Hon Mark McGowan BA LLB MLA

Hon Mark McGowan BA LLB MLA

Premier; Minister for Public Sector Management; State Development, Jobs and Trade; Federal-State Relations

Hon Ben Wyatt LLB MSc MLA

Hon Ben Wyatt LLB MSc MLA

Treasurer; Minister for Finance; Aboriginal Affairs; Lands

    Commission of Inquiry to investigate financial mismanagement

    15/05/2017 1:15 PM
     
    • ​Former Under Treasurer John Langoulant to head the McGowan Government's Commission of Inquiry
    • Inquiry to focus on decision-making processes, transparency and financial consequences of projects and contracts under the former government
    • Inquiry will report on lessons to be learned for current and future governments

    Former Under Treasurer John Langoulant AO will head the McGowan Government's Commission of Inquiry into contracts and projects of the former Liberal National Government.

     

    The dealings have exposed Western Australians to significant financial cost and risk, failed to deliver promised benefits to taxpayers or have been shrouded in secrecy.

     

    Premier Mark McGowan and Treasurer Ben Wyatt today released the terms of reference for the independent inquiry, which would shine a light on the decision-making processes, risks, and contract terms.  It will recommend safeguards to prevent this happening again.

     

    A total of 26 projects will be examined, including the Muja power station refurbishment, IT cost blowouts at Fiona Stanley Hospital and Perth Children's Hospital.  These projects alone exposed taxpayers to hundreds of millions of dollars in additional costs and contributed to WA's record State debt.

     

    Mr Langoulant will head the special inquiry, which will be conducted under section 24 of the Public Sector Management Act 1994 and will use other statutes to access information as required.

     

    All State Government departments will be required to fully co-operate with the inquiry and provide access to all information, documentation or other records requested by the inquirer.  Government Trading Enterprises will also be expected to co-operate.

     

    Mr Langoulant will produce a final report by the end of October 2017.

     

    Comments attributed to Premier Mark McGowan:

     

    "WA taxpayers have a right to know where all the money went.  They need to know how WA has gone from having the best set of finances in the nation, to the worst.

     

    "The Liberals and Nationals refused to answer simple questions about how taxpayers' money was being spent. They oversaw massive cost blowouts on projects like the Muja power station and the Serco contract at Fiona Stanley Hospital.

     

    "We need to get to the bottom of these deals and the Commission of Inquiry will answer these questions.

     

    "It will bring a high level of scrutiny, transparency and accountability to a series of decisions and projects of the former government."

     

    Comments attributed to Treasurer Ben Wyatt:

     

    "Collectively, these decisions of the former Liberal National Government have contributed to the State's significant deficit and debt position.

     

    "Western Australians have a right to know how the State got into this situation because every citizen will, unfortunately, bear the consequences of the financial repair.

     

    "Mr Langoulant's experience in both the public and private sector, including as a former Under Treasurer, means he is well placed to conduct the review into the integrity of decision-making processes and their financial consequences and liabilities."

     

    Terms of Reference

     

    The Inquiry is to examine and report individually on the programs and projects listed in the appendix, including analysis of contracts as necessary, entered into by the State Government between 2008 and March 11, 2017 and focussing on the governance arrangements and decision-making processes associated with these, including:

     

    The Inquiry is to examine and report individually on the programs and projects listed in the appendix, including analysis of contracts as necessary, entered into by the State Government between 2008 and March 11, 2017 and focussing on the governance arrangements and decision-making processes associated with these, including:

     

    1.  Their financial consequences - including any ongoing liabilities and obligations (intended or otherwise), and whether those undertakings represented value for

          money.

     

    2.    The adequacy of the decision-making processes leading to the awarding of the projects, including the adequacy of their supporting business cases and

            assessments of risks to taxpayer funds.

     

    3.    The adequacy of their procurement processes.

     

    4.    Whether reasonable value for money outcomes were achieved.

     

    5.    The validity of the use of 'commercial in confidence' reasons to justify non-disclosure to the public of contract information and whether that justification was valid

            (in the public interest) in the particular circumstances. 

     

    Following examination and reporting on each of the projects listed in the appendix, the Inquirer is to provide a final report, including:

     

    6.  A clear and concise explanation for the community of the key drivers or failures in decision-making processes, including identifying where significant costs have

         been incurred, that led to the State's operating deficits and unsustainable debt position. 

     

    7.    Lessons learned from the undertakings listed in the appendix.

     

    8.   Any measures that should be introduced by the State Government to ensure greater rigour and transparency in decision-making and procurement processes to

          ensure the highest value for money outcomes from government programs, projects and contracts.

     

    Land and Major Projects 

    1.         Elizabeth Quay

    2.         Perth Stadium, including Swan River Pedestrian Bridge

    3.         Land Assets Sales Program

    4.         Ord River Irrigation Expansion Project - Contracts

     

    Royalties for Regions 

    5.         Pilbara Accommodation

    6.         Pilbara Underground Power Project

    7.         The Ningaloo Centre

    8.         Bulgarra regional sports complex

    9.         Wanangkura Stadium (Port Hedland multipurpose recreation centre)

     

    Health 

    10.        Fiona Stanley Hospital (including the Serco contract)

    11.        Perth Children's Hospital

    12.        QEII Hospital parking

    13.        Karratha Hospital relocation

    14.        St John of God Midland Public Hospital

    15.        Department of Health - major IT procurement

    16.        Outsourcing of non-clinical services

    17.        NurseWest arrangement

     

    Energy Utilities 

    18.        Muja Power Station

    19.        Synergy - Billing System

    20.        Synergy and Western Power - contracts

    21.        Western Power - Woodlands transmission line

    22.        Western Power - Project Vista

     

    Other 

    23.        Road Safety Commission and RugbyWA partnership

    24.        Renewable Energy Buyback Scheme

    25.        Common Use Arrangement for Temporary Personnel Services

    26.        GovNext ICT Project

     

    Premier's office - 6552 5000

    Treasurer's office - 6552 5900