E12/2107/0821PUB05642 CREDO/SPICER PUBLIC 19/08/2014 pp 05642-5695 HEARING

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INDEPENDENT COMMISSION AGAINST CORRUPTION THE HONOURABLE MEGAN LATHAM PUBLIC HEARING OPERATION CREDO AND SPICER Reference: Operation E12/2107/0821 TRANSCRIPT OF PROCEEDINGS AT SYDNEY ON TUESDAY 19 AUGUST, 2014 AT 1.55PM Any person who publishes any part of this transcript in any way and to any person contrary to a Commission direction against publication commits an offence against section 112(2) of the Independent Commission Against Corruption Act 1988. This transcript has been prepared in accordance with conventions used in the Supreme Court.

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THE COMMISSIONER: Yes, Mr Watson. MR WATSON: I’ll call Gary Webb if I may. THE COMMISSIONER: Yes, Mr Webb, if you could come forward. MR WATSON: Mr McGuinness will I think seek leave to appear for Mr Webb. THE COMMISSIONER: Yes, Mr McGuinness, you have leave. 10 MR McGUINNESS: Mr McGuinness of Watson Mangioni. I seek leave to appear on behalf of Mr Webb. THE COMMISSIONER: Yes, thank you. And that leave is granted. And you have explained to Mr Webb the effect of a section 38 order? MR McGUINNESS: I have, Commissioner. THE COMMISSIONER: Does he wish to seek one? 20 MR McGUINNESS: He does. THE COMMISSIONER: Mr Webb, can I just explain that the section 38 order protects you against the use of your answers against you in civil or criminal proceedings but doesn’t protect you if it should be found you’ve given false or misleading evidence to the Commission. You understand that? MR WEBB: Yes, Commissioner. 30 THE COMMISSIONER: Pursuant to section 38 of the Independent Commission Against Corruption Act, I declare that all answers given by this witness and all documents and things produced by this witness during the course of the witness’s evidence at this public inquiry are to be regarded as having been given or produced on objection and accordingly there is no need for the witness to make objection in respect of any particular answer given or document or thing produced. 40 PURSUANT TO SECTION 38 OF THE INDEPENDENT COMMISSION AGAINST CORRUPTION ACT, I DECLARE THAT ALL ANSWERS GIVEN BY THIS WITNESS AND ALL DOCUMENTS AND THINGS PRODUCED BY THIS WITNESS DURING THE COURSE OF THE WITNESS’S EVIDENCE AT THIS PUBLIC INQUIRY ARE TO BE REGARDED AS HAVING BEEN GIVEN OR PRODUCED ON OBJECTION AND ACCORDINGLY THERE IS NO NEED FOR THE WITNESS TO MAKE OBJECTION

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IN RESPECT OF ANY PARTICULAR ANSWER GIVEN OR DOCUMENT OR THING PRODUCED THE COMMISSIONER: Do you wish to be sworn or affirmed, Mr Webb? MR WEBB: Sworn, thank you, Commissioner. THE COMMISSIONER: Yes. Can we have the witness sworn, thank you. 10

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<GARY ALLAN WEBB, sworn [1.54pm] MR WATSON: Are you Gary Allan Webb?---I am. What’s your current position, Mr Webb?---I’m retired from Newcastle Port Corporation and I’m a strategic advisor. To whom?---Ah, recently to Morgan Stanley who is doing the long term lease of the Port and currently to Bulbeck Group, a local group in 10 Newcastle. You’re a Newcastle boy?---Correct. Speak into the microphone, you’ve got a good clear voice, but that would be helpful, if you wouldn’t mind?---Thank you. I want to get into your background. When I say you’re a Newcastle boy, after you left school did you study?---I went to the University of Newcastle for two years, at that time the course I was in only offered two years and 20 then I went to Sydney for the last two years. What were you studying?---Surveying. And then after you graduated, where did you go?---Ah, during my university in the second year I went to the Port of Newcastle as a university student. So you’ve been attached to the Port of Newcastle one way or another for a very long time?---For a long time. Ah, then I went to the Port of Sydney 30 and completed my time in cadastral surveying, became a registered surveyor and then went to Botany Bay during the construction of the container terminal at Botany Bay. Well, that’s something I wanted to focus on. You’ve had a bit of experience in the development of container terminals?---Ah, certainly the construction side of it was a great grounding in how it works and as I became more senior in Newcastle Port Corporation certainly in pursuing the objectives of Newcastle Port Corporation visited many container terminals and operations. 40 Well, before we get back to NPC, you worked down at Port Botany. Tell us, how many years were you there?---Ah, I think it was about 18 months. It was with then the MSB and I was in the surveying side in terms of the construction of the container terminal and the associated landscaping projects attached to finish off the project. I then went to Port Kembla Port Corporation after that.

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Well, the Port Botany grew from being a relatively small operation into a relatively large operation. Is that right?---Yes, that’s right, that’s right. I think there were about two container cranes on each side to, to start up the facility and certainly at that time the MSB was looking to the future and there was extensive quay line to be developed and my understanding is it took about 20 years for Sydney to get to one million TEU’s from the time of construction to the actual time of, of throughput. TEU is an expression that we see in the papers in this inquiry, what does it mean?---TEU stands for twenty-foot equivalent unit, which is the basic 10 length of a container. There are certainly forty-foot equivalent units but they’re not as frequent or not as many as twenty equivalent unit containers, so summarised to TEU’s. So we can look at TEU’s and from that get an idea how big the turnover is in a particular port?---Oh, that’s, that’s correct, yeah. And that’s the kind of international measure?---Certainly, and then you convert it to number of TEU’s per, per metre of quay line to look at productivity. 20 And so you left Port Botany about when to go back to Newcastle?---Ah, I left Port Botany in either ’80 or ’81 and then went to Port Kembla- - - Right?--- - - -to establish the office there and then returned to Newcastle in ’82. And in 1982 there was no such thing as the Newcastle Port Corporation, it was an authority of some kind, was it?---Yes. I spent seven years in New South Wales TAFE and returned to the Port in 1989 to the then MSB Hunter 30 Ports Authority. Right. And what was your position by that time?---I was a surveyor. And slowly over time the Port Authority evolved and became a state-owned corporation. Is that right?---That’s right, that was in 1995. And the idea of state-owned corporation, I’m sure everybody knows, but it’s the idea, it’s owned by the New South Wales Government and there are two shareholders. Is that so?---That’s correct. 40 Usually it’s a Treasurer and a Finance Minister as the shareholders. Is that so?---That’s correct, that’s traditionally the shareholders. And you have two Ministers who are shareholders and you also have a Portfolio Minister?---That’s correct.

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Their roles of course are quite different. The shareholder Ministers are looking at corporate governance and profitability issues?---Yes. And the Portfolio Minister is looking at policy and political issues? ---Well, the policy, the policy issues, yes. And so in terms of the Newcastle Port Corporation, the Minister to whom you would be responsible, the Portfolio Minister would be the Minister for Ports?---Ah, that’s correct. In the early days it was the Minister for Transport until the Ports got its own Portfolio. 10 Got its own portfolio?---Mmm. And that of course, the identity of that Minister has changed from time to time?---Yes. In some instances, and this happened here, the Minister for Ports can also be the Treasurer so there is an outside Shareholder Minister appointed, is that so?---Yes, that’s right. 20 And do you remember the occasion when Mr Roozendaal assumed control for Ports, he was the Treasurer, who were your Shareholder Ministers? ---Ah, Mr Watson, I can’t recall. I’ve got a feeling Paul Lynch was one of them, is that right?---I would need to go and have a look, yeah. All right. It’s probably not an issue. So (not transcribable) went back and – well, let’s deal with it from about 1995 and the introduction of the corporation or NPC. At that stage what position did you hold?---I could 30 have been port surveyor then and at that point of corporatisation the establishment of a board and the ability for the port under the guidance and governance of a board and its relationship with the Government of the day to create the independence for Newcastle was one of the driving streams. Over a period of time between then, 1995 and right up until say 2011, you enjoyed a series of promotions inside the corporation, is that so?---That’s correct. So that at the time that we’re relevantly looking at, that’s just 2010/2011, 40 what was the position that you held?---I was Chief Executive Officer and a Director of Newcastle Port Corporation. For how long had you been CEO, when did you take that up?---I was appointed in October 2004. And for how long had you been a director of the corporation?---Ah, that appointment took place I think in December 2004.

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That idea that you were devoted to the corporation which looks after the Port of Newcastle, I suppose you knew the Port of Newcastle pretty much backwards?---I certainly knew it back the front from on the ground, from the delivery of the customers, from the day to day operations and certainly contributing to the strategic direction of the organisation. Now in terms of container terminals we know that Port Botany is one, where’s the closest or is there another container terminal on the East Coast of Australia?---Certainly Brisbane, Brisbane would be view as Newcastle’s 10 next competitor and Melbourne is a major container terminal. Well, there was Melbourne and Brisbane but at that stage there was no container terminal in Newcastle was there, this is - - -?---No, there’s no container terminal, Newcastle was doing around 15,000 TEU’s if we use that measure based upon the customers of the port using the gear of ships to move containers. Well, what was that like? I mean, in terms of the sophistication of moving cargos are Port Botany what was Newcastle like?---Ah, Newcastle was 20 using the ah the, the available equipment of, of trucks and using the cranes on a ship versus a dedicated container terminal at Botany which was streets ahead in terms of dedicated ah, lifting gantries. And in terms of its location did you form a view that there was a good opportunity for setting up a coal terminal – sorry, I’ll start again. In terms of its location did you think that there was a good opportunity to set up a container terminal in the Port of Newcastle?---I certainly formed that view and my view followed on from the work of others when BHP announced it was going to stop steelmaking in Newcastle. 30 That was the late 90’s?---Yes, that’s correct. BHP created a consortium and announced that they were going to look at developing a container terminal. The process of that group getting together to deliver it didn’t eventuate but clearly the kernel had been put in place. BHP and the Government of the day made an arrangement for BHP to pay the Government some money and to offer up the land and to exit Newcastle and Newcastle Port Corporation became the custodian and ultimate owner on behalf of the Government for part of the Mayfield site and with Government support on a number of, two or three occasions we went to the market to test the overall development of 40 the Mayfield site, that included increased container use and there’s no doubt from the analysis that was done by consultants to Newcastle Port Corporation but more importantly from the interest of the private sector to be prepared to invest its own money and take the risk which is always NPC’s view, it wasn’t about our numbers or our analysis of what the throughput might be but the private sector was prepared to take that risk, that a container terminal servicing the catchment area of, of Newcastle was a viable option.

