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ECONOMICS LEGISLATION COMMITTEE
03/05/2000
AUSTRALIAN SPORTS COMMISSION
Outcome 1—A stronger, sustainable and internationally competitive Australian industry

Senator GEORGE CAMPBELL —Coming back to the National Textiles issue, in the transcript of evidence of the last hearings in February, Mr Evans also referred to a letter to the company dated in April. He said there would have been letters in April and in June. Can we get a copy of the April letter?

Senator Minchin —I am not sure of the contents of the April letter or whether the recipients of the letter have any difficulty with it being released. I am happy to take on notice the request and, subject to the attitudes of the recipients of the letter—given that it was private correspondence—look at supplying you with a copy.

Senator GEORGE CAMPBELL —Could you also take on notice whether or not we can be supplied with a copy of the Ernst & Young report, which is critical to this?

Senator Minchin —Sure.

Senator GEORGE CAMPBELL —Also the first paragraph in the letter of 30 June refers to a letter from Bruck Textiles and National Textiles dated 21 June.

Senator Minchin —Would you like a copy of that?

Senator GEORGE CAMPBELL —Yes.

Senator Minchin —Again, we would like to make sure that Bruck do not have major objections to that, given that it is their letter and not ours.

Senator GEORGE CAMPBELL —Yes. Minister, is the department aware of what moneys were finally paid to National Textiles?

Senator Minchin —None were paid in relation to their requests in relation to the—

Senator GEORGE CAMPBELL —No, in relation to the redundancies.

Senator Minchin —They were for the workers, not the company per se, and I am not sure that we have a figure on that.

Mr Dean —I think that is a matter for the Department of Employment, Workplace Relations and Small Business.

Senator Minchin —Yes. What has been agreed is that, in accordance with and consistent with the new SIP scheme, a transfer of funds be made to the Regional Assistance Program to assist with helping the workers of that company under that Regional Assistance Program. In effect, we will provide a supplement consistent with the new TCF scheme into RAP.

Senator GEORGE CAMPBELL —Is it being funded out of RAP funds?

Senator Minchin —The mechanism by which it will be delivered will be RAP, but it will be a transfer from the TCF SIP scheme into RAP in accordance with the provisions of the SIP scheme and delivered through RAP.

Senator GEORGE CAMPBELL —So it is from SIPS to RAP?

Senator Minchin —Yes.

Senator GEORGE CAMPBELL —I understand that the Import Credit Scheme is due to end in June 2000.

Senator Minchin —That is correct.

Senator GEORGE CAMPBELL —Are there any other companies in the textile industry that have expressed to the department that they are in difficulties?

Senator Minchin —Again, I think it is unwise for forums like this to be used as mechanisms that inadvertently undermine commercial or market confidence in any particular entity. It is really not for us to be talking publicly about matters brought to our attention on a private and commercial basis that could affect the position of any company. We had that problem with Mitsubishi. Companies discuss with us, and with the department, in particular, from time to time their current positions, their forward positions and their capacity to access existing government schemes. I am not aware off the top of my head of anybody who has said that they are about to go out the door. Obviously the department maintains a regular contact with industry.

Senator GEORGE CAMPBELL —I am, Minister.

Senator Minchin —Fine, but I do not think it is fair to discuss these matters in a public forum unless the company itself seeks to do so, because you do not want to destroy confidence in commercial enterprises.

Senator GEORGE CAMPBELL —To some degree I agree with you, and that is why I have not named the company. But I am aware of at least one company that is about to go out the door and that they have had discussions with the department. I am trying to assess whether or not there is just the one company or whether or not there is more than one company in this industry that is about to find itself in similar circumstances to National Textiles. I would not quite put it as `in similar circumstances to National Textiles', but the end result may well be the same. I am giving the opportunity for an overview to be given to us rather than naming specific companies, but if that is the way of getting to an answer, I will do it.

Mr Dean —The department interacts with a lot of companies on a regular basis. It would be fair to say that a lot of the companies that the department deals with in any area believe that they have particular problems that they hope the government might be able to assist with. I think it would be fair to say that at any point in time across a number of sectors we are probably aware of companies that believe they have difficulties.

Senator GEORGE CAMPBELL —I suppose the point I am getting to is this: is the department aware that there is at least one company or that there may be several companies that are in extreme difficulty at the present point in time, and is anything being done to assist these companies?

Mr Dean —I am aware of more than one company, so I am not sure if we are talking about the same one. But within the parameters that have been established under the SIP guidelines and the other avenues we have available, the department makes all efforts to assist companies.

Senator GEORGE CAMPBELL —Will these companies be assisted?

Mr Dean —That is a bit hard to say without knowing exactly which companies we are talking about.

Senator Minchin —The SIP scheme, which starts on 1 July, was developed in very close consultation with industry, as you know, Senator Campbell. I think, at the end of the day, good consensus was reached on the parameters of the scheme in acknowledgment that the existing arrangements could not continue and to provide $700 million worth of assistance over the next five years. Given the industry's support for that scheme, our job now, having laid down those parameters, is to ensure that to the best of our ability every entity that is eligible under the scheme gets assistance.

Our role is to facilitate that assistance. So particularly when any company asserts to us that it is in a particular difficulty, every effort is made to ensure that within the parameters of schemes—because we can only go by legislated and provided schemes—we do everything we can to seek to have them eligible for assistance under those schemes. Sometimes, it is simply not possible. But we make every endeavour to ensure that we do our utmost to get them into the schemes.

Senator GEORGE CAMPBELL —I have to say, Minister, the company that I am talking about—and I will not name them at this stage, but it is not an insignificant company in the textile industry—have made approaches to the department at the highest level. They are in extreme difficulty. I suppose we have to wait and see what you do or do not do. But if they go out the door, the impact on regional Australia will not be insignificant.

Senator Minchin —I think we are all aware of the challenges facing TCF. I am pleased that, again, we have been able to put in place a five-year tariff pause and a significant industry assistance scheme. We will be doing all we can to assist this industry to adjust and go through the structural adjustment that is necessary and we will endeavour to the best of our ability to assist companies to access those schemes and minimise any dislocation from any adjustments that occur.

Senator GEORGE CAMPBELL —Mr Dean, are you aware of a company called Toorallie Ltd at Bombala?

Mr Dean —I am aware of the name of the company. I do not have a lot of detailed knowledge off the top of my head.

Senator GEORGE CAMPBELL —Has that company sought assistance through the TCF best practice program or one of these programs to relocate to Canberra?

Mr Dean —I would have to take that on notice, Senator. I do not know.

Senator GEORGE CAMPBELL —Could you also take on notice what government support or assistance has been provided to this company in the past 10 years?

Mr Dean —Yes.

Senator GEORGE CAMPBELL —Also, if there are any current applications before you by this company for assistance.

Senator MURPHY —I want to go to the import credit scheme and the information that was provided by the department following the last round of estimates hearings and the breakdown that you have given. I am trying to understand but I am not sure that I do understand the way the process works. I was looking at the Hansard on the last exchange on this. Export credits can be used to offset import duties, on the one hand, or can be traded to a third party and, if I understood it correctly , the third party can use those to also offset import duties. That is different to sales tax, isn't it?

Mr Dean —Yes, that is completely different.

Senator Minchin —It is a tradeable credit.

Senator MURPHY —Yes, but I always assumed the scheme was that if you got export credits you could use them to offset import duties payable on parts, materials, et cetera, that you would then use to manufacture a product for the purposes of export or re-export. Is that right? Or can it be used in terms of the tradeable commodity, so that an exporter can get a whole heap of export credits and then sell those to somebody who is an importer of products for retail sale who has no manufacturing operation in the country?

Mr Dean —That is right—confined to TCF products. It is not tradeable outside of TCF.

Senator MURPHY —It is interesting that Olex, over the period 1995 through to 1999, received some $18.6 million worth and, if I read this correctly, they did not use any of those to offset any costs associated with the goods that they manufactured and then exported. They traded them—it says `transfer' but I assume that means that they traded them. What is the checking process to see exactly where these export credits for the import credit scheme are used? What is the trace to determine whether they are actually used just for TCF imports?

Mr Dean —There is an audit system. AusIndustry would be the best to explain that.

Senator MURPHY —I was told by Mr Evans last time that you were in the process of having a bit of an audit, although it has been the responsibility of Customs before. I do not want to be told that again—I know that.

Mr Peel —We do have a regular auditing regime of the TCF ICS process. We audit approximately five per cent of claims annually. We audit all first time claimants; and if in processing applications our people feel there might be some anomaly, those claims are audited also. So there is a random audit process. The department has also put in place recently an internal audit of the scheme overall.

Senator MURPHY —You audit five per cent? What would the total scheme be? You can take that on notice. I would be interested in what the total scheme amounts to—that is, the total amount of refunds, if you like, that are paid.

Mr Dean —Last year, it was approximately $96 million, $97 million.

Senator MURPHY —When did you take the responsibility for this?

Mr Peel —In April 1999.

Senator MURPHY —So you have now proceeded to do checks and balances. What is the process of your audit?

Mr Peel —Our people go through a number of issues when they are looking at claims submitted by companies. They look to check that the product has, in fact, been exported, that the goods exported are eligible goods to receive their input credits, that the shipments that have been claimed have actually gone to the destinations claimed, and that the various criteria of the program are being met. There is a whole raft of things that they have a look at that I will be happy to provide you with later if you wish.

Senator MURPHY —I would not mind getting an outline from you about the audit process. If you have got a list of the companies that you have audited in this respect, I would like that as well.

Mr Peel —I will take that on notice. I am not sure I could provide you with the actual detail there but, if it would be helpful, we have conducted 95 audits so far this financial year, which is about 6.4 per cent of the total.

Senator Minchin —Can I just clarify? Presumably they are spot audits and—

Mr Peel —That is right—random audits.

Senator Minchin —We would not want to inadvertently be suggesting that a company was being audited because we thought there was a prima facie problem.

Mr Peel —It is only audited because the system picks—

Senator MURPHY —I understand they are spot audits. They are just standard spot checks with regard to the operation of the scheme. Maybe I misread Mr Evans's comments but I thought he was saying that you were going to have an audit of the scheme and that—

Mr Peel —Yes, I did mention that. There was separately an audit of the scheme overall since it was established to determine whether it met its objectives, et cetera. It was a sort of a general audit of the implementation of the scheme generally rather than an audit of particular companies. We audit particular companies on an ongoing basis but that is an overall audit of the scheme.

Senator MURPHY —Have you done a report on that?

Mr Peel —No, that has only just commenced.

Senator MURPHY —When do you expect that to be?

Mr Peel —I am not sure. Mr Dean may know the answer to that.

Mr Dean —I would expect in the next few months some time.

Senator MURPHY —Okay. Something that I have been concerned about is whether some of the trade in these credits is actually kosher and what capacity there was for the scheme to be rorted or misused—probably `misused' is the better terminology. Is it your intention as part of your audit to have a look at that?

Mr Peel —The audit would take into account any information that has been gleaned from the regular audit process that we undertake and that would look at those sorts of questions that you have raised.

Senator MURPHY —With regard to the various companies, I think the question that I asked was about the quantum of the funding—I am just trying to check the Hansard as to what Mr Evans said at the time. I think you said that National Textiles had received something in the order of $250,000 under the TCF Best Practice Program. I assume that $250,000 was moneys given only to Australian weaving mills—is that so?

Mr Dean —That is correct—under the best practice program.

Senator MURPHY —And a further $68,000 for the Quality and Business Improvement Program?

Mr Dean —That is correct—1998-99.

Senator MURPHY —With regard to Australian weaving mills—and that is in the information you provided—it looked to me like the full amount of import credits they received was also transferred. They did not use any to reduce—

Mr Dean —That is correct.

Senator MURPHY —And National Bartex got $2[half ] million. They did not use any to reduce import duties?

Mr Dean —That is correct, although National Bartex and Olex are the same entity.

