❓ Opposition questions the Minister for Housing regarding a KPMG audit of the head contractor maintenance model, alleging contracts were awarded without a business case and failures in cost savings and service. The Minister defends the model, acknowledging implementation issues but refuting claims of failure and waste, highlighting improvements and ongoing reviews.
AnsweredQoN 250Legislative Assembly
QuestionView source ↗
PUBLIC
HOUSING — MAINTENANCE CONTRACT — KPMG AUDIT REPORT
250. Mr P.C. TINLEY to the Minister for Housing:
I refer to the KPMG internal audit
report into the failed head contractor model for housing maintenance introduced
by the minister.
(1) Why were
contracts worth hundreds of millions of dollars awarded without the development
of a business case?
(2) Why did the
minister approve the new head maintenance contractor model knowing that a
proper business case had not been prepared?
(3) Why does the
minister not accept his ministerial responsibility for failing to deliver any
of the promised cost savings or increases in the level of service for
Department of Housing repairs and maintenance?
HOUSING — MAINTENANCE CONTRACT — KPMG AUDIT REPORT
250. Mr P.C. TINLEY to the Minister for Housing:
I refer to the KPMG internal audit
report into the failed head contractor model for housing maintenance introduced
by the minister.
(1) Why were
contracts worth hundreds of millions of dollars awarded without the development
of a business case?
(2) Why did the
minister approve the new head maintenance contractor model knowing that a
proper business case had not been prepared?
(3) Why does the
minister not accept his ministerial responsibility for failing to deliver any
of the promised cost savings or increases in the level of service for
Department of Housing repairs and maintenance?
AnswerView source ↗
(1)–(3) I
am glad that the member finally obtained a copy of the report a week after it
was tabled. For the public record, I had better read its title, which is ''Internal
audit report—Head Contractor Maintenance Model''. I do not see
the word ''failed'' in that title. Whilst the report acknowledges
a number of failings in the implementation of the head contractor model, it
certainly does not indicate that it is a failed report. In many ways it is a
shame the member was not here when we debated this. I think he was crook that
day, and I am not being critical of that. The member for Armadale did an
admirable job as the opening batsman for the opposition. A lot of these issues
were canvassed.
One of the big issues that KPMG
identified in this audit report was that the Department of Housing saw this as
simply an alternative procurement strategy to procure the services of
maintenance contractors when, in fact, as the member and I both know and as the
report highlights, it was a much more significant and substantive change
project for the agency. The focus and the management of risk in the
implementation project were lacking. I have said that many times publicly. As a
result, a number of issues arose during the early stages of implementation of
the head contractor model. As the member pointed out, work was clearly not
done. Clearly, contractors were not being paid. I would like to think that most
of those issues have now been put to bed.
Subsequent to being briefed about
this report by the auditors, I have asked them to do two more jobs. I will
happily table the outcome of that work in Parliament. They relate to the
accuracy of the payment system that the Department of Housing has in place. The
member has raised issues relating to that. I now have KPMG, completely external
to the department, looking at that. The second job is to understand what
controls, balances and monitoring the department has in place to ensure that
the quality of work that is being done is of a satisfactory standard. I
acknowledge that there were issues with the implementation and that the
management focus was lacking. It was not a procurement model change; it was a
total change in the way the agency did business. It should have been managed
better and it now is. Was money wasted under this model? I do not think so.
There is certainly no evidence that there has been a wholesale waste of taxpayers'
money. We saw that with the Office of Shared Services project, for example.
There is certainly not the wholesale waste of money that we saw —
Mr
M. McGowan : The solar rebate scheme.
Mr
T.R. BUSWELL : Certainly, there were problems with the solar rebate scheme,
but at least there are now solar panels on roofs providing energy to people.
The Office of Shared Services no longer exists, my friend. Perth Arena was
another great management project of the former government.