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Well, just in that context there’s a location. Where the container terminal was proposed, did that have easy access to carry the goods away by truck? ---Oh, enormously successful access from the water which is the first thing, the channel of Newcastle - - - This is the Mayfield site we’re talking about?---This is the Mayfield site. Yes?---The, the ex-BHP Steelworks site. 10 Yes?---Ah, and certainly the main channel is 15.2 metres deep. I’ll come back to that but I’m talking about getting the trucks out first? ---Trucks, fantastic, Industrial Drive, named for that reason to be able to carry ah, goods onto the national network. Well, Industrial Drive, does that connect with the highways?---Yes, it does. Which highways?---Ah, the New England and the Pacific. 20 And in terms of unloading goods at the Port of Newcastle and unloading goods at Port Botany, for example who could get goods to the Western Suburbs of Sydney more quickly?---Well, certainly some of our analysis showed that goods coming out of Newcastle could get to Western Sydney in around the same time or 15 to 30 minutes later than that coming out of, of Botany. And you were saying about the channel, the land that the old steelworks sat on was in Mayfield?---Yes. 30 But the port ran up in a channel just off the edge of the steelworks, is that right?---That’s correct. And how deep was the channel at that point?---The channel is 15.2 metres and the depth adjacent to the steelworks site was 12.8 metres in order to unload iron ore so there was good depth at that site. The significance of that in terms of container carrying vessels?---Ah, the significance is any channel that’s already got 15.2 metres is able to handle in terms of depth any size container and certainly with the harbourmaster 40 and the pilots Newcastle Port Corporation had modelled been able to handle a container ship up to 280 metres long. Now in terms of the logistics they favoured the, you thought, the use of this particular site as a container terminal?---Yes. Well, let’s have a look at some of the broader issues. Was there also a demand for that kind of service in Newcastle itself in the sense that the –

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you’ve spoken before and I think you were suggesting that the equipment available was antiquated or the methods were antiquated?---Certainly they were, they were not equivalent to a fully developed container terminal. From Newcastle Port Corporation’s point of view coming back to the time it takes to get to large volumes we never believed that that would happen overnight but when the, when the market becomes quite excited about the opportunity and is prepared to invest to develop the site for its use of bulk, of general cargo and containers that was, that was quite a remarkable opportunity for the Hunter region. 10 Well, in terms of Hunter region would the creation of a container terminal like that also create jobs?---I’m, I’m sure it would have, often the, the amount of jobs that can be created is broken into two components which is the construction side and then the operating side and ah, certainly the operation of, of that container terminal would have been fairly small to start with and then grown so I’m certainly aware that sometimes numbers are inflated in terms of long term employee numbers. Taking it outside the Hunter and looking at the broader economics of New South Wales had there been a long-term plan put in place earmarking 20 Newcastle as the site for a second container terminal?---Certainly the 2003 Ports Growth Plan identified Newcastle as the next major container terminal after, after Sydney reached capacity but Newcastle Port Corporation has a contract with each Government called a Statement of Corporate Intent that identifies what the key goals for the organisation will be. I’m going to come back to that in a moment but there was a long term strategic economic plan put in place by the New South Wales Government.---Correct. 30 Consistent with that plan was the idea that there would be a second container terminal created in the port of Newcastle?---That’s correct, after Sydney had reached capacity. Well, the, you were going to tell me then about the statement of corporate intent, did that have some bearing upon whether or not this site should or should not be developed as a container terminal?---Absolutely, the statement of corporate intent for the organisation and the Government identified that site. Identified it’s development and was overt in terms of the container side. Certainly, in 2010/11 and 2011/12 the pointy end of all the 40 approvals to go to the market was being realised and overtly put that Newcastle did have an opportunity to develop that site including a container terminal in preparation of when Sydney had reached capacity. Incidentally, when you have a statement of corporate intent, some of these things are kept on a coffee mug or something like that or is this a formal document?---Oh, it’s a formal document signed by the shareholders, signed by the chairman and the CEO and tabled in Parliament.

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Incidentally, was one signed or co-signed by Eric Roozendaal?---Yes. And did that include this long term plan involving the container terminal?---Yes. Now, I mean, and everybody’s who’s been around the last few years that the port of Newcastle is a critical place in Australia for exporting coal.---It’s the world’s largest coal export port and is certainly significant for the region, and the state and the national economy. 10 Now in terms of the discharge of the coal for export at the Port of Newcastle, what was in place?---The industry in itself was creating capacity and it got to a position whereby Port Waratah Coal Services was being, which is an industry owned group have been accused of not investing enough money to deal with the demand. The Government put a parcel of land in the Port out to the market for development and a competing consortium Newcastle Coal Infrastructure Group won the right to develop a terminal. 20 When was this?---Mr Watson, that could have been 2007, but when I left NPC I didn’t have access to any more documents. And part of the rationale for that particular terminal development was to allow the long haul miners to be able to build their stock pile at the port as distinct as to the PWCS model which is rather just in time. How many coal terminals were there at the Port of Newcastle once, well, how many are there now?---There are three now. Terminal 1 is at Carrington which is just south of the BHP, former BHP Steelworks site. Terminal 2 - - - 30 And who runs Carrington?---Port Waratah Coal Services. Good. Terminal 2?---It is on Kooragang Island. That’s just across the channel.---Just across the channel and that’s run by Newcastle Coal Services and then west of that just next door is Terminal 3 which is run by Newcastle Coal Infrastructure Group. And during the, about 2005 may be 2007 or thereabouts, there was a boom 40 in export of coal. Was there a heavy demand placed upon the existing infrastructure for coal loading?---There was a view that the coal loaders weren’t expanding enough to do with the, with the demand. As I said, there was an opportunity for the competing terminal to get underway but one at Port Waratah Coal Services difficulties as they put it with committing the capital funds to expand was the lack of long term contracts with the miners that would underpin the capital expansion.

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The distribution of the use of infrastructure amongst industry players, existing industry players, I suggested during the opening, by its nature that’s anti-competitive.---Yes. There has been an agreement struck - - -?---That’s right. - - - which allocates the use of existing infrastructure, is that so?---That’s correct. During the opening I suggested that that had to receive ACCC authority and 10 approval.---Absolutely. There was an agreement struck along those lines?---That’s correct, that’s the - - - What do you call it, I’ve heard it called different names?---Coal Framework Agreement. Coal Framework, that’s yet another one.---Yes. 20 I’ve heard it called the Coal Chain Agreement?---Yes, there’s multiple names for it. And also I’ve seen it in some documents referred to as the ACCC agreement.---Yes. All of those would apply. Well, yours is Coal Framework, I don’t see why we shouldn’t use that. But can you tell us about, in broad terms, how the Coal Framework Agreement works?---My understanding is that the industry went to the government of the day, Minister Tripodi then, and asked for assistance to look at how their 30 might be some way in which an agreement might be struck that was not anti-competitive to unlock the capacity of the coal chain and the demand that people hope was coming along. All through 2009 NPC, Port Waratah Coal Services and the NCIG under, first of all, the guidance of Nick Greiner in setting some principles and then some assistance of Joe Tripodi then formed a framework that was agreed to by parties, signed off by Port Waratah Coal Services, Newcastle Coal Infrastructure Group and Newcastle Port Corporation and then authorised by the ACCC for the start up on 1 January 2010. 40 And that bound, as you mentioned, the owners of the coal terminals and it bound the port corporation but what about the mining companies themselves, were they parties to it?---They weren’t directly parties to it but clearly, they had an opportunity to be actively involved in what it meant and there were then attached to, to part of that agreement is the long term take or pays that Port Waratah Coal Services needed to underpin the investments. Coupled with that was the contracts that the miners had with Australia Rail Track Corporation because part of the efficiency for the chain was to align

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rail contracts with terminal contracts. So there was a lot of work being done to ensure that this framework really handed over the miners who were going to underpin capital to commit contracts that would see the rail built that aligned with the terminals so that there was no inhibition to the development of the expansion of the coal chain. Sounds like it was quite a bit of detailed work went into this.---There was a lot of work by a lot of people. Did this involved, obviously, would have involved some effort by those who 10 understand prediction of the coal market?---Yes, in a policy sense though, this was about handing the control back to the miners. And was there economic input into this to determine whether or not this, the coal framework agreement was appropriate?---I think certainly, had a look at the economics of it and the perceived or actual capacity constraints had a direct economic impact so the ability for the miner’s to align their contract with rail and terminal freed up and underpinned long term capital works that would ensure the miners were able to sign contracts to their buyers and sign them with certainty in terms of the delivery. 20 That point in itself, that is tying up long term export markets is a matter of significant to the whole of the state.---Absolutely, and if you think about - - - I’d go further and say the whole of the country.---That’s my view. Certainly, attached to the ACCC’s determination was the demurrage costs that were attached to the number of ships that were anchored off Newcastle. So if you think about some of the tests that the ACCC will apply, that was another of the tests in terms of the public good. 30 And did the Coal Framework Agreement make plans for the future as to how the infrastructure might be expanded?---Yes, the plans were to ensure that the miner’s could nominate what their tonnages were and if the capacity of the terminals was then exceed the Government had allocated additional land on Kooragang Island to be coupled with land that PWCS owned and purchased to create the footprint the next stage of development which would be T4. And that would be obviously the fourth coal terminal for the Port of 40 Newcastle?---That’s correct. And whether it was developed or not would depend upon whether or not the coal boom continued and the demand required that facility?---That’s correct. How was it going to be paid for?---Well, the unique component of this was that the coal industry was going to fund the first stage and that was to ensure that the existing footprint in the Port wasn’t locked up and didn’t inhibit

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expansion or a new entrant, and that’s quite a unique component of the Coal Framework Agreement. And so how were they to do that, how was the money going to come through?---That was a levy from Port Waratah Coal Services. A levy on what?---On a tonne of coal. And do you know how much it was, was it a few cents- - -?---No, I don’t. 10 - - -or a few dollars or- - -?---I don’t. In any event, so the land had been set aside for the fourth coal terminal? ---Yes. The way in which it would be funded was organised?---Yes. And that development enjoyed complete industry support?---Yes. Now, I should have asked you something else about the container terminal. 20 A couple of times you mentioned the fact that there was an issue about demand and then you were saying however that was going to private industry, that risk. Is that right?---That’s correct. Could you just explain that to us. I mean the – if the model was one where a state-owned corporation was involved, was there a risk to the people of New South Wales that if the container terminal was a flop that we’d all be out of pocket?---No, none whatsoever. Why is that?---Because ah, in terms of getting Board approval and taking 30 that approval to Government, clearly we did have analysis and a throughput model, but to ensure that NPC wasn’t exposed to underwriting ah, a private investor, those figures were not made available and it was totally for the private investor to do their own throughput modelling, therefore the contracts that were being drawn up had ah, as a starter, significant capital investment, something in the order of $200 million, and it certainly had in it that should the project fall over, I think we were carrying around 10 per cent of the capital cost flowing through the first 10 years, so at worst the Port would have had some developed facilities with a bank guarantee to at least close it off or complete, it could have been then offered to the market, but 40 the groups involved certainly were not heading into this project in a, in an environment of failure. I’m just going to – so that people can maybe understand it a little better, just have a picture shown up on the screen. This is page 45 of the new bundle of documents, we only got it ourselves today, Commissioner, and so I haven’t been able to distribute copies. I’m hoping I can get it up on the screen. It’s a terrible picture, but the one I’ve got is so much nicer, it’s all in colour?

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---That must be one of ours then. What, I mean if people can see it, oh, thank you, you can see where Kooragang Coal is, that’s Kooragang Island on one, on the northern side of the channel as we look at it?---Yes. And then you can see where – it’s actually, it’s really very hard to read because we can’t see the edge of the Mayfield site, we can just see the word Mayfield?---That’s right, but if you join a- - - 10 If you joined those two other points that’s roughly it?---Two and put a bend in it, yes, yes. And then to the east we can see Carrington, you mentioned that before as one of the terminals?---Yes. And to the west we can see OneSteel, they were still in operation out there, is that right?---Yes, that’s right, that’s right. And the area was served with a rail track?---Yes. 20 And it was also served with a dedicated Industrial Drive?---Yes. And we can see there if you look carefully, Intertrade Industrial Park. You know about that as well?---Yes. Now, the area that’s Mayfield, that was under the control of the NPC, your organisation?---That’s correct, that’s correct. And the Intertrade Industrial Park, that was under the control of?---Ah, 30 originally Regional Land Management Corporation, it then became Hunter Development Corporation. Another state-owned corporation?---That’s correct. But you’re not related to them?---No. They run their own business, you run your own business?---That is correct, clearly with adjoining parcels we did work closely together to try and maximise the outcome. 40 What I want to ask you about now is that in terms of what you were doing on the container terminal there on the Mayfield site, had you, how far had you progressed this by 2010 in terms of working out who might be a suitable contractor or the like?---As I said, we, NPC had gone to the market twice or three times.