Senator MURPHY —There is a note at the bottom of page 22 that says that import credits issued to Olex Pty Ltd incorporated those issued to Bartex Fabrics. Is that the same as National Bartex?

Mr Dean —No, it is not.

Senator MURPHY —So National Bartex Pty Ltd was also one of the companies associated with Mr Bart?

Mr Dean —That is correct. It is a subsidiary of National Textiles.

Senator MURPHY —Maybe I can go through this in more detail. It is an interesting set of information.

Senator Minchin —While the scheme is coming to an end presumably the designers of the scheme under your government acknowledged the fact, presumably put by industry, that some people who earn export credits could not make full use of getting a reduction—

Senator MURPHY —I understand that.

Senator Minchin —You are quite right to say that ought to be policed to ensure that they are used for the proper purpose.

Senator MURPHY —Yes, and to also look at whether the scheme was misused.

Senator Minchin —Sure.

Senator MURPHY —The scheme was put in place for a specific purpose and it ought to be used for that purpose, not misused. I have no further questions at the moment on that matter.

CHAIR —We will now move on to the rehabilitation of the Maralinga former atomic test site.

Senator ALLISON —I will start with the minister's release on Monday of this week and the attached 17-page statement. Mr Harris, could I ask you whether this statement was run past the department? Do you acknowledge what is in that media statement and do you stand by it?

Senator Minchin —Could I answer that I requested that document to be prepared in the department.

Senator ALLISON —Okay, so the department assisted you to prepare it?

Senator Minchin —Yes.

Senator ALLISON —The release itself says that no major hazard remains at Maralinga. The TAG report says that Tadje is `a long-term health hazard,' and I think the ARL submission to the public hearing of the Public Works Committee said about Tadje:

... this small area north of the Tadje ground zero must be considered a potential hazard well into the future.

Minister, how does that sit with your statement that `no major hazard remains'?

Senator Minchin —I will ask one of the officers.

Dr Perkins —The Tadje area is actually inside the boundary markers around the Taranaki area. In other words, it is an area that is suitable for transit and hunting but not for permanent habitation.

Senator ALLISON —But the minister said that no major hazard remains.

Dr Perkins —It was always understood with the clean up that there would be an area which was suitable only for transit and hunting and not permanent habitation. Tadje is within that area in the Taranaki area.

Senator ALLISON —So it is not quite true to say that no major hazard remains. There is a hazard, but there are some restrictions on access to the site where it is at. Is that correct?

Mr Harris —The remediation works at Maralinga are a hazard reduction process. A contour was set for a risk assessment for Aborigines living in a traditional lifestyle. In an area of that region in the test sites there is a boundary marking out about 120 square kilometres within which, as Dr Perkins indicated, Aborigines are free to travel but not set up permanent habitation.

Senator ALLISON —Is there any intention on the part of the government to clean up the plume area of the bomb site at Tadje, that area about one kilometre long?

Mr Harris —Again, that area which is inside the boundary markers has been cleaned up to the standard that we set out to clean to ensure the area is safe for Aborigines living in a traditional lifestyle.

Senator ALLISON —So the answer is no.

Mr Harris —The area outside the boundary that you may be referring to was considered by our expert advisory group, the Maralinga Technical Advisory Committee, and it was found to be that remediation was not necessary at Tadje.

Senator ALLISON —Even though the TAG report says it is a long-term health hazard?

Mr Harris —You need to go back again all the time to the risk assessment and the risk contour that was established for the clean up operation.

Senator ALLISON —Is north Taranaki in the same situation? Will that area be cleaned up eventually?

Mr Harris —The total area of Maralinga is 3,200 square kilometres. Of that, an area of about two square kilometres was actually scraped and cleaned up because of the very extensive hazard that existed there. An area out to 120 square kilometres, even after that remediation work, was considered to be safe only for transit and for hunting, but not for permanent habitation.

Senator ALLISON —Mr Harris, you said on ABC TV last week that you would have no concerns whatsoever with your family going to visit Maralinga should it one day become a tourist destination. Was that a joke?

Mr Harris —No, it is not. My wife would be on a plane at the first hint that there was a spare seat that she could go on.

Senator ALLISON —Do you have small children?

Mr Harris —I have children aged 19 and 17 and both of those would surely love to be there. The question you may be getting at though is the effect on small children. In terms of Aborigines living a traditional lifestyle, the risk contour was established taking into account the fact that Aboriginal children in those circumstances do sit on the ground. The concern was that those children may pick up a dose of plutonium. Accordingly, the risk contour was set to minimise that.

Senator ALLISON —Children do a bit more than sit on the ground. They play in the dust, by and large.

Mr Harris —That's right.

Senator ALLISON —When you say you are very keen to go to the area, and so is your wife, would you be happy to consume food that had been cooked on the ground in a campfire?

Mr Harris —Studies were done of what the take-up of contamination would be in animals and that was found not to be a health hazard.

Senator ALLISON —So you would be happy to do that. You would be happy to go just outside the soil removal boundary on the north of the Taranaki in the plume area and set up a campfire and eat whatever was cooked there?

Mr Harris —Outside the boundaries I would be more than comfortable to do so.

Senator ALLISON —Just outside the boundary?

Mr Harris —Yes, just outside the boundary.

Senator ALLISON —The TAG report says, in referring to Aboriginal children at Oak Valley, that there is no sanitation, showers, water for washing or ablution facilities. It says:

Because of the unsanitary conditions and high incidence of cuts, sores and burns, many of which become infected, it is concluded that inclusion of soil, ash or dust in these wounds is likely.

The report also says that virtually all children have respiratory diseases and nasal discharges and that dust storms occur in the region as a result of high wind velocities together with high summer temperatures, et cetera.

Do you still maintain that this area is safe? How can we be sure that in 100,000 years, when the plutonium is still hazardous, firstly, the markers in the area indicating it should not be gone through will still be there and, secondly, there will be no will to use this for other than passing through? What measures are in place to see that this area is only traversed and not used for more long-term accommodation in the future?

Mr Harris —I think the short cut to the answer you are looking for is that the department, together with the South Australian government and other stakeholders, including the Maralinga Tjarutja and ARPANSA, is working on a long-term management plan for the site. That will cover not only monitoring of the trenches, but also monitoring of the ground water and monitoring also of the signage that we have placed out there. Those signs are fairly durable but they will need to be looked at from time to time.

Senator ALLISON —So is it not a bit premature to be saying that the area is safe before we have got that long-term management plan in place?

Mr Harris —Sorry, Senator?

Senator ALLISON —Is it not premature to be announcing in such a strong way as you did, Minister, on Monday and you, Mr Harris, have done on occasions in the last couple of weeks that the area is completely safe when we do not even have that management plan in place?

Mr Harris —I think there are two issues there, Senator. One is the clean-up operation, remembering this is a remediation work directed to reduce the hazard out there to, as I have said, a risk contour. Secondly, having achieved those outcomes we then need to put in place a long-term management plan for the site and that is what we are now moving to do.

Senator ALLISON —What is your estimation of the amount of plutonium that is left at Maralinga and not buried—

Mr Harris —On the ground?

Senator ALLISON —and which there is no intention to remove?

Dr Perkins —I think ARPANSA is still in the process of assessing that, Senator, and we expect a report from them later this year.

Senator ALLISON —So ARPANSA is assessing the amount of plutonium which remains on the entire site. Is that what you are saying?

Dr Perkins —Yes. They will have an assessment of that in their final report to us.

Senator ALLISON —Okay. So, again, I put it to you that it is a little early to be saying that the area is safe when we do not have that calculation. I have read estimates that it could be about 10 kilograms. Would you be surprised at that?

Mr Harris —I think we might as well say we would be most surprised if it is that.

Senator ALLISON —Would you? What is the process ARPANSA is going through to make that assessment?

Dr Perkins —They are doing their final monitoring of the site and—

Senator ALLISON —The entire site?

Dr Perkins —Selected portions. They have monitored various parts of the site previously. They are doing their final sign-off and a final risk assessment which will be concerned with looking at the amount of plutonium, at the contamination in various areas, particularly the plumes, and doing a final modification of the risk assessment that was used in the TAG studies because we know we have achieved a better level of clean-up than was originally intended. A lot of the data and assumptions in TAG need to be revised at this stage.

Senator ALLISON —As I understand it, ARPANSA is not doing a full site survey. They are doing some sort of aerial survey which will not necessarily pick up particular instances.

Dr Perkins —But ARPANSA is not doing an aerial survey. They have worked at Maralinga over many years and we have got quite an extensive database of the area as a whole. Essentially what they are doing now is the final touch, the final monitoring. That data will be tied in with all their previously collected data for a final risk assessment—a final study of the site.

Senator ALLISON —The release says that Aboriginal people living a semi-traditional lifestyle on the land will be exposed on average to less than one millisievert of radiation and no Aboriginal person will be exposed to any dangerous dose of radiation. Can you just confirm that one millisievert of radiation? Is that an accurate statement?

Mr Harris —No. This is based on ARPANSA's work and ARPANSA supplied those numbers to us.

Senator ALLISON —At what level would the radiation be at the boundary markers around Taranaki?

Dr Perkins —It depends where you are. There are not consistent levels of plutonium all along the boundary markers. At the highest point, the most contaminated area, it would be about five millisieverts you would get if you lived permanently there.

Senator ALLISON —Right. Where is it one millisievert if that is five?

Dr Perkins —It drops away from the boundary marker.

Senator ALLISON —That is right. Why was the background dose of 2.3 millisieverts not taken into account? Do you not have to add that to the additional one millisievert?

Dr Perkins —Senator, that is just an average figure. That is an average figure that Australians get now. What you get in terms of background radiation varies depending on what sort of rock type you happen to be standing on. If you are on a granite terrain as we are near Canberra we get much higher background than you would say if you were on some sort of limestone, as is the case at Maralinga. Also it varies with altitude; the higher you are the more radiation you get.

Senator ALLISON —Okay, let me ask the question in a different way. Does that one millisievert take into account normal background radiation?

Dr Perkins —Yes.

Senator ALLISON —Will ARPANSA's assessment of what kind of lifestyle will need to be adopted in these areas be a long-term assessment? What period will that cover?

Mr Harris —ARPANSA will work out some risk scenarios. They will go back and review the risk scenarios that were taken into account in the TAG report. They have already started work on what those risk scenarios would cover. They will then be discussed with the traditional owners, the Maralinga Tjarutja and, through the consultative group that Malcolm Farrow, my division head, is chair of, they will also be discussed with the South Australian authorities, then ARPANSA will calculate the exposure levels on the basis of those risk scenarios. To give you just one indication, it is not just a case of how frequently it would be reasonable to assume that an Aboriginal family might camp in the area, but how long it takes to change a tyre, for example. Simple things like that are all taken into account.

Senator ALLISON —No, my question was: was it long term or short term? What is the term that this risk assessment will cover?

Mr Harris —Long term.

Senator ALLISON —What is long term? Is that 100,000 years, to the end of this century or what?

Mr Harris —I think you possibly need to go back to what we are trying to achieve here—that is, that we are trying to ensure that the area is cleaned up to the standard below the risk contour.

Senator ALLISON —No, I am asking a specific question about the time frame.

Mr Harris —You need to appreciate that we take into account all reasonable scenarios. But the point is that we are trying to limit the dose uptake, which is an annualised uptake, so that the risk contour is met.

Senator ALLISON —So the risk assessment is only for a year?

Dr Perkins —The risk assessment will look at various ways someone could get a dosage. It is looking at various behaviour patterns. So a whole range of possible scenarios would be considered: for example, if someone is hunting or, as Jeff said, if someone has a breakdown and has to change a tyre in an area which could be contaminated or someone who is going to be changing a tyre perhaps in a similar way now or in the future. You are looking at behavioural patterns.

Senator ALLISON —But will this assessment say: `The half life of the plutonium in this area is going to be there for 24,000 years'—which is what I understand the half life of this plutonium is? Will it look at the time frame over which we can expect this material to become less hazardous.

Mr Harris —I think the answer to your question is a simple yes.

