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Parliamentary Standing Committee on Public Works
28/07/2017
HMAS Moreton Unit Relocation Project, Bulimba, Queensland

BEUTEL, Brigadier Noel, Director General, Capital Facilities and Infrastructure, Department of Defence

BLAIN, Ms Helen, Director, Environment and Heritage Policy Development, Department of Defence

GRAY, Ms Lauren, Assistant Secretary Property Management, Department of Defence

JENSEN, Mr Trent, Integrated Head Contractor Representative, ICON Co. (QLD) Pty Ltd

POLLARD, Lieutenant Colonel Jonathan, Project Director South Queensland, Capital Facilities and Infrastructure Branch, Department of Defence

SPEDDING, Commodore Philip, Director General, Navy Program Support and Infrastructure, Department of Defence

[13:31]

CHAIR: I welcome representatives of the Department of Defence. We are going to throw it to Brigadier Beutel for an opening comment. It is the intention of the committee that as many as possible of the questions that were raised today during this session are answered in your opening statement. In the event that you cannot, the deputy chair and myself will go back to chase those notes to give the community the best opportunity to hear first hand from you answers to some of the concerns that have been raised. I will just put it to those who are supporting the brigadier and the commodore that if there were lines of questioning that were made today we would appreciate it if we can get comments onto the record without prompting from us so that the community and the Hansard will have a genuine response from the department. Although the committee does not require that your give evidence under oath, I should advise that these hearings are formal proceedings of the parliament. Consequently, they warrant the same respect as proceedings of the parliament itself. Giving false or misleading evidence is a serious matter and may be regarded as a contempt of parliament. Brigadier Beutel, would you like to make some introductory remarks before we proceed to questions?

Brig. Beutel : Thank you. Again, as the committee is aware, this Defence proposal seeks approval of the HMAS Moreton relocation project. As this is the second hearing for this project, for the benefit of those who were not able to attend the first hearing, with your permission I'd first like to provide a brief overview of the project, then summarise some of the actions taken by Defence following the first hearing on 5 May 2017. Again with your permission, I will then seek to provide the committee with an update on the disposal of Bulimba Barracks for your situational awareness, because there were some issues raised through previous evidence about where that is at and when it is happening. I'll also ask for one of the Commonwealth officers here to provide the committee with a summary of our approach as a department, in accordance with Commonwealth requirements, as to how we manage the Defence estate with respect to heritage.

CHAIR: Absolutely. I would ask the brigadier to be conscious of the time.

Brig. Beutel : Always, Mr Buchholtz. HMAS Moreton relocation project will ensure that Navy's operational and administrative functions are retained after the disposal of the surplus land at Bulimba Barracks. The existing HMAS Moreton functions will be retained on a reduced footprint in its present location, with the loss of some current facilities infrastructure. The loss of supporting infrastructure necessitates the redevelopment of the retained site with the provision of independent access and services inside a secure boundary. The capability support functions provided by HMAS Moreton are an intrinsic part of the Royal Australian Navy's fleet command's mission to raise, train and sustain mission-ready maritime forces able to fight and win at sea. Key to providing sustainment for that force is the maintenance of a waterfront logistics support capability in South-East Queensland, including berthing for minor war vessels, accommodation and secure storage facilities for visiting major fleet units and other resident units.

The estate requirements include a new multipurpose building for office accommodation, classrooms and living-in accommodation. The engineering requirements include extension of a council road, a new entry gate, internal roadworks, security fencing and extension of connection to potable water, sewer, stormwater and electrical services. The total cost of the proposed works remains unchanged from previous advice to the committee, which is $15.6 million excluding goods and services tax. I would note that this cost estimate includes all construction costs, professional management, design fees and charges, furniture and fittings, and equipment together with appropriate allowances for identified risk for contingencies and escalation. Subject to parliamentary approval, the construction project is expected to commence in late 2017, with construction complete by early 2019.

Since the first hearing and as directed by the committee, Defence has subsequently conducted a third public information session on 5 June at the St John Baptist church in Bulimba, where a total of six members of the public were in attendance. The outcomes from the public information were again submitted in accordance with the requirements of the committee to the PWC as far as my third submission on public consultation.

