Saturday, August 8, 2020

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Home Issue 19 Government millions spent outside tender process

Government millions spent outside tender process

Part One in a series by ERWIN CHLANDA
 
Housing usually tops the list of Aboriginal disadvantage and it gobbles up much of the Closing the Gap government spending.
 
A few things stand out.
 
Firstly, the exorbitant cost of very basic dwellings. Example: A three bedroom house and two duplexes in Imanpa, on the road to Ayers Rock Resort and funded last year, will cost $1.6m.
 
Secondly, in many cases these are costs not linked to an open tender process but handouts to companies on the basis of their Aboriginal ownership or connections, sometimes through companies with an Aboriginal figurehead and formed for no other reason than to meet the government’s eligibility criteria.
 
This is the view of a long-time builder in Central Australia who spoke with the Alice Springs News on the condition of not being named. He says he suspects disclosing his identity may adversely affect his chances as a tenderer for other work.
 
He says contracts given under the Aboriginal Business Enterprises (ABEs) scheme are up to 25% more expensive than would be the case under open tenders.
 
In yet another example of the parallel universes in The Centre, such companies are getting the jobs under a system of “single select tenders” or select tenders involving a limited number of suppliers.
 
The builder says in a recent six months period two companies received about $12m worth of contracts for which mainstream companies were given no chance to bid.
 
And yet he says the benefits of the scheme go to people living in upmarket suburbs of Alice Springs and driving $80,000 4WDs, not the people on the ground in the remote communities.
 
Very little has been achieved over the years to establish permanent construction assets and skills in the bush.
 
The builder describes hapless initiatives such as linking a three-year Cert 3 Carpentry and Construction course to a seven months building project in a remote community.
 
Practical and feasible on-the-job training such as hanging a door or painting a wall, completed skills which people can re-use next time a housing project comes to town, are rare, he says.
 
Yet in his experience up to 70% of the workers on bush jobs could be Indigenous.
 
“Nothing much has changed in 20 years” with the widespread lack of basic school education at the core of the problem.
 
Most of the materials, machinery and crew usually have to be taken to the remote sites from Alice Springs.
 
“It costs $50,000 just to set up camp,” says another builder.
 
The ABEs program focusses “on developing Aboriginal Business Enterprises, opportunities for joint ventures, and local employment,” says the government’s website.
 
The likely outcome is that the ABEs will never be competitive because they don’t have to be, an absurdity in a society that touts competitiveness as the key to development and progress.
 
The government claims the scheme will reduce overcrowding and improve living conditions; encourage local decision making and engagement with communities; develop Aboriginal Business Enterprises; and provide sustainable local employment and economic development.
 
This is how the government’s website about ABEs defines them: They are 50% or more Aboriginal-owned or controlled; and are operating as a business (including a company, incorporated association, trust, social enterprise, or registered charity operating a business).
 
An incorporated joint venture is one that is 25% or more Aboriginal-owned.
 
Local employment means employing Aboriginal people from the community where the work is happening, where possible.
 
A minimum of 40% Aboriginal employment is required for work under the program.
 
Some further examples of recent projects from which the mainstream construction industry in The Centre was excluded. All contracts are for “design, documentation and construction”:–
 
• Santa Teresa, modifications to dwellings, Room To Breathe Program, $4.1m.
 
• Atitjere, two three-bedroom Remote Community Housing dwellings (1 duplex), $1.1m.
 
• Laramba, two three bedroom dwellings, $1.2m.
 
• Ntaria, two three-bedroom dwellings and demolition and construction of one three-bedroom dwelling and two three-bedroom dwellings, $2.6m.
 
 
PHOTO: Not the norm: Aboriginal construction crew in a remote community. Photo from our archive.
 
NEXT WEEK: Where does the money go?
 
 
 
 

4 COMMENTS

  1. While I wouldn’t have a clue about this kind of stuff, I would wager just about all builders in this town who could do this kind of work all live in nice big house and own 80k cars.
    Show me a builder that isn’t well off and I’ll show you a builder who doesn’t live in Alice Springs.

  2. James Smerk, there are over 50 registered builders in Alice Springs.
    Only about 10% of these are the “big boys”.
    They run big companies, big fleets, pay big payroll tax to the NT coffers, and employ hundreds and hundreds of people and dozens of apprentices.
    They sponsor about every sports team and other event you can poke a stick at.
    Yes, I hope that those top few are profitable. Good on them for building a big home with their own sweat and blood.
    Because there’s plenty of both in building. When its 45 degrees in the shade, and the blood? Building is a dangerous game.
    $80,000 car? That’s a GXL Landcruiser. All the big builders in town have children. Landcruisers are a great family car.
    But times are tough. The industry is in recession. There is next to no Government work except the work detailed in this article.
    There is next to no private investment as people lack confidence to invest in the town.
    Ed, good article.

  3. The way the tender processes occur is a shambles, let alone two charities being given large contracts.

  4. When Charles Darwin Uni (CDU) was established that did away with the Tertiary and Further Education (TAFE) with all TAFE centres and activities gradually coming to an end in all Territory towns.
    TAFE offered a range of training including basic training at a local level in various hands on skills that gave skills to equip people for a range of jobs including in the building industry.
    The CDU is a failure in this respect with more focus on international students rather than on our own local people.
    We need to get back to the basics but our governments lacks vision and commitment despite all the talk about growing our own. Talk is cheap [but] comes at a big cost.

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