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Tuesday, 16 June 2009
Page: 6099


Mr PYNE (3:52 PM) —The public would be scratching their heads today to remember a time when so much money had been so misspent, and misspent so quickly, as is being misspent through the bungled, mismanaged debacle that has become the schools stimulus spendathon . The minister likes to call it the Building the Education Revolution. Some of us suspect that she would prefer to call it the Great Leap Forward rather than the Building the Education Revolution but she probably failed to get that title past the hollowmen of the Prime Minister’s office—although she did manage to get a $3 million plaques campaign past the hollowmen of the Prime Minister’s office so that she can be remembered in perpetuity.

There is $14.7 billion being mismanaged by a minister who we used to think had too much on her plate. We used to think that in being a part-time education minister she just did not have enough time to manage her portfolio. But, since the passage of the Fair Work Bill through the parliament, what has become painfully apparent to the Australian taxpayer is that the minister cannot actually manage a program, whether it is the computers-in-schools program, which blew out from $800 million to $2.2 billion and is now delivering half and costing more than twice as much, or the Trade Training Centres in Schools Program, which was to put a trade training centre in every secondary school and is now being shared between 10 schools that cluster together to form one trade training centre. Now it is the schools stimulus debacle. Unfortunately, when it comes to the detail, the minister keeps spilling the drinks.

Our concerns revolve around many facets of this program but they can be headlined by the failure of the government to genuinely promote the regional aspect to what was supposed to be a jobs stimulus package in the regions as well as the cities, through the failure to use local businesses in many instances and through skimming by state governments, who are vacating their responsibilities now that the so-called Building the Education Revolution is in full swing. State governments realise they can rush away from the table and take what meagre resources they were going to put into capital works and leave the federal government—and the federal taxpayer—holding the baby.

We are concerned about profiteering by private enterprise and individuals who are inflating their tender contract figures simply because demand and supply have been suspended by this program. There is simply not enough capacity in the system to supply the demand that the government is asking of the private sector. When the private sector say to government bureaucrats, ‘We simply have not got the capacity to do this,’ they say: ‘We have to get this money out the door. We have to rush this money out the door, so you will simply have to do it.’ The private sector respond, ‘We cannot afford it,’ and are told, ‘Well, put up your contract figures and you will be able to do it.’ That is exactly what is happening through private companies. Whether they are profiteering deliberately or simply because bureaucrats are encouraging them to do so, there is profiteering.

We are concerned about the poorly targeted spending. It does not take into account the needs of schools and local communities. Instead, it insists on a centrally planned, centrally controlled template of options. Schools are being presented with these with sometimes one day to make the decision about whether they wish to take the template from the federal government, even though there might be real infrastructure that they need to have in their schools.

We are also concerned about the waste and mismanagement of projects where literally billions of taxpayers’ dollars are being spent on ‘Versace stuff’ to quote one expert in the field. Those wasted dollars are hard-earned taxes created by Australian taxpayers to be used on genuine infrastructure but we are seeing those dollars wasted and disappearing.

The only solution to this morass of mismanagement and this wanton waste is to refer the entire management of the program to the Auditor-General to determine exactly what is happening and what needs to happen to make the program work. Nobody on this side of the House begrudges the opportunity for schools to improve their infrastructure. But we do not believe—and neither should the government—that means waste and mismanagement should be tolerated. The Auditor-General will get to the bottom of exactly what is going on with the so-called Building the Education Revolution.

I turn to some of the details of these failures. On the issue of skimming by state governments, I quote the Prime Minister in a press conference he gave on 3 February 2009:

This Government will adopt a zero tolerance approach to any State Government whatever its political complexion, to any substitution of effort, let’s be very clear about that.

How does the minister explain to the House why in Victoria state government promises made at election time—under the rubric of schools policy—to build new infrastructure, new schools and new refurbishments in existing schools, are being taken off the table right across Victoria as the state government realises its chance to run from the field and leave the field to the Commonwealth to pick up the pieces?

How does she explain the South Australian government budget 10 days ago reducing capital spending by 12 per cent? In a state like South Australia, that represents about $8 million but most parents and grandparents would be expecting that every year capital spending in South Australia would be increasing because of the needs of the public school system. They would not expect it to fall by 12 per cent. Coincidentally, of course, it comes at the same time as the federal government is putting $1 billion into South Australia for the so-called Building the Education Revolution. They are clearly skimming federal taxpayers’ money, and it is the minister’s responsibility to do something about it. If she will not do something about it, she should ask the Auditor-General to do something about it.

Then there is the whole issue of preferred tenderers. The member for Bradfield raised in this House on 17 March a very good example in his own electorate—Wahroonga Public School. He is a very good member.

Opposition members—Hear, hear!