For the committee, to recap on previous evidence I gave at the last hearing: community consultations has been undertaken. Formal consultations were done on 3 April, which was the first one and which we would normally undertake in the normal course of our requirements to meet the PWC act. Twenty-eight attendees were at that first session. Ms Butler did raise some concerns to my project director in relation to the notice that a lot of people got on that, so we undertook to undertake a second community information session, which was done on 24 April. Again, that was formally advertised with lots of lead time. We had two attendees attend that one. On 5 June, which, as I said, was the additional information session that the committee directed I do after the last hearing, there were six attendees.

As was noted this morning in other evidence provided, Defence has conducted a heritage impact assessment on the proposed works at the HMAS Moreton site. The outcomes of that heritage impact assessment confirmed that the proposed works will not have a significant impact on the heritage values of HMAS Moreton. The only asset on the HMAS Moreton site that is considered to have Commonwealth heritage value is what we refer to as building A002, which is a World War II period warehouse. The proposed works will not directly affect that warehouse as the new buildings will be located at some distance and will, therefore, not result in changes to the setting or the historical context of that warehouse.

The heritage impact assessment also concluded that whilst the sea wall, which was built in 1963, has historic interest, it does not have significant heritage values. The sea wall does not provide an insight into an important period of the development of the site and therefore has low heritage value. The heritage impact assessment, however, makes a recommendation that works to the sea wall should seek to minimise disturbance to the wall and match the existing alignment, height, width and materials. Subsequently, Defence will conduct a targeted consultation session with the community following the completion of design, where the final design of the boat ramp will be presented to all interested parties. Again, the intention would be to do that through a community or public information session. The heritage impact assessment also outlined seven other heritage impact mitigation measures to assist Defence with further reducing the low heritage risk for the proposed works. Again, Defence will undertake the implementation of those recommended mitigation measures.

In relation to the Native Title Act 1993, Defence confirms that HMAS Moreton is freehold land and therefore native title is extinguished. It is acknowledged that native title may exist over state-owned property, as is the case with the boat ramp area. The Jagera people and the Turrbal people have previously placed a claim over a greater area of Brisbane, which included the project site. However the Native Title Tribunal determined in March 2015 that native title over the boat ramp did not exist. As part of the state assessment referral agency process for the development of the boat ramp site that Defence is proposing, Defence will consult with the Department of Aboriginal and Torres Strait Islander Partnerships and a request will be made with them to meet with the relevant applicant groups.

That concludes my opening statement. If you are happy with the timing, I'll quickly ask Ms Gray to provide an update on the disposal of the Bulimba Barracks and then after that Ms Blain will provide some advice in relation to the Defence heritage management.

CHAIR: Thank you.

Ms Gray : At the last hearing I explained that we had a body of pre-divestment work to do before bringing the Bulimba Barracks portion of the site to market. We're working through those strict diligence activities in that we've recently completed the procurement of our strategic property services and delivery services adviser. That procurement has recently been finalised. They're on board now. They're now in the process of subcontracting a specialist heritage services provider. That specialist heritage services provider will be undertaking heritage values assessment for both the Bulimba Barracks portion of the site and also the further work to do with the HMAS Moreton portion of the site, acknowledging that there is more consultation work to do in assessing whether those values meet the thresholds of local criteria and also state listing criteria.

With that fulsome understanding of the heritage values, our intent there is to make sure that the values identified are afforded the level of protection post sale. That will be by checking the existing listing under Brisbane City Council register and making sure that that listing fulsomely reflects those heritage values. Likewise, we will certainly be undertaking a nomination to the Queensland Heritage Register if the site is found to have values that meet those state heritage criteria. We note that the site is already recognised by the state as a World War II site, so it may well be in that light, and we are very happy to work with the historical society to do that. In terms of the timing of that, the heritage adviser should be on board by the end of August, and we expect that during September that adviser will be reaching out to undertake further consultation with the Indigenous groups, with the Bulimba District Historical Society, with the Chinese community representatives where possible and with other interested stakeholders that can inform that really good understanding of where the potential heritage values may meet those criteria.

