THE $370 million modernisation of the Mulwala explosives factory has fallen behind yet again and remains officially a “project of concern” for the Defence Department.
Budget papers reveal the taxpayer-funded project will now be presented to the Commonwealth for final acceptance — after stringent testing — in February 2015.
That’s three years behind the schedule set in September 2008 when the first sod of the project was turned for prime contractor Lend Lease.
It is now 13 years since the Howard government gave in to pressure from the Yarrawonga-Mulwala community, councils, MPs and unions to continue production at Mulwala instead of importing all the chemicals needed for munitions.
Tuesday’s budget provides another $22 million next financial year, the government having already paid out $344 million over the best part of 10 years.
These figures do not include a separate program of environmental remediation which has cost tens of millions of dollars.
Multinational French group Thales operates the Mulwala munitions plant — and the Thales-owned factory in Benalla — as Australian Munitions.
Mulwala’s 1000-hectare site, including the land and buildings, are owned by the federal government.
Between them the two factories employ between 500 and 600 men and women.
The Mulwala upgrade will deliver a modernised propellant manufacturing factory to replace the existing, but now obsolete, plant that dates back to the 1940s.
It will meet stringent and contemporary environmental, work, health and safety standards.
Mulwala manufactures propellants for incorporation into bullets and shells manufactured in Benalla for the Australian and New Zealand armies, navies and air forces, as well as private buyers.
Meanwhile, the budget papers give no clue as to who will operate the factories — Australia’s sole military munitions suppliers — after mid-next year.
That’s when the Strategic Agreement for Munitions Supply, the Mulwala Agreement and the contract for supply expire.
The papers say merely the department is “progressing” new arrangements.
Thales and several multi-nationals are in consortiums hoping to get the job.
Back in 2008, the Mulwala upgrade was costed at $348 million but is now $370 million.