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Can you remember which years they went to the market or it went to the market?---Ah, I think the first time might have been 2000, then it could have been 2005 and then it could have been 2008 or 9, but I don’t have documents. What do you mean by going to the market?---Oh, expression of interest being put out? Calling for expressions of interest?---Calling for expressions of interest, but on that site it wasn’t just containers, it was general cargo and bulk, because 10 a bulk port is at risk of containerisation and so the Mayfield Concept Plan was looking at allowing small amount of bulk that potentially could move in bulk units or move into containers with general cargo and containers. All right. Well, tell me about bulk, what sort of things are carried, as you call it, bulk. Are they grains?---Oh, grain. Grain is clearly one where NPC was losing market share and there is three or four grain operators in the port who succeed enormously well in the bulk environment but were looking to be able to also transition into containers within the port as well. 20 What else falls into that description bulk, would coal fall into it?---Ah, the Concept Plan had around 500,000 tonne of coal and that was around boutique coal um- - - Boutique coal?---Yes, yes. Turkey uses a particular style of coal and certainly we were trying to look at whether, make sure we didn’t shut off the opportunity for someone to look at containerisation. All right. So you say you’ve gone to the market calling for expressions of interest?---Yes. 30 The sort of people who you wanted to respond, I guess they’re not small outfits?---No. This is a huge sum of money involved?---That’s correct, and- - - Had you got responses?---Ah, there were responses each time. The first time in 2000 I wasn’t actively involved in it. My recollection was that the - - - 40 Let’s leave it behind, it’s a bit old?---Leave it behind, it’s gone. The second time ah, there was a response but the contamination and the remediation program for the BHP site wasn’t as clearly defined and the risk to the proponents on that meant it wasn’t pursued, and in 2005, that’s right, a year- - - I’ll just go and just deal with that for a second?---Yes.

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BHP was up and leaving the land?---Yes. And they paid the New South Wales Government $100 million to take it off their hands, didn’t they?---That’s what I understand, yes. And the idea was – I mean giving away, well, there we are, harbour front land and paying somebody $100 million to take it off, over reflected the fact that the soil had been contaminated over the years?---That’s correct. 10 And so there had to be a program put in place for the decontamination? ---Yes. So you go to the market again now with a better decontamination plan. What happened?---Um, it wasn’t totally clear in terms of the worst part and I think it was going to add something like three or $4 a square metre and it wasn’t well defined. So in 2005 I stopped that particular project and then put in place a rigorous market assessment and build in terms of the next development of the site. The RLMC, HDC had Government approval to take the whole site out to market as an integrated package, but under that, 20 that title of, that we saw, what happened was there wasn’t a satisfactory response on the Port side of land but they then started to move into finalising an arrangement on the Intertrade Site. The Intertrade Site ended up with HDC and the Mayfield site ended up with NPC?---That’s correct. All right. So you’ve gone out to market on the Mayfield site, did you find suitable potential bidders?---After HDC, after RLMC’s whole site didn’t get up - - - 30 Yeah, let’s move, leave that behind, yeah?--- - - - we took the Mayfield site out to the market and we came down to a single, a single consortium. Name?---Their name moved from Newcastle Stevedores Consortium and they ended up as Mayfield Development Consortium or something like that. Right. Who was behind it?---Anglo Ports. And is Anglo Ports a household name?---Ah, Richard Setchell used to be 40 CEO of P&O Ports. There’s the, the Spanish container company based in Barcelona. Named?---Um - - - TCB or something?---TCB, Grup TCB and they’ve got interests throughout South America and, and certainly Anglo and Grup TCB were looking at

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their financiers and were looking at having relationships with rail providers and so on. I looked at a website before I opened the case just to see who Anglo Ports were and it seemed to say they have been responsible for designing, constructing and maintaining massive container ports all around the word, is that fair enough?---Well, Anglo Ports and I think it’s a Philippine container group just won the right to develop the next expansion in Melbourne. All right. Well, so that would be an attractive bidder, Anglo Ports, is that 10 what you thought?---We were never, we were never bothered by who was attractive or not, we put the hard nose over it as to who was going to front up with the skills, experience and dollars to make it happen. Well, sorry, you didn’t want some ordinary outfit underfunded - - -?---Oh, no, no, no. This was, this is a mob with the experience and the money?---That’s right, and, and having Grup TCB there with their experience was enormously powerful for the consortium that was brought forward. 20 And so how far did you get down the track with Anglo Ports?---Ah, we - - - This is coming up into 2010 now?---Yes, I, I – from recollection NPC had stopped the original EOI process, then went into direct negotiations and had made a recommendation to Government to move to the last stages of preferred proponent or to, to head towards a final contract. Well, this Commission knows from recent experience a fair bit about Working with Government Guidelines and the nature of direct negotiations. 30 NPC had, had it received Government approval to undertake direct negotiations?---Yes, yes. And so it had been through all of those loopholes?---Yes. And so had there been any public announcement that Anglo Ports had succeeded or were likely to succeed?---No. What was the next phase that you were going to enter?---Well, the next phase was to develop detailed project delivery documents, lease documents 40 so that the principles, everything that had been negotiated would be developed into final documents that could be thoroughly reviewed so that then there could be a signature. You never want to make that announcement in public because it lets the groups involved have an upper hand if they want to try and change a deal. All right. Well, now any of these things are going to have massive consequential adverse effects on the environment and local residents. Have

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those matters been taken into account in the plans which NPC made before dealing with Anglo Ports?---Certainly it became the view that the well documented use on that site needed from NPC’s point of view to be taken to the next stage of planning approval and NPC lodged a concept plan with New South Wales Planning so that all of those issues could be thoroughly examined in the public domain to give one clarity for anyone who wanted to use the site and confidence for those who, who might need to follow knowing that a consortium would then need to lodge a development application and still get approval. 10 All right. Now I’ll change direction a little. NPC is going along, they’ve gone through an EOI process and they’ve got Anglo Ports. During this time were alternative proposals put to you by a company Hunter Ports Pty Limited?---Ah, I only heard that there was rumours that this was happening and it wasn’t until I think formally I was asked to go to then Minister Roozendaal’s office to have a presentation that there was some formality around that. All right. I should just show you in this, this document, I’ll see whether I’ve got a spare one but if it could be brought up on the screen so that we can just 20 all look at it together, I’ll have this shown to the witness and there’s a copy for the Commissioner, I’ll just see whether we’ve got one for Mr McGuinness as well. Mr McKenzie quickly wrote out numbers on the bottom right-hand corner, could you turn to page 6. Now I just want to show you some documents which seem to be getting around the critical dates. This is a document you prepared, Mr Webb, it’s a two-page document, just believe me for the moment that you prepared it, well, you can see it’s to the Minister from Gary Webb so – and it’s dated 22 October, 2010, see all of that?---(No audible reply) 30 You see that?---Yes. Now all I’m trying to show you is that this is the sort of material that you were providing to the Minister on where NPC stood in terms of the development of the Mayfield site?---Yes. And it’s giving the Minister the history?---Yes. It’s giving the Minister the evaluation and reporting which had been carried out to that point in time?---Yeah. 40 It’s giving the Minister a summary of the economics, is that right?---Yes. And it’s also giving the Minister something of an insight into the way in which the proposal would work into the future, is that right?---(No audible reply)

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I’m not sure we have every page of this but we’ve collected these things very hastily for the - - -?---Sure, and it’s been a while since I’ve looked at them but certainly that appears - - - I don’t want to, I don’t want to delay on it - - -?---No, no. - - - I just want to show something - - -?---Yeah. - - - because we can show the Minister later, he’s going to come along, something which you were giving him and ask him about it?---Sure. 10 But this is the sort of thing you were giving him, the Minister was Mr Roozendaal of course?---In 2010, yeah, I think so. And then if you go to page 8 you’ll see there’s the first page of yet another one and this one in particular if you go to page 9 deals with negative consequences in the event that the coal framework or Coal Chain Agreement was disrupted?---Yes. And this was a serious advice in terms of providing the Minister with the 20 consequences of putting a further coal terminal on the Mayfield site, is that correct?---Yes, that’s correct. I should just deal with that very briefly. There had been legal advice obtained which was a precursor to getting ACCC signoff on the agreement, correct?---Mmm, mmm. And then as part of your process you’d also taken legal advice about the way in which anything that you did at the NPC and the Mayfield site could interfere with the Coal Chain Agreement?---Absolutely. 30 And the reason for that was is the Coal Chain Agreement was fundamental to the whole of the coal industry?---Yes, yeah. It could bring the, if, if you like the industry to its knees if it was disrupted? ---That’s right. And that was an advice which you were providing the Minister as to what you understood to be the potential consequences there?---That’s correct and I believe as I flicked through this there was – that’s right, this is now 40 reminding me there was a meeting on 6 October that we were asked to do an urgent briefing on but this later one is a much more fulsome briefing note. Well, if I just show you the first page of this document, what you’re talking about there is a briefing note, this one prepared by Treasury I believe, we got these documents from Treasury, but you’ll see there that there’s going to be a meeting between the Treasurer and Buildev on 6 October, 2010, do you see that?---Yes.

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Now who or what was Buildev as far as you were concerned?---Ah, Buildev was a local development group that ah, was interested in the Intertrade site. And Intertrade, so that we’ve got it clear, that’s the HDC site - - -?---Yes. - - - adjacent to the Mayfield site?---Yes. What did you understand would be involving the Minister for Ports in respect of a landlocked block of land, the Intertrade site?---(No audible 10 reply) Did you know what Buildev were coming up with?---Oh, there’s no doubt that I’d heard that Buildev were talking about putting coal over the site but at that time they were talking about around two million tonne of coal and using an easement through the port land to a berth on the Mayfield site. All right. What I really want to get down to is this, is that the NPC controlled the Mayfield site, had anybody from Buildev or Hunter Ports come to the NPC with their proposal?---Not to my recollection no. 20 Well, is that unusual?---It is unusual but - - - I mean, after all you were the decision makers weren’t you?---Well, no, no, no. We if you look at our documents, we were very aware we were a state owned corporation. Of course.---And ultimately the Government makes a decision as was always the case. 30 Well, for example, did Anglo Ports go over your head around your back, whatever the saying is, to the Minister rather than dealing with you?---Not to my knowledge, no. And, I mean, as if Buildev or Hunter Ports had come to you with a proposal about using the Mayfield site for a coal terminal, would you have listened to what they had to say?---I would have listened. I would have given them some feedback, perhaps reflected but Mr Watson, Port Waratah Coal Services had come to NPC and NSW Planning seeking to see if we would support an expansion of the Carrington Terminal for coal and the answer for 40 both entities was no. And why?---Because of the best use of land, the functionality, the future port capacity and development and the ability for the coal industry to have all that they needed as well as the diversification strategy for the port to be realised.