There are also some other pre-due-diligence activities that need to happen. We are looking at a time frame of the later this year for advertising the property on the open market, subject to the completion of those assessment processes.

CHAIR: Can you elaborate on what that process looks like in sending a block of land to the open market and how you'll make your assessments? There were some concerns raised earlier today from other witnesses about potential buyers and their nationality. Does Defence have position on foreign ownership? Brisbane City Council, though I know you can't speak on behalf of them, has a wide portfolio of international investors here in the city. I am interested, through the purview of federal Defence, as to what its policy position is.

Ms Gray : Any purchaser that is eligible to own land in Australia is eligible to bid as part of this process. What we will be doing as part of the sale process is making sure that all interested purchasers are fully aware of the characteristics of the site. That includes making those purchases aware of the Brisbane City council master plan as part of that sale process, so that interested purchasers can frame their bid understanding the heritage assessment and the master plan that's in play as well.

Brig. Beutel : If you're comfortable there, Mr Buchholtz, we'll go to Ms Blain to discuss the overall heritage management of the Defence estate.

Ms Blain : Defence meets its heritage obligations under the Environment Protection and Biodiversity Conservation Act and actively manages heritage values regardless of their listing status. Defence identifies heritage values on its properties through a risk-based approach. Assessments are prioritised for places that may be subject to redevelopment, disposal or otherwise where heritage values may be under threat. Defence assesses heritage impacts associated with all its activities. In regard to HMAS Moreton the site will be added to the Defence Heritage Register. It will also be subject to a heritage management plan, which has been programmed. I'll leave it at that.

Brig. Beutel : I think I can quickly go to this, because I think it would have been a question from the committee. This relates to the evidence and the requests made about access for the public by a number of members of the community. I would like to point out again that that is within our statement of evidence. On our concept design schematics we have shown that there is a buffer zone on the southern boundary. This is not the river boundary but the southern boundary. There is an exclusion zone there for potential walkway or access. I can commit to the committee and the community now that I am very willing with this project going forward to have discussions with the community and Brisbane City Council in relation to how that could be effected on the southern boundary. I will state, though, that having access to the riverfront—not just because of Defence's security requirements but also for workplace health and safety, noting the waterfront access there to the jetty and the potential problems when we have minor war vessels or visiting major fleet units or when we are undertaking other sorts of support operations, we can't provide public access to the riverfront. But we're more than happy to have those discussions about potential access on the southern boundary. I can't commit to saying, 'We will do it now,' because there will be due diligence required by the Commonwealth in relation to ownership of the land and then the actual undertaking of those works, should some sort of excise or ability to allow access be undertaken.

CHAIR: Assuming that this bike path, at some stage in the future, becomes an instrument for moving along the foreshore, you're saying they'd come up to the new boundary. Would a potential bike path/walkway have access up that western boundary before they hit the southern boundary?

Brig. Beutel : That is my understanding from previous evidence on the Brisbane City Centre Master Plan and that sporting reserve, but I will get Lieutenant Colonel Pollard, my project director, to confirm.

Lt Col. Pollard : I'm the project director for Defence for this project. Our understanding is that under the Brisbane city plan there will be a green space in that location, so we would expect that on the western boundary of HMAS Moreton, in that vicinity, there would be that bike path to then link into the southern boundary of the HMAS Moreton.

CHAIR: And then down the eastern side?

Lt Col. Pollard : The eastern boundary of HMAS Moreton is currently the road reserve, which is being referred to as the Taylor Street park. I would hazard to say it would be up to Brisbane City Council to decide what happens on that portion of land.

CHAIR: So they'd just walk around the proposed site.

Brig. Beutel : The other concern that was raised was in relation to our proposed works for the gateway or the entrance into the new HMAS Moreton site. We are at a 30 per cent concept design report at the moment, so further schematic, detailed design still needs to be undertaken. I am advised by my project team and through our industry consultants that we've already been working with Brisbane City Council in relation to that access and any impingements on that access. We will continue with that work to mitigate those risks. The point I would make is that the proposed site of the gateway, or the 'gangway' as Navy likes to refer to it, into HMAS Moreton is the only access for us, so we will need that access. But we will work to mitigate those risks. We've already been doing that and we'll continue to commit to doing that. Similar to what we're doing with the sea wall, we're more than happy to share with the community of Brisbane City Council the final designs and consultation for this aspect of the project.

