Building Services Corporation Inquiry

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Speakers - Nile Reverend The Hon Fred; Jobling The Hon John
Business - Division

BUILDING SERVICES CORPORATION INQUIRY

Debate resumed from an earlier hour.

Reverend the Hon. F. J. NILE [2.31]: Before the adjournment I was speaking in support of the motion moved by the Hon. J. H. Jobling. As I indicated, the motion contains a number of important aspects. The motion is comprehensive and should not be watered down in any way. I have received a number of letters from people who have been affected by the inefficiency and mismanagement of the Building Services Corporation. The Auditor-General, who investigates this matter, will perhaps find something improper about its operations. I have no evidence of that. The evidence I have from people who have suffered is overwhelming. I did intend reading to the House a number of letters that I have received from such individuals, but the Hon. J. H. Jobling has covered the material comprehensively and I do not wish to delay voting on this motion as it is important that it be passed.

The main purpose of the motion is to give the Auditor-General the authority to immediately investigate and audit all payments relating to the inquiry into outstanding grievances. The Auditor-General would conduct an efficient and prompt investigation; he has great skills and ability in this area. A parliamentary committee or some other body would perhaps take months to conduct an investigation. I am sure that the date stated in the motion, that is, 27 June 1996, would not present a problem to the Auditor-General. Because that date is still within the present financial year, there would be nothing out of order in the Government directing the Minister for Fair Trading to extend the date from 31 May to 27 June, or even to the last day of June in order to allow a day or so for any final adjustments.

It appears to me that we are dealing with a heavy-handed situation; it is blackmail. I have talked to people who have received these cheques. They are distraught; they are under tremendous stress; their marriages and their families have been affected. Basically, they have received a directive, which is very serious. I do not know of many other such heavy-handed situations, in which people are told, "Bank this cheque by this date or you'll have to return the cheque; the cheque will be cancelled." That is the kind of advice that these people are receiving. The letter I received from Mr A. R. and Mrs S. C. Allen dated 29 April simply states:

I refer to the Inquiry's letter to you offering $100,000.00 and enclosing a cheque for that amount.

The Inquiry has been advised that as at 24 April 1996 the above cheque had not been presented for payment.

Those people do not want to bank the cheques because they have been told that if they do so that will indicate acceptance of the offer, and that would be the end of the matter. These people know that there are still other matters to be finalised and that the $100,000, even though it sounds a large amount, is not enough. Expenses on the properties and the buildings have been incurred and are still being incurred. Many of the buildings are virtually write-offs; they cannot be sold. The buildings were so poorly built and so badly constructed by irresponsible builders that the owners have been left with a white elephant. This is a terrible situation for them to be in. The Allen's letter continued:

For a combination of budgetary, financial control and audit reasons, it is necessary that the status of the above cheque, and therefore the offer in respect of which it was made, be finalised before the end of the financial year.

Accordingly, I am writing to advise that if you wish to accept the offer made in the above letter, you should ensure that the above cheque has been banked by 5.00pm Friday 31st May 1996. The offer made in the above letter lapses if not accepted by that time.

Cheques not deposited by then will thereafter be cancelled.

One would think that if one got a cheque from a government department it would at least be valid. Even if the person hesitated banking it, the money would be transferable to that person's account. That person would understand that a government cheque could not be cancelled. The wording in the letter indicates that the cheque will be cancelled. The letter concluded:

If you wish to accept the offer made you must do so, by banking the above cheque, by 5.00pm Friday 31st May 1996. If you do not do so by then, it will be too late.

Yours faithfully,

Terrence Lynch

I speak on behalf of the consumers who have approached me - the Allen family, the Russon family of Hurstville, the Austin family of Narellan and Shirley Foster of St Ives - and many others who are grieving over this matter and suffering a great deal of stress and anguish. I am not suggesting that I have any evidence that a person would take his own life; no-one has said that to me. But in my contact with those people, in counselling them, I believe that some of them are on the edge of at least a nervous breakdown. If the Government has any compassion or concern, it must support this motion; it must allow the Auditor-General to conduct an inquiry. If the Auditor-General supports the Minister's actions and nothing more can be done, that would be the umpire's ruling. I would accept that, and at that point consumers would have to accept it as well. I strongly support the motion before the House. There is light at the end of the tunnel; we can refer the matter to the Auditor-General.

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The Hon. J. H. JOBLING [2.39], in reply: I thank the Hon. A. G. Corbett and Reverend the Hon. F. J. Nile for their contributions and for their support for the motion. In response to some of the comments made by the Minister, I remind him that a number of the claims go back to the middle of the 1970s and up to 1988. Some of the claims are very old but are still in the unresolved bin. I point out that most of the improvements and changes made to the Building Services Corporation, as it became, were introduced by Liberal-National Party governments. Coalition governments increased the maximum for compensation payments from $20,000 to $50,000 and then to $100,000, tidied up contracts and redrafted them in plain English, and attempted to instruct and ensure that the BSC became consumer orientated. We perhaps did not succeed on the latter point as much as we would have hoped to. I remind the Minister for Community Services that in another place this morning the Opposition again attempted to increase the maximum payment for compensation, to $200,000, but that attempt was effectively blocked and denied by the Government. To me that move showed the contempt in which the Government holds consumers and those who need protection.

It is clear, as set out in the motion, that there is a need for a consistent methodology. The methodology needs to be exposed so that people can study it and understand it. That is the methodology that should have been used in the inquiry. There has been no real assistance given to the claimants, or, as they are sometimes called, the victims. The heavy-handed threat of the Department of Fair Trading in relation to its cheques can be described only as harsh and unconscionable. There is no reason that the Government could not and should not grant the additional month proposed to allow the Auditor-General to carry out his investigation and report to the Parliament. The report will make known and publicly available the issues of legal rights, methodology and whether consumers were treated fairly. It is my hope that the Auditor-General will be given the opportunity to carry out the investigation and report back to Parliament, as suggested, by 27 June. I commend the motion to the House.

Question - That the motion be agreed to - put.

The House divided.

Ayes, 22

Mr Bull Miss Kirkby
Mrs Chadwick Mr Lynn
Mr Cohen Mr Moppett
Mr Corbett Rev. Nile
Mrs Forsythe Dr Pezzutti
Miss Gardiner Mr Samios
Mr Gay Mrs Sham-Ho
Dr Goldsmith Mr Tingle
Mr Hannaford
Mr Jobling Tellers,
Mr Jones Mr Gallacher
Mr Kersten Mr Ryan

Noes, 16

Mrs Arena Mr Primrose
Dr Burgmann Mr Shaw
Ms Burnswoods Ms Staunton
Mr Dyer Mrs Symonds
Mr Egan Mr Vaughan
Mrs Isaksen
Mr Kaldis Tellers,
Mr Macdonald Mr Obeid
Mr Manson Ms Saffin

Pair

Mr Rowland Smith Mr Johnson

Question so resolved in the affirmative.

Motion agreed to.

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