Mr PYNE —The member for Bradfield is an excellent member, and I see two excellent members sitting together in the House. The member for Bradfield raised the Wahroonga Public School, which had received a $22,660 quotation from a local fencing company to be spent at that school. But Spotless, the preferred state government tenderer, had also tendered for $40,122. There was a $17,000 difference, and of course Spotless were told that they would win the tender and the local tenderers were told that they had missed out. The minister would say, ‘What is $17,000?’ Seventeen thousand dollars is just a Versace suit to the minister. The $17,000 is a metaphor for exactly what is going on in the so-called Building the Education Revolution on the grand scale as well as on the micro scale. Why doesn’t the minister wish to act? Why is the minister hiding from the Auditor-General’s scrutiny of yet another one of her bungled, failed programs? Unfortunately, this is a minister who is long on rhetoric and short on delivery.

In terms of waste and management, Reed Construction Data, who are considered to be the industry bible on building costs, are absolutely shocked at the amount of money that is being spent on school halls. The Australian of last Saturday stated:

Reed’s chief estimator, Gary Thornley, said an average school hall should cost no more than $1000 per square metre to build.

A three-storey office block could be built for the price the government was spending on halls, he said.

And I agree with him. The article quotes him as saying:

I reckon $3m is a really big hit …

Even if we went beserk we’d never come up with that figure. Whoever has produced that figure has taken it out of their earlobe. It’s Versace stuff.

Unfortunately, the government has gone berserk and we do have a minister who has no control over what is going on at the grassroots level in her department. She has taken it out of her earlobe, and that is the problem. That is the answer from Mr Thornley. Most of these quotes are in the minister’s earlobe and she is pulling them out and throwing them on the ground for her bureaucrats to pick up. The bureaucrats are rushing them out into the public and the builders are saying: ‘This is a tremendous amount of money, but we’re hardly going to argue about it. Why wouldn’t we want to make a profit?’ The losers are the hardworking taxpayers of Australia.

But there are much worse examples. Take the Hastings Public School. The minister confused this school yesterday with the Hastings Primary School in Victoria—we have always been talking about the New South Wales one. The principal, to his great credit, because he would be fearing repercussions from probably the New South Wales Labor Party for speaking out, said he was shocked. He said:

It’s not my money. It’s not your money. It needs to be used properly.

He is quite right; it is taxpayers’ money. He also said:

I am intrigued as to how the figures have been arrived at and who gave them a figure of $400,000 for what is essentially a weather shelter.

Reflecting on our experience of six years ago—

and the minister has still failed to answer these questions after two days—

we built a COLA—

a covered outdoor learning area—

that is almost as big as the one we anticipate to build now, and it cost just over $40,000.

Even if there were another contribution that made the total cost $80,000, she entirely failed today in her answer to deal with the fact that today it is $400,000. He said:

Inflation hasn’t increased 10-fold in six years.

I’m expecting the Taj Mahal of COLAs.

And I imagine so is his local community. The article stated:

Mr Heaton said $2.6m for the new double classroom also seemed too high.

“I’ve got a friend in the building industry and his jaw dropped when I mentioned the figure to him,” he said.

“It’s a very large figure for two classrooms.

               …              …              …

“I want someone to show me why a weather shelter is going to cost $400,000.”

I think that is a reasonable question, but for some reason the minister refuses to answer it.

There are more examples. There is poorly targeted spending in the Prime Minister’s own electorate at the Holland Park State School, where they are required to have the same school facility rebuilt. Craig Mayne says about the Queensland state government bureaucrats:

It’s just numbers to them.

That about sums it up. It is all just numbers to them—numbers to get the money out the door as quickly as possible. Any justification or scrutiny of the decisions that have been made is not nearly as important as the fact that they can go on the news at night on Channel 7 or another channel and say they are spending $14.7 billion. I am sure the public think that $14.7 billion being spent on school infrastructure in some respects would be justified, but they would also want it to be spent sensibly. They would not want it to be spent in a wasteful and mismanaged way. Unfortunately, that is what this government is delivering.

The piece de resistance so far, and I am sure it will get worse, is that project managers in Queensland are being paid at least twice as much as the Prime Minister to manage these projects—$525,000 over six months. Members on the other side must be amazed that the minister is allowing them to get away with this. They are being paid $525,000 over six months to manage these projects. That is much more than the Prime Minister earns in a year. What did the minister do when she was asked about that today? She said, ‘We have a 1½ per cent administrative fee.’ She completely avoided the question that was asked. The facts on the ground are showing that half a million dollars is going to project managers in Queensland. What is she doing about it?

I could go on and on, and I am sure the minister would like me to. I could talk about the Cleve Area School, about how eight classrooms can turn into four in a three-month period, an inflation figure somewhere between Ethiopia’s and Zimbabwe’s, or the lunacy of air-conditioning not being allowed to be included in existing buildings, which the member for Kalgoorlie raised yesterday, but I will finish on the really pernicious issue that the minister today refused to address—that is, the Orwellian nature of the guidelines that stop any criticism of the government, the Orwellian nature of writing a guideline which strikes fear into the hearts of principals and the chairs of governing councils around Australia. They have given us a lot more information than we have been able to use, I assure the House. They do not want their names used, because they are frightened of Labor Party recrimination.

If the minister were genuine about wanting accountability and transparency, she would lift the veil of secrecy that exists over this program and hand it to the Auditor-General. Clear up the mess, Minister. Give it to the Auditor-General and save taxpayers’ dollars.