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And what about the effect on the Coal Framework Agreement?---Sorry, PWCS’s request was before the Coal Framework Agreement. All right. Okay.---So what I’m just saying that, that path had been discussed and PWCS had accepted that decision and I don’t recall whether, I don’t believe they’d gone to government to try and change that decision. In any event, how was it that you found out as a formality, not sure mere gossip, formality that Buildev was talking to the Minister about altering the nature of the use of the Mayfield site?---I was asked, I was asked to go to a 10 meeting in Sydney where I would be shown plans so that I just didn’t hear that there was going to be a development and that would have taken place around that October/November 2010 time. You were asked to go to a meeting in Sydney in the Minister’s office?---Correct. Mr Roozendaal’s office?---Correct. And were people from Buildev there?---Yes, they were. 20 And did they have advance plans?---They had schematic plans that were laid out but weren’t left me at that meeting. Why not? Wouldn’t you need to look at them in some detail?---There’s no doubt about that but they weren’t offered I was told that sorry, I’m not sure what happened at the end of that meeting. I think one thing that happened was you must have provided those two briefings to the Minister that we’ve seen.---Yes, yes. 30 Page 6 and page 8 - - -?---Yes. - - - that you must have provided a briefing to the Minister about your view on the merits or demerits of the proposal.---Well I think page 6 is really part of NPC pursuing its objective as signed up with the government and yes, page 8 - - - Yes, it’ s a reference back to the Statement of Corporate Intent?---Yes, that’s right and page 8 would have been a more further developed briefing 40 note to follow up that one that was asked for, for 6 October. Well, you can see on page 8 that what you’re advising the Minister on their questions specifically arising out of a meeting that the Minister had with Buildev on 6 October 2010.---That’s right.

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So somebody must have told you that Buildev was meeting with Mr Roozendaal at that time?---Yes, and we would have, it seems as if NPC was asked to provide an initial briefing note. The point I’m trying to make is this, is given how advance you were with Anglo Ports, was this, did you think, unusual?---I found it quite unusual in terms of the contract the NPC did have with the government of the day. I accept that governments can review where we’re up to, where anyone’s up to but it’s the process of clarity and how that’s perused that became quite confusing. 10 Well, one of the things I wanted to know is this, is did you find it unusual that it was only Buildev there, that it wasn’t industry wide?---Yes, yes, particularly when we’d just completed the Coal Framework Agreement and really, I think this was around agitation from one particular miner who was quite new and had great aspirations and was having a view that they were locked out of access, I think that was Aston at the time. Aston Resources Limited?---Yes, yes. 20 And they had the rights to the coal won from Maules Creek in Gunnedah?---That could be right, yes. And that’s Mr Tinkler by and large, is that right?---That’s my understanding. And so this is all being driven by eventually, Mr Tinkler?---Well, that, at that stage it was the CEO of Aston, yes. Well, I just want to go into the detail of that a little. Just imagine for the 30 moment that there was going to be some sort of disruption to a long held plan of the NPC to use the Mayfield site for a container terminal. Just imaging that was to be disrupted. Would it be right, in your opinion, to throw it over to one company Buildev?---No, no, not at all. Incidentally, when we’re talking about the development of a container terminal, what are we talking about the capital costs, is it hundreds of millions or is it getting up around $1 billion?---No, as I said, this was a staged approach of development but the first stages was around $200 million or $250 million and that included an extension on the general cargo 40 of it as well as a berth with some container facilities. Well, again, let’s just tally it up, what are we talking about, hundreds of millions of dollars or?---The overall project over its lifetime would have been in the order of $700, $750 million. And did the Minister ever tell you about anything about the economic strength of Buildev to finance a $750 million project?---I’m talking about

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the development of the general cargo and container costs. I don’t recall the Minister telling me the cost of the coal terminal, I think I recall at a meeting Buildev talking about billions of dollars and jobs and so on but clearly, we’ve just got major expansions of the coal industry and certainly coal development can be in the order of hundreds of millions or for a start-up, it would more than likely be over a billion dollars. What was the economic viability of Buildev, I mean, could it do this? It’s a well-known Newcastle property developer, was it in this sort of market?---Mr Watson, I didn’t look at who was behind them because the issues that 10 NPC put forward in this briefing note of 8 November were never actually brought back and addressed and in terms of Buildev claiming to be able to build a terminal in a very truncated and speedy time limit that never made any practical sense to me based upon what we had just seen in terms of other terminal developments. So I never got anywhere near close to being asked nor wanted to look at their financial viability. Well, did these are matters that you addressed in your report to the Minister, that is, these are the practical consequences of reversing the plan and did the Minister ever give you an answer to the queries you’d raised?---Not to my 20 recollection. Did, to your understanding, the Minister ever seek an answer to those questions from Buildev itself?---Not so much from Buildev, I do know that we did have a conversation with the Minister and some advisors about the impact of the ACCC authorisation. I’m going to come to that.---Okay. Before I do, I just want to know where my monies going, you see. NPC 30 over this whole long process, it had been running at this stage for something like five years.---Yes. You would have spent a lot of money on accounting firms in looking at these things, experts?---There would have been significant money. And lawyers?---In certain preparation of documents. Of course, and people at NPC had to be employed to sit down and assess what Anglo Ports had put forward and see whether it was viable or 40 worthwhile or stupid?---Yes. And there would have been environmental consequences and the like which has to be considered?---Well, certainly, lodging a concept plan on a site has got serious money.

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You correct me if I’m wrong, but I’m going to take a wild stab and say that NPC must have spent hundreds of thousands of dollars on those sorts of considerations over those five years?---That’s quite possible. And did the Minister, Mr Roozendaal, tell you any reason why, it if is, hundreds of thousands of dollars of investigations were going to be pushed aside for the sake of Buildev?---I don’t recall that being discussed. I mean it’s an important consideration, isn’t it?---Well, I think the- - - 10 I’m not having a go at you, Mr Webb?---No, no, no, I understand that. I think for me I, NPC always saw in its contract with the Government you could have both, you could have the expansion that the coal industry wanted based upon the T4 land being available and you could have the expansion of general cargo and containers in the Port. Well, one of the concerns you must have had reading your reports is that if you’re going to a meeting between the Minister and just one company, Buildev, what, what effect on the industry might it have if that much power was transferred to one party?---It certainly raised concerns for NPC, as our 20 advice shows, that it could fracture the Coal Framework Agreement. Ah, part of the deal that was authorised by the ACCC was this allocation of land that allowed for the expansion and clearly if Government became involved in allocating directly to land a competing terminal it could be viewed to, to fracture the framework. NPC clearly held a view too that the supply chain lagged behind the terminals in terms of capacity, and that was always one of the principles that Nick Greiner brought in, get the terminals built in front and it would draw the supply chain- - - You’re getting a bit carried away there?---Sorry, yeah. 30 Mr Webb, on the issue of the, you’ve described it as a fracture of the ACCC approval, did you take legal advice on that?---Oh, absolutely. The same legal advice that NPC used ah, during the development of the Coal Framework Agreement. And did you draw – well, and that advice, was it comforting, did it tell you there would be no problem with the ACCC agreement or what did it tell you?---Oh, well, the advice was, formed the basis of the advice that was then passed onto the Minister that highlighted there would be grave 40 difficulties and I think from memory, and I’m sorry, I haven’t had a chance to read this, that at one point because it was an agreement between PWCS, NCIG and NPC, introducing a new terminal operator may well change the whole nature of who the players were that the ACCC would have had a dim view of, but I’d need to come back and read that.

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Well, did you draw that to the attention of the Minister?---Oh, absolutely, but our, our, our briefing notes here – oh, there it is, “Material change of circumstances.” Yes, it’s all – we’ll be able to read it, I can assure you we’re on the ball. But this was drawn to the attention of the Minister?---Oh, absolutely. Did Mr Roozendaal ever give you an adequate response to the idea that the Coal Framework Agreement could be fractured?---Ah, no. I remember carrying these views to the meeting with the Minister and Buildev and then 10 subsequent to that, taking our legal advisor to a meeting with the Minister and Government advisors to explore this further, because there was clearly a view that this advice wasn’t right. Did you wish to make a public announcement in respect of your coal – I’ll start again. Did you wish to make – this is around about late 2010, did you wish to make an announcement, a public announcement about anything to do with the container terminal?---No, no. There’s a document that we have. Could the witness be shown Exhibit – 20 perhaps what I’ll do is I’ll tender that bundle of documents, Commissioner, before I go further. THE COMMISSIONER: Yes, Exhibit Z42. #EXHIBIT Z42 - MEETING WITH BUILDEV BUNDLE MR WATSON: Now, I’ll take that off you, Mr Webb, and you’ll be given 30 Exhibit Z10?---Thank you. Would you open this up at page 15. These are some notes which we’ve been able to capture. They come from Buildev and they were prepared following a meeting that Joe Tripodi had with Buildev on 19 November, 2010, so around this time, late 2010. Will you just assume that for the moment. Okay. You see there that there’s a discussion bullet point, “Gary Webb provided legal opinion from Tobins.” Was the law firm that you used Gilbert & Tobin?---That’s correct. 40 And that, did that legal opinion argue that the ACCC agreement would be compromised?---Yes, it did. Was that, was that discussed with the Minister?---Ah, yes. Were Buildev people there at that time?---Not with Gilbert & Tobin there.

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No?---But clearly I carried the argument of the fracturing of the Coal Framework to that meeting. I’m just wondering, how would it be that somebody at Buildev was being told- - -?---Mmm. - - -of the legal advice from the law firm? Even their name is there?---Yes, I have no idea. How would that leak out so that Buildev could get access to that 10 information?---I have no idea, Mr Watson. Well, I mean you’ve had extensive background in the Public Service now through the state-owned corporation?---Mmm. Was the fact of that legal advice something which you regarded as confidential?---Absolutely. Can you think of any good reason why it’s leaking out and being discussed apparently by Joe Tripodi with Buildev?---Well, as I read down it’s clear 20 that, that there is looking for a- - - Well, I don’t want you to read down?---All right. I’m thinking now, I mean was, did you think it was a good idea for example for the Treasurer, Mr Roozendaal, to give open advice on the legal advice from Gilbert & Tobin? MR CARROLL: I object. 30 MR WATSON: No, I won’t press that. Let’s just go on. The legal advice, I take it they’re high-qualified lawyers?---They are. And then we can see that they’re apparently scored low points with Joe Tripodi and Ian somebody, we think that’s Ian McNamara. Do you remember a chap named Ian McNamara?---Yes, I do. Was he present at the meetings with the Minister?---He was present at one meeting with the Minister I think, yeah. 40 Right?---He was definitely at one, I don’t know whether it was two. Do you know why he was there?---I have no idea. Where did he come from, what did he have to do with it?---Well, Ian was previously Joe’s advisor.

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Right. Well- - -?---So I was, I was told that Ian was coming because of his previous knowledge of the Coal Framework and Ian worked very hard on it in the early stages, yeah. Third bullet point. “Gary Webb proving to be stubborn.”?---Yeah, many people would agree with that, Mr Watson. And then fifth bullet point is an important one for us, “Joe,” this seems to be what Joe is going to do. “Joe is going to get Eric,” take it that that’s probably Mr Roozendaal, Mr Tripodi is going to get Mr Roozendaal to stop 10 Anglo deal going to Board this Thursday. Do you know what that’s about? ---I don’t know, but it does make the fact that there was a period where I was requested to provide the agenda that’s going to the Board to the Minister’s office put into some context. Well, tell me about that, is that unusual?---Oh, enormously unusual. It didn’t stop me doing what I needed to do in the right governance framework but I certain believe I provided that agenda and then talked through what it was that was going to the Board. 20 Well, tell me this, how did it come about, was it the Minister himself or a member of his staff?---A member of his staff. And you don’t remember who that was?---No, I don’t. Could it have been Ian McNamara?---I doubt it, I don’t think so. But you were asked to provide the agenda- - -?---Yes. - - -the CEO of the NPC- - -?---Yes. 30 - - -the agenda that you were going to take to your Board?---Yes, that’s right. In what capacity was he demanding that?---Um, either Shareholder Minister or Portfolio Minister. My view, Mr Watson, was quite simple, provided it did not change what I needed to do in terms of proper governance to the Board. But can you think of any good reason why Mr Roozendaal would want or 40 need such a document? MR CARROLL: I object. MR WATSON: Well, I press that. THE COMMISSIONER: Sorry, is there an objection?

