Legislative Assembly for the ACT: 2003 Week 13 Hansard (27 November) . . Page.. 4795 ..
MR CORNWELL (continuing):
territory, be in a position to compete in the private market against private companies? Although the answer to that could be that they can compete, I would like to know in a little more detail whether they will be obliged to compete in the market against the private sector unencumbered, if I may put it that way, and whether they will be given any advantages. I can understand that the answer to that probably is that they will not; nevertheless, I would like to hear it.
What arrangements have been made for the continuation of any contracts with Totalcare's existing customers? I trust they will be continued, that they will not be curtailed. What will happen to all the staff, Mr Treasurer? Have they all been given assurances that their jobs are safe? If any staff are to be laid off, how many and under what terms, to the extent that you can provide me with that information without breaching privacy legislation? Where is it intended that Totalcare's business units will be located physically after the transfer? If they are all to be located at Mitchell or Fyshwick, what is going to be the situation with the unused site, if there is going to be an unused site?
Perhaps another question is whether the current board of directors will have any ongoing role in Totalcare after its disposal. I noted in the statement of corporate intent that a new board has been appointed. I am just trying to find the reference to that. These are, you may imagine, fairly basic questions, but I think we do need to have a look those matters and receive those assurances if this Assembly is to approve this transfer, as required by law.
MS DUNDAS (11.14): The ACT Democrats will be supporting this motion today. The return of each of Totalcare's functions to the ACT government departments where they best fit has the potential to eliminate the cost of a separate board, a CEO and some senior management positions. But I have little confidence that the winding up of Totalcare Industries will eliminate the risk of the ACT government undercutting private businesses in the provision of services to the private sector, using taxpayer subsidies. It looks like we are merely shifting the problem to the departments that will absorb Totalcare's functions.
Through the briefing that the Treasurer offered on the winding up of Totalcare, I learned that the government planned to continue to enter into new contracts to deliver services such as fleet, linen and building management to private businesses. There was no plan to phase out private sector provision and return to delivering only core services, as required by the ACT government.
I was informed that the government will not accept as high a level of financial risk in private contractual arrangements as Totalcare may have done as a commercial corporate entity, but it appears that there is little concern that the government may continue to lose money on private contracts. From the outset, I have argued that it makes sense for the government to perform functions directly related to the delivery of public services, but it is not desirable for the government to compete with private businesses for contracts to deliver services to the private sector.
The government claim that private sector contracts in the linen sector are required to bring the business close to a break-even point. They cite the excess capacity inherited from the Commonwealth government at the time we moved to self-government as the