State government rejects claim port lease will lead to environmental damage

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Posted July 22, 2015

The federal Coalition has intervened in the Victorian government’s plan to lease the Port of Melbourne, citing concerns about environmental damage to Port Phillip Bay.

Environment Minister Greg Hunt said Labor’s proposal would certainly lead to the “blasting” of Port Phillip heads to accommodate bigger ships in coming years.

“It is certain that there will be blasting of the heads and there will be an impact on the beaches of the bay with this plan,” he said.

But Ports Minister Luke Donnellan rubbished the claims, saying they were “simply wrong”.

“The blasting at the heads was carried out to deepen the shipping channels and hasn’t been done for over 80 to 100 years,” he said. “Any future dredging of the shipping channels in Port Phillip Bay will continue to require the relevant environmental conditions and approvals.”

The Andrews government has already introduced legislation for a long-term lease of the port. It plans to use the proceeds of the lease to to fund infrastructure projects, including the removal of 50 level crossings.

The proposed lease would last 50 years with an option to extend it another 20. Leasing the port is expected to raise up to $7 billion.

However, the state opposition has threatened to block the legislation in Parliament.

It says the contract would expose Victorians to “massive compensation” if a second port is built during the lease.

Earlier this week Treasurer Tim Pallas rejected suggestions that no new port could be built in Victoria without compensation.

He said as soon as the Melbourne port reached capacity a new one could be established.

Opposition Leader Matthew Guy said establishing another port could take 20 years.

He said the government needed to guarantee the heads would not be blasted in the port lease legislation.

“It would be one step on the way to improving what is a deeply, deeply flawed proposal,” he said.

The opposition supports the “medium term” lease of the Port of Melbourne together with the development of a second container port at Hastings.

“We have the prospect of using the Port of Hastings and the government should make that clear through its port lease process.”

Fairfax Media has previously reported minor dredging would be required at Hastings to establish a large container port.

The Greens are also opposed to the legislation to lease the Port of Melbourne, which means Labor cannot get it through the upper house in Parliament without the Coalition’s support.

The government has insisted it can bypass Parliament and proceed with the lease although that is not its preferred option.