Road contract a good deal for state, but not for subcontractors
Tender tough on locals
THE Queensland Government used a tender process on the $ 200 million Townsville Ring Rd project which restricted its access to information and its control over subcontracts, when compared with other options.
Local haulage operators have complained they were shut out of the process and being given work for rates much lower than the principal contractor after passing through a number “middle men”.
As revealed by the Bulletin yesterday, principal contractor Seymour White is paying Brisbane- based Australian Premium Haulage nearly $ 3 per tonne in haulage rates for the project, before the work is subcontracted to local businesses for as little as $ 1.80 per tonne.
The previous LNP Government decided to go ahead with a price tender, instead of an alliance tender, which meant it had less control over the project.
Under an alliance tender – regularly used by governments on big projects – the government works more collaboratively with private companies to deliver the project.
However, a Department of Transport and Main Roads spokesman said under the Ring Road project, the Principal Contractor must seek approval to subcontract from the Contract Administrator.
When asked complaints yesterday, Main Roads Minister Mark Bailey said the tender process was successful because more than 80 per cent of staff, materials and product being used on the project were sourced from the Townsville region.
“There’s always some disappointment when it comes to people getting contracts and subcontracts and competitiveness. I think that’s a normal part of the process and I think that’s what we’re seeing here,” he said.
“Importantly what we’re seeing is good value for money in terms of the taxpayer commitment.
“We’ve got to make sure is we’re spending taxpayer dollars responsibly.”
Townsville Mayor Jenny Hill said the government needed to ensure local contractors weren’t being paid unnecessarily low haulage rates.
The TMR spokesman said based on the scope of the Ring Road works, the Road Construction Contract was deemed the most suitable type of contract by the deparment.
“Current market conditions also favour that contracting model and supports value for money outcomes for taxpayers,” he said.