A parliamentary committee has rejected a new building plan for Mitchell.

A parliamentary committee has rejected a new building plan for Mitchell. Photo: Karleen Minney

A potential $30 million blowout in costs has prompted a parliamentary committee to reject a plan by the National Archives of Australia to build a new preservation building in Mitchell. The public works committee has also criticised Archives management for providing ''confusing'' information on the proposed $100 million project.

The committee wants the federal government to reconsider the financing model for the project and provide the cash-strapped Archives with enough money to pay in advance for a building fitout.

The Archives proposed engaging the commercial sector to build and then lease it a purpose-built complex with capacity for 150 staff, 104 kilometres of shelving for paper archives and 10 kilometres for audio-visual material.

The Archives would pay for the fitout through its lease payments. But the committee said this would be more expensive than paying in advance for the fitout and would not be good value for taxpayers.

''The amortising of the fitout for the NAA's project would see the fitout costs effectively jumping from $21.3 million to around $52 million,'' the committee said in its report. The committee said the Archives should have lobbied the government for the capital needed to pay the fitout costs, and had failed to give clear answers to questions about options considered.

''Further, there seemed to have been a disconnect of some sort between what the committee was asking and what NAA was able to answer. The committee asked NAA about seeking government funding for the project, and NAA stated that the design-build-own option was considered; that question was not answered or possibly avoided,'' the report said.

The committee also criticised information provided on the costs of the project.

''The committee was very concerned with the confusing nature of the information presented to it in the submissions to the inquiry. In particular, the costs information was difficult to tease out and interpret,'' the report said.

The Archives said the project would cost $97 million over 30 years.

The committee accepted that the new building was needed to provide a secure home for important national documents.

The Archives has run out of room in its high-security vaults for classified documents and the lease on a site at Greenway is due to expire.

If the new building goes ahead the existing preservation building at Mitchell will be gutted and rebuilt to create additional space for future documents. An existing site in Sydney will also be upgraded.

The National Archives declined to comment for this article.