Showcase for brilliance - except at making money - 21.12.2004

The government-owned company operating Australian Technology Park, which aims to be "a lighthouse for quality" showcasing the nation's genius for innovation, has made a loss of almost $5 million in the past financial year.

This follows a loss of more than $4 million in the previous year, even though the company pays no rent for its 14-hectare site at Redfern. It has also repaid none of the $47.2 million loan it has received from the park's current owner, the Sydney Harbour Foreshore Authority.

The company's annual report reveals that the new Redfern-Waterloo Authority will inherit a financial headache when it acquires the technology park early next year.

Australian Technology Park Precinct Management, which has the job of attracting high-tech businesses to lease premises on government-owned land at the former Eveleigh Railway Workshops site, was hit last financial year with a $4 million bill to fix a heritage roof.

It is now due for a second $4 million bill for remediation works after dust in the roof trusses of an old locomotive workshop on the site was found to contain lead paint particles, the annual report recently tabled in Parliament reveals.

Even without the clean-up bill, ATPPM, which since July 2001 has operated under the Sydney Harbour Foreshore Authority, would still have recorded a loss of about $1 million in 2003-04, the report said.

The Foreshore Authority's acting chief executive, Sandra Chipchase, did not answer a question from the Herald about whether the company was headed for another loss in 2004-05. Her authority had "revolutionised" the park's management, lifting its occupancy to 97 per cent. "This has not been a time for debt reduction, but rather a time for expanding the park to reach the economies of scale needed to turn [it] into a future profit centre," she said.

The technology park, where about 1200 people work in more than 100 companies, was kick-started by three Sydney universities nine years ago with $45 million from state and federal government. Its management company has been given numerous financial breaks. It has not had to repay any of its loan from its current parent body, the Foreshore Authority. Nor has it had to pay rent under a 10-year deal worth $14.4 million.

These loan and lease deals will now be subject to negotiation with the Redfern-Waterloo Authority and its new board, Ms Chipchase said.

The value of the company's assets dropped in 2003-04 when the valuation of two heritage-listed buildings was reduced by $23 million. But this had "no impact on profitability", Ms Chipchase said.

The tax office also told the company in July that it had lost its income tax-free status because it no longer qualifies as a scientific institution.

This was not a concern because it is only liable for notional taxes payable to NSW Treasury, Ms Chipchase said.

ATPPM has concentrated on attracting companies specialising in nanotechnologies and computer technology to aid biological research, but cabinet documents sighted by the Herald reveal the Government has been advised to broaden the focus of the park to lift the number of jobs there to 15,000.

The park had a 10 per cent return on investment and it would not be long before it made a profit, Ms Chipchase said.