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MR CARROLL: Sorry, Commissioner, there is an objection. THE COMMISSIONER: There is an objection? MR CARROLL: Yes. THE COMMISSIONER: To what? MR CARROLL: To the question saying that, in essence that Mr Roozendaal requested the release of the Board meeting agenda. 10 THE COMMISSIONER: No. The question was is, could there be a reason why Mr Roozendaal might- - - MR CARROLL: And he answered that previously in relation to the statutory framework. MR WATSON: Well, I- - - THE COMMISSIONER: I’m not sure that he did. Anyway- - - 20 MR WATSON: I’m sorry, I mustn’t have made it clear. I’m not talking about the statutory framework or whatever that is. THE COMMISSIONER: No. MR WATSON: I’m talking about this idea that the Treasurer wanted your agenda given to him before you went to the Board. Can you think of any reason why he would want it?---Um, I’m not going to – I can’t remember what it was, that it could have been at the time, I just provided it. 30 Could you just bear with me while we have a look at a couple of other of these points? You’ll see down there it’s the 11th point and it says this, “Buildev will contact Tony Kelly and make sure he is still on side.” Now what role did Tony Kelly, we think that’s the former Minister for Planning, what role would he have had?---(No audible reply) Do you know?---Um, I – do I know, no, I don’t know, I, I don’t know what role he had. 40 The 12th bullet point is the same except it’s speaking of Warwick Watkins, you’d know of Mr Watkins?---Yes, I know, I know Mr Watkins. What role did he have?---He was Director General of a department at that time, I can’t recall which one.

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Then there’s a point Mark Sargent should be briefed, who was Mark Sargent?---Mark Sargent was one of the directors of Newcastle Port Corporation. Right. And Mark Sargent should be briefed and if he’s supportive he should speak to Gary and other board members. Did Mr Sargent approach you?---No. Then if you go down a little there’s a suggestion there, “Joe, we try and make any recommendations through Budget Committee.” Now we think 10 that’s probably the Budget Committee of Cabinet?---Mmm. What does all that mean, can you explain it for us?---Oh, certainly. For major projects within the State the Budget Committee of Cabinet that’s made up of a number of Ministers considers recommendations. Generally Treasury through the Treasurer might carry them forward and from Newcastle Port Corporation’s point of view that was going to be the process that, that would be followed anyhow. Then if you have a look the next one is interesting, Anglo meeting, that I’m 20 going to suggest to you must, must mean that somebody from Buildev, maybe Mr Tripodi, was going to meet with Anglo because it’s talking about dumping the Spanish, that’s dumping TBC. MR NEIL: I object to that, that question is an unnecessary question. MR WATSON: I withdraw that, I’ll withdraw that, I shouldn’t have said Mr Tripodi, somebody’s going to meet with Anglo, they’ve got to dump the Spanish, that’s TBC, fight 500,000 et cetera, what, what does that mean? ---In the ah, concept plan and the expression of interest for the development 30 of the site it had 500,000 coal could go through that site but not above that. Then the next one is there should be a meeting between Eric and Gary, now assuming that’s Eric Roozendaal and Gary Webb, there were meetings weren’t there?---Yes. And then you can see that there’s two options, one was that you were going to roll over, you don’t seem like that kind of man to me, Mr Webb, that’s a compliment?---I’m, I’m a very flexible person until the obvious needs to happen, Mr Watson. 40 Well, have a look at the second one, in the event that Gary does not roll over, did you hear any discussion along those lines, that the Treasurer would take land control off the NPC and give it to the HDC with instructions? ---No, no, I never heard that. There is the capacity however for a Minister to give an instruction a State-owned corporation?---Absolutely, yes.

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So that’s actually quite feasible is it not that a Minister could take dramatic action like that?---Um, it is quite feasible but it’s rare for Ministers to take the direction, direct action route. Thank you, Mr Webb. Just close that up. I’m sorry this is going on so long. Well, the meetings with Mr Roozendaal, did he display to you any preference toward an outcome?---I, I don’t recall that, Mr Watson, I recall that he was very keen for us to have an open mind and to explore the opportunities um, and certainly it was odd that Buildev came into a meeting 10 with him but I don’t recall him preferring that as an option to me, no. Do you remember circumstances in which a Treasury report was leaked? ---Yes, I do, I do. Could you tell us about that?---Um, I’m not sure if it was late that year or early the year after so I’d, I’d need some help with that but I became aware that the Newcastle Herald was going to run a story about trucks and containers and that Treasury wasn’t for it, I believe that the Member Newcastle and Jodi McKay rang me to inform me of that so I think that was 20 the night before the story. Well, I can show you the document if you need to see it but I’ve got to ask you, did you leak it?---No. Did you even know about it?---No. There was a campaign called Stop Jodi Trucks, you would have at least heard since the commencement of this inquiry that that is so?---Yes. 30 Were you aware that that was going on at the time?---Ah, yes, that was closely aligned around that, that time, yeah. I can’t remember which one came first. There was a suggestion that there were going to be 1,000 trucks a day rattling in and out of that container terminal if it was built. What do you say about that?---I think it went, I think it went, I think it went through the streets of Mayfield did it not? The brochure?---I’ll come to that in a moment but there’s 1,000 trucks a day 40 going through the container terminal?---Yeah. What do you say about that as an estimate?---Well, that, that’s not, that was never within NPC’s estimates at day 1, it was never. Well, could I just ask you, NPC’s estimates, let’s assume it’s built, it’s up there and trucks are coming in and going out, how many a day was NPC’s estimate?---Oh, 20 or 30 years down the track?

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No, no, no?---Oh. This is day 1?---We, we thought that if they were operating a 20 to 30,000 starter with the extra activity in the port because we didn’t necessarily think Newcastle Stevedores Consortium would cannibalise all the existing container movement within the port, but 20 to 30,000 as a start-up would have been quite good. 20 to 30,000 TEU’s?---Yes, a year. 10 And trucks?---Ah, I think the number, Mr Watson is if you divide that by 1.8, because some of the trucks can take more than, more than one but even if you take one um, you pare that back and you’ve got 100 trucks a day. And you said something about that, there was a suggestion there that these trucks would be rattling around in the streets of Mayfield, Islington and Tighes Hill, would that be true?---No. It was all on this single dedicated drive, Industrial Drive?---Absolutely, you can imagine in terms of getting planning approval if NPC had supported this 20 concept of road trucks it just would have been impossible for it to happen so the conditions that were placed upon the development of the site it was clear to be using the Industrial Drive as the entrance and exit pathway. And there was also a suggestion in the paper that the trucks were going to place schoolchildren and elderly pedestrians at risk, lots of them crossing over Industrial Drive?---Um, well, that was, that was never, that was never our intention, no. Thanks, Mr Webb, there may be some other questions for you I’m afraid. 30 THE COMMISSIONER: Who has some questions for Mr Webb? Anyone? Mr Neil. MR NEIL: I do, thank you. Mr Webb, I act for the Honourable Joseph Tripodi, do you understand that? ---Yes, thank you. Now I just want to ask you very briefly firstly about the evidence you gave 40 regarding the development of the Coal Framework Agreement, did Mr Tripodi have a part to play in that?---Yes. Was he a person who as Minister for Ports, I think for something like nearly three, three years or a little over, took a close detailed interest in the detail of these matters?---He certainly was very active, he certainly ah, was very interested in the detail um, but certainly as the framework agreement was

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negotiated it became impossible for the Ministers and the advisors to be at every meeting in developing the framework. Understood. But would it be fair to say that he was a major contributor to that agreement coming about?---Yes. And indeed at one stage was there a great dispute with BHP about matters we needn’t go into but he got them to back down?---Ah, yes, he was a very active, engaged Minister. 10 And he was a Minister who was active in relation to ports that included, obviously, Port Botany?---Yes, I believe so. And there’s a large container terminal or terminals at Port Botany, correct?---Yes. And truck movement in and out of that terminal or those terminals was a matter of considerable important, correct?---Yes. Both in order to efficiently move the trucks in and out, firstly, correct?---20 Yes. And secondly to try and reduce the impact on the local environment and people, correct?---That’s my understanding. And would you be able to say that Mr Tripodi had a detailed knowledge of those matters?---My understanding is he was actively involved in facilitating arrangements to help address that in Sydney. Yes. Right down to the detail of how many trucks, how many movements, 30 how many containers per truck and the like?---I can’t tell you what Mr Tripodi knew about trucks in Sydney. But he knew enough to be able to resolve some of the problems that were happening at Port Botany in terms of truck movements, correct?---He certainly set the framework that enabled Sydney Ports to develop a system, I don’t know what Mr Tripodi knew about trucks in Sydney. All right. Now, the I don’t want to take you too much onto the matter of this coal loader, that’s for others, but I think you’ve said, and I just want to 40 clarify this, that the Buildev proposal as you understood it was to use some kind of easement from their land across to a part of the Mayfield site, is that right?---That was version one, version two wasn’t that. Well, was a version, to use some kind of easement or corridor?---That was version one but version two wasn’t that.

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And when did you understand version one to be, when did you first learn about version one?---I think version one was at the meeting with the Treasurer and I’m not sure when Version two that wanted to take the whole erupted, I’d need to get some access to documents. Could the witness, Commissioner, be shown Exhibit Z10 please and when you receive it, could you have a look at page 132. Now the, are you able to easily read that?---No. No, it is difficult. The, I think we can find another copy that’s a little easier 10 to read, if I might hand this up Commissioner. It’s not much better but I think you can find you can read it.---Thank you. I’ll put, I’ll suggest to you if you could just take this subject to any correction by my learned friend or anyone else, but we understand that appeared in the Newcastle Herald on 4 March 2011. Now, the sixth last paragraph has Mr Tinkler reported as saying, “the coal and container terminals can co-exist and both will benefit from rail and infrastructure upgrades associated with the projects with the main aim to minimise road traffic,” do you see that?---Yes. 20 Would that assist you to be able to say that version two, which was non-co-existence, must have come up after that date?---Your putting that, it may well have been, I can’t confirm or otherwise. All right. Thank you, all right. But anyway, Mr Tinkler’s public position as of that date seems to be in accordance with that page, correct?---It appears to be that way, yes. All right. Was that ever drawn to your attention, can you recall or not?---I 30 can’t recall. All right. Now, the – you have been a long term proponent of development of the Newcastle Port, correct?---That’s right. Was there a concept plan that was produced at some stage?---Yes. And was there an SEPP that covered the Mayfield site?---There was an SEPP that covered the whole of the port. 40 Yes.---And as I said, the Newcastle Port Corporation lodged a concept plan for the Mayfield site with New South Wales Planning. Now, would it be fair say that subsequently, sorry, that there was at one stage a parliamentary inquiry into port infrastructure which produced a report in 2005?---Was that an Upper House Inquiry?

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Yes. Mr Kazan Terreni(?) I think was the chairman.---Yes, I recall something about that. All right. And was there produced in 2012, March 2012 a major project assessment of what had happened up till then in relation to this site?---Who would have done that? The Department of Planning and Infrastructure?---Is the major assessment, yes, the major assessment is the assessment of the concept plan that Newcastle Port Corporation lodged, is that, are we on the same thing? 10 Yes, yes. I think that’s correct.---Yes. Now, the difference, I think you’ve outlined briefly already between the old form of loading and unloading by cranes on ships and the modern system with the crane facilities and other facilities being on the port involves a significant upgrade all round, correct?---That’s right. And the modern port, if it contains a container terminal, it’s going to be one that would be developed over time, correct?---That’s right, yes. 20 And however, the environmental impacts including traffic have to be assessed over the whole time of the likely project, correct?---Yes. Because a decision may be made that is going to involve implantation over a period, it may be 20 or 30 years, correct?---That’s right. So you’ve got to look along the line.---Yes. But you make that decision at a particular date to cover the future events, 30 don’t you?---That’s correct. But the citizen who’s concerned about what might be happening is concerned about, not only what might happen with the port opens but what might be the effect upon them at each stage of the development until the end in accordance with the approval given at the beginning, correct?---As someone who led the community consultation on the strategic plan of the port, the community is very interested the port because of its history and its impact and certainly, from NPC’s point of view, the transparency of the planning process ensures that this strategic plan that fits within the national 40 ports strategy does have a 50 year view, that it is very clear as to where the port plans to be in 50 years, or 30 years. Right. Yes. And what’s put out to the public are the predictions, such as they can be made, for the whole period?---That is part of the planning process.

