Greg Combet (Charlton, Australian Labor Party, Minister Assisting the Minister for Climate Change) Share this | Hansard source

by leave—On Friday, 26 February the Prime Minister appointed me as the Minister Assisting the Minister for Climate Change and Energy Efficiency. The government has determined to move the energy efficiency areas of the Department of Environment, Water, Heritage and the Arts into the Department of Climate Change, thereby creating a Department of Climate Change and Energy Efficiency. Within the Climate Change and Energy Efficiency portfolio, I have the responsibility for the wind-up of the Home Insulation Program and the introduction of the new Renewable Energy Bonus Scheme. I am assisted in that task by the member for Isaacs, and I thank him for his assistance.

It is the Home Insulation Program that I wish to address today. The government’s Home Insulation Program was terminated on 19 February as a result of safety and compliance concerns. I am advised that, from 1 July 2009 until the program closed, around 1.1 million Australian homes had been insulated, at a cost of approximately $1.5 billion. In my statement today I want to update the House and the community on the steps being taken by the government to wind up the program. As the responsible minister I have five principal objectives:

• to put in place a household inspection program to identify and address the extent of safety and fire hazard concerns, to mitigate risk, and thereby reassure householders who have had their homes insulated under the program;
• to assist industry and employees adjust to the termination of the program and transition to the new scheme;
• to identify and put in place processes to deal with issues of noncompliance and fraud;
• to identify any failures of administrative processes within government associated with the design and implementation of the Home Insulation Program; and
• to introduce the new home insulation component of the Renewable Energy Bonus Scheme on a sound footing.

In my statement I will outline three particularly significant responses to the problems experienced with the Home Insulation Program:

1. A commitment by the government to remove foil insulation, or alternatively install safety switches, in over 50,000 homes.

2. A commitment by the government to do a safety inspection in a minimum of 150,000 homes, in addition to the action taken in relation to foil insulation. If a risk assessment identifies the need for more inspections, those inspections will be undertaken.

3. A commitment by the government to aggressively pursue those who may have committed fraud. As my statement will make clear, the actions of unscrupulous operators have had a serious impact on legitimate businesses, employees and household safety.

To begin, however, I would like to express my sincere sympathy to the families of the four young men who lost their lives while installing insulation under the program. They were Matthew Fuller, Rueben Barnes, Marcus Wilson and Mitchell Sweeney. These four fatalities are independently the subject of workplace safety authority investigations and reports, police investigations, and will also be the subject of coronial inquiries. The government will do what is necessary and appropriate to support these inquiries.

The deaths of these four young men is a terrible tragedy. Each of them was entitled to a duty of care from their employer. Having spent much of my life representing working people in relation to occupational health and safety, I find these fatalities very distressing. Firms that have flouted their obligations to employees under the program will be a focus of my attention as minister. I will use all of the resources at my disposal to ensure that they are held accountable. The labour movement in this country has long fought for rights to protect employees from unsafe work practices, and these values will inform my own approach to responsibility in relation to the Home Insulation Program and the new Renewable Energy Bonus Scheme. I have spoken with a member of each of the families, and on behalf of the government and myself as minister, expressed my deepest regret and sympathy.

As I stated earlier, the purpose of my statement today is to outline the approach that I am taking to the wind-up of the Home Insulation Program. It is important firstly to place the origins of the program into context.

The program was designed as part of the government’s response to the global financial crisis. In late 2008 and early 2009 the government was implementing measures designed to stimulate and support economic activity and employment. The Home Insulation Program was part of these stimulus measures, which has had a very positive impact on the economy and employment. The environmental objectives of the program were also very important. The energy efficiency of residential buildings can be a significant factor in Australia’s capacity to reduce its greenhouse gas emissions.

On the workforce front, the Home Insulation Program led to the registration at the peak of installation activity of over 10,000 installation firms, employing many thousands of workers. The program delivered the first ever national training program for ceiling insulation employees, and over 3,700 workers have so far completed the new training package. Safety standards, in what has largely been a self-regulated insulation industry, have received long overdue attention and improvement.

However, the dramatic increase in household demand for insulation installations under the program generated significant problems. Longstanding participants in the industry have advised me that the market for the retrofitting of insulation in homes has historically been around 60,000 to 70,000 homes per year. Under the program more than 1.1 million homes were insulated in less than eight months, at an average of over 137,000 per month—that is, twice the previous annual average number of home insulation jobs were completed on average each month under the program. That is an extraordinary result.

These figures I think provide important perspective—the rate of home insulation under the program could not possibly have been achieved without a very dramatic escalation in the supply of household insulation and in the size of the installation industry. The larger longstanding participants in the insulation industry have historically self-regulated in order to build and maintain their business reputation, consumer confidence in their product, and their market share. The entry of many thousands of new insulation installation firms, some of which engaged in unscrupulous conduct, and the probable importation of some poor quality insulation products to meet the dramatic escalation in demand, contributed to many of the risks and problems experienced under the program. Some of the issues include:

• The use of insulation products that failed to comply with Australian standards;
• Poor quality installation of insulation in some homes, including breaches of building regulations and occupational health and safety laws;
• Safety and fire hazards in some homes;
• Breaches of consumer protections; and
• Entry into the installation market of operators intent on committing fraud.

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