Senator ALLISON —A simple yes. So we will be able to see that in the document?

Mr Harris —Yes. What you will see in there is a statement of what the hazard at Maralinga is, and that includes the fact that there is plutonium there which has a half life of 24,000 years. You will see the risk scenarios that ARPANSA, in consultation with the traditional owners, the South Australian health officials, and government have worked out as being reasonable scenarios for how Aborigines living in a traditional lifestyle will likely pick up a risk of exposure to plutonium. That will all be very clearly put out in this paper.

Senator ALLISON —I will go again to the attachment to the press release. There is a statement on page 6 from Mr Des Davy of MARTAC that the Department of Industry, Science and Resources engaged a consulting company in the UK to determine a safety case for the disposal trenches and the consultants found that what was done was acceptable and safe for our class of waste. Is it not the case that the company that did that report is actually part of GHD?

Mr Harris —I think it would be incorrect to say that AEA Technology is part of GHD.

Senator ALLISON —What is their relationship?

Mr Harris —They are a separate company and they are experts in this nuclear field. What you may be referring to is that our project manager at GHD took on expertise from AEA Technology—an individual there—and formed a joint venture with that person so that GHD, our project manager, had the appropriate expertise on site to oversight the health physics contractors. By `health physics' I mean the radiation protection workers and the regime.

Senator ALLISON —Was the report a joint venture between GHD and this organisation?

Mr Harris —No.

Senator ALLISON —What is the joint venture? I do not understand.

Mr Harris —A partnership. They came to an arrangement that one person from AEA Technology—a qualified health physics worker—would join GHD, the project manager, to oversight the delivery of health physics arrangements on site by another contractor called CH2M Hill.

Senator ALLISON —So who did the report that is referred to on page 6—the report to determine a safety case for the disposal trenches?

Mr Harris —The report was done by AEA Technology in the UK independently.

Senator ALLISON —At what point did GHD set up the joint venture? Was it before that report or afterwards? How did that work?

Mr Harris —Way back.

Senator Minchin —Just to clarify what Jeff said, the joint venture that you referred to is not with AEA per se; it was with one individual. Is that right?

Mr Harris —No, it was with the company, AEA, to provide the services.

Senator Minchin —A particular service. But the service of that individual?

Mr Harris —Yes.

Senator ALLISON —But there was, nonetheless, some sort of relationship between GHD and this organisation?

Mr Harris —Yes, to provide these services.

Senator ALLISON —Is it not the case that that safety review is for human intrusion into those trenches and not the safety case for the trenches themselves?

Dr Perkins —Certainly various scenarios of intrusion were considered. What do you exactly mean?

Senator ALLISON —I am just going from the statement. It said, `... to determine a case for the disposal trenches'. As I understand it, that report was about human intrusion—the safety procedures regarding digging it up and dealing with it—rather than whether or not the burial pits with the earth covering are safe in the other sense of use of the area.

Mr Harris —I guess, starting off from what we are trying to achieve again, which is the safe disposal of the contaminated material at Maralinga, we then have a full health physics regime, including a lot of arrangements for how we actually dug those trenches, how we actually moved the material to them and how we actually filled them. That included what are called class 2 vehicles, which have positive air pressure filters and so on. The risk assessment is about minimising the risk to people who visit Maralinga. It is about: what are the intrusion scenarios and what are the erosion scenarios for the debris trenches? That is the whole point of it.

Senator ALLISON —I would be grateful if you could have another look at that report and perhaps give another response to that because it is my understanding that this report is not about the safety case for the trenches. I will go back and have a look at it as well and maybe we can take this up at some other time. At page 8 of the attachment, Mr Davy says:

The burial pits contain the contaminated materials at levels well below the base of the limestone ...

How accurate is that statement, Mr Harris?

Mr Harris —I am just trying to find it.

Senator ALLISON —It is the quote from Mr Davy in a box on page 8. It states:

The burial pits contain the contaminated materials at levels well below the base of the limestone ...

Mr Harris —We believe that is accurate.

Senator ALLISON —You believe that is accurate. Isn't it the case that the debris is only two or three metres below the top of the limestone, not at the base of it?

Dr Perkins —The limestone is the rock at the top of a thick sequence of flat-lying sediments. I think Mr Davy was referring to the upper crust of limestone. Beneath that there is a very solid sequence of limestone, sandstone and mudstone. It is a very stable bedrock environment.

Senator ALLISON —Indeed, but how could you say that it is well below the base of the limestone when it is just under the top?

Dr Perkins —I think what Mr Davy was referring to was the very top part of the limestone sequence.

Senator ALLISON —No. He says `well below the base of the limestone'. It is quite clear.

Dr Perkins —Yes. He is saying `the base of the limestone'. It is a thin sequence, say, of a metre or so. The base of the limestone is the cap, but there is a thick sequence of sediments underneath.

Senator ALLISON —A different kind of limestone?

Dr Perkins —Yes, that is right. There are limestones and limestones, but it is a layer of solid, stable rock.

Proceedings suspended from 11.01 a.m. to 11.18 a.m.

CHAIR —Senator Allison, do you have questions?

Senator ALLISON —Thank you, Chair. I would like to go to the decision to abandon vitrification. I understand that GHD prepared several cost estimates for the various options and that they were treating all the pits by ISV exhuming and burying. They were sorting debris, melting some and burying the remainder—the so-called hybrid. They were exhuming the pits and placing all of the debris in a specially engineered pod for melting. Is it possible to get copies of each of those cost estimates and the discussion associated with those options?

Mr Harris —Yes.

Senator ALLISON —Who assessed the cost estimates?

Mr Harris —The cost estimates were assessed by me and our project manager.

Senator ALLISON —GHD?

Mr Harris —Yes.

Senator ALLISON —Were they subjected to any other independent review?

Mr Harris —No.

Senator ALLISON —Why was that?

Mr Harris —Why would it be?

Senator ALLISON —I am asking you the question. Why did you decide not to subject them to independent review?

Mr Harris —The cost estimates were reviewed by our project manager, GHD. That is an independent review of the cost estimates that were done by the ISV contractor. The contract costs for Theiss, which is the earth removal contractor, were reviewed by our independent project manager, GHD.

Senator ALLISON —Independent contract management?

Mr Harris —I think you are looking for who reviewed the fees other than the people who prepared the fees.

Senator ALLISON —I understood GHD prepared them or at least pulled them together.

Mr Harris —GHD brought them together.

Senator ALLISON —Okay, so there were no costs in there that were actually established by GHD?

Mr Harris —There would be costs for GHD because GHD are our project managers but the primary costs are from the ISV operation and from the Theiss operation to build the pods and the burial trenches.

Senator ALLISON —Which of the options was the least costly?

Mr Harris —Can I clarify the options that you have in your mind? The options that I have in my mind are continuation with ISV for the remainder of the project, the `hybrid option' as we have called it, which was to exhume and bury the less contaminated products, and ISV and specially designed pods for the more contaminated products. The third option was to exhume and bury the entire contents of the debris pits.

Senator ALLISON —I have another category but can you indicate which—

Mr Harris —If they are the three, then the cheapest option is to exhume and bury.

Senator ALLISON —Okay, which was the option that was finally chosen.

Mr Harris —It was.

Senator Minchin —Can I refute the scurrilous suggestion which I see floating around in the media that suggests that this decision was made on cost grounds.

Senator ALLISON —Sure. What was the cost difference? How much cheaper was that option from the next cheapest option?

Mr Harris —I really cannot remember off the top of my head.

Senator ALLISON —But you are going to provide us with the cost estimates. Why was it that GHD were not asked to prepare an estimate for burying the debris in a concrete encased enclosure?

Mr Harris —I think the quickest answer to that is probably that it was unnecessary.

Senator ALLISON —Would you mind giving us a longer answer?

Mr Harris —The longer answer is that we took expert advice from our independent advisory committee, MARTAC, and we also took advice from the independent regulator, ARPANSA. The view of those organisations was that it was unnecessary.

Senator ALLISON —I do not have a chance to speak with MARTAC, but ARPANSA said yesterday it was not their role to be advising on different methods. They said that once a method was chosen they simply oversaw the procedures involved in achieving it.

Mr Harris —Yes, that is quite correct. Their proper role is an outcome that they are seeking, and it is for us as the managers of the project to come up with the correct ways to safely handle the product to reach the safe outcomes that we are seeking to achieve, and for ARPANSA then to review those procedures and to review the outcomes that we are proposing to achieve to ensure that they are both safe and do achieve the outcomes.

Senator ALLISON —Can you provide the expert advice that you relied on—obviously it was not from ARPANSA but it was from MARTAC—about there being no necessity to have an estimate for the concrete encasement option?

Mr Harris —I am not sure whether we are able to provide that, but I can certainly assure you that we sought advice on that and we reached the decision, on the basis of that advice, that it was unnecessary to encase the material in concrete when we had already placed the material under five metres of clean fill.

Senator ALLISON —Why is it difficult for you to give us that advice?

Mr Harris —I am not sure that I can find it in a single piece that would satisfy you, but I can assure you, as the manager responsible for the project, that we did consider that option and it was unnecessary to do so; therefore we did not do it.

Senator ALLISON —What was the forum? Was this a meeting that you had with MARTAC and ARPANSA at which it was decided, or did you phone them up and they said, `don't worry about it'? It is a fairly contentious area and I would have thought it would need to be well documented.

Mr Harris —Can we cut to the bottom again on this and say that this is not a contentious area. The key issue remains, as always, that we have to achieve the safe outcomes for the project, and we have to achieve those in the safest way possible. We have achieved those safe outcomes and we have achieved them in the safest way possible.

Senator ALLISON —This project is a very costly one, and it is incumbent on the committee to scrutinise the process of decision making where cost is an issue. I would ask you again if you can provide the committee with the procedure that was adopted in deciding not to even ask for an estimate of this option. It must be a straightforward matter for you to look up minutes of meetings and records on file about this matter. You said you had expert advice from MARTAC and ARPANSA. I am asking you again if you can look at that question and provide the committee with details and evidence of that advice.

Mr Harris —We will have to take that on notice, with your good wishes.

Senator ALLISON —When was the original decision made to vitrify all of the pits?

Mr Harris —In 1996.

Senator ALLISON —Is it the case, as has been reported in the last couple of weeks, that Guttridge Haskins and Davey were on the record very early in their contract as saying that the waste should be buried and not vitrified? Can you confirm that? Can you indicate when those statements were being made by GH&D?

Mr Harris —I cannot verify that.

Dr Perkins —I can say that at various times during the project there was consideration of the way various pit debris could be dealt with. Originally it was proposed by TAG, in option 6C, that all pit debris should be vitrified—turned into glass. Sometime before the commencement of the Maralinga project on the ground, there was consideration of some of the pits from areas other than Taranaki whether vitrification was a suitable process to treat those. There were various discussions with MARTAC and with the project manager, and it was decided that some of those pits should be exhumed. That was very early on in the project, so that particular decision would have been made in 1996-97.

Senator ALLISON —How many pits were there all together? In 1996, what number of pits were determined would be vitrified?

Dr Perkins —There were 21 known pits at Taranaki. There were also pits at TMs and Wewak. I think there were two pits at Wewak and four at TMs.

Senator ALLISON —For the sake of the exercise, can we concentrate on the 21 at Taranaki?

Dr Perkins —The point I was making was that there was reassessment all the way through as to whether ISV was a suitable method to treat pit debris. That started early on and it started at sites other than Taranaki.

Senator ALLISON —Nonetheless, in 1996 the decision was made to do the 21 pits in ISV at Taranaki.

Dr Perkins —In 1996, the Public Works Committee finally okayed the use of the ISV technique at Maralinga. The Taranaki pits were amongst those, but I think also at that stage there was a possibility that ISV could also be used at some of these other sites, and then there were subsequent considerations.

