Unsolicited proposals ‘lead to higher costs’

Australia’s competition and consumer watchdog has said accepting unsolicited proposals for new toll road concessions generally leads to higher costs.

As part of its investigation into Transurban’s bid for control of the WestConnex toll road in New South Wales, the Australian Competition & Consumer Commission (ACCC ) scrutinised the history of unsolicited proposals for toll road concessions in NSW and found that competitive bid processes for new toll roads are more likely to provide positive outcomes for taxpayers and drivers.

The ACCC noted that state governments are able to promote competitive outcomes by rejecting unsolicited proposals.

ACCC chair Rod Sims said: "The ACCC considers that state governments should only award new toll road concessions through a competitive bid process, and not following an unsolicited proposal, unless there is a truly compelling reason. Accepting unsolicited proposals for new toll road concessions generally leads to higher costs to taxpayers, drivers, or both.”

Following the ACCC announcement, Victoria’s Shadow Treasurer Michael O'Brien said: “The ACCC has just slammed state governments accepting unsolicited bids for private toll roads for ripping off taxpayers and motorists – which is exactly what Daniel Andrews and Labor have done to Victorians on their WestGate Tunnel deal with Transurban. Victorian motorists and taxpayers will be paying more tolls for 20 years under Labor's dodgy deal.”

O'Brien told The Age newspaper that if the Liberal party is elected in November, it would refuse major transport proposals from the private sector, unless the circumstances were exceptional.

The ACCC will not oppose the Transurban-led Sydney Transport Partners proposed acquisition of the majority interest in the WestConnex project.

The NSW government has acknowledged the announcement as it finalises a decision on a preferred bidder. An IFM-led consortium is understood to also be in the running.

NSW Treasurer Dominic Perrottet said: “The NSW government will continue to assess the bids based on all available information. As is standard practice with live transactions the government will not comment further.”