Proton therapy project: SA Government context and insights

Audit snapshot

What we reviewed and why

The Australian Bragg Centre proton therapy project involves a substantial investment of public money and there is significant concern as to whether a proton therapy unit (PTU) to deliver leading-edge medical technology for cancer treatment will be established in South Australia. This report provides a status update on the project and discusses how the SA Government is managing its financial commitments and risk exposures.

Our key observations

The South Australian Health and Medical Research Institute (SAHMRI):

• terminated its contract with the proton therapy system supplier
• was unable to appoint a private sector operator willing to invest sufficient capital to ensure the financial sustainability of the PTU.

A PTU has not been established. Establishing and operating a PTU in South Australia will require significant additional public (State and/or Commonwealth) funding.

The SA Government has ongoing risk exposures and financial commitments from the project, including:

• funding a proportion of building development cost overruns
• step-in obligations for certain arrangements if SAHMRI becomes insolvent
• leasing five floors in the Australian Bragg Centre at commercial market rates.

We identified gaps in the way the SA Government managed its involvement in the project, including the need for:

• a formal documented evaluation to justify contributing significant public money to a project
• fully documented assessments of significant issues and risks and the analysis and rationale for any responses
• full and complete advice to decision makers on risks and monitoring of risk mitigation strategies
• effective oversight, project management and risk management arrangements, reflecting a project that is high risk, has a significant cost and has national consequences.