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The Hon. GREG PEARCE [6.47 p.m.]: Tonight I draw the attention of the House to more of Bob Carr's broken promises and to the duplicitous and dishonest lengths to which the Government will go to cover up failures and shortcomings. The Carr Government has spent more than $1 billion on private consultants and advertising, despite promising in Carr's original election platform to slash such spending. In order to lure the people of New South Wales to vote for him in 1995, Bob Carr made pre-election promises to cut spending on private consultants by more than half, stating:
Labor will impose a $50 million whole-of-Government limit on annual consultancy costs …
When the people of New South Wales elected Carr to government he not only made New South Wales the highest-taxing State in the country but also went on a spending spree with private consultants and advertising campaigns. In fact, since 1995 this Government has spent more than $955 million on consultants and $797 million on advertising. This long-forgotten promise is just another example from the bottomless pit of Bob Carr's waste and mismanagement that I continue to highlight in the House. I will refer to those costs in more detail later.
No-one disputes that the New South Wales public are entitled to receive the best advice and that some consultants are used well by public servants. However, there should always be transparency and accountability when using consultants. The Government is not into either of those things. One example of the Government's failure in this regard concerns the consultant Frontier Economics. Former Treasurer Michael Egan said he would limit government spending on this consultant to $14 million over five years. However, before his retirement from the House he admitted to a parliamentary committee that the Government has actually paid $15.7 million to Frontier Economics. To make matters worse, Mr Egan subsequently confessed that he had made a mistake and that the Frontier Economics fee had blown out to $18.1 million. The Government has even reclassified the Frontier Economics contract, changing its classification from "consultant" to "contractor" so as to avoid adding the fee to the Government's annual list of consultants' expenses.
More light has been shed on this dishonest practice and attempt to hide the extent of the consultants by recent admissions by the Director-General of the Department of Infrastructure, Planning and Natural Resources that the department had paid a firm of auditors $176,000 in fees for internal audit work last year. The director-general admitted that these fees had not been declared in the annual report on the consultants list because the firm had been classified as a "contractor" and not a "consultant". When asked to explain the difference between a "contractor" and a "consultant", the director-general gave an obtuse answer and read from a Premier's Department circular. I will quote the section she quoted:
For the purposes of these guidelines a consultant is a person or organisation engaged under contract on a temporary basis to provide recommendations or high-level specialist advice or professional advice to assist decision making by management. Generally it is the advisory nature of the work that differentiates a consultant from other contractors.
As I said, the Department insisted on calling this consultant a contractor when the type of advice was clearly that of a consultant. Indeed, a number of other departments had engaged the same consultant for similar sort of work and did not use the ruse in identifying the consultant as a consultant. When the director-general of the department engaged the consultant, part of the role that that consultant was given was to justify the $2.1 million the director-general had spent on a mate's business—BSR Consulting—even after BSR ceased to be an approved government contract supplier. The director-general paid the $2.1 million to BSR Consulting to provide information technology services to the department. It turns out that BSR Consulting is the business of Jennifer Westacott's old colleague from the Department of Housing, Sharon Kennedy, who is a 20 per cent shareholder. When the ICAC became interested in this matter the independent consultants Deloittes were called in to investigate and justify the expenditure. These are really quite appalling examples of this Government's mismanagement and its ability to dishonestly avoid accountability and transparency.