THE cancellation of the CBD Metro has left the Tigers leagues club and its partners at least $26 million out of pocket, newly released government documents on the axed transport project reveal.
An email from Sydney Metro to the Premier’s Department also shows the government was seeking legal advice on cancelling the metro at the same time it was reassuring the club the project was going ahead.
The Tigers leagues club and its partner, Rozelle Village, are two of the many companies that have lodged confidential compensation claims since the project was cancelled.
The terminus for the metro was to be built under the club site at Rozelle. The club had agreed to move for up to five years while the station was built, before Rozelle Village would redevelop the site.
The email states Sydney Metro was going to lease the site for $26 million over five years.
It also states that although agreements were non-binding, Rozelle Village ”would be liable to litigate against Sydney Metro to recoup damages if the agreement was not executed”, and that the government could also be ”liable to compensate RV for loss of profit and incidental cost”.
Hundreds of documents relating to the project, which was shelved in February, were released just before Easter weekend. The email was sent from Sydney Metro to the Department of Premier and Cabinet on January 18, 2008, three days before the government reassured the club the metro was going ahead.
”They were adamant that no decision [to cancel the project] had been made,” said a Rozelle Village co-director, Benny Elias, who met a government staffer and a policy adviser on January 21.
The club moved off the premises two weeks ago after shutting down operations and laying off numerous staff.
A Greens MP, Lee Rhiannon, said Tigers and Rozelle Village were only two of the many groups who had been left out of pocket. ”The government must now come clean on what it estimates the final compensation bill for this failed project will be,” she said.
The email also acknowledges that if the metro were to ever be revived, as the government has pledged, the Rozelle Village site would not be able to be used for a station and that more sites would need to be acquired at further cost.
Another internal document released on Thursday also shows a wild discrepancy in government estimates for the metro, stating the project would have cost up to $7 billion, far in excess of the government’s public estimates of $4.8 to $5.3 billion.
The larger figure was cited in a summary of key projects, including the CBD Metro, by the Department of Planning.
Dated October 20 last year, it states: ”The majority of these submissions oppose the project based on its expense (currently estimated at up to $7 billion)”.
A spokeswoman for the department said yesterday the estimate reflected what was being said in the media at the time: ”These notes did not form part of any statutory assessment process, and were instead a relatively informal background update of planning for major projects at the time.”