Gunnedah Ethanol Plant

Mr PETER DRAPER (Tamworth) [2.27 p.m.]: Many Gunnedah residents recently raised concerns with me that an ethanol plant proposed for Gunnedah by Primary Energy, which attracted $1.1 million in Federal funding as part of the Namoi Valley Structural Adjustment Package, will not go ahead. They believe that, unless the company provides a firm commitment, the funds should be returned and used to help the Gunnedah community deal with the social and economic trauma from drastic cuts to groundwater entitlements. I have strongly supported the concept of an ethanol plant in Gunnedah, and I will continue to support the proposal. But following years of false starts and anticipation I can well understand the concerns of many people. As long ago as 4 December 2003, Neil Lyon stated in the Land that the proposed plant would directly employ people and indirectly employ another 200 in the region. On 2 September 2004, also in the Land, Matthew Cawood wrote an article headed, "$100 million ethanol plant set to open in 2006." In the article he stated:

the proponent is optimistic construction will start at Gunnedah next year—2005—with the plant beginning operation by the summer harvest of 2006/07.

Fast forward to May this year: not one sod has been turned on the proposed 11-hectare site—which incidentally has been offered free of charge by the Gunnedah Shire Council. Gunnedah residents' concerns were further heightened on Monday 21 April when the proponent, Matthew Kelley, stated on ABC radio, "I don't think we can really afford to be putting up with the political rubbish that is associated with this grant." He went on to say that he would give the $1.1 million back. The interviewer then asked, "So how soon may you look at repaying this loan and would that be a big financial impost for Primary Energy?" Mr Kelley replied:

Well I think it would be an absolute blessing and it would be like a new lease of life for us involved around Gunnedah in not having to deal with the political side of it. We'll pay that grant back as soon as we're given a clear pathway by the Government on how to do that.

Concern was further raised by an article in Gunnedah's Namoi Valley Independent newspaper on 22 April 2008 headed, "Politics Could Sink Ethanol Project", in which the proponent said, "The odour of politicking was going to kill the project", adding that "it may already be too late." The proponent has suggested, "There was a taint on our programme" due to political interference. I would suggest there has been a political taint on this project for a number of years. An article in the Canberra Times by Ross Peake on 1 December 2004 headed "Anderson rails at slush fund accusation" states:

The project company, Primary Energy, wanted to use the money—the $1.1 million grant—for CSIRO research, which is explicitly excluded under the regional partnerships guidelines.

The funding was obviously used for this purpose because Primary Energy released a statement on 31 May 2005 entitled, "CSIRO Study Shows Ethanol A Clear Winner For Australia". It states:

The CSIRO has recently completed a comprehensive cradle to grave greenhouse gas emission analysis on one of the proposed projects for Australia—Primary Energy's Gunnedah Ethanol Project.

On 13 February 2005 the article, "Primary Energy Pty Ltd had failed to get Government assistance at least three times", written by Glenn Milne, appeared in the Sunday newspaper, the Sun-Herald. He stated:

Labor says the money was finally handed over by Local Government Minister Jim Lloyd—two months before the last election—using the Strategic Opportunity Notional Allocation guidelines, which basically suspend all previous guidelines to allow funding to proceed—

Mr Milne commented that John Anderson would be "in for a torrid week". But there's more. An article in the Sun-Herald on 20 April this year asked some more questions about the funding. The article alleged that a New South Wales member of Parliament chaired a local committee that assessed applications to the previous Federal Government for business grants. The committee backed an application by Primary Energy to be provided with $1.1 million towards the ethanol plant in Gunnedah. The member of Parliament subsequently formed a business partnership to build an ethanol plant at Moree with the proponent of Primary Energy, plus a Moree farmer. However, if that commitment is not forthcoming the $1.1 million should be returned—perhaps not to the Federal Government but to a trust fund administered by Gunnedah Shire Council, so the funds can be invested as intended. That would be for the long-term benefit of the Gunnedah community, as was originally intended under the Namoi Valley Structural Adjustment Program.

Last night on Prime Television in Tamworth the member for Barwon stated that Matthew Kelley was only a consultant and that none of the regional partnership money went into his business, MAK Fuels. However, a company search reveals that Mr Kelley was indeed a director of MAK Fuels, along with the member for Barwon and Andrew Ball. The member for Barwon chaired both the Namoi Valley Structural Adjustment Committee and the New England/North-West Area Consultative Committee before entering into business with Mr Kelley, whom he had recommended for Federal funding. I believe a large number of answers should be sought, and I call on the member for Barwon to reveal all.

Mr Daryl Maguire: Point of order: Under the forms of this House, if a member wishes to cast aspersions on, or attack, a member, he or she should do so by way of substantive motion. Clearly, the member for Tamworth has cast aspersions on another member of this House, and it is inappropriate to use a private member's statements to do so. If the member for Tamworth wishes to take the matter further, he should move a motion in the House and use the rules of this place.

ASSISTANT-SPEAKER (Ms Alison Megarrity): Order! I uphold the point of order. Has the member for Tamworth concluded his speech?

Mr PETER DRAPER: Yes.

Question—That private members' statements be noted—put and resolved in the affirmative.

Private members' statements noted.