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Potential train and tram operator accused of "coaching" Govt on privatisation spin

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UPDATED: A potential contender to win the state’s rail contracts will be referred to the Auditor-General over claims it “inappropriately” tried to coach Transport Minister Stephan Knoll’s office on how to sell its privatisation message.

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Labor MP Tom Koutsantonis this morning released an email obtained through freedom of information, which was sent by Newcastle-based transport company Downer Group to Knoll’s media advisor in July – one day after the State Government announced it would seek a private operator for Adelaide’s public train and tram services.

Keolis Downer – a joint venture with Downer Group – currently runs the Yarra Trams operation in Melbourne and the Southlink and Link SA bus networks in Adelaide, and has been named a likely contender to win the Adelaide Metro tram and train services contract.

In the email, Downer Group executive general manager Sasha Grebe – a former staffer to Prime Minister Scott Morrison and former Federal Treasurer Joe Hockey – referred to an earlier email he sent to then Shadow Transport Minister and now Industry and Skills Minister David Pisoni in 2017.

“These might be helpful,” he wrote.

The forwarded email from 2017 included quotes attributed to then Treasurer Koutsantonis, Premier Jay Weatherill and Transport Minister Stephen Mullighan stating the Labor Government was open to privatising the state’s rail fleet.

“We are currently exploring options where the Adelaide metro railway lines would be partly privatised,” Koutsantonis is quoted as saying.

“When you look at cities such as Melbourne and Brisbane, the way their rail networks are run (by private operators) is a very successful model in which we will be looking at in the near future.”

The email included statements from Grebe claiming that the “SA Labor Government has… not shied away from discussing franchising of the metro rail network”.

“The SA Labor Government has already undertaken a significant privatisation and outsourcing program,” he wrote.

But Koutsantonis this morning told reporters the quotes attributed to him, Weatherill and Mullighan in Grebe’s email were fake.

He said they were originally published by online forum Wheels on Steel in 2014 as part of a fabricated news story.

In the story – titled “Adelaide looks towards privatisation” – it was inaccurately reported that the city’s suburban rail network could be privatised within two years “thanks to Federal Treasurer Joe Hockey’s push to the states to sell off public assets in return for crucial infrastructure funding”.

Koutsantonis said this morning that the Labor Party had always opposed privatising the state’s rail fleet and would refer the email to the Auditor-General.

“Keolis Downer has conducted itself in a way that is deeply inappropriate,” he said.

“Emailing the Government fake quotes, trying to coach the Government on how to win the argument on the privatisation of our trams and trams, I think, raises real concerns about the integrity of the entire tender process for our trams and trains services.

“The question is this – why does Keolis Downer and Sasha Grebe – someone who used to work for Scott Morrison and former Federal Treasurer Joe Hockey – feel comfortable enough to contact the Minister’s office with these fake quotes?”

Koutsantonis shied away from implying that Knoll’s office had acted in an improper manner, but alleged that an “intimate” relationship between the Government and Keolis Downer could compromise the tender process.

“The idea that the Minister is anywhere near this is inappropriate,” he said.

“This should be a complete no-go area.”

But Knoll told ABC Radio Adelaide this morning that the Government “never used the email or acted upon the email”.

“The tender process is being conducted at arm’s length from me and my office,” he said.

“It’s being done all above board, all proper, all in accordance with the way that these tenders should be looked at.

“To try to suggest that an email sent to my office has anything to do with anything is patently ridiculous.”

Knoll said that he “understood” that Keolis Downer was a tenderer for the rail contract.

“I don’t know that officially but they have an existing contract so it stands to reason that they are a tenderer,” he said.

Asked if he thought it was appropriate for Keolis Downer to email his office, Knoll said it “wasn’t his decision to make”.

“We had an email sent to our office, we did absolutely nothing with it and we all moved on.”

InDaily contacted Keolis Downer for comment but a spokesperson redirected questions to the Downer Group.

“I can confirm that the email from Sasha Grebe has not come from Keolis Downer and we had no knowledge of its existence,” the spokesperson said.

A spokesperson from the Downer Group said management was unaware of the email.

“It was not sanctioned or approved,” the spokesperson said.

“Importantly, we have a strong record of being apolitical.”

In July, Department of Planning, Transport and Infrastructure chief executive Tony Braxton-Smith told a parliamentary inquiry that he and Knoll had visited Newcastle while the rail tender process was underway to meet with Keolis Downer.

He said the meeting lasted for about two and a half hours and included a site inspection of the Newcastle tram network, as well as an “extensive conversation” with the Newcastle mayor.

Braxton-Smith said the Minister did not seek probity advice before travelling to Newcastle as “no conversation could take place in relation to any matter to do with procurement processes either planned or prospective or on foot”.

Knoll told Parliament in July that he did not meet with Grebe during the visit.

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