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Economy

NT Government Promises new Indigenous Jobs Program won’t be Vulnerable to Rorting

After a Northern Territory employment scheme was suspended because of suspected fraud by some companies, the Northern Territory’s Labor Government says it is making sure any new plans for boosting Indigenous employment are not vulnerable to rorting.

The former Country Liberals Party (CLP) government’s program — the Indigenous Employment Provisional Sum (IEPS) — was introduced in October 2014 and gave bonuses to construction companies that achieved 30 per cent Indigenous employment on Infrastructure Department contracts.

The procurement policy was part of the CLP’s broader strategy to close the gap between Indigenous and non-Indigenous Territorians, and then-NT chief minister Adam Giles went on to sell the program to other states at the Council of Australian Governments meeting (COAG).

But in August this year, after tens of millions of dollars had been paid out through the IEPS, the NT Labor Government suspended the program because of suspected rorting by some contractors, and the Government referred cases involving six companies to police.

“The Department [of Infrastructure] has the resources now to ensure that it scrutinises these types of schemes far better,” said NT Treasurer Nicole Manison.

Some employees recorded as working more than 24 hours per day

NT Treasurer Nicole Manison speaks to the mediaBut the NT Chamber of Commerce said the Government needed to take more responsibility for the failures in the scheme, and would need to make sure it properly managed any new program.

Many contractors had warned the Government from the beginning that the policy was confusing and that there were not enough skilled Indigenous workers in the region to take on the jobs, said Kay Eade, the chamber’s Alice Springs representative.

“I think everyone realises the intent and nobody’s got an issue with that but it was just the way it was rolled out. I think it was just too fast, too quick, and they didn’t sit down and really think it through,” Ms Eade said.

“I’m not saying all the companies are innocent, but what I’m saying is neither was the Government.”

An NT auditor-general’s report, released last month, found failures in the way the Department of Infrastructure planned, implemented, and monitored the program, and said it was impossible for the department to know if the $40 million the NT Government paid to contractors through the scheme had made a difference to Indigenous employment.

The report said in some cases, contractors recorded Indigenous employees working more than 24 hours a day, or submitted claims for workers from interstate rather than Indigenous Territorians.

Workers on scaffoldingRed flags raised from the outset

The report also found poor monitoring had left the department vulnerable to “financial risk”.

“There is evidence to suggest that some contractors have deliberately claimed payments under the IEPS to which they were not entitled,” the report said.

The report noted there were red flags regarding flaws in the scheme from the time it was first introduced.

“There have been a significant number of procedural weaknesses, IEPS claim anomalies, and system inadequacies brought to the attention of those at executive level since the inception of the initiative,” the report said.

The NT Government has blamed the former CLP administration for fumbling the roll-out of the scheme.

But in December last year — several months after Labor was elected and eight months before the program was suspended — a KPMG report warned that the program was vulnerable to exploitation.

“Both sides of Government were given warning that it was a failed objective,” Ms Eade said.

But the Government said it moved as quickly as possible to improve the department’s auditing systems, which helped identify the suspected fraud.

Labor is now planning to replace the CLP’s program, and insisted its new audit measures in the Department of Infrastructure would make sure its new program worked.

‘Disheartening’ when workers can’t follow through on training

Bullant director Alex Fior stands beside a truck.Alice Springs construction company Bullant Building — a company which has been doing the right thing under the employment scheme — said the IEPS had merits.

But Bullant director Alex Fior said the extra administration and support that was needed for new employees with limited work experience had put a lot of extra pressure on his small company.

“We needed more supervision on-site for untrained people to help us renovate houses and more admin [for] chasing up payslips and signed payslips and things that were required,” Mr Fior said.

He suggested that under any new scheme, the Government could take on more of the load of organising longer-term work for Indigenous people, because under the old scheme projects often lasted only three to five months.

“They need really the two or three or four years to achieve an apprenticeship, and I guess it’s disheartening when they start something and then they can’t follow through with it,” Mr Fior said.

One of Bullant’s Indigenous workers, 62-year-old Alice Springs truck driver Wayne Rathman, has been working in the construction industry for decades and hopes to see other Indigenous people in Central Australia given opportunities to get jobs in the sector.

“Yeah of course, I’ve got two young ones myself, so the more opportunities around for them, it’s got to be better, ” Mr Rathman said.

He hoped any new scheme brought in by the Government would provide training that would lead to jobs.

“There’s a lot of fellas here that want to learn but don’t get the opportunity,” he said.

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