Mr ZAPPIA: You would've heard the submission by Councillor Sutton in which she proposed three recommendations to do with the 10-metre pedestrian/cycle link, the entrance layout for Taylor Street and something to do with heritage management, which I think you've responded to. With respect to the first two matters, have you considered her solutions to the concerns she raises and will they be able to be accommodated as part of your ongoing discussions and perhaps reassessment of the final plan?

Brig. Beutel : Unless I've confused the councillor's evidence, as I was referring to in relation to the proposed walkway/bike way on the southern boundary—which is what I believe her evidence was—yes; I am more than comfortable with and committed to having further negotiations or discussions about that, noting that at the moment it is Defence land and we'd have to work through the process about who owns the land, access to the land and management.

The second point that the councillor raised is in relation to the Taylor Street entrance. As I was just referring to, we would be more than happy to continue to work through that to minimise any impacts. As I said, we have already been working with Brisbane City Council on this and we will continue to work with them on the journey to get to our final design.

Mr ZAPPIA: I think the Taylor Street access is where the guard house is. Is that right?

Brig. Beutel : Yes, that's the proposed guard house.

Mr ZAPPIA: So the concerns raised about the guard house will be taken into account as well, I assume?

Brig. Beutel : There is a requirement for the guard house and there's a requirement for vehicle access, but yes—we'll look at it as a holistic solution to minimise impacts. But the point I'm making is that we do need a guard house for security and we need vehicle access to the base.

Mr ZAPPIA: Ms Blain, in your earlier comments about managing the heritage process, I assume you were referring to the whole of the site as it currently is and not to the area that will then come under the new proposed development?

Ms Blain : The heritage management plan would be done in respect to HMAS Moreton only, at this stage.

Mr ZAPPIA: So your description of HMAS Moreton is what is the new proposal?

Brig. Beutel : Correct. We've done the heritage impact assessment for the proposed works on the HMAS Moreton site as it is. I acknowledge the previous evidence also provided that there are two areas, when we look at Commonwealth heritage consideration, where there is further work to be done. That links back into the work that Ms Gray was referring to about the heritage impact on the whole of the site. Noting that there will not be a heritage management plan developed for Bulimba Barracks, heritage comments will be provided to the owners of the proposed disposal site. The whole heritage assessment—for HMAS Moreton, including the heritage impact assessment we've already done for HMAS Moreton, plus the disposal—will inform our heritage management plan for the base, as it does for all our bases as we're going through.

Mr ZAPPIA: Can you provide the committee with a broad time frame as to when you would expect that work to be completed?

Brig. Beutel : The heritage impact assessment for HMAS Moreton is complete. Again, Ms Gray can provide a broad schedule for that.

Ms Gray : That's right. The heritage assessment will be on deck and out for consultation come September, and that work will be pulled together certainly by the end of this year. The heritage management plan for HMAS Moreton would commence after that heritage assessment is completed. The heritage management plan for HMAS Moreton would be a subsequent step, but it's focussed on managing the ongoing management for Defence of that as a base, rather than a heritage impact assessment, which informs the works that we're discussing.

Mr ZAPPIA: I'm trying to clarify that there will be some work carried out in respect of the area of land that is proposed to be sold, and I assume—and you can correct me if I'm wrong—that that work will be completed prior to the land being disposed of.

Ms Gray : Absolutely. We don't propose to advertise the site until that work is well and truly completed, and then that body of work can be made available to interested purchasers.

Mr ZAPPIA: Out of curiosity, did Defence make a submission to Brisbane City Council in respect of their master plan?

Ms Gray : Not that I know of.

Brig. Beutel : We'll have to take that on notice, I think. We'll get back to you. I'm not aware of it, because I'm not in the disposal area—thank goodness—but we'll take that on notice and get you the answer to that.

Mr ZAPPIA: I think that answers all my questions.