Senator ALLISON —So in 1996 the agreement and the funding were in place for the pits to be vitrified—those 21 and some others. That was after a process, and of course the TAG report canvassed a whole lot of options. Presumably that decision in 1996 was a result of all of those options having already been discussed. Why was the question then reopened about—again, for the sake of simplicity—the 21 pits at Taranaki? What was the trigger that said, `Let's have another look at all the options'?

Mr Harris —It is easy to visualise Taranaki as being two semicircles of pits and in a set of pits that are in a more defined host material—and there are about 13 of those. There is an outer ring of pits, and there are about eight of those, which are in a more sandy, less defined substance. When we were on the ground at the ISV stage, it ended up that the diffuse conditions of those outer pits, when we reviewed the progress with the ISV and the inner pits, we could not satisfy ourselves that the melt product would be contained, particularly in a lateral way, given the very large size of those outer pits.

Senator ALLISON —Is there some documentation about the discussion on that? Could it be provided to the committee?

Mr Harris —Yes, there are MARTAC minutes; we could find something about that for you.

Senator ALLISON —So, out of the 21, how many pits were in doubt at that stage?

Mr Harris —Eight.

Senator ALLISON —What was being canvassed as an option?

Mr Harris —That was when we moved to the hybrid option. We moved to the hybrid option prior to the explosion on 21 March.

Senator ALLISON —In roughly what year did that discussion take place?

Mr Harris —In 1998.

Senator ALLISON —By virtue of the way that the Guttridge Haskins and Davey contract was written, did they stand to gain financially by moving to a shallow burial?

Mr Farrow —No.

Senator ALLISON —Categorically no?

Mr Farrow —Yes.

Senator ALLISON —Minister, in your statement on Monday you said that a reason for abandoning the ISV program was that `the pits were not as highly contaminated with plutonium as originally expected'. Does the department now know exactly how much plutonium was buried? How can it know that when, as I understand it, there has not been an inventory of each the pits?

Mr Harris —I will give two parts of an answer here: the first part is that we do now know, as a fairly good estimate, how much plutonium was in the pits because we put trace elements into the melts, and we then analysed those trace elements when the melt had cooled down by chipping the blocks at various points around them. But I think it also needs to be said that, when the decision was taken for ISV, we did not know the true contents of the pits in terms of their plutonium content.

Senator ALLISON —How reasonable is it to argue that the pits that were vitrified represent the same level as the other pits that were not?

Mr Harris —ARPANSA has also provided us with estimates of the plutonium content of the debris that was excavated from the outer pits and placed in the burial trench.

Senator ALLISON —How did they do that?

Mr Harris —They are experts at that and they have monitoring equipment.

Senator ALLISON —They said yesterday that they only looked at some of the larger pieces and that they had to do it at a distance.

Dr Perkins —As well as ARPANSA's measurements, the health physics provider, CH2M Hill, also conducted monitoring as the material was being excavated; they did some very general measurements. They submitted those to ARPANSA for examination. ARPANSA also independently took some very general measurements of some of the debris as it was being placed in the trench. So, in actual fact, we have two sources of information on that. They are estimates, but they are quite reasonable estimates.

Senator ALLISON —And they are estimates that pretty well accord with the work that was done in the 1980s. Would that be fair to say?

Mr Harris —It depends on which way you are heading there in the sense that the records for Maralinga are not particularly robust. Some of those records indicate that the amount of plutonium at Maralinga could be as high as 20 kilograms.

Senator ALLISON —Where did that come from? I saw that in the TAG report but I could find no reference to the 20 kilograms elsewhere. As I understand it, the British have always said that there were about 2.2 kilograms of plutonium, and another report said that there could be two to four kilograms.

Dr Perkins —It is the Pearce report that says 20 kilos. There was a whole range of estimates that were conflicting, and MARTAC's view at the time was to take the most conservative estimate. They were all speculative; every single one of them was speculative. The only time we really knew was after we had actually measured the plutonium content in the debris in the various pits.

Senator ALLISON —So if we took the most conservative estimate, which is some 10 times more than what the British said in two other reports, we can hardly say now that the pits were not as highly contaminated with plutonium as originally expected, surely? Wouldn't a more accurate statement be that the less conservative estimate was the one that turned out to be the case?

Mr Harris —The expectation that we worked on was the conservative estimate of the 20 kilograms. To give you another indication of how difficult the British records are, we were led to believe that there were 21 pits and that those 21 pits were dug vertically, with straight sides, and capped with concrete of a rectangular shape that overlapped the boundaries of the pits. This is a fabrication of reality. In reality many of the pits were of a less geometrically regular shape and, on some occasions, the rectangular piece of concrete might have been placed on top of the pit or it might have been placed a few feet away.

Senator ALLISON —Are you suggesting that the British fabricated that bit of information?

Mr Harris —I am suggesting that the British were keen to leave Maralinga and that, after they had made the decision to leave, their clean-up operation, as history has shown, left a lot to be desired.

Senator ALLISON —So the pits were larger, were they not, than was anticipated?

Mr Harris —Very much larger.

Senator ALLISON —Did we make representation to the British government when it was discovered?

Mr Harris —We have certainly written to the British government at numerous times during the rehabilitation project and at every stage where some new element has come in, such as undiscovered debris pits, the explosion that occurred on 21 March and the irregular shapes of the pits.

Senator ALLISON —Was there a request for the British government to provide further funding to deal with the size of the pits, or not?

Mr Harris —I think that we as project managers have taken our task to be the safe rehabilitation of the site within the budget that the government has given to us.

Senator ALLISON —But cost is an issue, isn't it? Surely if the pits are bigger, particularly if they are to be vitrified, the task is more substantial.

Mr Harris —It may help if I say that the settlement reached with the British was a one-off settlement between the respective governments and that it was a `don't come back again, please'.

Senator ALLISON —And we did not.

Mr Harris —As project manager, I have not.

Senator ALLISON —Minister, do you know whether the government ever went back?

Senator Minchin —No, we did not go back. I was not around at the time the original agreement was made. I think it was [pound ]20 million. Those involved in those negotiations should be congratulated for extracting [pound ]20 million at the time. Without having read the document, I have no doubt the British government, in making that grant, did so on the basis that there would be no further contribution of funds. As I said, at no stage in the time I have been responsible has it ever been suggested that there would be any point in seeking additional funds from Britain.

Senator ALLISON —If I can go back to the pits for a moment, in the records of what is in those pits there seems to be an issue about the fact that there were nine concrete firing pads which do not appear in the inventories of those pits. Can you explain that?

Dr Perkins —I understand this is a matter that MARTAC has considered and is still in the process of considering. You have to understand that 11 of the pits at Taranaki were actually melted and all the material within them was converted into glass. It is impossible for anyone to say how many firing pads might be contained within those glass melts.

Senator ALLISON —So you would expect all of them, including the ones reported as being likely to be contaminated with between 16 and 160 grams of plutonium on each pad, to be in the pits that were vitrified, is that correct?

Mr Harris —No, we cannot say that all of the concrete pads are in the pits but we can say that it is not possible to account for every firing pad because some firing pads were melted necessarily in the pits. That is all we can say.

Senator ALLISON —What are MARTAC doing? Are they examining the burial pits? How are they going to tell you? What is this consideration going to do?

Dr Perkins —They are looking at the records. If the inference is that there are some firing pads that have somehow been missed, I can assure you that is not the case. As well as exhuming all the debris pits at Taranaki we have done a very extensive ground magnetic survey which would have picked up anything like that.

Senator ALLISON —Okay. I would like to go back to the hybrid solution that was announced by the department in September 1998. What happened to that hybrid solution?

Mr Harris —We were beginning to melt the eleventh pit. We had two more melts to go of the inner pits, which we decided we would continue to ISV. We were then to move on to exhume the outer pits for the hybrid works. On 21 March, before we completed melting the eleventh pit and therefore before we had even started the last two of the 13 inner pits, we had the explosion.

Senator ALLISON —Why did the explosion make a difference to the hybrid model? As I understand it, the ISV for the hybrid model was to remove the material from the pits and to vitrify ex-in situ.

Mr Harris —Indeed it was.

Senator ALLISON —So what difference would the explosion make to that decision?

Mr Farrow —Senator, we could get no conclusive answer as to what had caused the explosion.

Senator ALLISON —But surely the explosion is going to be caused by something which might be able to be identified if the material was removed from the pit. Are you saying that, when you took the material out of the pit, you still did not know whether it was explosive or not?

Mr Farrow —We do not know what caused the original explosion. We do not know that it was explosives in the pit. We do not know what it was. The reports that we have received are not conclusive in that regard.

Senator ALLISON —I understand that, Mr Farrow, but you must have some idea of what causes an explosion in the general sense of the word, even if you do not know whether it was a gas bottle, an explosive, a drum of bitumen or whatever. Surely if you can look at it you can understand whether it is going to make an explosion or not.

Mr Farrow —The answer is that you cannot. We do know what caused the explosion. Over the life of the vitrification of the earlier pits there were various excursions that took place and there were bubbles of gas coming up. They do not know, to this day, what the cause of the explosion was. So we could get no conclusive advice as to whether it was caused by something that was in the pit or a product of the process itself. We just do not know what caused the explosion in any conclusive way.

Senator ALLISON —But isn't the point of exhuming and sorting and then revitrifying that you actually look at each piece?

Mr Farrow —Even if we had looked at each piece we would not have known whether it was the contents of the pit that had caused the explosion or a build-up of gas from limestone or what had caused the explosion. We could not tell. The experts could not tell.

Senator Minchin —Your line of questioning would be reasonable if you could, with absolute confidence, confine the cause of the explosion to the pit contents. I think the point being made is that it was not possible to do that and that causes beyond content of pit were possible which rendered it unsafe to continue.

Senator ALLISON —I am not talking about in a pit, though, I am talking about ex-in situ, where the material is taken out and then it is vitrified.

Senator Minchin —If it is something about the process itself, not just the pit, it does not matter where you deal with the contents of the pit or, in other words, the material. If you could confine the causes of the explosion to what was in the pits, that is one thing; but the point is being made that there was no confidence that that could be done and that, wherever you conducted the process, if it were the process itself then it was not safe to continue.

Senator ALLISON —How much money was spent on the development of the process?

Mr Harris —Within one hour of that explosion, four workers were due to be on top of the equipment. That brings it into sharp relief that, in our view, the risks had suddenly changed. It was not a safe process to use.

Senator ALLISON —We are talking here about the hybrid situation, not the pits. As I understand it $3 million was spent on the development of ISV over a period of six years. Why was it not possible to sort out what sort of material would explode and what would not? Surely after that kind of expenditure you would have some confidence in the process.

Mr Farrow —Based on our experience following the explosion, we did not have confidence that we could switch it on again, even in a hybrid situation, and guarantee the safety of the work force there.

Senator ALLISON —In November 1998, I understand that the convenor of MARTAC, Mr Des Davy, asked you, Mr Harris—and I quote:

Would you welcome advice to terminate Geosafe's contract, abandon the hybrid and go for excavation trench disposal at some nominal depth, say 10 metre depth cover?

Was that advice provided to the department?

Mr Harris —We sought advice from MARTAC as to what the treatment options should be for the remainder of the project, given the explosion that occurred on 21 March.

Senator ALLISON —That is not what Mr Davey said. I will repeat it:

Would you—

that is, would the department, and you, Mr Harris—

welcome advice to terminate Geosafe's contract, abandon the hybrid and go for excavation trench disposal ...

It is quite clear.

Mr Harris —I do not recall the particular email.

Senator ALLISON —I will provide you with a copy.

Mr Harris —No, I am saying that I do not recall the particular email.

Senator ALLISON —And you do not recall welcoming, if you like, the advice from MARTAC to this effect?

Mr Harris —If I responded to that email—and I would be surprised if I did—it would be in the following manner: that we always welcome MARTAC's advice on options for the safe conduct of the project.

Senator ALLISON —Did you ever instruct MARTAC or ARPANSA as to the sort of advice that was sought or given?

Mr Harris —No, but we have asked them for advice.

Senator ALLISON —Did you indicate to them at any stage what that advice should be, such as in this instance?

