The Education and Health Standing Committee announced last week that it had found the Department of Health failed to meet the ambitious targets it had set for itself in the commissioning of FSH because of ‘serious shortcomings with governance and project management arrangements’.
Committee chairman Graham Jacobs said the project plan had allowed a transition period of only four weeks, a time frame he said was unreasonable.
He said the department underestimated the complexity of the project and focused on the bricks and mortar elements but failed to consider that other elements had an impact on arrangements with Serco, the private provider of non-clinical services.
‘It was within the Department’s realm to set the rules of engagement with Serco, yet they set conditions for themselves without adequate reassurance that they could actually fulfil them,” Dr Jacobs said.
‘Renegotiating this condition and opting for a longer transition period of six months has cost the State $36 million. The additional funding required for all elements of the commissioning project, including the additional payments to Serco, is around $300 million.’
Dr Jacobs said then Department of Health director general Kim Snowball was unwilling to accept advice that the hospital would be delayed.
‘Unfortunately, several months elapsed before this advice was formally communicated to the Minister for Health,’ he said.
‘Similarly, the taskforce established by Cabinet to improve governance of the commissioning project was only told of the advice regarding delay after Mr Snowball’s departure. Had these negotiations commenced earlier, Serco would have been in a position to mitigate its costs earlier.’