There are lessons to be learned;
there is absolutely no doubt about that. A number of recommendations have been
made by KPMG, and the department is acting on that. But let me say this: I do
not think that we will ever get a maintenance system that delivers a 100 per
cent perfect outcome, member. I just do not think we are going to get that
because of the complexity of the clients we deal with and because of the
diversity of the homes. But I will tell members one thing that I do not think
will happen. Members opposite hold up the former housing maintenance model as
being a very good model that did not need to be reformed. I will close with
this because I think it is important to understand this: there was a young boy
whose name was Cassius Norman. Cassius Norman crawled through a hole in a wall in
a house in Roebourne and was tragically electrocuted. That house, under the
former maintenance model, had had, according to all the records, a residual
current device installed. The invoice had been submitted and paid for that RCD
under the maintenance model that those opposite flag as being a great
maintenance model. The fact is that no RCD was installed. Would that have
stopped Cassius Norman from being electrocuted? Possibly, but we will never
know with 100 per cent certainty. The point I am trying to make is yes, there
were problems. The former model had some massive flaws. I think this gives us a
good base to make change into the future and to drive efficiencies.
am glad that the member finally obtained a copy of the report a week after it
was tabled. For the public record, I had better read its title, which is ''Internal
audit report—Head Contractor Maintenance Model''. I do not see
the word ''failed'' in that title. Whilst the report acknowledges
a number of failings in the implementation of the head contractor model, it
certainly does not indicate that it is a failed report. In many ways it is a
shame the member was not here when we debated this. I think he was crook that
day, and I am not being critical of that. The member for Armadale did an
admirable job as the opening batsman for the opposition. A lot of these issues
were canvassed.
One of the big issues that KPMG
identified in this audit report was that the Department of Housing saw this as
simply an alternative procurement strategy to procure the services of
maintenance contractors when, in fact, as the member and I both know and as the
report highlights, it was a much more significant and substantive change
project for the agency. The focus and the management of risk in the
implementation project were lacking. I have said that many times publicly. As a
result, a number of issues arose during the early stages of implementation of
the head contractor model. As the member pointed out, work was clearly not
done. Clearly, contractors were not being paid. I would like to think that most
of those issues have now been put to bed.
Subsequent to being briefed about
this report by the auditors, I have asked them to do two more jobs. I will
happily table the outcome of that work in Parliament. They relate to the
accuracy of the payment system that the Department of Housing has in place. The
member has raised issues relating to that. I now have KPMG, completely external
to the department, looking at that. The second job is to understand what
controls, balances and monitoring the department has in place to ensure that
the quality of work that is being done is of a satisfactory standard. I
acknowledge that there were issues with the implementation and that the
management focus was lacking. It was not a procurement model change; it was a
total change in the way the agency did business. It should have been managed
better and it now is. Was money wasted under this model? I do not think so.
There is certainly no evidence that there has been a wholesale waste of taxpayers'
money. We saw that with the Office of Shared Services project, for example.
There is certainly not the wholesale waste of money that we saw —
Mr
M. McGowan : The solar rebate scheme.
Mr
T.R. BUSWELL : Certainly, there were problems with the solar rebate scheme,
but at least there are now solar panels on roofs providing energy to people.
The Office of Shared Services no longer exists, my friend. Perth Arena was
another great management project of the former government.
There are lessons to be learned;
there is absolutely no doubt about that. A number of recommendations have been
made by KPMG, and the department is acting on that. But let me say this: I do
not think that we will ever get a maintenance system that delivers a 100 per
cent perfect outcome, member. I just do not think we are going to get that
because of the complexity of the clients we deal with and because of the
diversity of the homes. But I will tell members one thing that I do not think
will happen. Members opposite hold up the former housing maintenance model as
being a very good model that did not need to be reformed. I will close with
this because I think it is important to understand this: there was a young boy
whose name was Cassius Norman. Cassius Norman crawled through a hole in a wall in
a house in Roebourne and was tragically electrocuted. That house, under the
former maintenance model, had had, according to all the records, a residual
current device installed. The invoice had been submitted and paid for that RCD
under the maintenance model that those opposite flag as being a great
maintenance model. The fact is that no RCD was installed. Would that have
stopped Cassius Norman from being electrocuted? Possibly, but we will never
know with 100 per cent certainty. The point I am trying to make is yes, there
were problems. The former model had some massive flaws. I think this gives us a
good base to make change into the future and to drive efficiencies.
Explore WA Government Data
Search the full archive in the free dashboard, or query programmatically via API.
Explore more
Government Gazette
Appointments, regulatory notices, planning changes.
Hansard
Debates, questions, speeches and sentiment.
Tabled Papers
Reports and documents tabled in Parliament.
Committees
Committee profiles and recent reports.
Regulations
Subsidiary legislation with filters and summaries.
Bills
Proposed laws and parliamentary progress.
Acts
Current WA legislation and summaries.
Explanatory Memoranda
Bills with EMs (text/PDF) available.
Members
MP profiles, party breakdown and rankings.
Pollie Rankings
Data-driven rankings across 19 categories.
Amendment Chains
Track how schemes and regulations evolve over time.