The State Government has announced it has been forced to appoint advisors to conduct a commercial scoping study into the potential privatisation of the government-owned Motor Vehicle Registry.
Investec Australia Limited and PricewaterhouseCoopers were appointed following a competitive tender process, and their advice will help inform the Government’s decision on whether or not to pursue a commercialisation process.
Treasurer Rob Lucas said the Government was contractually obliged to use ‘reasonable endeavours’ to conduct the commercial scoping study because of a secret deal struck by the former Labor government as part of its 2017 $1.605 billion privatisation of the Lands Titles Office.
“Let’s be clear – this whole costly exercise is entirely due to Labor’s gross deception and deceit,’’ said Treasurer Lucas.
“As part of Labor’s privatisation of the Lands Titles Office, a secret deal was struck which saw the Land Services SA (LSSA) consortium pay $80 million to be granted an exclusive right to negotiate for the further privatisation of the other state registry functions such as the Motor Vehicles Registry.
“While we make no criticism of LSSA in relation to this deal, it requires the new Marshall Government to undertake a scoping study for the potential privatisation of the Motor Vehicle Registry.
“I’m advised that if the state and LSSA do not enter a privatisation agreement for the Motor Vehicle Registry by 12 October, 2020, or the state appoints a third party to manage the Motor Vehicle Registry before this date, then the state must elect to either repay LSSA the $80 million, including interest charges at 10 per cent per annum, or grant LSSA an additional seven year extension to the existing 40-year term of the Land Services Agreement.
“Therefore, the total repayment in 2020 under this secret deal if the State Government doesn’t proceed with the privatisation could be up to $104 million.”
Investec Australia Limited and PricewaterhouseCoopers have been contracted for a 6-month period at a total cost of $575,000. PwC will undertake a detailed ICT system and process mapping of the Registry to inform Investec’s study and analysis.