Mr Harris —We discuss our views on the project from time to time with ARPANSA and we then rely on ARPANSA giving us their independent advice.

Senator ALLISON —In a frank and fearless manner.

Mr Harris —Indeed.

Senator ALLISON —What is the relationship between the department and ARPANSA and MARTAC? Let us start with ARPANSA. What sort of money has been paid to ARPANSA from the department for their services relating to Maralinga?

Mr Harris —I am not sure that I can give you that answer as quickly as that, but I might have it in a table. A rough estimate of that—and I would be happy to come back to you again on it—is between $4 million and $5 million.

Senator ALLISON —What is your understanding of the lines of responsibility? I know it is a rather unusual case—this kind of understanding that you have with ARPANSA. Who does ARPANSA report to in relation to Maralinga in the first instance?

Dr Perkins —There are various aspects of ARPANSA's involvement with the project. What are you specifically referring to?

Senator ALLISON —I am referring to the contract, the arrangement, between your department and ARPANSA. I am asking who, in relation to Maralinga, ARPANSA answers to. Is it Senator Minchin, as the minister for your department?

Senator Minchin —They do not answer to anybody. They are an independent regulator; there is a purchasing contract. They do not answer to us. They are an independent body who oversee the work.

Senator ALLISON —So in relation to advice that is sought from them, does ARPANSA need to respond to that advice through the department that they are attached to or does it come direct to your department?

Mr Harris —No. As an independent agency, they respond to us. However, I should also make the point that ARPANSA is an independent agency and they also report to parliament through their annual report.

Senator ALLISON —The decision that meant the abandonment altogether of vitrification: when was that taken?

Mr Harris —On 16 August 1999, I wrote to GHD telling them to proceed with the burial option.

Senator ALLISON —Was that the first time the decision was announced?

Mr Harris —That is the final stage in the process of our formalisation of the decision.

Senator ALLISON —When was the first announcement of the decision?

Mr Harris —That would be the first formal announcement of the decision.

Senator ALLISON —Why do you make the distinction between an announcement and a formal announcement?

Mr Harris —Because the changes on this project have been very complex and very difficult. The move, for example, to the hybrid process from ISV took a very long time through the consultation processes that we went through, through the ARPANSA regulatory processes that we went through. The same process of consultation and putting in place the correct procedures and getting ARPANSA's sign-off for the procedures that we had proposed meant that it took some months before we were in a position to formalise the implementation.

Senator ALLISON —At what date was the actual decision made?

Mr Harris —The actual decision: on 11 August the minister approved the burial option.

Senator ALLISON —Who actually made the decision?

Mr Harris —The minister made the decision.

Senator ALLISON —The minister?

Mr Farrow —On recommendation from the department.

Senator ALLISON —So when was it decided what the recommendation to the minister would be—at what meeting and on what date, and who was there?

Mr Harris —I think what you may be referring to—and it might help—is this: are you referring to a meeting that took place of the consultative group on 23 June 1999?

Senator ALLISON —Is that where the decision was made?

Mr Harris —No.

Senator Minchin —The formal decision making responsibility rested with me, based on the department having consulted with the consultative group, all the stakeholders involved, and sought the views of the technical committee and ARPANSA. It brought to me a consolidated recommendation based on all that evidence, which I then assessed. I then accepted the recommendation from the department.

Senator ALLISON —So it was the consultative committee that formulated the advice or part of the advice to the minister?

Senator Minchin —They were involved in the process of preparing advice for me.

Mr Harris —We consulted with them.

Senator ALLISON —Sorry, who consulted with the committee?

Mr Farrow —The department. It is a consultative group of which we are a member, and chair.

Senator ALLISON —Who else is on the consultative committee? There is a member from MARTAC and someone from ARPANSA. Is that right? And who on the department is represented on there?

Mr Farrow —And the Maralinga Tjarutja, and the South Australian state government officials—their Premier's department, their health department, their Aboriginal affairs—and ATSIC.

Senator ALLISON —Was this a consensus decision? This is on 23 June, is it? Did everybody agree at that consultative committee that we should proceed with an alternative to ISV?

Mr Harris —The consultative committee is a consultative committee of stakeholders, where we explore with them all elements of the project, from decisions as to whether to move to the hybrid, the burial option, the asbestos removal, all sorts of issues. We consult with stakeholders on making our recommendations on changes to the project.

Senator ALLISON —And on 23 June the committee ticked off the abandonment of ISV, did it?

Mr Harris —At the 23 June meeting I indicated to the consultative group that I was coming to the view that we could not expect that a sound answer to the question of what caused the explosion on 23 March would emerge, on the basis of the considerable information that we already had available, and that we were moving to a clear preference to move to the exhume and bury option.

Senator ALLISON —Yes?

Mr Harris —That is what I did.

Senator ALLISON —That is not the question I asked you.

Senator Minchin —Could I say that this is not a decision making body. It was a consultative group where the government informs the assembled stakeholders of our position and seeks their views. I think what you are asking is what were the views expressed at that meeting about the options before the government.

Senator ALLISON —You say it is a consultative committee, and it seems to have some relevance, Minister, to your decision making. I just wondered what your view was.

Senator Minchin —You are describing it as a decision making body.

Senator ALLISON —No, I am not.

Senator Minchin —I think it is now appropriate for Mr Harris to indicate to you the views, if any, expressed at that meeting on 23 June about the options facing the government.

Senator ALLISON —What were the views, Mr Harris?

Mr Harris —The views of a key stakeholder body, the Maralinga Tjarutja, were indicating that we would be premature in moving to the exhume and bury option before Maralinga Tjarutja had been able to fully review all the material and await the final reports on the cause of the explosion.

Senator ALLISON —So they said, `Too soon to make a decision on this. We want to wait until there is a report of the explosion'?

Mr Harris —They wanted to wait until the spread of information is available—till all the information is available.

Senator ALLISON —Were they, at some subsequent meeting, given all of the available information, and then did they say they were happy with it?

Mr Harris —They have been given all the available information that we have been able to give them.

Senator ALLISON —You keep not answering that question, Mr Harris.

Mr Harris —I am sorry, I must have lost the second bit. What was it?

Senator ALLISON —The second bit was: what was their response once they had all the information?

Mr Harris —At the end of the day, the Maralinga Tjarutja subsequently wrote to the minister disassociating themselves from the decision to move to the exhume and bury. However, they made no suggestion that they considered that that was either an inappropriate decision or that the burial option was one that was not safe.

Senator ALLISON —They just wanted to disassociate themselves with it?

Mr Harris —Yes.

Senator ALLISON —The meeting on 23 June of the consultative committee seems to me to be a meeting at which a decision that you had already made was taken to this consultative group, and you announced it as something of a fait accompli. Would that be a reasonable summary?

Mr Harris —It would not be, because I was not the decision maker on this matter, but certainly that was the view I was forming.

Senator ALLISON —And this was done before you had the report of the explosion?

Mr Harris —What we had prior to that date was a draft report from the contractor about the explosion.

Senator ALLISON —It was a draft report on 23 June? What date was that report?

Mr Harris —Some time prior to that meeting, but in June.

Senator ALLISON —Some time in June. That report then took another four weeks before it was finally released?

Mr Harris —No. It was not finalised. You might be asking whether we gave across a copy of that report to the consultative group, but we did not receive the final report itself until 15 November.

Senator ALLISON —How different was this draft report from the final report?

Mr Harris —As I recall, it was considerably thicker but the conclusions were the same. The conclusions in that report were that the contractor considered that the most likely cause of the explosion on 21 March was the existence of explosives in the pit.

Senator ALLISON —So from mid-June to mid-November there is no difference in the conclusions, but it took that long for the final report to be drafted: can you explain that?

Mr Harris —No: for them to provide the report.

Senator ALLISON —Can you explain why it took so long?

Mr Harris —I can only say that we regularly and frequently requested the contractor to provide the report and that the contractor took until 15 November before they gave us the final report. However, during that period, we also went through a process and selected a reviewer to audit the report. That report was made available to us.

Senator ALLISON —This is to review the draft report?

Mr Harris —Yes. On 6 July.

Senator ALLISON —Okay. You started to indicate whether the draft report was provided to the consultative committee. Could you confirm whether that was the case or not?

Mr Harris —Yes. We provided the draft report to the consultative committee.

Senator ALLISON —Notes of a teleconference between the department and ARPANSA on 1 July, a week after that 23 June meeting, said:

After considerable discussion it was agreed that ARPANSA would provide its written review of the exhume and burial option to DISR within 4 weeks as a separate approach from actually granting the licence.

Why would ARPANSA do that review, and is that the independent review you were referring to? Why would they do that review if the decision had already been made? The conclusions were there in the draft report, and you had already indicated to the consultative committee that this was the way you were going to go: why would you then ask ARPANSA to do a review?

Mr Harris —I do not want to leave you with the impression that the decision was taken at that time. What I communicated to the consultative group was that we were coming to the position that that was the direction in which we wanted to go, on the basis of the available evidence. I also suggested to the consultative committee that I did not see any likelihood that further papers that were always being developed were likely to be more conclusive than the draft report.

Senator ALLISON —Again, what was the point of the ARPANSA review?

Mr Harris —Before we can actually proceed to do the burial option, we also have to put in place all the approvals for it.

Senator ALLISON —So that review was conducted by ARPANSA?

Mr Harris —Yes.

Senator ALLISON —Can a copy of that review be provided?

Dr Perkins —Yes. I am a bit unclear. I think there is a bit of confusion as to what review we are talking about. Mr Harris referred to a review—by Robsearch, I think he meant—of the pit 17 report, and so it is the audit of that report. Is that what you are referring to?

Senator ALLISON —I am referring to the notes of the teleconference on 1 July—perhaps you can check this at some stage—where it was said that after considerable discussion it was agreed that ARPANSA would provide its written review of the exhume and burial option within four weeks as a separate approach from actually granting the licence. I am just asking for an explanation of that and also whether the review referred to was done and, if it was, whether the committee can have a copy.

Mr Harris —Yes, you can; and yes, it was completed. We received that advice on 2 August, and we will provide a copy to the committee.

Senator ALLISON —The same teleconference notes said:

Peter Burns did suggest that it may be sensible to concrete encase the highly contaminated items, which, in his view, only amounted to a small number of units.

Why was that not considered?

Dr Perkins —That was just an idea that occurred to Peter Burns. There was discussion of it at the teleconference, as you will read if you follow through on the document, and the idea was then dropped by Peter Burns. It was just something that was floated, discussed and then dropped.

Senator ALLISON —Why was it dropped? What were the arguments against doing it?

Dr Perkins —I do not really think Peter Burns was suggesting it as a major safety measure, if that is what you are implying. I think he was just thinking to isolate in the short term the very contaminated plates. But there were reasons why that was not very practical in terms of having to sort material. That was the sort of discussion we had and, at the end of it, Peter dropped the idea.

Senator ALLISON —This option of concrete encasement is something that was floated in the options in the TAG report, was it not? Why has it suddenly become impractical?

Mr Harris —Yes, it was one option. But again we are looking to the outcome, and the process that we went through and the way we designed the burial trench has been approved by ARPANSA. I think that is the key point. It might also be of interest to the committee to note that the burial trench also has a couple of layers of plastic to clearly identify for people who are wanting to intrude in that trench that they ought to pay attention to what they are doing. That is in addition to the signs that are placed around the trench and to concrete plinths that we are putting at the location.

Senator ALLISON —Just as a matter of interest, what is the life of the plastic?

Mr Harris —I can only tell you that we got some heavy duty plastic, and I think it is a few thousand years.

Senator ALLISON —A bit of plastic lasts a few thousand years? Fascinating.

Dr Perkins —We have a more durable marker horizon, a layer of vitrified block material that will last for a considerable time in a geologic sense.

Senator ALLISON —A vitrified block material: what is that?

Dr Perkins —They are bits of ISV block material that will be placed as a marker horizon in the trench and also to compact the underlying material.