CHAIR: Ms Gray, can you run through for me again what the disposal process looks like and some of the time frames you have in mind.

Ms Gray : We're looking to complete our pre-divestment due diligence, including the heritage assessment work that we've discussed. We have other standard property due diligence activities—drawing up draft contracts of sale towards the end of that, and that sort of thing. The idea there is that, subject to all of the assessments been completed so that they can be made available to those interested purchasers, we would then bring the property to market at the end of this year.

CHAIR: So at about the same time as construction starts?

Brig. Beutel : Late 2017.

CHAIR: I know the sale process can be as long as a piece of string, but, using historical data as evidence, what would be time for a block of that magnitude and price range? I know you've given evidence in camera on the price range. What could be an expected sale time? That doesn't necessarily mean a developer's not going to start for another five or 10 years down the track.

Ms Gray : We have been saying that we don't necessarily need to rush the sale through. It may make sense to hold off on settlement until the works are completed for HMAS Moreton, which is in that 2019 year. We are looking for the sale process to occur over that period, so it won't be the case of a single auction and then a 30-day settlement. Certainly we can look at whether there are options for lease back that make sense, but realistically the property will probably change hands in 2019 upon completion of those works.

CHAIR: There was some evidence given today around concern that the state government was precluded. Can you give some commentary in that space? Would the state government be precluded from entering the competitive tender process?

Ms Gray : As you know, the Commonwealth is required to sell property in accordance with the Commonwealth property disposals policy. That policy provides that property must generally be sold on the open market for market value. There are some exceptional circumstances—that properties can be sold as off-market sales to local governments or to state governments—and that is where it is demonstrated that it would be beneficial achieving broader government outcomes. The starting point for those types of discussions is also in achieving market value.

In terms of demonstrating that improved government outcomes could be met, in this instance there wasn't necessarily a case made that different government outcomes could be achieved compared with the council upholding a master plan for the site. On that basis, certainly anyone who is eligible to own land in Australia can bid, and the Commonwealth will not be precluding Queensland from submitting a bid as part of this process.

CHAIR: Earlier evidence suggested that when the state government made a request to the federal government to purchase the land it was denied, or it wasn't approved. Do you have any knowledge of that process?

Ms Gray : Do you mean whether an offer was made? Yes. There were ongoing conversations between Queensland and the Commonwealth government through 2015 up until April 2016, when a final offer was provided. That final offer was considered on the basis that I explained before, where it wasn't necessarily demonstrated that that aligned with the intent of the Commonwealth property disposals policy. Defence wasn't in a position to accept that offer.

CHAIR: Thank you. In our opening comments as a committee we clearly articulated to the room what the committee's purview is. We have, for the vast majority of today, strayed well beyond the jurisdiction of this committee's work to give the community the opportunity to put forward their concerns, predominantly—hopefully—to replace unknowns with knowns. So, in the minutes remaining, perhaps I could bring Defence's position back to onsite. Brigadier Beutel, do you foresee any issues emerging with the community in the coming years, until 2019, until construction is completed on the remaining footprint, as a result of that construction?

Brig. Beutel : Based on our risk assessment at the moment and feedback we've had from the community throughout our three consultation processes, no. That said, I would acknowledge that, subject to parliamentary approval and completion of the design, regarding the actual award of a contract to undertake construction works, Defence will also require that contractor to provide an environmental management plan, a construction environmental management plan. We refer to it as a construction environmental plan generically, but industry have different ways of describing what that is. Part of that will be traffic management, management of the environment, management of construction noise, management of construction dust. Again, that will all be put in place first. Again, we have done this previously here in Brisbane, at Enoggera Barracks, where there are quite a lot of community houses directly on the boundary of the base. After construction we will continue to work through with community consultation, information and letter drops to provide advice in relation to what is happening. Again, if there are any concerns from the committee as we go forward—even though I'm not tracking any of that, and we will have mitigations in place as we know the risk now—there will be opportunities, if the committee wants that, to raise any concerns with us.

CHAIR: Will there be a point of contact for Defence? You'll have civil contractors undertaking construction. Will there be a single point of contact for the community to raise concerns during that process?

