Monday, 18 October 2010
Commission of Inquiry into the Building the Education Revolution Program Bill 2010
Bill and explanatory memorandum presented by Mr Pyne.
I present the Commission of Inquiry into the Building the Education Revolution Program Bill 2010. The Building the Education Revolution program of the 42nd Parliament, otherwise known as the school hall stimulus debacle, is one of the sorriest tales of waste and mismanagement in the history of Federation. I am sure there have been more gross examples of fraud, mismanagement or waste of themselves, but in terms of the quantum of funds nothing can surpass a $16½ billion program of taxpayers’ money, $14.1 billion of which was the Primary Schools for the 21st Century program, which became known as the school hall stimulus debacle. In terms of the quantum of funds that have been wasted and mismanaged by the now Prime Minister, previously the Minister for Education, nothing surpasses the Building the Education Revolution program of the 42nd Parliament.
Unfortunately the waste continues unabated, in spite of the fact that since April 2009 the opposition have raised in this House and in the media example after example of waste and mismanagement. The opposition have been supported in raising these issues by notable media identities and outlets such as Ray Hadley, the Australian, the Today show on Channel 9 as well as others. In spite of all this, the previous Minister for Education, now the Prime Minister, described those complaints as nitpicking about a $16 billion program—in spite of the fact that we have uncovered billions of dollars of waste and mismanagement. Outlets and organisations such as the New South Wales Teachers Federation, not usually aligned or associated with the coalition, have said that there is as much as 30 to 50 per cent waste in this program, leading people to assume that there is as much as $6 billion to $8 billion of wasted taxpayers’ money. In spite of all that, the Prime Minister, then the Minister for Education, has defended this program for 18 months. She has insisted that complaints about it are nitpicking and has gone as far as to accuse the opposition and the Australian of fabricating these examples. It has led to red-hot anger in the electorate. In school communities, middle-class Australians who want the best for their children in education greeted the announcement of this funding with excitement and with the apprehension of being able to achieve the right outcome for their children in terms of what their school needed. These school communities welcomed this funding and in many, many cases they have ended up disappointed, frustrated, bitter and angry at the extraordinary waste in this program.
I think the emblematic waste was the school canteen that cost $20,000 per square metre to build, and having been built was unable to house the necessary requirements for the small primary school that it had been built for because it was smaller than a one-car garage. That is an emblematic example, but there are so many examples. Over the last 18 months, the coalition have raised concerns to do with nine areas of the program. Hundreds of schools have been forced to accept ‘McSchool’ hall style demountables delivered off the back of trucks, irrespective of what local communities wanted. Schools in some jurisdictions that wished to build new classrooms were told they had to have stock standard school halls or libraries, irrespective of whether they already had a school hall or a library. Schools were not allowed to use local builders or contractors and instead were forced to use enormous contractors from capital cities who rolled out these school hall demountables from hundreds of kilometres away. In some states, it has been revealed that school communities received funds for schools that were closing down at the end of the year; in others, state governments and state government contractors gouged or ripped off the Commonwealth taxpayer for administrative fees and management fees, in many cases to the tune of 22 per cent of the total cost of a project. Some schools are missing out altogether. There are no funds for distance education or campuses of multicampus schools, yet the government can find $3½ million to spend on school plaques and $3.8 million to spend on school signs promoting the government for its apparent greatness and insist that the then Minister for Education, Julia Gillard, be invited to open every one of the potential 9,000 school programs.
For example, under the National School Pride Program, also part of the BER, schools wishing to spend their maintenance funds on energy efficient air-conditioning to make buildings that were perfectly usable but not without air-conditioning have been refused permission to do so. Instead, they have been told, ‘Knock the building down and you can build a new building with air-conditioning.’ Common sense has flown out of the window in the way the government has handled the school halls program. In the original guidelines announced by the government, principals and governing councils were effectively gagged and told not to speak to the media or to the opposition for fear of losing their funds. There was a culture of fear and intimidation, particularly in New South Wales, which was documented by numerous inquiries.
This program began on 3 February 2009. The opposition first started raising its concerns in April 2009 and, on 12 June, I wrote to the Auditor-General outlining the concerns of the coalition and asking for an inquiry into the BER. On 25 June the Senate passed a resolution asking the Auditor-General to undertake an inquiry into the BER program. By late August 2009, six months after the program had been announced, there was a cost blow-out of $1.7 billion, followed by changes to the guidelines and, for the first time, value for money was included in the guidelines as a requirement of spending $16.5 billion of taxpayers’ money.
In October 2009 the BER national coordinator announced an interim report rephasing funds from one financial year, 2010-11, to 2011-12. So the program was already being delayed within the first 12 months of its establishment. The Audit Office handed down its inquiry findings in May 2010. It found that guidelines for the program included ambiguous definitions, operational rules that were not clearly stated, detailed levels of prescription and control over funding allocation decisions, with some features imposing an additional administrative burden on education authorities. It showed that, where projects were in non-government schools, there was a high rate of satisfaction but in government schools there was a very low rate of satisfaction. The defining difference between the two was that non-government schools got to manage their own projects and achieve value for money whereas government schools did not get to manage their own projects. They were managed by central bureaucracies and, in most cases, were mismanaged.
The Victorian parliament initiated an inquiry in September 2010. The upper house of the New South Wales parliament handed down a scathing summation of the BER in September 2010. It is now the right of this parliament to insist that a full judicial inquiry be established into the failures of the school halls stimulus program. Taxpayers deserve to know whether a judicial inquiry finds whether value for money has been achieved in this program and taxpayers deserve to know who is responsible, from start to finish, for the failures of this program. It is not enough for the now Prime Minister, then the Minister for Education, to insist that those people who have raised concerns about this program are nitpicking or that they are fabricating examples. There is white hot anger in the community and it deserves to be given an answer as to whether value for money was achieved and who was responsible for not achieving it, if indeed that is what is found.
The opposition have been calling for a judicial inquiry from the very outset, when our concerns were announced. They have been ignored. Now is the time for the parliament to pass a private member’s bill to insist upon it.
Bill read a first time.