‘Not working’: Multibillion-dollar govt contract under scrutiny
A damning assessment of the state government’s multibillion-dollar asset maintenance contract with Sydney-based Ventia has drawn the ire of the state’s Treasurer.
The Auditor-General has slammed the operation of a $4.2 billion whole-of-government maintenance contract which covers billions of dollars’ worth of SA government assets, including schools, hospitals, TAFE SA sites, prisons and courts.
In his latest annual report, the Auditor-General Andrew Blaskett found that the Across Government Facilities Management Arrangements (AGFMA) contract “continues to not operate as intended”.
The former Liberal government entered into the $4.2 billion contract with Ventia Australia to provide private management services across SA facilities in 2021, such as building maintenance and repair works.
The latest report tabled in state parliament on Tuesday, highlighted areas of “significant risk”, including that there was a lack of evidence of Ventia’s compliance with cyber security rules, the Department of Infrastructure and Transport’s risk management process contained “gaps” and that Ventia was “not procuring trade-based services in line with the SA Government’s procurement policies”.
The first term of the contract with Ventia ends on 1 July 2027, with additional extension options available.
Treasurer Koutsantonis told ABC Radio that “luckily there is a clause in the contract that allows us to either extend or not extend it at the five-year mark, that’s coming up very soon”.
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He said the contract was “not working for the government”.
“In my previous role as Infrastructure and Transport Minister, we had to oversee this contract. It is very difficult to get value for money out of it but the previous government thought it would save money, in fact it costs us more… and the controls that they gave us in their contract are not very good and are substandard,” he said.
“The Auditor-General is rightly calling those out, and this is a problem when we sign an 11-year contract weeks before an election, it shouldn’t have been done that way, they should have waited until after the election and gone through a proper process and then, if they still thought it was value for money and had then signed the contract, and I think the Auditor-General’s reflecting everyone’s frustrations.”
Opposition spokesperson for Government Accountability Ben Hood said the report “reveals a pattern of mismanagement that Labor has failed to fix”.
“When schools, hospitals and public buildings aren’t being properly maintained, and costs are climbing, the government’s failure is plain to see,” he said.
“At a time when online scams and cyber threats loom large, South Australians should expect the highest standards of security from anyone contracted by the government.
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“The list of issues with the Ventia contract should shock all taxpayers, with even basic maintenance not completed on time, and legally required work delayed or missed altogether.”
Koutsantonis blamed the former Liberal government, saying the contract left South Australians worse off by the opposition’s “privatisation zeal”.
“The former Liberal government’s obsession with outsourcing continues to leave South Australians worse off,” he said.
“The wholesale outsourcing of management services is possibly one of the worst contracts the former government inflicted on South Australia. We warned the former Liberal government that outsourcing these contracts would be a mistake, and unfortunately, we have been proven correct.
“We continue to pursue all options to ensure service delivery improves because the people of South Australia deserve better.”
Hood said Labor “can’t blame anyone else for this failure”.
“It’s their job to manage this contract and they’ve had over three years to do the job,” he said.
“Taxpayers deserve accountability, not excuses.”
A Ventia spokesperson would not comment on the Auditor-General’s report.