Brig. Beutel : Yes. That's normally done through our project manager contract administrator appointed to that.

CHAIR: Will they be Defence or civilian?

Brig. Beutel : That's industry. That's usually the first point of contact, because we engage them to manage the day-in, day-out work. But Lieutenant Colonel Pollard is well known to the community now. I think they have him on speed dial in certain cases, or email. Normally it would be PMCA, but I'm happy for the community, through whatever contacts they have in Defence, and that includes myself, to contact us if there are any issues to be raised. Normally it would be done through our project manager contract administrator.

CHAIR: Do you have any closing comments, Colonel Pollard, given that you are going to be the voice of this project?

Lt Col. Pollard : No, I don't.

CHAIR: Would you like the Hansard to give everyone your mobile number?

Lt Col. Pollard : I definitely would not like that!

CHAIR: Are there any other closing comments?

Mr ZAPPIA: Just one question. This was asked of the historical society. Have the current operations at HMAS Moreton at any time raised security concerns for the adjoining residents? The response was that to their knowledge it had not. Can I ask you the same question, Brigadier?

Brig. Beutel : When that evidence was provided, during the break we spoke to the CEO of HMAS Moreton. He is not aware of any security aspects during his tenure. This is more on the base than security impacts on the community from operations on the base. The point I would make here about security and a comment about why Defence sees the access has a security issue, is that it's not so much that we identify a threat within HMAS Moreton with the local community that lives around HMAS Moreton. However, on every single Defence establishment in Australia an overall assessment has been made about the security environment. Defence's position is that we are now at what we refer to as safe base Charlie. There are certainly security requirements that go with that. We have discussed this with the committee a few times before on other projects.

That's what stands. So there is still a requirement to have security in the form of fences, guards and other procedural matters in place, no matter what the security threat is. I also note that if something were to happen—and I'm not forecasting any increase in security requirements around Bulimba Barracks or HMAS Moretonat the moment—there are other measures that we need to take into account when we do our developments in relation to rising to a safe base Delta and a safe base Echo. That is based on extreme threats, and I'm not saying that we are seeing that, but it is important that we have safe base Charlie. We've been on safe base Charlie pretty much since 2011. I don't see it ever going back to safe base Bravo in the foreseeable future. That is pretty much business as usual for us now, and the requirements for that security performance remain extant no matter where we are in Australia.

CHAIR: Are there any closing comments, Commodore?

Cdre Spedding : This is really in response to something that Ms Nolan raised that the visibility of Moreton within the Bulimba precinct and why we still have the name HMAS Moreton, commissioned as an establishment rather than being a lodger unit as it had been before. Moreton was the naval establishment up at New Farm from 1911 to 1994 as a commissioned base. In 1994, when it was disposed of, decommissioned, the functions moved to Bulimba and the small resident naval headquarters South Queensland really drew upon the support and services from the broader Bulimba precinct. With the decision to dispose of the remainder of the Bulimba precinct those functions had to be consolidated within Moreton, and it became once again a stand-alone naval facility commissioned as HMAS Moreton—having that historical name but recognising that it's now a self-sustaining naval establishment. That's the basis of that.

The other point I would like to clarify relates to the discussion around the extensive water frontage. With the planned disposal, that is some 560 metres. The Moreton site will retain 115 metres of water frontage.

CHAIR: Thank you for your attendance here today. You will be sent a copy of the transcript to make any corrections to the transcript. For the benefit of those that are in the gallery today, whilst I completely understand that Mr Zappia, my deputy chair, has to catch a flight, I advise you that I will stay and take any questions that you have as for as long as you want, as long as we can be out of here within the next half hour. So feel free to come up and say hello in an informal capacity, because I'm going to close the official part of the hearings. To those nine remaining in the gallery, I thank you for your contribution today. I trust that you will take away from this process a sense of openness and genuine consultation process from this committee. We have shown latitude in letting the conversation reach beyond our purview, but I think it was important for those issues to be recorded in Hansard. I will stay for as long as you want to chew my ear. I thank Defence for their evidence.

Committee adjourned at 14:05