Senator ALLISON —I am sorry: what do you mean by a `marker horizon'? A tag on top, or something, is it?

Dr Perkins —It is like a layer of plastic.

Senator ALLISON —A layer over the whole mound?

Dr Perkins —A layer not over the mound, but within the debris within the trench. So it is a layer of clearly different identifiable material placed over the underlying material in the trench, so that anyone who was intruding would intersect a material that is very different from the surrounding material.

Senator ALLISON —What is the size of it?

Dr Perkins —I think it covers the entire area of the trench at a certain depth. It is really a marker layer that overlies the underlying debris.

Senator ALLISON —MARTAC, in its comparison of vitrification with exhumation and burials, said that ISV represents a final solution and will not need to be redone. That suggests that the burial pits will need to be redone at some stage. What is your estimate of the time frame for that?

Mr Harris —A better way to look at it is that we have disposed of material—I am sorry to keep on using these words—safely, against the foreseeable scenarios that the regulator has developed for us. We are also putting in place a long-term monitoring program to ensure that we are regularly inspecting the integrity of the trenches and any likelihood of erosion, et cetera.

Senator ALLISON —Mr Harris, that is not my question.

Mr Farrow —I do not think that the conclusion you draw—in other words, you say that MARTAC said that vitrification would be a final solution and would not have to be redone—of itself means that an exhume and bury option would have to be redone at a later date. It is not our assumption.

Senator ALLISON —What does it mean then?

Mr Farrow —It means what it says—that a vitrification process, had it worked, would not have to be redone.

Senator ALLISON —But they are comparing ISV with the option that was finally adopted. You cannot just say that this is a throwaway line by ISV. They are saying that ISV will not need to be redone.

Mr Farrow —But they are not saying all other options would need to be redone, are they? I would have to read the whole context.

Senator ALLISON —I do not know. Is that MARTAC's advice? Do they indicate that—

Mr Farrow —Is that just a sentence that you have or is it in the context of a fuller report?

Senator ALLISON —It is, but I probably cannot turn it up now. I can do that later if it is necessary. You could confirm that, I am sure, with MARTAC anyway. Perhaps you can get back to us on that.

Mr Farrow —There has been no suggestion by MARTAC that the exhume and bury option that we have now had to go to will need to be redone.

Senator ALLISON —Wouldn't you think they would say, in that report, that neither of them would need to be redone—if they are talking about a comparison?

Mr Farrow —I would have to read the context of the report that you are quoting from.

Senator ALLISON —Perhaps you can get back to us on that. Minister, on Monday you said:

We have at all times been guided by the advice of Australian, British and American experts with experience in atomic test site remediation.

Can I ask—perhaps Mr Harris can best answer this—whether any of the experts who were associated at any time with the project disagreed with the final exhume and burial option?

Mr Harris —MARTAC, as I think I have said in other places, is a grouping of scientists and they do have independent views. I have indicated to MARTAC on a number of occasions that we respect the independence of the frank and fearless advice of MARTAC members but that we also need from MARTAC an indication of what its general view is. As a result of that, we have always got a view from MARTAC, but there are dissenting views on MARTAC.

Senator ALLISON —It is not quite true to say that we have all the scientists on board, Minister, you would have to say.

Senator Minchin —I have said that we have the endorsement for what we are doing of the technical advisory committee.

Senator ALLISON —You did not. You said that you have been guided by the advice of Australian, British and American experts with experience in atomic test site remediation.

Senator Minchin —Are you suggesting that we have not been?

Senator ALLISON —We have just found that members of MARTAC did not necessarily agree, but we took the majority view. Minister, you should have said `the majority of those that we dealt with'.

Senator Minchin —That is a ridiculous, silly criticism. Of course we are guided by the committee in everything we do. I have never been on anything where you get a unanimous view. It is ridiculous to suggest that you might.

Senator ALLISON —I am not suggesting it. You did in your release; not me.

Senator Minchin —If one out of six do not agree but five out of six do, that is fine by me.

Senator ALLISON —Isn't it the case that all of the members of MARTAC agreed that vitrification was a far superior method of dealing with the waste than any other? I quote Dr Mike Costello, who is himself an international authority on plutonium:

I don't believe that shallow burial is 1) within the spirit of the UK National Radiation Protection Board Code. (I accept that it is within the letter)—

but not the spirit—

or 2) that it is accepted practice. However, I am outvoted by my colleagues. I have experience with plutonium at Sellafield in the UK. There are much smaller quantities of plutonium there. The amounts varied yet whilst miniscule, it had to be enclosed in concrete. I don't believe this shallow burial is the best that we can do, as it could be encapsulated in concrete.

How does that comment, albeit from only one member of the committee, sit with Dr Loy's announcement that claims that what has been done is not world's best practice are unfounded?

Mr Farrow —As you note, that is the view expressed at a consultative group meeting of one of the members of MARTAC.

Senator ALLISON —Even though the rest of the committee agreed that vitrification was the best solution, it is not.

Mr Farrow —The rest of the committee agreed in a certain context that vitrification was a desirable way to go. Subsequent to that, as we have said and as you know, there was an explosion following which we could not guarantee the safety to a reasonable level of anybody who was going to be involved in the process. What MARTAC said about vitrification—whatever the words you used were—has to be taken in the context in which it was said and the time at which it was said, and you need to take into account the events that happened subsequently.

Senator Minchin —Senator Allison, your line of questioning completely ignores the fact that the government was faced with an explosion which put workers' lives at risk. We were faced with a decision as to whether to continue to put those lives at risk or adopt another method for disposing of this waste. You have to accept that fact.

Senator ALLISON —I do not have to accept it, Minister.

Senator Minchin —Lives were at risk and we had to make a choice. You seem to completely disregard the welfare of the workers in your line of questioning. Therefore, it is naive and very difficult for us to answer your questions.

Senator ALLISON —Others will be the judge of that, Minister. Would a simple burial of plutonium in an earth pit covered by soil be allowed in other countries, such as the United States or the UK?

Mr Farrow —The answer is that the remediation was carried out in accordance with international guidelines.

Senator ALLISON —That was not the question.

Mr Farrow —That envisages that plutonium would be buried in a soil pit covered by clean fill.

Senator ALLISON —Can you tell me where that happens in the United States or the UK?

Mr Harris —Could we go back one step, Senator, and—

Senator ALLISON —I would rather have this question answered first, if you would not mind.

Senator Minchin —Allow them to answer the question in the best way they can, please, Senator Allison. They will answer your question. Allow them to answer it.

Senator ALLISON —Mr Harris has asked if we can go back. I am asking if we can make sure we do not miss this question.

Mr Harris —Yes. Maralinga was a contaminated site. The aim of our remediation works there were to reduce the hazard. We have reduced the hazard in a manner that is consistent with the international guidelines on remediation of former nuclear test sites. We are the only country in the world that has remediated a former nuclear test site for return to habitation. The answer to the question about the burial of plutonium is that, in the view of ARPANSA, the burial of plutonium in the manner that we have done it does satisfy the code.

Senator ALLISON —You say Australia is the only place where there has been a remediation of a test site. Is it not the case that this has happened in Nevada?

Mr Harris —I did not say `the only place where there has been a remediation of a test site'. I said it is the only place in the world where there has been a remediation of a test site for a return to habitation. In the case of Nevada, the site has been cleaned up for continued military use, and it is certainly the case that in Nevada there is still an awful lot of plutonium on the ground.

Senator ALLISON —Why should there be a lesser standard for Maralinga, where there is human habitation, than for a test site?

Mr Harris —I would take the contrary view, Senator. I think you would probably mean that as well.

Senator ALLISON —As I understand it, the material from Nevada was collected up—I forget the exact name of the place where it was cleaned up from.

Mr Harris —Double Tracks?

Senator ALLISON —No, it was not Double Tracks. It was actually taken to the Nevada test site from elsewhere, some 400 kilometres away, and it was put into a burial facility which was an engineered one. It certainly wasn't an earth pit in the ground covered by more earth. Why do you imagine that would be more stringent than the system adopted finally in Australia?

Dr Perkins —That situation you refer to in Nevada is a completely different situation to this site—

Senator ALLISON —I agree; totally different.

Dr Perkins —simply because those particular disposal facilities were already there. It is just a totally different situation. It is silly to compare it with Maralinga. It happened that there were low level waste disposal facilities in a different part of the Nevada test site from the area that was being cleaned up, and it was convenient to remove the material to that particular location. But the situation we faced at Maralinga was a completely different one.

Senator ALLISON —So this was different because there was already a disposal facility there and so it was convenient; is that right?

Mr Harris —No. I think you need to go back again and remember that at the Nevada test site there is still plutonium contamination. You cannot go out to the Nevada test site and use it as you can the Maralinga test site. As I am told, 470 grams of plutonium was removed to the low level repository in the United States. That is leaving a total of something like one to two kilos of plutonium still on the ground at the Nevada test site.

Senator ALLISON —But people are not living there or walking through it or making campfires or anything, are they?

Mr Harris —No. That is right.

Senator ALLISON —And is it not the case that we may well have up to 10 kilograms of plutonium at Maralinga?

Mr Harris —Again, we have put that material, against our risk scenarios and against the uptake dosages that are all built into those scenarios, into burial trenches to reduce the hazard.

Senator ALLISON —What are the limits that the United States and the UK put on placing plutonium in unlined repositories?

Mr Harris —I think we would have to take advice on that.

Senator ALLISON —Is it your understanding that there is some level of plutonium that could be put into an earth burial, or not?

Dr Perkins —I think you are still confusing practices with interventions. You are saying: if you wanted to set up a waste disposal facility, what would the limits be? That is a different question to what we are doing at Maralinga. It so happens we did choose to follow Australia's guidelines, the code of practice for the near surface disposal of radioactive materials, in what we did at Maralinga. But it was a different situation to the sorts of situations you are referring to in overseas examples where low level waste repositories have been set up in a pristine environment.

Senator ALLISON —A pristine environment? We will not pursue the point. I understand the point you are making: it is convenient if you have a facility there; it is a bit of a shame if you don't—you just put it in the earth.

Dr Perkins —No, that is not the case.

Senator ALLISON —I actually do have some figures on the limits of what you can put into an earth lining in the US and the UK. It is 3,700 becquerels in the US and 100,000 per kilogram in a concrete lined facility in the UK. So we can compare that. What would be the measure of becquerels in plutonium per kilogram buried at Maralinga.

Mr Harris —We will have to take that question on notice.

Senator ALLISON —If we can talk about the codes, you said in your press release, Minister, that the project had been conducted in a manner consistent with both international guidelines and domestic codes of practice. In your release on 17 April you said:

Whilst the government was under no obligation to refer to the NHMRC Code of Practice for the near-surface disposal of radioactive waste in Australia (1992) as the Code was not specifically designed for a situation like Maralinga where there already was contamination, in the interests of enhancing safety, the Government elected to observe the Code.

Is it the case that the code was observed in all respects? If not, what specifically were the clauses which were not observed?

Mr Harris —As you indicated there, this is an intervention. We were not required to satisfy the code. However, we do think it is a helpful guideline. If we are undertaking near surface burial of the substances, then it is good if we can comply with the code. We have done our utmost to comply with the code.

Senator ALLISON —That is not my question, Mr Harris.

Mr Harris —I am not aware of any clause that is appropriate to Maralinga under those circumstances that we have not complied with.

Senator ALLISON —ARPANSA said yesterday that the thinking behind the code had been observed, if not the letter. They were not able to elaborate on that and referred us to the department. Are you?

Mr Harris —We would have to take advice on anything that you have in mind there. If I can go to what ARPANSA are saying there, it is a philosophy that we share that we are seeking a safe outcome. To the extent that the code can help us in achieving that safe outcome, then we have sought to follow the code.

Senator ALLISON —Perhaps I can prompt you. The code says in clause 2.3.3(a):

Radioactive waste shall not contain corrosive materials, waste containing ... alkalis shall be treated to neutralise them.

