Grievance Debate

Kangaroo Island Airport

Mr PENGILLY (Finniss) (15:03): A short time ago in the house, the member for Flinders asked some questions of the Treasurer in relation to B.J. Jarrad. I was particularly pleased to hear the member for Flinders ask those questions, and I am not pleased with the answer that was provided by the Treasurer. He has been sitting on this for some time, and these poor devils of subcontractors have still not been paid. Quite frankly, it is not good enough. That leads me to the latest debacle about unpaid subcontractors which is to do with the Kangaroo Island airport project.

The company, NBS, went into receivership just recently, and I have a couple of subcontractors on the island who have not been paid and it is seriously impacting on their capacity to do business. I am worried because I believe this has been extremely clumsily handled by the council on the island. I remain unconvinced that they have done their job properly. Indeed, one of the questions that went from the Public Works Committee to the council was around the question of due diligence; the committee was questioning whether due diligence was done on particularly NBS.

At this morning's Public Works Committee, in answer to a question, a government officer explained that there was a procurement process and an assessment process based on a basic framework of DPTI. To quote the government officer, it would appear unfortunate that the council had not undertaken a detailed financial review, and so I said, 'Due diligence,' as a comment. The officer went on, 'Or at least a financial review of NBS'.

This is where it gets particularly messy. I have concerns that there have been things untoward going on with this whole deal. Unfortunately there is only one officer of the council who has knowledge of it. Other officers are excluded, and it all boils down to the CEO of the council over there, who seems to be behaving in a psychopathic way, wanting to run the whole show. Here we now have two local businesses that have not been paid.

NBS were running a quarry run by a Mr Hardy, and there was another quarry run by a Mr Willson. What further concerned me was that in a letter of response to the Public Works Committee today from Mr Deegan, the CEO of Transport, the council was quoted—and this is why I suspect there has been something untoward going on right through this in relation to the procurement of crush materials. In the answer from the council, Mr Tony Willson is referred to as 'Tony Willson' and Mr Mark Hardy is just referred to as 'Hardy'. I detect a distinct clash there between the council officer and the crushing contractors. I believe that there may well be something that needs to be looked into seriously.

I do not intend to rest on this. I want to see these people paid. They should be paid. No money has gone out whatsoever. They are now unsecured creditors and, according to the letter that has come back from Mr Deegan and the information on there, there is every likelihood that they will not get paid, or will not get paid very much. It is simply not good enough for this to take place in this day and age, particularly after what happened with B.J. Jarrad and the creditors there, which the Treasurer referred to today, who are still waiting on their money. It is not good enough.

I do not know where things are going with some of these contractual arrangements on the island in relation to the airport. It is $18 million of taxpayers' money, half and half from the state and the feds. I look forward to the project being completed. It has now been held up for a variety of reasons, not the least being NBS going into receivership. However, the simple fact is that NBS should have had an in-depth analysis of its financial position. Due diligence does not appear to have been done and, as a result, we have people needing money. Their bills keep coming in, and they are being required to pay that money without any cash flow coming in. You cannot operate like that and have a fair playing field. It is a disgrace and there is more to come on it.