$15m loan secrecy queried

CRITICS have slammed the state government for refusing to detail any terms or conditions of a $15 million loan given to the developers of a Hobart retail redevelopment.

The government approved the multimillion-dollar loan to Kalis Properties earlier this week, after the company approached the Tasmanian Development Board for finances to get a new Myer complex off the ground.

Premier Will Hodgman would not comment on how long the developers had to repay the public money, or on any other terms of the contract.

"We're not going to compromise commercial, sensitive discussions, negotiations and outcomes that have been reached by this company and the Tasmanian Development Board," Mr Hodgman said yesterday.

He said the loan mirrored finances provided on "almost identical terms" to paper mill Norske Skog by the former government.

He said details of that deal had not been released publicly, and that the same considerations applied to this loan.

The government loan is in addition to private finances the company has secured for the project.

Greens leader Kim Booth said the government should be open and transparent about its decision to provide the finances.

"They need to provide clear reasons as to why the public pursue should shoulder the risk of this loan when banks have not been prepared to offer it," Mr Booth said.

"It could set a very dangerous precedent, where businesses who are financially unviable will be queueing up at Mr Hodgman's door, wanting the same treatment."

Leading economist Saul Eslake said he generally disagreed with governments giving finance on concessional terms to businesses who hadn't been able to obtain funds elsewhere.

"However, this particular transaction is hardly the first of its kind," Mr Eslake said. "While I personally wish it wasn't the case, this is a common practice by governments of all political persuasions in all jurisdictions."


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