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Part of it. And the citizen can see, for example what is the likely traffic impact when the port opens, what it’s likely to be like in three years, five, 10, 30 years, correct?---I can’t recall what the application had but that should be able to be hypothecated back if need be. Yes. And you’d agreed that at least some controversy, at least some controversy arose in the Newcastle area about what was going to be the effects of traffic in the future from the port, correct?---Certainly, in terms of engagement the community was interested in those predictions. 10 THE COMMISSIONER: Sorry, Mr Neil, are we talking about the port activity generally and not just the proposal for the container terminal? MR NEIL: Both, but I’ll clarify as I go along and divide up if needs be. I’ll ask this question to perhaps help with that. The proposal development at Mayfield was to be a multi-purpose terminal, is that right?---Yes, as I described, it had a number of activities in terms of bulk general cargo in containers but I also expressed the consortiums desire to put money into a berth that was able to handle containers. 20 All right. Did it have what one might call an operational area of about three hectares for headquarters and the like?---Ah- - - The operational precinct?---Yes, yes, I think that’s right. Thank you?---Yes. Did it have what was called a bulk and general precinct of 12 hectares? ---It certainly had that precinct and I accept your numbers, yes. 30 Thank you. And was that the precinct that coal – we’ll come to quantity in a while – that coal was permitted to be passed through?---Ah, that, that would have been the precinct on that 500,000. Right. Now, was there a general purpose precinct of 25 hectares for storage, cargo containers, heavy machinery, break bulk and so on?---Yes, more than likely, yes. Was there a container terminal precinct of 35 hectares for the storage and transfer of containers?---Yep, that sounds right. 40 And was there a bulk liquid precinct of 15 hectares?---That’s correct. And for the various operations to come into play, were there various different timeframes anticipated?---In terms of NPC the operational area was not included in any expression of interest, the bulk liquids precinct was handled separately and that is currently underway.

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All right?---There’s terminals operating. The other three precincts were put out to the market together. Right. Just on that, has anyone taken it up, the container terminal for example, has anyone taken up the bidding and been given a tender for it, given a contract?---No. All right. Now, the container terminal would within itself have multiple facilities. Is that right?---Could you give me an example? 10 Well, the gantries, the cranes and so on?---Yes, that’s right. And the number of, the efficiency of such a container terminal in part depends upon the quay length. Correct?---Yes. Because you’re going to expect a number of loading points and unloading points for the trucks. Correct?---Ah, no, not necessarily. Do you want to talk about how a container terminal works? Could you just tell us, would there be just one only loading or unloading 20 point for trucks or more than one?---Well, it depends on how the operator wanted to run their facility. Right?---They, they may not start off with trucks, they may use particular dedicated gantries. I, are we talking about Anglo Ports Consortium, are we talking about hypothetical development? Well, this is part of the problem isn’t it, because no actual tenderer has come forward with their plan, have they?---No, that’s not true. 30 Well, no actual tender has been granted a contract according to their plan. Correct?---That’s correct. Right. Now, just on some technical matters, when concerned with imports, if a truck comes to the terminal to pick up an import, it may pick up a container that’s full and leave. Correct?---That’s correct. A standard container is twenty foot. Correct?---Yes. And ordinarily that will fit on one ordinary truck. Correct?---Yes. 40 There may be some other variations and you might have to come to that formula that you talk about?---Yes. Is one of the formulas in the industry, I think you said 1.8, but is one of the formulas used 1.2?---It could be.

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Right. Now, might the truck who comes to pick up an import bring to the port an empty container?---Ah, could do. Do the shipping companies own the containers?---Ah, some might, some- - - So a truck that comes to pick up an import might bring in an empty container and leave with a full one or it might come without a container and leave with a full one. Correct?---That’s correct. And in terms of exports, a truck may come to the container, come to the 10 terminal with a container to export and leave with no container or leave with one it’s picked up?---It could do. Right. So that for each time, this obviously goes without saying in a way, but for each time there is a truck pick up or delivery there’s a movement of a truck to and from or from and to the terminal through the nearby areas. Correct? MR WATSON: Commissioner, could I inquire through you as to my learned friend’s positive case? 20 THE COMMISSIONER: Yes. MR WATSON: Is Mr Tripodi trying to justify the 1,000 trucks a day? THE COMMISSIONER: Well, no, that’s why I was just asking a short time ago whether we were talking about truck movements for the coal port generally or whether we’re talking about the container terminal. MR NEIL: I’m talking about that particular terminal. And let me be quite 30 clear about this, Commissioner. Mr Tripodi’s position is that he believed that the flyer was accurate. THE COMMISSIONER: All right. Well, I think, I think we need to put that proposition don’t we in terms of whether or not this witness has a view about that? MR NEIL: Yeah, I’ll come to that. THE COMMISSIONER: All right. 40 MR NEIL: And the movement of trucks is obviously important to that point. THE COMMISSIONER: Yes.

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MR NEIL: Now, the, in the, in March of 2012 a document was produced which we provided to the Commission, but could I hand to the witness a hard copy, Commissioner. Thank you?---Thank you. Just before I ask you to look at that, you say the Concept Plan included provision for 500,000 tonnes of coal out of the bulk et cetera precinct? ---That’s my recollection, yes. Now- - -?---As well as other bulk commodities. 10 Thank you. Was the, in effect was the 500,000 tonnes a cap?---Yes. Now, was that cap introduced at some time?---No, that was, that was in NPC’s expression of interest document. All right. And can you, sorry, do you need to finish?---No. Right. Do you know when that was issued?---Ah, I would need to go back to documents. As I said, I retired from NPC and I don’t have access to all those documents. 20 All right. Well, could I just ask you to have a look at the document I provided to you, which is NSW Government Planning and Infrastructure, that would be the – it’s Director-General’s Environmental Assessment Report. Would that be the Director-General of the Planning Department? ---Yes. And it’s referring at the executive summary on page 1 to the Newcastle Port Corporation as the proponent, which it was. Correct?---Correct. 30 And had put forward the Concept Plan. Correct?---Correct. And I’ve taken you to the various precincts on page 1 and to the timeframes on page 1 and it may be, sir, that you see something, because I’ve only just provided this to the Commission today, and to you – if you think I’m taking anything out of context, please say so and we’ll try and resolve the matter. But on page little 2, as part of the Executive Summary, you see the paragraph that is the second-last paragraph on the page, see that?---Yes. And that says, “Traffic impacts including traffic generation and the capacity 40 of the existing transport infrastructure are considered to be the key issue in relation to the Concept Plan.” You see that?---Yes. “In light of the capacity and performance of the road system and the number of containers and vehicle movements predicted to be generated in conjunction with the potential cumulative traffic impacts from the adjoining Intertrade Industrial Park, the Department has recommended restrictions on the movement of container freight by road. Movements will initially be

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restricted to 200,000 TEU with potential increases up to 700,000 TEU per annum subject to the review of the performance and capacity of the road and rail network and the identification of required infrastructure and service measures. This restriction is reflected in the recommended terms of approval.” Do you see that?---Yes. Now is it not the case that prior to this, the production of this document in response to the proponent’s concept proposal there had not been a restriction specified in terms of the TEU for the container terminal?---Um, I, I think there was. 10 Well, in case you have to come back can you perhaps look at any documentation you can find so we can have a look at it?---Yes, certainly but if I come back to your first point we’re now looking at the final assessment of March 2012 - - - Yes?--- - - - and therefore if we need to come and step back through all the process of getting that approval that, if we need to, may be a helpful thing but the thing that I notice is on page I, the first page I, we’ve got operation from construction for the container terminal 13 to 25 years so clearly this 20 has been a document that has been amended to reflect the decisions of the long-term lease of Sydney and, and Kembla but I just point that out to you because the time we’re talking about was not a container terminal 13 years down the track at all so I, I hear what you’re saying but even so in this document you’re, you’re saying that there was an uncapped component, I’m not sure about that at all. Well, I am seeking your assistance because the timeframe that affects my client, the particular timeframe seems to be from about very late in 2010, more likely about February 2011 through the election of March and maybe 30 through to June 2011, do you see what I mean?---Oh, I see what you’re saying but I - - - And I want to find out was there such a cap or not in the proposals as they’d reached the stage about then and if I just take you a little further through the document - - - MR WATSON: Well, I object. This document’s irrelevant. My learned friend just said it’s 2010 but Mr Tripodi says it’s accurate, let Mr Tripodi bring forth the document upon which he relied. 40 MR NEIL: Your Honour, this is – I’m going to take the witness to this, Commissioner, and to the fact sheet. This shows what was done with the concept document which we’ve never been served with and I would invite the Commission to find it and/or Mr Webb to find it and any other relevant documents so that we can look at them because what this clearly shows is the timeframe - - -

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THE COMMISSIONER: Well, sorry, before we go any further, Mr Neil I think the problem is that this witness as I understand his evidence doesn’t agree that the document you’re now showing him provides a basis upon which he could express a view about the projected truck movements from the container terminal at the relevant time, that’s as what, that’s the effect of what the witness has just said, I’m not sure. Is that right, Mr Webb?---That is correct, Commissioner, but even if I step past that and accept the numbers in here – I’m just trying to make a technical point, that this document is way beyond the timeframe we’re talking about, I believe that these numbers were the numbers that were being talked about at the time, the question 10 asked to me was there a cap and I, I know that the transport studies and planning were certainly talking about the impact of traffic at that time so it’s a moot point, these numbers are not unfamiliar to me but I’m trying to be quite clear in terms of the context of this particular approval. It is, it is not at the time based upon the operation being 13 to 25 years. Well, Mr Neil, is there another document that is relevant to the timeframe that we’re discussing? MR NEIL: Well, there may be the concept plan but we haven’t been given 20 it and the witness has been brought two days earlier, we haven’t had a chance to look at it and could I just clarify one thing with the witness, I’ll make it perfectly plain because he may have a difficulty with this, that we are going to mount arguments based upon the full timeframe in this or any other document and if he – could I just ask you to look at page 1 of this document, go back to page 1, it says, “The project has been described conceptually,” that’s the concept plan, correct?---Which paragraph? Line 3 on the top of the page, line 3, talking about your - - -?---Yes, yes. 30 - - - your proponent, your, your – the proponent’s proposal, “The project has been described conceptually and includes a layout plan which divides the site into five key precincts to be developed progressively over a period of approximately 25 years with development commencing in 2012 and peak operations anticipated being reached by 2036.” What I’m seeking your assistance on it appears on one reading of this document that the 200,000 to 700,000 TEU cap has been brought in by this document where there wasn’t one before that I want your assistance to clarify that if you can, do you see what I mean? 40 MR WATSON: Sorry, Commissioner. THE COMMISSIONER: Yes. MR WATSON: My problem is what’s the case? I mean, Mr Tripodi doesn’t have an interest surely in projecting this out, we’re talking about Stop Jodi’s Trucks.

