Housing failure: spin meets the real world

Housing failure to trigger penalties

BY:AMOS AIKMAN From: The Australian March 25, 2013 

ALMOST one house a day will need to be built between now and the end of June if the Northern Territory government is to avoid financial penalties for missing federal targets, amid allegations it is bungling its contribution to the nation’s premier indigenous housing scheme.

On-site construction for these homes has yet to begin, and angry contractors are now raising prices and refusing work as concern grows that Darwin’s mismanagement has rendered its own deadlines and budgets unachievable.

The tightening time frames have forced the Top End administration to replace some tenders with a “select” process, in which bureaucrats pick firms without competitive bidding.

Documents obtained by The Australian show some companies were told what prices to offer, and departments made preliminary decisions about what contracts to award before tenders were issued.

A government spokesman said the tender process followed “normal NT government procurement processes, including approval by the Procurement Review Board”.

There are fears painful lessons about program management, build quality and house design — learned during earlier iterations of the troubled indigenous housing program — are being lost as the NT government changes its delivery model to assume more control.

The National Partnership Agreement on Remote Indigenous Housing succeeded the troubled Strategic Indigenous Housing and Infrastructure Program, which was plagued by delays, cost blowouts and allegations of shoddy workmanship.

Federal Indigenous Affairs Minister Jenny Macklin said the Country Liberal Party government needed to build a further 75 homes by June 30 in order to meet its obligations.

“I will take any failure to meet these agreed targets very seriously,” she said.

“I am advised that the Northern Territory government has been slow to complete the scope of works for projects, and many contracts are yet to be awarded.”

Both Queensland and South Australia have suffered financial penalties for failing to meet their targets in the past. Up to 25 per cent of the NT’s funding could be at risk, with the NPARIH worth $1.7 billion over 10 years.

A spokesman for NT Housing Minister Peter Chandler said the government had scaled back its ambitions from 100 homes by the end of June to a new goal of 59, which he maintained was the real NPARIH target. A spokesman for Ms Macklin disagreed.

The Australian understands the new CLP government is significantly behind where its Labor predecessor was at this time last year, in terms of filling its house-building quota.

The head of one construction firm said he had finally rejected a long-delayed offer of work because he was “not going to go broke on an NT government project with ridiculous timelines and ridiculous budgets”.

Others said they feared being blamed for delays caused by government maladministration.

The CLP has had a leadership change and four cabinet reshuffles since it took power in an election seven months ago. The housing portfolio has changed hands three times.

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Thanks Amos for a view that reinforces that all may not be running smoothly with the NT part of the National Partnership Agreement on Remote Indigenous Housing. 

Whilst these stories seem to have been consistently appearing since 2009 we are told by the Federal Government’s own website “All States and the Northern Territory have exceeded the Indigenous employment targets set for them.”

A brief summary from HH’s view point:

• numbers matter, speed matters and therefore deadlines matter. 
• not much talk of quality, function, who lives in the houses or the health of them and their family.
• what has been learnt from 4 years of the program roll out to date?

Would there be slightly more interest in the quality of the works and the money being spent if the works were in the suburbs of Sydney or Melbourne, rather than remote communities, and being completed for non Indigenous clients. HH thinks there would be a very big difference. 

Well around $2bn has been spent and apart from target numbers, no one is quite sure what has been built or if it functions.