As I understand it, 60 tonnes of soda ash, which is both a corrosive and an alkaline substance, from Ceduna was dumped in the burial pit. Was that material neutralised? You had a bit of a chuckle there. What is funny about that, Mr Harris?

Mr Harris —It is amusing, when we are talking about the primary hazard at Maralinga being plutonium, that we are now talking about the burial on site of materials that were stockpiled there for the ISV process and that those materials have been disposed of in the burial trench.

Senator ALLISON —Why is that amusing?

Mr Harris —I found it amusing only to the extent that I thought we were talking about the application of the codes to radioactive wastes.

Senator ALLISON —I will read that clause to you again. It says that radioactive waste shall not contain corrosive materials, and waste containing alkalis shall be treated to neutralise them. Doesn't that suggest that you do not put those two substances together?

Mr Harris —What could be observed is that the limestone environment at Maralinga is an alkaline environment which has a natural neutralising effect on the soda ash.

Senator ALLISON —In 60-tonne quantities? How would it do that?

Mr Harris —There is a lot of limestone out there.

Senator ALLISON —How does it get to 60 tonnes of soda ash? Did you mix it with limestone as you put it in? That is my question. Did you neutralise it?

Mr Harris —It is fully surrounded by this sort of limestone material that the burial trench has been filled in with.

Senator ALLISON —Being surrounded by it does not mean it is necessarily neutralised, does it?

Mr Harris —I would have to refer to experts on how chemical reactions take place in an arid environment.

Senator ALLISON —If you could get back to us on that it would be useful. In terms of the burial option being consistent with the national standard for limiting occupational exposure to ionising radiation, I acknowledged that the system complies with that standard. Is compliance with that code beyond occupational exposure appropriate in this circumstance?

Mr Harris —I do not know. Can we take that question on notice?

Senator ALLISON —The minister in his statement has identified that code as being one which was complied with. My question to you is: why mention that when that is about occupational exposure and we are talking here about what happens over the next 24,000 years or so?

Mr Harris —We will take the question on notice.

Senator ALLISON —All right, thanks. Again in a press release, Minister, you say:

As the primary risk from plutonium is inhalation, all these groups—

I assume that means Australian, British and American experts, ARPANSA, the South Australian government and the Maralinga Tjarutja—

have agreed that deep burial of plutonium is a safe way of handling this waste.

That is taken directly from your press release. What depth were you referring to when you said `deep burial'?

Mr Farrow —Under five metres of clean fill, minimum.

Senator ALLISON —What sort of definition is that?

Mr Farrow —You went through this yesterday in some detail, I think, with Dr Loy. That is a common usage definition. It is deeper than a less deep version. It still falls within the category of near surface disposal. As explained yesterday, there are concepts of deep burial which can go down to a kilometre or so, but this was significantly deeper than the material that had been in the original pits and would have been had all of them been vitrified. So it is deep.

Senator ALLISON —Mr Burns mentioned shallow burial in many of his statements about the ultimate method of disposal. Are the two terms interchangeable? Do they all mean five metres?

Mr Farrow —In this context what is meant is under a minimum of five metres of clean fill from grade.

Senator ALLISON —That is deep burial. So what is shallow burial?

Mr Farrow —I think the answer to your question is not so much what is shallow burial and what is deep burial, but that in this instance, as approved by the regulator, it is under five metres of clean fill.

Senator ALLISON —In this instance?

Mr Farrow —And in accordance with the code and international guidelines.

Senator ALLISON —The problem here, Mr Farrow, is that we have got a press release that says it is deep burial—we all know that deep burial, at least if you look at the earlier studies, means 100 metres deep, or something of that sort. We have got another kind of burial, which is shallow burial, and the two seem to be interchangeable. I imagine if you asked a person in the street what they think deep burial means, they would probably say a little deeper than five metres. It is all a question of semantics, obviously.

Mr Farrow —I cannot speculate on what a person in the street might say in response to that.

Proceedings suspended from 12.31 p.m. to 1.31 p.m.

CHAIR —In order to limit the time because the committee had previously agreed for the minister to be able to leave mid-afternoon, Senator Allison has kindly agreed to try and limit questions between now and 2 o'clock and has organised a series of questions to be put on notice beyond that, so that is what we are going to try and work to.

Senator ALLISON —I want to pursue the question of what the realistic expectation was that there were explosives in the pit. Mr Harris, you said in June last year:

... the advice from the British Government was that there would be a negligible chance of explosives being in that area. They were not used in those particular trials; they were used in other areas on the Maralinga test site as target response items, and we have a report from the British Government about those.

Is it not the case that you received a letter from the Office of the Assistant Chief Scientific Adviser in the Ministry of Defence in London which said:

It is clear that the team at Maralinga were very lucky not to have had any injuries ... It is the current view that given the nature of these experiments incomplete detonation of the charges is a distinct possibility ... There can be no guarantees that there are not small amounts of explosive residues in the pits. The probability would be greatest for the pits located at a pad site.

Mr Harris, do you acknowledge that you misled the Senate in your remarks about the fact there was a negligible chance of explosives being in that area?

Mr Harris —I certainly did not intend to mislead this committee and I hope that I did not mislead this committee. What you read out there certainly is what I recall we received from the British because we specifically wrote to them on that issue. It is also, though, very relevant that the firm that we engaged to do a review of Geosafe's investigation of the report engaged experts themselves in explosives and they concluded that it was highly unlikely that there were explosives in the pits. It is also of interest to note that we have not found any other suggestion that there were explosives.

Senator ALLISON —What about Mr Avon Hudson, a former leading aircraftsman in the RAAF who worked at Taranaki during the Vixen B nuclear trials, who I understand, Senator Minchin, tried to contact your office on a number of occasions to say to you that there were 3,000 PSI hydrogen bottles in the pits and that there were projectile heads—chemical explosives—but he was not able to get that message through? You must, Mr Harris, have seen reports of that attempt to communicate since that time?

Mr Harris —We have received no direct contact from Avon Hudson at all. We have checked Avon Hudson's records. He appeared before the committee of inquiry, the royal commission, and he put forward a very detailed submission but there was no mention of any of these items in his evidence at that time. He certainly has made no attempt to contact me. That is all I can say.

Senator ALLISON —What about the letter from the Ministry of Defence that I referred to earlier, which said that exhumation of pits containing explosives would need to be undertaken by EOD specialists from the Army RLC? I am not sure what the initials stand for, I am sorry. Was it the case that there were no such specialists involved in the exhumation?

Mr Harris —There were no particular specialists of that nature, but what we did do was, before we excavated the pits, draw up guidelines for those and had those approved by the regulator ARPANSA.

Senator ALLISON —Guidelines for?

Mr Harris —For the exhumation of the pits.

Senator ALLISON —And how were they able to do that when they did not know the exact cause of the explosion or what might be in the pits?

Mr Harris —Of course, and I am not being trite, they did it very carefully. We had a lot of experience by that time in excavating pits and we gained that from a number of pits that we had done at Wewak and TMs. So we proceeded under these guidelines in what we believed would be a safe manner and what proved to be a safe manner.

Senator ALLISON —You said, and I think you have confirmed it again just now, that the conclusion was that explosives were most unlikely to have caused the pit 17 incident. Is it not the case that the independent report says:

... the most likely cause of the explosion is suspected to be due to the detonation of explosive materials.

Mr Harris —That is the Geosafe report; it says something along those lines. Without looking at the exact words, our reviewer looked at that and dismissed that as being a likely cause. However, they did go on to say that they did think that it was likely that there was something in the pits that did explode. It may have been a barrel of diesel or something else, but they found no evidence that would point to what that was.

Senator ALLISON —That Geosafe report goes on to say:

Many of the investigation samples contained chemical evidence of common explosives such as Ammonium Nitrate Fuel Oil.

That is not what you are referring to in the drums?

Mr Harris —The Geosafe report found minute quantities that they considered were associated with explosives. However, our reviewer who engaged their own experts in explosives concluded that those amounts were minute and that it was highly unlikely that there were explosives in the pits.

Senator ALLISON —Was Guttridge Haskins and Davey asked to make any assessment of worker safety in both the exhumation and the ISV process?

Dr Perkins —Yes, they were.

Senator ALLISON —And did they?

Dr Perkins —Theiss contractors undertook a risk assessment of their own associated with the exhumation of material from the debris pits.

Senator ALLISON —So they did their own. What do you mean by that? GHD were asked to do it, but Theiss did their own.

Dr Perkins —No, GHD was the project manager and it is quite normal for them to seek advice from relevant contractors. Theiss undertook a risk assessment, understanding the various procedures they had used to exhume material from the pits, and then passed it on to GHD.

Senator ALLISON —When did that take place? When did you ask for assessments of safety to be made?

Dr Perkins —During 1999. I cannot tell you which month; I would have to take that on notice.

Senator ALLISON —Could you also indicate what was specified in terms of the investigation?

Mr Harris —Yes, we will.

Senator ALLISON —I will go now to the question of Mr Parkinson's removal. Minister, you said in the media release on Monday that Mr Parkinson was an engineering adviser to the clean-up. Isn't it also the case that he was the department's representative overseeing the contracts with GHD and Geosafe?

Mr Farrow —Mr Parkinson was a technical adviser to the department. GHD were the project managers for the first phase of the operation, the soil clean-up phase of the operation, and had a continuing role after that time. Mr Parkinson was at that stage the technical adviser to the department.

Senator ALLISON —Yes, but you neglected to mention, Minister, in your release, that prior to being removed he was actually overseeing the contracts with GHD and Geosafe. Can you just confirm that; that is all I am asking?

Mr Farrow —He was a technical adviser to the department on the project.

Senator ALLISON —No, he was more than that. Wasn't he the department's representative overseeing the contracts?

Mr Farrow —He was in the first stage of the—

Senator ALLISON —That is what I am asking you, thank you.

Mr Farrow —Geosafe contract.

Senator ALLISON —Prior to being dismissed?

Mr Farrow —Prior to being dismissed.

Senator ALLISON —Thank you. Isn't it also the case that Mr Parkinson was removed because he was opposed to the extension of GHD's contract? He said they were not qualified for the job and had no knowledge or experience in ISVs. Is that your understanding too?

Mr Farrow —When we got to the in situ vitrification phase of the project we looked at the project management arrangements that were to be in place and decided that we needed the services of an experienced project manager, and in that case it was GHD. Mr Parkinson had considerable difficulty in accepting that decision.

Senator ALLISON —I have just said to you that that was because in his view they were not qualified for the job. Can you confirm that you understood that to be his position as well?

Mr Farrow —I do not understand fully what his difficulties were. Certainly I have read his views expressed like that recently, yes.

Senator ALLISON —The media release draws attention to what it says is the fact that Mr Parkinson was unsuccessful before the IRC in a claim for unfair dismissal. Minister, is it not the case that in fact that case was ruled out not because of any lack of supporting evidence but because the contract was with a company and so the case was outside the jurisdiction of the IRC? Can you confirm that?

Mr Farrow —That is correct.

Senator ALLISON —Why did the department decide to sue for costs in that case?

Mr Farrow —The applicant had been unsuccessful and, moreover, had indicated that he was intent on continuing action in whatever forum he could bring the matter forward. It was our view that, while that was definitely his right, it was also the right of the Commonwealth to seek costs in cases where he was unsuccessful.

Senator ALLISON —Were you given any legal advice to suggest that suing for costs would be successful?

Mr Farrow —It had been our view that that was the appropriate course to take, based on legal advice.

Senator ALLISON —That was not my question. My question was about legal advice?

Mr Farrow —We had legal advice before we went to seek costs.

Senator ALLISON —That indicated that you had a good chance of success?

Mr Farrow —I would have to revisit the legal advice.

Senator ALLISON —Could you check that? In summing up, the commissioner said there was other compelling evidence to show that an employer-employee relationship existed and that she could have found in Mr Parkinson's favour had the case proceeded. Do you also acknowledge that?