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THE COMMISSIONER: Well, that’s what I was, that’s what I was attempting to rectify but I think the witness has already said, correct me if I’m wrong, Mr Webb, that you, you understood that there was a, there was a cap at some earlier time?---That’s what I understood but I would, I would need to get someone to go and look at it, Commissioner, I, I’m - - - Well, all right?---But, but I’m trying to help by saying these numbers are not unfamiliar to me and even though it says it’s been described conceptually, this concept plan was just about reviewed as a DA. 10 But, Mr Neil, can I just – sorry to - - - MR NEIL: Yes. THE COMMISSIONER: - - - labour this but there’s one part of this concept, of this concept plan to which the Stop Jodi’s Trucks flyer related and that’s the container terminal precinct which is dot point 4 on that page and I, and I think the question is, can we cut to the chase, is there anything in, in that estimate, namely up to 600,000 TEU’s by 2024 or, or a peak of one million TEU’s by 2034, is there anything in that concept plan in relation 20 to those estimates which you say supports the figures that were quoted in that pamphlet, I think that’s the issue isn’t it? MR NEIL: Well, that may well be the issue, we haven’t got the concept plan, I’m going to argue that that very paragraph that you’ve read out supports it and - - - THE COMMISSIONER: I understand that’s what you want to say but I think we need to ask the witness lest we bring him back again whether or not there’s anything in that particular dot point upon which he can comment 30 that supports the positive case you’re putting that the projected numbers in the pamphlet was accurate? MR NEIL: Well, that’s what I’m coming to but I’m entitled to do it by taking the witness to different parts of the document and what I’ve opened with is the proposition that it would appear that the concept plan provided for that dot point, 600,000 to a million and it was pared down by the departmental decision but it then, as I’ll take you through to different pages, provides for further, further development, further development in different phases. 40 THE COMMISSIONER: But there again. Mr Neil, I hate to be – maybe I’m being difficult about this but, but if this is, if this is something that is developed for the purposes of 2012 not 2010, 2011 how is this witness supposed to know whether or not or how is this witness meant to comment on the basis of this document whether or not the estimates that were given as at 2010/2011 were accurate?

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MR NEIL: Because (a) there’s sufficient material in here to prima facie show that it’s dealing with the concept plan and it’s amending it and therefore that dot point on page 1 would be in the concept plan. Secondly, as you go through this you will be able to see and I will be able to take the witness I believe ultimately in context, in context, to further figures of the predictions for the future which is what a citizen would be concerned about. THE COMMISSIONER: All right. Well, Mr Neil, can I make this suggestion, it’s 20 to 4.00. I’m wondering whether or not it would be better for Mr Webb to be given access to the documents that you want to take him 10 to so that he has the opportunity to read them and inform himself of any other concept plans that are relevant and then you can revisit these questions on Thursday. MR NEIL: Well, I couldn’t agree more and I’m not criticising anybody but we’ve been caught a little bit short and we would like to have that process adopted. THE COMMISSIONER: Well, all right, but I mean we’re not going to get there in 20 minutes are we? 20 MR NEIL: No, no, no. THE COMMISSIONER: All right. Does Mr Webb have a difficulty? MR McGUINNESS: Commissioner, Mr Webb is no longer at Newcastle Ports Corporation. THE COMMISSIONER: No, I know that but Mr Neil says he’s got documents that he want to take the witness to. 30 MR NEIL: And he ought to, he ought to have a chance to read them, I thought by lunch he might have, that’s why I raised the point this morning. MR WATSON: Mr Webb only got here at (not transcribable) THE COMMISSIONER: Yes, all right. MR NEIL: Well, that’s the problem. 40 THE COMMISSIONER: Anyway look, we all know what the problem is. Mr Webb, do you have any problems returning on Thursday?---Um, no, Commissioner. I’m sure you do but can you put them, put them to one side?---I absolutely do but I don’t. No, all right. All right, well then - - -

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MR WATSON: Sorry, could I just - - - THE WITNESS: Can I make a comment Commissioner? THE COMMISSIONER: Yes, certainly. THE WITNESS: In my comments, I expressed what NPC believed the start up numbers were going to be. You rightfully said when you put out a concept plan you look to the future. So, even, the Commissioner’s asked 10 are these numbers, what did they relate to the here and now, that to me, NPC had a view that if they got to 20,000 to 30,000 in two years at start that was amazing and it would take time. So that’s about 100 trucks. I’ve already made that comment. MR WATSON: Sorry, your wrong Mr Webb, we’ve done the maths, 20,000 to 30,000 TEUs divided by 1.8 will give you between 30 and 45 trucks per day.---Certainly, I was being generous in terms of one, because I can handle that. 20 MR NEIL: I would ask what you have suggested Commissioner be done but could I just also ask my learned friend if he’d be good enough to check his figures of 9 seconds per truck, we might as well get this clarified because we’ve worked this out at 90, he’s worked it at 8.64, we’ve worked it out at 86.4 and that would have been sold in a hurry. MR WATSON: Mr O’Mahoney pointed that out to me, yes, so right, I see. I’m sorry. Mr O’Mahoney pointed that out to me that I got a bit excited with 9 seconds, but then again, can I make the point. How ridiculous is this, this is Mr Tripodi saying they will be coming in every 90 seconds, really? 30 THE COMMISSIONER: The turnaround of 90 seconds I think, is that the suggestion? MR WATSON: Yes. THE COMMISSIONER: That I truck can load that quantity of containers within 90 seconds, Mr Webb, is that something that you factored in.---I don’t believe so Commissioner, but if we need to go the long haul and analysis all this, let’s do it. 40 MR NEIL: And that’s assuming one loading point only, only. THE COMMISSIONER: Yes. MR NEIL: Now my point will be later that that statement in the opening statement is completely wrong and out by a factor of ten and doesn’t even

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include more than one loading point. But perhaps we could take this up later. THE COMMISSIONER: Well, we might Mr Neil, but can I just say that there was other evidence as I recall and I can’t remember who the witness was when we were canvasing this issue some time ago that acknowledged that absolutely no research was done when that pamphlet was produced to determine what the traffic volume would be on that day, that that was a future that was literally plucked out of the air but that was not your client, I don’t know where that came from but in any event, how can we – Mr 10 Watson, do you have the documents that Mr Neil wishes to - - - MR WATSON: No, I’m sorry. THE COMMISSIONER: Mr Neil, are you in a position to copy the documents you want to show to the witness so he can take them away and read them? MR NEIL: He’s got the one and there’s another one that we’ve sent to the Commission that we’ll give him. There’s a fair bit of reading in it. 20 THE COMMISSIONER: That would be helpful if you gave him the other one. MR NEIL: Could I say this Commissioner. In the material that we’ve been provided, I’ll be drawing your attention to the fact sheet in due course I know there might be some controversy about that but we’ll be relying on that in our case. Could I just say this, if the issue of the actual facts of whether or not certain truck movements did happen or did not happen at that time or were projected to happen or not happen as against my client’s belief, 30 well belief on reasonable grounds, if the objective facts are to be gone into it will obviously mean there’s a much greater scope in this inquiry than otherwise would be leave the case. I’ll just leave my learned friend to consider that point. MR WATSON: I’ll think about taking the short cut that Mr Tripodi was accurately stating things which lead to him trying to destroy his parliamentary colleagues career. So we’ll take that as an alternative position. Really, I think the bottom line it’s rather arid. 40 MR NEIL: I hear what my learned friend says but Commissioner, will understand the point I’ve made? THE COMMISSIONER: Yes. MR NEIL: And let’s set aside politically disloyalty. MR WATSON: I’m not sure we should?

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MR NEIL: It’s not part of the terms of reference. THE COMMISSIONER: No, Mr Neil, I think Counsel Assisting’s making the point that even if Mr Tripodi believed on reasonable grounds the material that ultimately came to be in that pamphlet, it does nothing to address the issue that Counsel Assisting has raised which was that Mr Tripodi in effect set about to undermine the prospect of re-election of a member of his own party, so that’s the only point that’s being made. 10 MR NEIL: There is a bit issue about that and whether or not that point can come within the terms of reference but that’s for later. THE COMMISSIONER: All right. Anyway, again, we’ve not advanced things very much further. So I think the better course is that Mr Webb stands down unless you can ask him something Mr Neil that doesn’t depend on those documents? MR NEIL: I think I’ll be inclined to take less time if we have the documents and I can - - - 20 THE COMMISSIONER: Well then, all right. Well then we’ll defer the balance, Mr Neil and anyone else, does anyone else have any questions of Mr Webb now that can be dealt with now? MR WATSON: Sorry, why? THE COMMISSIONER: Do you have any questions that you wish to put to Mr Webb? 30 MR CARROLL: I anticipate that the bundle of documents that were provided to those in the front row of the bar table, including Treasurery documents that my client may wish to give me some instructions in relation to that given that they were tendered through this witness. So that’s the principle reason why it would appear to be in the best interest for due process for the fifteen minutes we have left might be better served by getting instructions on the rest day, a Wednesday, that’s the principle reason why the cross-examination is better served on Thursday. THE COMMISSIONER: All right. I’ll say it again, do you have any 40 questions you can put to the witness now? MR CARROLL: Yes. THE COMMISSIONER: Well, go ahead. MR CARROLL: Is there a time frame just so I can - - -

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THE COMMISSIONER: We’ve got fifteen minutes, if there’s some questions you can put to him now, put to him now. MR CARROLL: Thank you, I’ll do that. Thank you Commissioner. Now, in relation to making an announcement of the successful components - - - THE COMMISSIONER: I’m sorry, you’d better indicate for the record. 10 MR CARROLL: I’ll do that again, sorry. My name is Carroll I represent Mr Roozendaal. In relation to the question about a public announcement as to who the successful bidder was, that wasn’t priority as at October 2010, do you accept that?---Yes, that’s correct. And in relation to Mr Roozendaal, you certainly never put any time frame for him to make that Ministerial announcement, that wasn’t one of your 20 priorities?---Certainly I can’t tell the Minister what to announce. No, but you certainly didn’t say, for example, I want to be able to make a public announcement in relation to the successful proponent in a time frame, you didn’t ask him to do that?---That’s correct. Because at that stage there was a great deal of public consultation going on in relation to your environmental assessment, you accept that don’t you?---I accept that we were in planning but I also accept that we were pursuing the project in parallel. 30 Yes. You seem to be a person who has worked closely with the Newcastle interest groups in relation to this proposal, as someone who wishes to get the input of the community in relation to this proposal, that’s one of your priorities, correct?---The priority was to pursue the project that had been agreed to with government pursued for a number of years as well. In terms of the time frame going back to a chronology in 2010 you applied for an expansion of the development application in essence, for the Mayfield site in June 2010, is that seem about the right time frame?---Yes, 40 that’s right. And at that stage another person was the Minister for Ports, is that correct? ---I take your word for it. Do you recall that Mr Roozendaal became the Minister for Ports in September 2010?---I accept that. The only reason I say that is I haven’t gone a chronology of who the Ministers were.

