Economic cost of Varanus Island pipeline explosion

According to the Australian Treasurer, Wayne Swan, has said, on 3 December 2008, that the Varanus Island explosion

“is estimated to have subtracted around a quarter of a percentage point from [Gross Domestic Product] in the September quarter.”

This follows earlier estimates from the Reserve Bank of Australia that the disruption from the explosion would cause a negative blip of $2.5 billion in GDP.

The Senate Economics Committee report to the government yesterday said that the real economic impact will never be known because it occurred amongst other economic confusion.  

Business cases for the importance of occupational safety management are notoriously difficult to quantify, although some OHS colleagues disagree.  OHS has a far stronger argument through the moral imperatives than economics but economics is the language of the business world.  The Senate Committee report includes a lot of macro- and micro-economic data for those who want it.

The fallout from the Varanus Island investigations continue in Western Australia but it may be possible to say that for the wont of regular assessments and maintenance on a pipe in a remote location, Australia has lost billions of dollars in revenue, in a time of economic difficulties.

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