Australian taxpayers paid almost $20 million to sell the Port of Darwin

Australian taxpayers forked out almost $20 million as an incentive for the Northern Territory to sell the Port of Darwin to a Chinese company, sparking Labor to claim that Prime Minister Scott Morrison actively encouraged the deal when he was treasurer.

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Chinese company Landbridge secured a 99-year lease of the port in a $506 million deal with the NT government in 2015. The move unsettled national security figures and led to then-United States president Barack Obama expressing concern about the outcome later that year.

In Sunday night’s debate, Morrison said the federal government in 2015 did not have any authority to reject or approve the deal.

“The federal government had absolutely no authority over that sale whatsoever,” he said.

However, the federal government’s asset-recycling scheme offered millions of dollars to the NT government to sell the port. Under the scheme, states and territories were meant to receive 15 per cent of the price as an encouragement to privatise economically productive government assets.

The final schedule for payment, signed by federal Treasurer Josh Frydenberg and then-NT Treasurer Nicole Manison in 2019, shows the Commonwealth agreed to pay the territory $18.56 million for the sale.

The Foreign Investment Review Board in 2015 determined that it had no authority to examine the lease, but these laws were later changed to ensure a similar deal in the future could be reviewed.

Morrison was treasurer at the time the port was sold to Landbridge, which is owned by Chinese billionaire Ye Cheng.

Labor’s defence spokesman Brendan O’Connor said Morrison had “actively encouraged” the deal.

“Scott Morrison likes to say it wasn’t his job to stop the Port of Darwin being flogged to a company with ties to the Chinese Communist Party,” O’Connor said.

“His government had over a year to fix the foreign investment framework to deal with the sale. He also could have urged his Country Liberal Party colleagues in the Territory not to proceed.

“But not only did he not stop it, he actually encouraged it. He gave the Country Liberal Party government nearly $20 million in incentives to privatise the asset.”

The Coalition has been contacted for comment about the claim.

O’Connor said: “Even our American allies chided Australia for the decision”.

Michael Shoebridge, director of the defence program at the Australian Strategic Policy Institute, said both major parties should end the “war about what should have happened at the time” and instead focus on what to do about it now.

“If both the major parties admit the port in Chinese hands is a bad idea, which is going to be the first to change that?” he said.

“We’ve got bipartisanship that it’s a problem, and bipartisanship that they’re not going to do anything about it. And while it persists, we have a national security own goal.

“Leaving that invaluable piece of harbour real estate in Chinese control means we can’t make the best use of it for ourselves, partners and allies at a time when that is a critical need.”

Shoebridge said a $1.5 billion plan to build new port facilities in Darwin, backed by both the Coalition and Labor, was a “work-around” and would not address the core problem.