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No, but you’ve spoken about meeting with Mr Roozendaal in around October, could that have been the first time that you ever discussed the proposal at Mayfield with him?---It could have been. And in relation to the time frame for the environmental assessment, it was on public exhibition between June till September 2010?---Yes, yes, I accept that. And at the current development application in relation to container terminal 10 that plan that was developed in 2000 had a cap of 350,000 TEUs, does that refresh your memory in relation to what the cap was?---So that’s the number? No, and you wanted to make it a larger number so it was more attractive to potential investors?---Yes, that would make sense. And the ultimate plan was in 2034 you’d be able to have a million TEUs going through Newcastle, container terminal, that was the ultimate plan? ---Yes, that’s right. 20 And they were the numbers that you submitted when you made the concept plan back in June 2010?---I accept that, yes. And that was based on your analysis that by 2034 there’d be a million trucks going through the container, a million TEUs - - -?---Thank you. If we do the percentages we get to 1,000 roughly?---We hadn’t talked about what might be going on train. 30 Yeah, I know, but in terms of the initial application in June 2010 there was a - - -?---Yes. - - -proposal which would have been fantastic for the Hunter, that there’d be a million TEU’s going through that container terminal in 2034. MR WATSON: Could I ask what my learned friend’s positive case is? THE COMMISSIONER: Yes, sorry. Why are we canvassing this with this witness, Mr Carroll, is this, do you have some proposition that you want to 40 establish? MR CARROLL: Yeah, that the 1,000 trucks per day is, from his own evidence, the bare percentages, that what was initially proposed in June 2010, the public display of numbers, was that in 2034 there would be a million- - - MR WATSON: No, but what’s the positive case? We just heard all of that.

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THE COMMISSIONER: Yes MR CARROLL: I’ve already announced my positive case this morning. MR WATSON: Which is? THE COMMISSIONER: Which is, sorry? MR CARROLL: Which is that the information which was public display in 10 June 2010 allowed for the figure of 1,000 trucks per day to be- - - MR WATSON: Is Mr Roozendaal saying that he participated in that pamphlet? MR CARROLL: Thank you. Of course not. MR WATSON: Well, then what’s it, what’s it to him? THE COMMISSIONER: Well, I’m just- - - 20 MR CARROLL: Well, there’s been some- - - THE COMMISSIONER: I’m querying the relevance, Mr Carroll, because I don’t understand Mr Roozendaal to – well, correct me if I’m wrong – have had a part to play in drawing up and distributing the pamphlet. MR CARROLL: Well, there’s been suggestions of leaking of information at every level and the opening, Counsel Assisting wasn’t specific in terms he was attributing the dissemination of information, it was quite a broad 30 brush, Ian McNamara, Mr Roozendaal, Mr Tripodi – I’m happy if this inquiry gets limited to what it specifically said that Mr Roozendaal had supposedly done in terms, in terms of impropriety. THE COMMISSIONER: I’m sorry, I think you’re confusing two issues. The reference to, the reference to leaking that information was a reference to the Treasury Cabinet Minute that talked about the relative merits of the coal loader proposal over the, over the container terminal. It’s got nothing to do with whether 1,000 trucks a day were coming out of the coal, out of the container terminal. 40 MR CARROLL: Well, if the, if the Commission’s position is that that figure which is being discussed in evidence, about 1,000 trucks per day, is irrelevant, I’ll move on. MR WATSON: Well, it’s not irrelevant.

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THE COMMISSIONER: No, it’s not that we’re saying it’s irrelevant. Look- - - MR WATSON: Could I also say this, does my learned friend say that – I’ve looked for it but I just can’t see where on Jodi’s Trucks it says there will be 1,000 trucks a day in 2034. THE COMMISSIONER: Well, and I think that’s the problem. MR WATSON: Or by 2034. Does my learned friend see that? I can’t see 10 it. THE COMMISSIONER: Perhaps, Mr Carroll, you’d better go back and put to this witness what you want to put to him in terms of whether or not that figure is accurate. MR CARROLL: The figure 1,000 trucks per day is reflective of one million TEU’s going through Newcastle container terminal. Do you accept that?---What year and by what modal split? 20 Oh, in terms of the year, in terms of your proposal it was the forecast in 2034. THE COMMISSIONER: Look, Mr Carroll, see, the problem is this. Just saying one million TEU’s per day in 2034 is consistent with a thousand trucks per day doesn’t, as Mr Webb has pointed out, deal with containers that might have been shifted by rail as opposed to road. MR CARROLL: We can get to that, but he hasn’t answered a very simple question, the way in which he’s answered is by saying give me a timeframe, 30 which is- - - THE COMMISSIONER: By, by what, no, he said by what year and by what model split, meaning are were talking only about trucks or are we talking about trucks and trains. MR CARROLL: Assuming that they’re moved by trucks, do you accept that figure?---For which year? Well, the year is not relevant to the simple maths? 40 THE COMMISSIONER: Well- - - THE WITNESS: Well, you do the maths. MR CARROLL: One thousand trucks?---Well done.

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Now, in relation to the materials which you tendered in June, 2010, that was part of your assessment as to the amount of trucks which would be required for the amount of container?---Certainly as we’ve discussed, right through the planning system in New South Wales requires a proponent to have a long-term view. Every port in Australia has been charged to have a long-term view of the port. The hypothecation of that long-term view to the here and now is not what NPC was about. The two issues are not mutually exclusive nor are they necessarily linked. So NPC also knew that any proponent had to lodge a Development Application that sat under the umbrella of a concept plan, so a proponent still carried the risk of the 10 detailed analysis. And the year 2000 the tender process fell back or fell down because of the situation with the environmental assessment roughly, that’s what was the problem in 2000?---In 2000? Well, we moved past that one. As I said, I wasn’t, I wasn’t senior management at that time, we moved to about 2005. And the same issue arose in terms of the environmental assessment and the remediation, hadn’t- - -?---In, in 2010 or 2009? 20 No, 2005?---Yes, that, that, the remediation was an issue around that 2005 as we’ve called it proposal. And in, and in 2010- - -?---It wasn’t a problem. No, well, it hadn’t been determined. You accept that, don’t you, that the environmental assessment, at least during the period- - -?---Oh, the environmental assessment- - - - - -in which Mr Roozendaal was the Ports Minister it hadn’t been 30 completed?---That doesn’t stop NPC pursuing the development on the site, knowing that a planning approval could still be given and an applicant had to put in a Development Application. It also could have been refused at that environmental assessment level, you accept that, don’t you?---That wouldn’t have – it could have been refused, that wouldn’t have stopped an applicant putting in a Development Application. It certainly would have been one matter which would have set back the 40 likelihood of people going forward with the project, as history had proven in 2005 and 2000. You accept that, don’t you?---My recollection was that that wasn’t a problem to the group we were talking with at the time. I, I hear what you’re saying. But you accept that the public exhibition finished in around September 2010 and then there was an extension to allow the public to respond to the environmental assessment. You remember that timeframe, don’t you?

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---Yes, I remember that timeframe. And then it took your organisation another three months to respond to the submissions made by the public and various Government departments. You recall that, don’t you?---I take your word for that, yes. No, but you certainly do recall that- - -?---It, it take a while to respond. Yeah?---Particularly at the level we’re at. But you recall that NPC was happy to press the risk back to the private sector and they were, they were 10 happy to be engaging in commercial negotiations with NPC at the time. And you spoke about one of the risks being the capital investment of the new buildings for the Newcastle Port Corporation, that was one of the risks which you as the corporation were going to bear?---No, that was- - - You spoke about a capital expenditure, a 20 per cent figure- - -?---Yes, that was passed onto the private sector. In relation to the Newcastle Ports Corporation, the building of the new area 20 for your department to work, you spoke about that being something which could have created a financial concern for the state?---I don’t recall saying that. Can you help me? In terms of your evidence- - -?---Yeah. - - -in terms of the capital- - -?---Where did I talk about NPC’s capital works program? Not a capital works program, but do you accept that there would, there 30 would have been the commencement of building, the first project was to build a new office?---No. That was the first stage?---No. You don’t recall that?---We identified, we identified an operational part of the Port and you recall I said the bulk, the general cargo and the container precinct went out to the market for a development opportunity. The operational part was excluded. If you go back to the capital works program of NPC, I don’t think there’s ever been any money placed in that or 40 certainly not in the forward three years. Can I ask you another question. In terms of any legal rights being created by the Ministerial approval of the tender process, what legal rights does it create in terms of NPC and the potential bidder?---I – can you rephrase that question, please?

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So there’s been some evidence in this Commission about the need for there to be an announcement by the Minister as to the success, successful bidder for this Mayfield Site. Can you accept there’s been some evidence in relation to that?---I’m not aware of that evidence and I haven’t given that today. So it wasn’t- - - MR WATSON: And I’m not aware of it. 10 MR CARROLL: It wasn’t an issue for you for there to be Ministerial approval of the bidder?---Well, you might recall I’ve indicated to my understanding it was going to have to go to the Budget Committee of Cabinet. So beyond simply Mr Roozendaal?---Well, well, certainly that’s what I anticipated. If, if the Minister of the day wanted to sign it off I would have been surprised because it requires Treasury and so on to do it. I, I think, I think we just need to be careful here that the operational part was never part of it, the bulk was never part of it and NPC was not committing capital to 20 the development of the site, that was a private sector risk. And can I just ask you finally, in relation to version 1, that was the version which was discussed in the presence of Mr Roozendaal. Do you recall that? ---Yes, I do. And at that discussion there was discussions with Buildev about the two projects running side by side. That was the- - - THE COMMISSIONER: Sorry, what two projects? 30 MR CARROLL: The coal loader and the container terminal, Your, Commissioner, that- - - THE COMMISSIONER: So what, are you putting to the witness that at that meeting with Mr Roozendaal the discussion was about both the coal loader and the container terminal proposal proceeding in parallel? MR CARROLL: Thank you. 40 THE COMMISSIONER: Was that part of the discussion, Mr Webb? ---Ah, that is correct. MR CARROLL: Those are my questions for the day. THE COMMISSIONER: Does anyone have any other questions of Mr Webb that can be put now? I’m assuming that only Mr Neil needs to revisit

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this on Thursday, subject to any further questions from his own legal representative. MR WATSON: I need to tender that document that Mr Neil placed before Mr Webb. I tender that. THE COMMISSIONER: Yes, Exhibit Z43. #EXHIBIT Z43 - MAJOR PROJECT ASSESSMENT: NPC PORT 10 TERMINAL FACILITIES, MAYFIELD MARCH 2012 THE COMMISSIONER: Mr Webb, I just have, I just have a question. Regardless of what kind of volume of TEU’s was ever going to go through this coal loader, sorry, this container terminal site, was it anticipated that that would, that those movements, whether they be by truck or by rail, would be occurring 24 hours a day seven days a week?---Ah, I would imagine that, Commissioner, yes. I’d need to check that, but that’s- - - 20 And that’s the usual pattern for- - -?---That’s the usual pattern, yes. - - -a container terminal?---Yes, that’s right. All right. Well, I’m sorry, Mr Webb, you’re going to have to stand down and return on Thursday. We’ll do what we can to get those documents to you. MR McGUINNESS: Commissioner, if I could just understand. Mr Webb is expected to read a document only and return on Thursday? 30 THE COMMISSIONER: Mr Webb, as I understand it, Mr Neil’s proposal is to read the document that is now Exhibit Z43 and another document that Mr Neil wishes to show him. Is that right, Mr Neil? MR NEIL: Yes, that we have supplied, and if he can find the Concept Plan and any others, please read them and if we can have them. THE COMMISSIONER: Well, but you see, Mr Webb is no longer at the Newcastle Ports Corporation so I doubt he’d have access to those 40 documents. MR NEIL: Well, I’d ask the Commission to make a request for such documents. THE COMMISSIONER: Well, I don’t know to what extent we’ve sought those, Mr Watson?

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MR WATSON: Well, we can look into that. THE COMMISSIONER: All right. MR WATSON: But the one thing I can’t do is guarantee that we’re going to get a response in that short period of time. THE COMMISSIONER: By Thursday, right. MR WATSON: Anyway. 10 THE COMMISSIONER: Yes. All right. Well, I’ll adjourn until 10.00am on Thursday, thank you. THE WITNESS WITHDREW [4.03pm] AT 4.03pm THE MATTER WAS ADJOURNED ACCORDINGLY 20

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