The Guardian February 2, 2000

Privatisation demolishes public expertise

by Peter Mac

The Institution of Engineeers Australia (IEAust) has drawn public attention 
to the decreasing ability of the Public Service at all levels of 
government, to tender, assess and administer government contracts.

The Institution has highlighted the fatal Canberra Hospital demolition, the 
fire on HMAS Westralia and the Collins class submarine fiasco as prime 
examples of this trend.

Three seperate inquiries into these matters have in each case drawn the 
conclusion that the contracting government authority's lack of technical 
expertise significantly contributed to the disastrous outcome.

The old Canberra Hospital, for example, was supposed to be demolished by 
implosion, but somehow the implosion turned into an explosion, killing a 
12-year-old girl.

The coroner concluded that officers appointed to oversee the work had been 
asked to "undertake a function well beyond their experience, qualifications 
and skill". 

The number of engineers working for Federal, State and local government 
authorities has fallen by 40 per cent in the last decade.

Although the IEAust attributes this to the rise of "managerialism", the 
reality is that within this period there has been a massive push for 
commercialisation, and in some instances privatisation, of government 
contracting authorities, which has severely reduced the collective 
competence of government.

A case in point was the former Commonwealth Department of Housing and 
Construction (DHC), which specialised in public sector construction.

This Department at one stage had some 5,000 employees, including hundreds 
of architects and engineers. It also had an extremely knowledgeable and 
powerful contracts section, which specialised in keeping abreast of the 
latest contractor "dodges".

However, an organisation with such a range of marketable skills was a prime 
plum that the private sector had had its eye on for a long time. And, lo 
and behold, their wishes came true!

Over a ten-year period the DHC was reduced in size and then split into 
three separate organisations. Most of the employees of these organisations 
were then either encouraged or forced to seek work in the private sector, 
and the tiny remnants of the organisation were finally sold in 1998.

The responsibility for the work formerly carried out by the DHC contracts 
organisation was devolved to other Federal Government departments and 
authorities, each of which now maintains its own isolated contracts 

Apart from the inefficiency of such an arrangement, the collective 
experience that was generated formerly by a single organisation working 
closely with hundreds of construction professionals has been largely lost.

At the State and local government level also, the size of many authorities 
with contractual responsibilities has been whittled down over the last 10 
to 15 years, and with it the level of corporate expertise.

A Spokesman for the Institute, Mr Athol Yates, has pointed out that the 
three examples cited by the institute may be only the tip of the iceberg.

He noted: "Commercial-in-confidence requirements, burial of contractual 
problems and early retirement, and with it a loss of corporate memory, have 
prevented the scale of the problem coming to light. But the results of 
coronial inquiries and government investigations ... have exposed the 
consequences ..."

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