Alex Gallacher (SA, Australian Labor Party) Share this | Hansard source

I move:

That the Senate take note of the document.

In speaking about audit report No. 16 of 2016-17, Offshore processing centres in Nauru and Papua New Guinea: procurement of garrison support and welfare services, I want to refer back to the previous parliamentary committee on the recent allegations relating to the conditions and circumstances at the regional processing centre in Nauru, and recommendation 15. Recommendation 15e said:

the extent to which contracts associated with the operation of offshore processing centres are:

delivering value for money consistent with the definition contained in the Commonwealth procurement rules;

meeting the terms of their contracts;

delivering services which meet Australian standards; …

And what do we have here? We have the most damning Australian National Audit Office report of a government department. It is almost incomprehensible. We have an examination of $3,045 million worth of expenditure as reported by AusTender at the end of March 2016. And we have an examination of the adherence to Australian government procurement processes, which combine Australia's international obligations on good practice and enable government entities to design processes that are robust and transparent and instil confidence in the Australian government's procurement activities. And what is the conclusion? The conclusion is damning:

The Department of Immigration and Border Protection's (DIBP) management of procurement activity for garrison support and welfare services at the offshore processing centres in Nauru and Papua New Guinea (Manus Island) has fallen well short of effective procurement practice. This audit has identified serious and persistent deficiencies in the three phases of procurement activity undertaken since 2012 to: establish the centres; consolidate contracts; and achieve savings …

This is an auditor outlining serious deficiencies.

I have not had the time to digest this audit completely. There are paragraphs about insufficient record keeping, about no due diligence, about no conflict-of-interest management—on the expenditure of $3 billion, or $3,045 million. The Australian National Audit Office has come down with a damning indictment of the activities of this department and this minister. We in this chamber at question time get lectured to by the finance minister about what a grown-up government they are and how fiscally prudent they are and how in charge they are. Well, let me just give you an example of how Finance is in charge of expenditure in this debacle. The Prime Minister had requested that per-head costs be lower as a result of retendering the contracts, but the department did not calculate a cost per person. Finance advised the Australian National Audit Office that under the consolidated contract the per-person per-annum cost of holding a person in offshore processing centres in Nauru and on Manus Island was estimated at $573,111 at the time of the Mid-Year Economic and Fiscal Outlook 2015-16. Prior to the consolidation of these figures, Finance had estimated the cost at $201,000. That is $371,000 per head that they could not get right, that Minister Cormann and his department cannot add up. They are $371,000, per head, out of whack.

And these are the grown-ups in charge. These are the people who lecture this chamber about prudent, diligent fiscal and economic management, and they are $371,000 out. This is not the end of this matter. This report should be digested by every senator in this place. It is an indictment on this government.