Energy’s scoping study. That scoping study identified a number of issues that made that company vulnerable including investments in a number of areas that were not generating—[ 
Interruption 
] 
Mr SPEAKER 
: Order! 
Hon TONY RYALL 
: It also identified very high head office costs—[ 
Interruption 
]  
Mr SPEAKER 
: Do not continue to ask me what I did. 
Hon TONY RYALL 
: —and vulnerability around the projections for coal prices. And together with the collapse in coal prices during 2012 the company finds itself in this difficult position.