Why have taxpayers given the Canberra Institute of Technology nearly $9 million over the past five years to spend on “an unintelligible diatribe of words”, Canberra Liberals leader Elizabeth Lee wants to know.
The ACT Government wants to know, too, and will ask the Auditor-General to audit the CIT’s contracts with Patrick Hollingworth and his consultancy companies at the earliest possible opportunity.
Since 2017, the CIT has awarded seven contracts totalling $8.87 million to Mr Hollingworth’s Think Garden (“a transdisciplinary complexity and design lab”) and Redrogue Nominees, for strategic guidance and mentoring – predominantly mentoring and workshops for the CEO and executive team.
The value of contracts had steadily escalated from $86,281 in 2017 to $4,999,990 in March – even though the contractor’s services had not substantially changed, Ms Lee remarked. Mr Hollingworth’s latest contract is worth nearly $10,000 a day.
CIT receives most of its funding from the ACT Government, and is accountable to ACT taxpayers, Ms Lee said – but it was unclear what outcomes or results the contractor had delivered.
“There is very little publicly available information to indicate what services were delivered under these contracts, and there is no transparency about what Canberrans have received for an eye-watering $10,000 per day.”
What Mr Hollingworth was paid to do is a mystery, Ms Lee argued. The contracts she has seen lack information about personnel (including their qualifications and charge-out rate), milestones, and deliverables.
“It’s not even clear what the services are for. If that’s the case, then you cannot, on any objective measure, make a clear assessment about whether those so-called services have been delivered. You cannot measure the success of what they delivered if you don’t know what it is that is being delivered.”
Mr Hollingworth describes himself on his website as a “complexity and systems thinker”. His fee increased from $1,059 a day in 2017 to “a staggering” $9,980 a day this year, Ms Lee observed.
“To have someone essentially on a retainer costing $10,000 a day to mentor the CEO raises serious questions about the use of taxpayers’ money,” she said.
The March contract’s figure of $4,999,990 is $10 below the ACT Government’s notification threshold of $5 million, above which ACT Government administrative units must seek approval. “Is that a coincidence?” Ms Lee wondered.
Three of the contracts were sole-sourced, and four went to open tender, Ms Lee noted; Mr Hollingworth won each tender. In 2019, CIT ignored a request from the Government Procurement Board for an update about the procurements.
“How on earth is this value for money when it comes to taxpayer funds?” Ms Lee wants the ACT Government to explain. “How has this been allowed to happen under their watch?”
Ms Lee called on the ACT Government in the Legislative Assembly this afternoon to commission an independent, comprehensive audit of the CIT procurements by the end of September. Did CIT require the services? Were procurement processes unbiased? Was it appropriate to use an interstate contractor for services a Canberra-based supplier could have provided? What outcomes were delivered for CIT and Canberra taxpayers?
Government is concerned
Chris Steel, ACT Minister for Skills, revealed that he wrote to the chair of the CIT board yesterday, asking them to explain why the contract was a necessary, efficient, and appropriate expenditure of public funds; what would be delivered under the new contract, and what personnel would be involved; the justification for such a large quantum of funding; why CIT had not recruited an in-house adviser or team at less expense; whether the CIT Board was sure the expenditure was value for money; and whether the procurement process was conducted with the highest level s of probity and impartiality.
“I have reviewed the tender documentation and contract for this procurement, and am unable to determine the specific work to be delivered through it, based on the use of jargon and an ill-defined statement of requirements,” Mr Steel wrote.
Mr Steel amended Ms Lee’s motion this afternoon, to invite the ACT Auditor-General to review the contract and pursue an inquiry.
Mr Steel said the government had been concerned about the contractor since last year. In March 2021, he wrote to Craig Sloan, chair of the CIT board, asking him to clarify how the first four contracts “contributed to the efficient, effective delivery of CIT’s mission to deliver high quality skills and training for the Canberra community”. He doubted this represented “an efficient use of public funds in line with community expectations”.
The CIT has until next Monday, 14 June, to respond.
Mr Steel’s office noted the CIT operates under a governing board and executive external to government, in line with the Canberra Institute of Technology Act 1987. The release and negotiation of external contracts were therefore a matter for the CIT board and executive.
Ms Lee said Mr Steel had gone into “damage control”, and that his response raised more questions about what the government had done. Although Mr Steel had sent a “please explain” letter last year, Ms Lee said, the CIT signed another, even more extravagant contract this year.
“At best, the CIT has no confidence in the minister; at worst, Mr Steel had turned a wilful blind eye,” she claimed. “For the last 15 months, what has this government done to protect ACT taxpayer funds from being grossly misspent?”
“Thought piece” is food for thought
The CIT told the ABC that the March contract would “progress the evolution of its complex, adaptive systems-informed approach to CIT’s transformation, from its initial exploration, designing, and testing phases to a wider systematic implementation… CIT envisions this will occur through the continued acquisition and embedding of knowledge, tools, activities, practices, and structures that will ensure CIT can function as a system that learns.”
Bafflegab, Ms Lee thinks, sheer bafflegab.
“It seems very clear that statement was clearly written by the contractor,” Ms Lee said. “Who determines that their role involves things like multi-dimensional and multi-spatial? It is absolutely unintelligible at best, but really, if you look into it, it is wilfully opaque.
“What is it? How do we know that we get value for delivering whatever it is? And how do you even measure or begin to measure whether that, whatever it is, has actually been delivered? These are the serious alarm bells that are ringing in relation to these contracts.”
At a press conference this afternoon, Ms Lee brandished a “thought piece” delivered under contract – redacted to nothing.
“This is what is publicly available, as some of the ‘services’ that have been delivered under this contract,” she said. She read out what had not been redacted:
- Thought piece by [name redacted]
- Our context
- Our key temporal scales are…
- Our key spatial scales are…
- The difference between temporal and spatial scales: agency
- But before we identify our context specific approaches…
- Our context specific approaches…
“If anyone can tell me what that means, and whether that is going to be of value to the CIT and the Canberra taxpayer, and that it’s worth $5 million, then perhaps they need to be paid these types of sums,” Ms Lee said.
She believes the CIT contract is symptomatic of a wider problem with ACT Government procurement processes.
“The CIT contract issue is astounding, but for a lot of people, it won’t be surprising,” Ms Lee said. “And that is the most concerning thing of all.”
In February, she noted, the ACT Integrity Commission urged building and construction tenderers to report suspected improper conduct after the Campbell Primary debacle. Ms Lee called in March for an independent audit of ACT Government procurements for the last five years. The ACT Government responded that it would monitor and enhance their Procurement Framework, and commission an examination of select procurements across directorates.
The ACT Government must take responsibility, she said. “At best, they’ve been completely incompetent; at worst, they have been complicit in allowing this to unfold.”
