Review of issues related to the acquisition and management of container accommodation in the Northern Territory and the management of ACMS on prescribed communities 

1. In my opinion:

Finding 1:  The management structure dictated by government and based on the effective separation of the Operations Centre from the Department resulted in fragmented responsibility and accountability at least in relation to accommodation issues.

Finding 2: The time scales imposed resulted in managing to deadlines which gave little opportunity for detailed consideration and planning including risk management and an acceptance of higher risks than would normally be the case.

Finding 3: Despite the size of the task and the problems caused by the imposed structure and time scales the Operations Centre and the departments have very largely achieved the outcomes required as part of the Northern Territory Emergency Response (NTER). The issues identified below have not, to date, been critical to the achievement of those outcomes.

Finding 4: Apart from some aspects of the contract documentation with Royal Wolf, which is being separately reviewed by FaHCSIA's Legal and Compliance Group, the Department's management of the procurement of the containers was adequate in that:

1. the decision to use appropriately fitted-out containers was reasonable in the circumstances;
2. the fumes issue could not have been reasonably foreseen;
3. the decision to convert the original leasing arrangement to a purchase arrangement was appropriate given the business case; and
4. the requirement that the fitted-out containers met the relevant Australian Standards was appropriate.

Finding 5: The response to the concerns raised by Government Business Managers ('GBMs') was not adequate in that:

1. In the case of the Operations Centre:
   1. No effective action was taken to determine the nature and extent of the problem despite numerous and detailed reports from GBMs, although the potential for there to be Occupational Health and Safety (OH&S) implications was recognised when the fumes were first reported. Other OH&S issues raised were not effectively pursued;
   2. The apparent assumption that the issues reported were not serious was not justified; and
   3. Many of the GBM reports relating to accommodation risks were not registered as required by the NTER Project Plan and by the Strategic Accommodation Plan nor were they reported to a senior Officer as required by those Plans.
2. In the case of National Office:
   1. When the potential seriousness of the fumes issue was recognised in the Operations Centre and reported to National Office (NO) the action taken by NO did not reflect the urgency of the issue until the Simmons & Bristow report was received from Royal Wolf ('RW') in April 2008 when decisive action was taken; and
   2. Whilst the initial reference to RW for assistance in identifying the nature of the problem was appropriate the continued reliance on RW was not justified given the difficulties experienced in obtaining promised 'data sheets' and reports and the recommendation from the Department's OH&S area that an independent assessment of the nature and seriousness of the problem be obtained.
3. Both the Operations Centre and NO failed to consult appropriately and effectively with both GBMs and other stakeholders.

Finding 6: In the light of this case the Departments OH&S management and escalation procedures were not adequate in that:

1. I have been unable to identify any departmental escalation procedures of general application;
2. The risk management strategies identified in the NTER Strategic Plan and particularly in the Strategic Accommodation Plan which would have provided a focus for the management of the OH&S issues were not followed by the Operations Centre or NO;
3. Despite the fact that as previously identified, the OH&S implications of the fumes issue were raised and acknowledged on 8 November 2007 by the Operations Centre, the OH&S section of the Department was not officially informed until late January 2008;
4. The OH&S section did receive unofficial advice that there were issues with the container accommodation in December 2007 but in the absence of formal notification and given its on going work load took no action;
5. Recognising that there will always be question of judgement involved, there was insufficient recognition within the Operations Centre of the responsibility of line managers to identify and report potential OH&S issues in relation to the accommodation and to take action to deal with them;
6. The report that was prepared by the senior OH&S Officer was treated both by the Operations Centre and in NO as advisory only rather than as a report requiring management action;
7. There was inadequate follow up by the OH&S section on the matters raised in the OH&S report; and
8. The OH&S section is under resourced for the tasks it is asked to do, lacks appropriately qualified staff and is not adequately supported at senior levels.

Finding 7: Other matters which arose during the investigation:

1. The division of responsibility between the Operations Centre and NO and therefore accountability between the provision, installation and management of accommodation in the 'Top End' confused the handling of the accommodation issues;
2. The 'installation' and 'hand-over' of the accommodation complexes was not well managed and was a significant source of discontent amongst GBMs and a risk to the contractual interests of the Department;
3. There was insufficient capacity to identify and manage the risks inherent in the 'Top End' accommodation strategy;
4. Given the time pressures involved in the initial implementation of the accommodation strategy there was a failure to provide for 'review and catch-up' processes to identify and remediate problems in a systematic way;
5. Considerable effort and resources were devoted to establishing the risk management strategies in the NTER Strategic Plan and the Strategic Accommodation Plan.  Even allowing for the very real problems caused by the timetable set by government neither was effectively used in managing the provision and installation of the container accommodation.  Indeed the difficulty experienced in establishing the existence of the Plans in the course of the review suggests that risk management is not effectively used in the Department when it comes to the implementation of project plans;
6. In part as a direct result of the handling of the accommodation issues both by the Operations Centre and in NO there is a serious loss of confidence in management within the GBM network that can only be addressed by the senior management of both;
7. Despite, or perhaps because of, the voluminous provisions on the subject in the GBM handbook, there is a need to clarify and refine the role and priorities of GBMs particularly as that role relates to other officers working in or visiting communities;
8. The different employment conditions applying to officers working in similar circumstances often on the same community is a cause of dissatisfaction with both GBMs and CEBs;
9. There is a need for an objective and transparent method for appraising the performance of GBMs;
10. A major issue for a number of GBMs and a serious limitation on their willingness to extend their posting, should that be offered, is that the accommodation effectively precludes their being accompanied by their partners;
11. Consideration should be given to involving Legal and Compliance Group early in the establishment of contractual arrangements such as those that related to the acquisition of NT container accommodation; and
12. There is a need for officers to recognise that sending emails is not a substitute to taking action to resolve issues.

Finding 8: In relation to the management of ACMs on prescribed communities:

1. The actions taken by the Department to determine the nature and extent of the hazard arising from the presence of ACMs on those communities and the possible risks to health have been appropriate;
2.  The strategy now being proposed for managing ACMs on those communities appears appropriate;
3. A comprehensive plan for managing the risks associated with ACMs should have been prepared and agreed to at the appropriate executive level – I have been unable to establish that this was ever done;
4. The Minister should have been briefed about the ACM issues as soon as practicable after assuming office in the event the Minister was not advised about them until 28 May 2008;
5. The Secretary should have been briefed about the ACM issues as soon as practicable after the material was first identified;
6. Corporate Support, and in particular the OH&S section, should have been informed that ACMs had been identified as soon as the Department was alerted to their presence;
7. The OH&S section should have had a major role in determining the strategy to be followed in dealing with ACMs;
8. As identified in Finding 6, the OH&S section is under resourced for the tasks that it is asked to do (and should do), lacks appropriately qualified staff and is not adequately supported at high levels; and
9. More attention needs to be given to managing the concerns of persons, including departmental officers, living and working on communities where ACMs are identified.