SA HEALTH

116 Mr HAMILTON-SMITH (Waite) (17 July 2012). With respect to 2012-13 Budget Paper 4, vol. 3, p. 64—

1. Who are the major suppliers to SA Health and its Agencies referred to under the $1.6 billion expenditure on general supplies and services in 2012-13 and what are the general gross payments for each?

2. What is the total value and scope of the government's business with Spotless in respect of SA Health and its Agencies?

3. Are there problems with the government's laundry services and in particular, who are the major contractors for laundry services and have any recent contracts failed and had to be renegotiated without tender?

4. What outsourcing initiatives has the government undertaken in 2011-12 and what outsourcing initiatives are planned?

5. What is the scope and dollar value of outsourcing of maintenance work at metropolitan based hospital and how many jobs are affected at each hospital within the Adelaide Health Service?

The Hon. J.D. HILL (Kaurna—Minister for Health and Ageing, Minister for Mental Health and Substance Abuse, Minister for the Arts): I am advised:

1. Based on the results of the Procurement Spend Diagnostic Project by Deloittes in December 2011, the major suppliers for goods and services for SA Health for the 2012-13 financial year will be:

Supplier Amount spent in 2010-11

Symbion $46m

Spotless Services $43m

National Blood Authority $27m

ISS Facility Service $26m

Roche Diagnostics $21m

Clifford Hallam Healthcare $16m

Baxter Healthcare $15m

Nursing Agency Australia $15m

Hewlett Packard $14m

CSL Biotherapies $13m

2. SA Health has engaged Spotless Services for the following services:

3. There are no problems with the laundry services for SA Health. Historically, the supply of 90 per cent of the laundry service has been provided by one major contractor, Spotless Facilities Services. No recent contracts have failed and had to be renegotiated without tender.

Following a rigorous open market procurement process, a contract across SA Health for the provision of Linen and Associated Services has recently been awarded to Spotless Facility Services. The term of the contract is for an initial five year period, with a further five year extension term available subject to satisfactory performance

4. There were no new outsourcing initiatives contracted by SA Health during the 2011-12 financial year. The contract for Linen Services was established during the 2011-12 financial year, however this was replacing a previous contract with an external service provider, which was established 11 years ago via the sale of the Government owned Central Linen Service facility.

Procurement processes to re-tender previously outsourced contracts are planned for SA Health. These contracts include Hotel Services, Courier Services, and Security Services.

5. Maintenance and repairs of SA Health buildings, plant and infrastructure, including building improvements less than $150,000, are currently being transitioned to a non-SA Health facilities management provider.

The facilities management services for the Northern Adelaide Local Health Network and Noarlunga Health Service will be Building Management Facilities Services, a unit of Department of Planning, Transport and Infrastructure and is not being outsourced to the private sector.

The remaining units of the Southern Adelaide Local Health Network and the Central Adelaide Local Health Network will have Spotless Pty Ltd as their facilities management provider.

The dollar value and number of jobs affected (position in place prior to the September 2011 Cabinet approval) at each hospital are as follows:

Hospital Dollar Value No. of Jobs Affected

Royal Adelaide Hospital $8.5 m 48

The Queen Elizabeth Hospital $5.7 m 26

Hampstead Rehabilitation Centre $1.2 m 1

Glenside Hospital $0.8 m 3

Lyell McEwin Hospital $3.2 m 18

Flinders Medical Centre $7.0 m 28

Noarlunga Hospital $1.3 m 7

SA Dental Hospital $1.3 m 5

SA Pathology $2.3 m 4

It should be noted that prior to the Cabinet approval, United Group Limited (UGL) were the facilities management provider for Modbury Hospital and Spotless Pty Ltd for the Repatriation General Hospital.