Moora loss blamed on tender process

AS the Mid-West town of Moora campaigns to get its $6.3 million hospital project reinstated, attention is being drawn to the State Government’s handling of the tender process for the Geraldton Hospital tender, which some claim is the key to the controversy.

The State Government has already blamed cost blow-outs on the Geraldton development for its decision to shelve the Moora Hospital project, claiming over-heated market conditions in the building industry caused costs to escalate to $9 million over budget.

But some business people, led by building giant BGC, claim this is the Government’s own fault.

They point to the move by former Works and Services Minister Tom Stephens earlier this year to add union-friendly builder Broad Constructions at the 11th hour to the tender shortlist.

This move by the then minister, who was already under fire for allegedly trying to block non-union builder BGC from government contracts, caused a furore.

In the background, Broad Constructions had been named during the Cole Royal Commission for improper payments to the Construction Forestry Mining and Energy Union and had ties with former premier Brian Burke.

According to BGC general manager Gerry Forde, it was the poorly handled tender process that caused his company to withdraw from the Geraldton development.

Mr Forde said BGC had a track record of being competitive and that it was likely the company could have delivered the Geraldton project up to 20 per cent cheaper.

He said that after the tender closed BGC had advised the Government to recall tenders for Geraldton.

Master Builders Association executive director Michael McLean said the forecast for the commercial sector was bullish for the next five years and that it was unlikely delaying the tender would have reduced the cost of the project.

He told WA Business News the State Government’s budget was unrealistic and that the tender prices reflected the cost of the services in that region.