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Wednesday, 17 June 2009
Page: 6328


Mr BRUCE SCOTT (3:19 PM) —My question is to the Minister for Education. I refer the minister to reports that the Beechmont State School has been granted $1.8 million through the school stimulus debacle for a concrete undercover play area, instead of the school hall—including sports facility, kitchen, stage and toilet—they had planned for the same price. Does the minister agree with the Beechmont Hall Committee Treasurer, Greg McKenzie, who said, ‘With no tender process, the school was never going to get a good deal’? Why won’t the minister now do the right thing and refer the waste and mismanagement of this program to the Auditor-General?


Ms GILLARD (Minister for Education, Minister for Employment and Workplace Relations and Minister for Social Inclusion) —I am happy to discuss the circumstances of that individual school with the member. I must admit I did not even quite catch the name of the school.


Mr Bruce Scott —Beechmont.


Ms GILLARD —Beechmont. I think the member would be aware that he is an example of a member in this House who has from time to time raised issues about our Building the Education Revolution Program and we have responded. When he has asked us about individual matters, we have responded in a way that has met with his approval. Despite the fact that the opposition opposed the program holus-bolus, we have worked with individual opposition members—including the member who raises the question.

What I want to explain to the honourable member in response to the question about tenders and costs—and I explained some things earlier in my answer to the member for Sturt—is the way the estimates end up being refined into project costs. It may depend at what stage of the process he has got the figure from. It may be from an early stage of the process and there has been some refinement of the costs. In Building the Education Revolution program initial estimates of costs are provided to the Commonwealth and they are based on the extensive experience of state and territory and block grant education authorities, and funding is approved based on those estimates. The people who run schools give us estimates that in their experience have proven to be correct estimates of costs. Then tenders are sought for managing contractors, who will then hire subcontractors in local areas to undertake the work. They may project manage a number of projects across a region. Quotes or tenders are then sought for individual projects. In many cases, design and construction contracts are being used to fast-track the process. This means that the builder works with the design team, architects and engineers on the job.

Quotes will include some money allocated for contingencies, which may be things like unforeseen problems with the site or excavation problems. When quotes are finalised, schools may find they have funding available to do more than was originally envisaged. They can then seek an agreement for a project variation from the Commonwealth if what is planned was not within the scope of the original approved project. When buildings are progressed to a certain point and all concerns about contingencies have been addressed, decisions will then be made with school principals about how the contingency amount can be used either to enhance the existing approved project, or projects, or to add a second project if there was only one initial project approved.

I think the member can see from that process that, in relation to the original cost estimates, we are relying on the historic experience of those who run schools, state and territory governments, and the block grant authorities in the Catholic and independent school system. Then we go through a tender process, which obviously refines costs. Then we go through a project delivery process, where of course some money is kept in reserve for contingencies because when you are building things, as people would know from home renovations and residential construction, you can hit contingencies. Then when you come to the actual costs, if there is a project variation, there is a way of dealing with the approval of that. If at the final stage you have money left over then we can enter into an agreement with the school as to the use of the money that is left over.

This is a considered and thoughtful process that has checks and balances at every stage. I accept that the member—


Mr Pyne —Mr Speaker, I rise on a point of order. The minister was asked whether she would refer this debacle to the Auditor-General. For some reason she refuses to answer that question. I draw—


The SPEAKER —The member for Sturt will resume his seat! The question had a preamble and raised a matter of specificity. The Deputy Prime Minister has responded to that. I am not in the business of marking the correctness of answers, but I would have thought that the information that was being given was totally relevant to the question.


Ms GILLARD —I have provided that comprehensive information because I know from my dealings with the member about the Building the Education Revolution program—notwithstanding the fact that he voted against it—that he is involved in helping his local schools. I have responded to it on the basis that it is an honest question.

I understand that the tag line is part of the political campaign of the shadow minister for education, the member for Sturt, to besmirch this program. He might choose to do that, but the reality is—and members know it as they move around their local communities—that this is being seized by schools as an opportunity to deliver the infrastructure they need for tomorrow and it is being seized by local communities to deliver jobs today. Responsible members of the House know that and are responding to that. Unfortunately, those who squeal, wail and moan sitting on the opposition side here do not acknowledge that.