The heated public debate over a secretive deal between tech giant Apple and the Victorian government to build a “flagship” store at Federation Square has revealed internal divisions within the Labor Party.
Just before the Christmas break, the Victorian state government quietly announced it had signed a contract with Apple for the tech giant to open a large store at Federation Square.
Officially opened in 2002, Federation Square is a civic and cultural space that is home to a number of public institutions – including the Australian Centre for the Moving Image, the National Gallery of Victoria and SBS – as well as restaurants and bars.
As part of the contract, Apple would demolish the Yarra building on the site to make way for an Apple store. The Yarra building is currently home to the Koorie Heritage Trust, which would be relocated elsewhere within Federation Square.
It’s believed that Apple would invest $100 million into the project, including construction costs, additional public space and the 20-year lease.
The announcement was met with huge public outcry over the use of an important public space for a commercial operation, the lack of public consultation over the planning permits, as well as the lack of information on the contract or plans.
Very little information on the contract between Apple and the state government has been made public. Apple has released its own mock-up images of the store, and said it will be the first of its kind in the southern hemisphere.
It has said that the store’s design “complements the original vision for the precinct, increases public space and provides a daily program of activity to inspire and educate the community”.
The Victorian government has said that no public money would be go towards the demolition of the Yarra building or the construction of the new Apple store. It says 250 jobs would be created during construction and a further 200 by the new retail store.
It has also said that the Apple store would be significantly smaller than the current building, creating 500 square metres of additional public space at Federation Square and better access to the Yarra River.
But further details on the contract and the proposals for the site have not been made public. According to an Age newspaper report, Apple has prevented the state government from releasing the information.
The contract has also revealed an internal division within the state government, with reports that several Andrews Government cabinet ministers argued against the idea, including Special Minister of State Gavin Jennings.
Tourism inistmer John Eren and Trade and Investment minister Philip Dalidakis, who jointly announced the project, were among the biggest backers of the deal within the government.
Premier Daniel Andrews did not appear at the announcement or provide any comments for the public statement.
Mr Eren has railed against the criticism of the deal. He says the project would serve to improve Federation Square’s role as a public space.
“This will be Apple’s only global flagship store in the southern hemisphere and it is a coup for Melbourne to get it. The current Yarra building will be replaced by a new building which will create almost 500 square metres of new public space and improve access to the river from Fed Square,” Mr Eren said.
“The existing Fed Square tenants are happy with the proposal and excited about working with Apple in the future.”
The deal is also believed to be part of the Victorian government’s ongoing strategy of attracting global tech companies to open offices or stores in Melbourne with an aim of helping to grow the local tech sector and bring other big players to the city.
“Apple’s new Australian flagship reinforces Melbourne’s reputation as the undisputed tech capital of Australia and creates hundreds of ongoing jobs in the process,” Mr Dalidakis said.
The deal has outraged some members of the Melbourne City Council. The council is a partner in the development and funding of Federation Square, but was left in the dark over the contract with Apple.
This led ALP member and councillor Jackie Watts to claim that Apple had “duped” the state government, as The Age reported.
“Apple was presented with at least one of the development opportunities around the Metro Tunnel redevelopment. And there is going to be massive space under the City Square. Apple rejected it. Who the hell is running this town?” Ms Watts said.
Fellow councillor Rohan Leppert has also slammed the secrecy surrounding the deal.
“That the public was deliberately and completely cut out in this instance is extremely worrying, and the public backlash is entirely justified. The electorate won’t put up with this level of secrecy,” Mr Leppert said.
State Greens MP Ellen Sandell has launched a campaign to “save” Federation Square, which has now received nearly 2000 signatures.
“Federation Square was built as a public and cultural space, but it could soon become more like a shopping mall. This store will dominate Fed Square, take over public space and change the face of one of the most iconic public places in Melbourne. What’s more, this decision was rammed through with no public consultation,” Ms Sandell said.
“Talking to people on the streets and seeing their reactions in the media, I’m confident the majority of Victorians join me in being horrified at the idea of giving our public land over to a multinational corporation,” she said.
“I’m hoping this petition will show the Andrews government exactly how unpopular this decision is, and ultimately convince them to leave Federation Square untainted.”
A separate online petition against the plan has now received more than 50,000 signatures.
Federal member for Melbourne Adam Bandt from the Greens said he would have supported a new Apple store somewhere else in the city, but the proposal for Federation Square was a “disgrace”.
“I’m furious Labor is giving over public space to a multinational that pays next to no tax here,” Mr Bandt said.
The new Apple store was granted a planning permit by Planning Minister Richard Wynne, without a public consultation period.
This was done by the minister exercising his power to exempt a planning scheme amendment from public notice if it is judged to be in “the broad interests of Victoria to do so”.
Questions have also been raised over handing over the important public space to a multinational that pays a relatively small amount of tax in Australia.
On the back of $7.57 billion in sales in Australia during the last financial year, Apple paid only $128.2 million in income tax after reporting a profit of $3.67 million.