On the day the Barnett Government will declare Fiona Stanley Hospital “open”, we thought it a good time to launch our new video and remind the community of the bungling that led to the project being significantly delayed and over budget.
It is also a good time to point out that the hospital is barely functional, has very few patients, and will not start treating emergency patients until well into next year.
In fact, Colin Barnett declaring Fiona Stanley Hospital to be “open” reminds us a lot of George W. Bush declaring “Mission Accomplished” in Iraq.
The truth is the Barnett Government has bungled this project from day one.
In its determination to privatise services at the hospital, the Barnett Government rushed its contract with Serco, the private operator of the hospital. In evidence to the 2014 State Parliament Education and Health Standing Committee into the commissioning of the Fiona Stanley Hospital, former Under Treasurer Tim Marney testified that Treasury was only given two weeks to examine the $4.3 billion dollar contract, when it usually gets six months for contracts of this size and complexity.
A major issue with the Barnett Government’s handling of Fiona Stanley Hospital’s development was in workforce planning. It didn’t put enough thought into how many doctors, nurses and other clinical staff would be needed in the health system when the hospital opened.
In June 2010, the Auditor General delivered a report into Fiona Stanley Hospital. At the time, he noted that the scheduled opening date of May 2014 was up to four years later than originally planned. It identified workforce and IT planning as major risks that “could mean further cost increases, delays or that the hospital may not be fully operational when it opens.”
The Education and Health Standing Committee’s report found that advice had been repeatedly provided to government since July 2012 that concluded a delay to the opening of the hospital was likely to occur.
In further evidence to the Committee, Mr Marney testified that delays had cost the State an additional $330 million, including $150 million in IT costs.
The Committee identified that the original paperless / fully digital vision for the hospital had been abandoned in 2011 and that the pursuit of alternative options had set the hospital’s opening back by up to a year, in addition to the increased costs.
The Barnett Government went to the 2013 state election promising the hospital would open on time. It made these commitments, despite the multiple reports within government that had concluded that the hospital’s opening would be delayed.
After the election, Health Minister Kim Hames finally confessed that the hospital would be further delayed, blaming the complexity of the project and the advanced (scaled back) ICT system – issues that had been raised by the Auditor General way back in 2010.
It is possible that the Barnett Government thought there would be a political cost if the public was aware the hospital would be further delayed prior to the election. What is certain, however, is that there has been a significant financial cost to the delay.
In the period since April 2014 and the hospital’s “opening”, the Barnett Government has been forced to pay more than $118 million to Serco in contract fees and penalties, despite the fact that the hospital has had no patients.
If the government had shared its knowledge of delays with the community and with Serco earlier, the contract could have been renegotiated and Serco wouldn’t have hired staff well ahead of them being required. If the government had been honest, taxpayers wouldn’t have had to foot the bill for these financial penalties.
If the Barnett Government hadn’t decided to privatise services at the hospital, it wouldn’t be obligated to pay financial penalties to anybody. The Department of Health, which was fully aware of the delays to the hospital, would have been responsible for hiring non-clinical staff and wouldn’t have hired them too early.
So, at a time of budget cuts and belt tightening, the community is entitled to be angry at the Barnett Government’s bungling of the Fiona Stanley Hospital project and the hundreds of millions of dollars this has cost taxpayers.
The community is also entitled to be angry that it was misled at last year’s state election into thinking the hospital would be fully operational by April this year. The reality is, the hospital won’t be fully operational into well into next year, at best.
One of the big problems with privatisation is a lack of transparency and accountability. The full Serco contract has never been revealed to the public. As we have found over the last couple of years, the Barnett Government has not been giving us the full story in relation to delays and it has required multiple investigations and inquiries to extract information.
As the new hospital gradually opens, we are likely to be impressed by the appearance of the new facilities. However, as the Education and Health Standing Committee found, a hospital is “more than bricks and mortar” and the Barnett Government has been found seriously wanting in the planning for operations.
We wish the new hospital and its staff well. However, we have serious concerns that more issues with the Barnett Government’s handling of the project will emerge over time, along with additional issues with the Serco contract and likely financial penalties for Western Australian taxpayers.
It is far too soon for Mr Barnett to declare “Mission Accomplished” at Fiona Stanley Hospital.