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Auditor-general's report slams insulation sch -

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Auditor-general's report slams insulation scheme

Broadcast: 15/10/2010

Reporter: Susan McDonald

The report on the scrapped home insulation scheme says the Government put economic stimulus ahead
of safety.

Transcript

LEIGH SALES, PRESENTER: The problems with the scrapped home insulation scheme have been
well-documented but only now has the full scale of the policy's failing been revealed. The
auditor-general's found the Federal Government program put stimulus ahead of safety. He says the
Environment Department was overwhelmed and unprepared. The report's dragged the troubled scheme
back into the spotlight just when the Government's trying hard to regain control of the water
debate.

From Canberra, Susan McDonald reports.

SUSAN MCDONALD, REPORTER: It was meant to help insulate the nation from recession. Instead, the $2
billion government scheme led to fraud, debts and, at last count, more than 200 house fires.

JULIA GILLARD, PRIME MINISTER: This scheme did become a mess and that's why we brought the scheme
to an end.

SUSAN MCDONALD: The auditor-general has delivered his assessment and points to a department totally
out of its depth. The report says the stimulus objective overrode risk management. It says
difficulties overwhelmed the department and it was unable to recover.

There were problems in nearly 30 per cent of the roofs inspected. Of those with foil insulation,
safety fears forced the removal of the foil in more than one-third of them. And on top of that,
4,000 cases of fraud were identified, with the full extent of the problem still not known.

GREG HUNT, OPPOSITION ENVIRONMENT SPOKESMAN: Fraud, fire, failure on a massive scale, and above all
else, contributed to the possible deaths of four beautiful young men.

JULIA GILLARD: We as a government, and I think those too in the public service, have worked through
to learn the lessons here. And I welcome the auditor-general's report because that will also assist
both Government and the public service to learn from this example and to avoid these kind of risks
in the future.

SUSAN MCDONALD: Peter Garrett was demoted over the scheme. The Opposition is now calling for him to
be dumped from Cabinet all together even though the auditor-general found his department's advice
was overly optimistic and inaccurate.

PETER GARRETT, FORMER ENVIRONMENT MINISTER: Who couldn't be disappointed if there was advice that
came through which was deficient? But at every step of the way, I took the advice that I received
seriously.

SUSAN MCDONALD: But critically the report reveals bureaucrats wanted to roll out the program over
five years and that a five-year rollout was not accepted by the Government as it did not meet the
stimulus objective.

PETER GARRETT: Was it the right thing for the Government to do to respond in the way that it did to
the global financial crisis? I believe that it was. Are lessons to be learnt? Clearly there are.

SUSAN MCDONALD: The cleanup is estimated to cost almost half a billion dollars. 95,000 safety
inspections are now complete, but the Government won't say how many of those uncovered dodgy
insulation.

MARK DREYFUS, PARLIAMENTARY SECRETARY: Any figures that are produced from the 95,000 inspections
that have been carried out to date are also not representative because they are...

(Journalists all speak at once)

SUSAN MCDONALD: As much as the Government would like to move on from the insulation mess, the
Opposition is likely to pursue the matter when Parliament resumes next week. And as the Government
is picking up the pieces from the past, it's steeling itself for the battle that stretches ahead
over water use in the Murray-Darling Basin.

Following a dramatic day in the New South Wales town of Griffith, the basin authority had a less
hostile reception in South Australia's Riverland. Nonetheless it came across opposition to the
proposed water cuts.

RESIDENT: There's absolutely nothing in that draft plan that says we will have a more secure
future.

SUSAN MCDONALD: In Canberra, water experts waded into the debate.

RICHARD NORRIS, UNIVERSITY OF CANBERRA: I think most of the economic orientation has been towards
the production of food and fibre rather than the sorts of benefits we might gain from having more
water in the environment.

SUSAN MCDONALD: The Government's released figures showing some valleys have already achieved most
of the recommended cuts through water buybacks, and ministers are offering words of assurance to
nervous communities.

SIMON CREAN, REGIONAL AUSTRALIA MINISTER: In the end the Government has to make the decision. It
was never going to be a decision just for the Murray-Darling Basin Authority. It hasn't put out a
plan; it's put out a guide. The Government has to produce the plan and it will do that based on
serious consultations.

SUSAN MCDONALD: Taking the heat out of the debate won't be easy.