Mr Farrow —If you are reading from the commissioner's report, I would have no choice but to acknowledge that.

Senator ALLISON —Right. All of that does not sit especially comfortably with the minister's statement on Monday that the case was unsuccessful?

Senator Minchin —It was not successful.

Mr Farrow —It was not successful.

Senator Minchin —There is nothing incorrect about the statement I made.

Senator ALLISON —No, it is more what it leaves out, Minister.

Senator Minchin —No.

Senator ALLISON —I want to go to the question of GHD's performance. Was the department completely satisfied with GHD's performance in the earliest parts of the project?

Mr Farrow —As far as I am aware, yes.

Senator ALLISON —What about the dust suppression during the soil removal at Taranaki? No problems?

Mr Farrow —Not so far as I am aware.

Mr Harris —I guess the best answer to that is that due to the requirements that we had in place, no worker at site has received a measurable uptake of plutonium, so I guess that says it all for how safe the operations were.

Senator ALLISON —So it does not matter how much contaminated soil was blown away?

Mr Harris —I think that is a separate question. That probably deals with plutonium resuspension. We have had studies done of the resuspension of plutonium. There is going to be another study done in the final sign-off of the site to test what is the risk of resuspension of plutonium in dust—

Senator ALLISON —How much contaminated soil was blown away in this process?

Mr Harris —I guess it is not an answer, but I can tell you that over 300,000 cubic metres of soil was scraped from the site and put into the burial trench.

Senator ALLISON —And how much was expected to have to be scraped from the site prior to a quantity of it being blown away?

Mr Farrow —I do not think anybody is accepting that there was a quantity blown away other than in the normal circumstances that would appear in that geographic region.

Senator ALLISON —Would you mind checking that, Mr Farrow or Mr Harris? It is my understanding that quite a lot was blown away and that then meant the contractor did not have to scrape up as much.

Mr Farrow —If any was blown away it would be quite insignificant compared with the amount which was scraped up. It would not be measurable in those terms. If there is a suggestion that because of the way the operation was conducted soil was blown away and therefore the contractor did not have to bury that soil, it may well be that some grams of soil blew away.

Senator ALLISON —Would you mind checking how much that was, for our records?

Mr Farrow —There would be no records of what soil had blown away. We are not talking about measurable quantities here.

Senator ALLISON —Maybe there is an estimate of the amount of soil that was due to be scraped up and disposed of. Perhaps we can compare that with what the ultimate quantity was. Surely that is possible.

Mr Farrow —I am not sure that that is possible. I am not sure that it would be relevant or meaningful.

Mr Harris —The key point is that it was an area that was scraped and it was scraped down to bedrock which in most of the times involved scraping about 150 millimetres of soil. The key issue of dust is whether there is any resuspension of plutonium in the air. That is what we have certainly studied. The other issue is that we did have dust suppression arrangements in place in terms of putting water onto the area. I do not think it really is an issue at all.

Senator ALLISON —I understand $100,000 was put aside for suppression of dust. Was that amount spent?

Mr Harris —That is more detailed than I have here.

Dr Perkins —It is worth mentioning too that plutonium is not easily resuspended. That is what the studies have shown so far. Very negligible amounts are actually resuspended in normal wind conditions.

Senator ALLISON —Perhaps you could look into the question of the $100,000 and what happened to it, whether it was used for dust suppression or what happened. Who typically approved work procedures on the site?

Mr Harris —ARPANSA.

Senator ALLISON —ARPANSA and not GHD.

Mr Harris —No. All the procedures for radiation monitoring and for all radiation work were approved by ARPANSA.

Mr Farrow —There were provisions in the GHD arrangements that they would approve and develop things like quality assurance systems, work safety systems and work procedures. That is part of their contractual arrangements.

Senator ALLISON —Is it possible to get some sort of indication of which kinds of procedures GHD were responsible for and which were the responsibility of the department and/or ARPANSA?

Mr Farrow —Sure. They were developed by GHD as part of their contract for the arrangements. The whole process for how that was carried out was under the approval processes.

Senator ALLISON —Mr Harris has just said ARPANSA was responsible for approving the work procedures. Were there different sets of procedures?

Mr Harris —Again it needs to be emphasised that all procedures that involved any risk to workers from radiation were approved by ARPANSA.

Senator ALLISON —I think I am asking for more than that, including things like dust suppression, if you could just take that on notice. What was the arrangement in the contract regarding the cost of the contract management extension at this point when GHD took over the contract management? What was the consideration to GHD for that?

Mr Farrow —They would continue and extend the scope of their contract that was continuing anyway to cover the Geosafe contract.

Senator ALLISON —How much?

Mr Farrow —And at the hourly rates that had been agreed in the original contract.

Senator ALLISON —Was there a figure put on that, an estimate?

Mr Farrow —There was an estimate put on at the time of the additional amount of $250,000, if I remember rightly.

Senator ALLISON —How much has GHD been paid since the end of 1997? That is for contract management.

Mr Farrow —I think the issue is that we do not necessarily have that figure split out because GHD's contract continued to the end of the project in any event.

Senator ALLISON —How can you not have it split out when it was a separate arrangement from the work that they were doing otherwise?

Mr Farrow —The extension of the contract was to extend it not in time but in expansion to cover the Geosafe contract management as well.

Senator ALLISON —But you have an estimate of $250,000. Surely you are able to make a judgment as to whether that estimate was exceeded or not. If so, by how much?

Mr Farrow —I think we can confidently say that the estimate would have been exceeded, as indeed has all of the work that has been associated since the Geosafe contract took place.

Senator ALLISON —By what sort of order has it been exceeded?

Mr Farrow —I would have to take that on notice to get the precise figure.

Senator ALLISON —What was the approval process for increasing the amount of the contract?

Mr Farrow —The $250,000 figure to which I referred was an indicative figure. The contractual arrangement was for the hourly rates covered under the original contract.

Senator ALLISON —Cost plus, was it?

Mr Harris —It was the hourly rate.

Senator ALLISON —Was that unlimited or at what point did it have to be approved before it could be exceeded?

Mr Harris —The contract continued while ever the work continued.

Senator ALLISON —So there was nobody saying, `You have gone beyond $250,000; we will approve this much.'

Mr Harris —We had month by month meetings with GHD on project management.

Senator ALLISON —Was that raised at those meetings?

Mr Harris —The costs were known as they were mounting.

Senator ALLISON —Were known, but not approved?

Mr Harris —Yes, approved but not—

Senator ALLISON —It was self-evident that you did not have an approval process?

Mr Harris —It was self-evident that they were approved.

Senator ALLISON —Is it possible to get a breakdown of those cost increases?

Mr Harris —I think the answer is no because the Geosafe part of the contract was not overall separate from the supervision of the other contractors that were on site. One needs to bear in mind that GHD were not going to finish their arrangements at the end of the earthmoving process. They remained project managers for the other contractors that were on site—the catering, the security, the health physics and the range of other contractors. In the arrangements that had been in place prior to extending the contracts there would have been one contract outside of that and all of the others under project management on site.

Senator ALLISON —Was there a limit to the number of staff that GHD could have on site? What sorts of controls did you have over that expenditure?

Mr Harris —There were estimates of what staff would be involved in the process in the contract extensions.

Senator ALLISON —In the event there was a decision made by GHD to increase that number of staff, were there any checks or approval processes or contract variations to accommodate that or not?

Mr Farrow —Yes, if additional staff were put on that was approved by us.

Senator ALLISON —By the department?

Mr Farrow —By the department.

Senator ALLISON —How often were approaches made to increase the number of staff?

Mr Farrow —On two to three occasions.

Senator ALLISON —On those two or three occasions, what was the cost implication? If you can give us details of that, it would be good.

Mr Farrow —It would be the hourly rate of the extra staff concerned.

Senator ALLISON —There would not be an estimate? A total estimate would just be the number of staff?

Mr Farrow —Yes.

Senator ALLISON —What was the selection process for GHD?

Mr Harris —It was an extension of their existing contract.

Senator ALLISON —So there was no selection process.

Mr Harris —A variation to their contract.

Senator ALLISON —What was in the department's request for a proposal to manage the Geosafe contract? Can the committee have a copy of that document?

Mr Harris —If you wish to have a copy of the varied contract, that is fine.

Senator ALLISON —Thank you. Who made the decision at the end of the day to extend GHD's contract?

Mr Farrow —I signed the contract.

Senator ALLISON —You signed the contract. Who was involved in deciding that was the way to go?

Mr Farrow —I take the ultimate responsibility for that.

Senator ALLISON —How many meetings were held with GHD to finalise the extension?

Mr Farrow —I could not tell you offhand, but certainly more than one, and not many more than that I wouldn't think. I am not sure whether Dr Perkins can recall.

Dr Perkins —Yes, I think two or three.

Mr Farrow —Two or three meetings perhaps.

Senator ALLISON —Who was involved in those meetings?

Mr Farrow —I think Mr Rawson was. Dr Perkins, were you involved?

Dr Perkins —Yes.

Senator ALLISON —Were you aware at that time that Guttridge Haskins and Davey had no experience or knowledge of the ISV process?

Mr Farrow —I am not sure that is the case. I was certainly aware that they were well-experienced project managers. They were managing the project and the contract. They are quite an established firm of engineers.

Senator ALLISON —Yes. You are not suggesting that Geosafe was not? Were they more experienced in your view?

Mr Harris —Geosafe is the contractor and GHD managed the contract.

Senator ALLISON —Yes, I understand that, but we are talking here about experience, size and knowledge of ISV too.

Mr Farrow —I am not sure of the context of your question. The role of a project manager is to manage the various contracts that are under the project. I do not think you would be suggesting that Geosafe would manage themselves in this process.

Senator ALLISON —GHD did to some degree, did they not?

Mr Farrow —No, they reported to us. They are the project managers.

Senator ALLISON —Is it the case that Geosafe was on a contract which was for recovery of an estimated cost plus a capped management fee so that if the cost rose above the estimate Geosafe were to complete the work for no extra. The contract with GHD was on an hourly basis, so that any delay that might have been caused by GHD would be at Geosafe's cost rather than that of GHD. Is that a fair sort of summary of how that worked?

Mr Farrow —No, I do not think so, Senator. The arrangements with Geosafe in this part of it were certainly a cost plus arrangement up to a certain level, which was something like $9.2 million, beyond which they did not get a 20 per cent management fee on top of their costs. Up to that point, all of Geosafe's costs were reimbursed, including their own salaries, time, overheads et cetera, then on top of that they got a 20 per cent fee up to a capped figure of $9.2 million beyond which they did not get the 20 per cent fee. In other words, they did not get the extra profit margin, but remember that related to a contract that related to some fairly well-defined pits. Almost from the beginning that was never going to be met.

Senator ALLISON —What I am trying to get at is that there was a degree of animosity when GHD came in to manage the Geosafe contract. There was no disincentive for GHD to not delay the length of the contract whereas there was for Geosafe. I am just trying to set the scene for that argument.

Mr Farrow —No, there was not, because from the beginning of the processes the original specifications of the project had been changed and therefore the cap of the $9.2 million on the profit was never going to be a realistic figure. So from then on it was virtually a cost-plus contract which needed management by a well-recognised project management firm. Certainly, there was some animosity on the part of Mr Parkinson.

Senator ALLISON —Were the Australian National Audit Office involved at all in the process of extending the GHD contract?

Mr Harris —No, not in the process of it, but they have reviewed it since that time.

Senator ALLISON —They have reviewed it since that time?

Mr Farrow —In discussions with ourselves; they have come to discuss the matter with us.

Senator ALLISON —Now that the contract is complete, or nearly so, have the Audit Office indicated to you that they will be examining the arrangement?

Mr Farrow —No, they have indicated that they will not be examining it further.

CHAIR —Senator Allison, we have run out of time. Senator Allison has agreed to put questions on notice. The committee is happy to accept questions on notice from you to pass on to the minister and officers. That completes questioning on the Maralinga rehabilitation. We now move to ANSTO.

[2.01 p.m.]