Franklin Dam dispute

In 1978, the Hydro-Electric Commission, Tasmania's electricity generator, announced its intention to build a second dam (the Gordon-below-Franklin) on the Gordon River, which given its location would have flooded parts of the environmentally-sensitive Franklin River valley which was joined to the Gordon upstream of the proposed dam site. Noting community concerns over the environmental impact of the proposed dam, Lowe instituted a moratorium on new dam proposals in 1979, and set up the Energy Advisory Council to advise the Cabinet of alternative proposals. The Department of the Environment was instructed to advise the HEC to undertake an environmental impact assessment and report, which when tabled to Parliament recommended proceeding to flood the Franklin. Several alternative proposals were raised: the establishment of a national park on the same site, and a large number of submissions questioning the project and recommending no dam be built at all.^[3]

By mid-1980, Tasmania's high levels of unemployment—the highest in the country—were starting to bite economically, and the HEC and elements of the government were adamant that the dam project would alleviate Tasmania's employment and financial problems, although there was considerable public opposition to the dam. Lowe suggested a compromise: the construction of a dam on the Upper Gordon, upstream from the Franklin above the Olga River (Gordon-above-Olga). He also proposed to declare the controversial Lower Gordon area a national park, as suggested by the Department of Parks and Wildlife.^[3]

The compromise proposal pleased neither the Hydro-Electric Commission nor the Tasmanian Wilderness Society which was campaigning against the dam. It also caused a deadlock in the Tasmanian Parliament: the House of Assembly rejected the HEC's Lower Gordon (Gordon-below-Franklin) dam, and the Legislative Council rejected the lower house's legislation, and voted against the Upper Gordon (Gordon-above-Olga) dam, insisting they proceed with the original proposal. Lowe, now personally opposed to damming in the region, was successful in the expansion of the existing Frenchmans Cap National Park to include the Franklin, Gordon and Olga Rivers in the Franklin-Gordon Wild Rivers National Park.^[3]

Referendum and no-confidence motion

In an attempt to break the deadlock, the Tasmanian government called a referendum, the Tasmanian power referendum for 12 December 1981. When Lowe announced this to the media, he was asked to clarify if the referendum would include a 'No dams' option, and he indicated it would. The President of the Labor Party in Tasmania, however, wrote to members of parliament and instructed them to withdraw the 'No dams' option, forcing Lowe into a humiliating backdown, and restricting the options to a choice between the two dam proposals.^[4]

On 11 November 1981, members of the Labor Party moved a motion of no confidence against Lowe's leadership, petitioning him to resign as Premier and leader of the party, which he did. Harry Holgate was installed as Premier in his place. Instead of joining the backbenches, Lowe resigned from the ALP and joined the cross-benches as an Independent.^[5]