Review of Main Roads WA's privatised road contracts

12/07/01
One of Western Australia's most distinguished former public servants, Dr Ken Michael, will head a review into the impact of the privatisation of road construction and maintenance in WA.

Planning and Infrastructure Minister Alannah MacTiernan announced the Main Roads WA Term Contracts Review today, stating the review's three clear objectives.
These were to determine:

• what work currently contracted out could and should be brought back in-house;
  
• how to address the negative impacts this contracting policy has had on many small and regional businesses and regional employment; and
  
• what steps need to be taken to ensure the quality of the State's network, and the cost of maintaining it, are able to be controlled.

"Main Roads construction and maintenance functions were dismantled during the Coalition years as 100 per cent of road building and maintenance and most technical services were contracted to the private sector," Ms MacTiernan said.
She said she had received troubling reports from small and regional businesses which traditionally sub-contracted to Main Roads WA but who were missing out as these big contractors took over the work.
Many other regional businesses had complained that these often international companies no longer sourced plant or supplies locally.
The review will also examine the extent of job losses in regional WA as a result of the privatisation.
The Minister said she had concerns the State's road authority had been seriously deprived of in-house road design and building expertise under the previous government's policy of contracting out.
"The 10 year Main Roads Term Network Contracts for maintenance throughout the State are worth in excess of $1 billion over the life of the contracts," she said.
"That is a lot of State money locked away for a long time and we have an obligation to ensure it is being properly controlled. We have been alarmed at some reports we have heard about the failure to properly enforce the contracts.''
Among other things, the review will examine:

• whether the contracting out of road maintenance and other services had allowed for the retention of sufficient skills within Main Roads to ensure the proper long-term management of the contracts;
  
• the extent to which there was duplication in the management of contracts within Main Roads;
  
• the degree to which local in-house knowledge of Main Roads staff had been lost;
  
• the extent to which contracted functions could and should be reinstated in-house;
  
• the extent to which regional small business had been affected as a result of term contracts; and
  
• what could be done to improve opportunities for regional small business in maintenance and construction work.

Dr Michael, a former commissioner of Main Roads WA, will assess the impact on small and regional businesses and management consultant Richard Simons will determine whether there were sufficient controls in place for Main Roads WA's existing term contracts.
Media contact: Keri Welham 9213 6400