THE state’s auditor general has found that a clerical error by the Department of Commerce has meant plumbers across the state have collectively been overcharged almost $1 million, while weaknesses in the government’s regional tender process have also been uncovered.
In a report tabled in parliament, Auditor General Colin Murphy found that six government agencies focused on regional Western Australia failed to comply with policies and guidelines when procuring goods and services in the 2011 financial year.
In a separate section of the report, Mr Murphy also found that an error by the Department of Commerce through its administration of the Plumbers Licensing Board meant it had incorrectly added a 10 per cent GST charge to a gazetted fee charged to plumbers and thus accumulated $1 million over a five-year period.
The error occurred because department staff believed that GST needed to be added to the gazetted fee, when in fact GST was already included in that fee.
The department discovered in June 2010 that it had been overcharging plumbers over the course of five years but was given differing advice from the State Solicitor’s office and the Treasury.
It received final advice from the State Solicitor’s office last month confirming “there remains a serious matter to be determined and remedied”.
In its response to the auditor general’s investigation, the department said most plumbers would likely have passed on the extra charge, being a small dollar amount, to a large number of individual customers and that the loss to any individual would be small.
The department said it regretted what happened and had briefed a senior barrister on how to remedy the situation.
Mr Murphy also found there was an ineffective working relationship and communication between the department and the board, which as a result has a $250,000 budget deficit.
“While we did not find evidence to substantiate concerns that funds had been used for activities outside the board’s mandate, we did find that there was ongoing confusion regarding the control of funds received from plumbers’ fees,” Mr Murphy said.
“We also found that because the board did not receive timely and reliable financial information from [the Department of] Commerce it was unaware of its deteriorating financial position in sufficient time to take action to address it.”
Meanwhile, an investigation into regional tendering found that none of the six agencies audited fully complied with procurement policy and guidelines and may have missed opportunities to get best value for taxpayer dollars.
The report found that agencies did not source the appropriate number of quotes for services, that there were poor controls for identifying and managing conflicts of interest, and agencies did not publish awarded contracts when required.
“It is important agencies ensure their procurements result in value for money and fair access for suppliers,” Mr Murphy said.
Opposition leader Mark McGowan said the report found no government agency had complied with its own tender guidelines for regional projects.
“This casts huge doubts over whether taxpayers’ money is being spent wisely, or even being completely wasted,” Mr McGowan said.
