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Lest we forget? The home insulation scheme ...

By Chris Lewis - posted Friday, 16 July 2010


The Labor Government’s home insulation scheme beggars belief in terms of wastage of resources and lack of regard for warnings from a variety of players.

By April 22, 2010, the day the scheme was abandoned, the policy disaster spoke for itself. Four installers had died; there had been 120 related fires; widespread rorting; more than 10,000 complaints lodged; and inspections of 14,600 of the 1.1 million completed insulation jobs revealed “quality issues” in 16 per cent and “safety issues” in 7.6 per cent.

Of the $2.45 billion scheme (previously intended to continue to December 2011), the May 2010 budget did not expect much change from the $900 million that was still left given the need to fund safety problems on 200,000 homes and to meet industry concerns.

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The Rudd government had plenty of warnings about the safety aspects of the scheme and of possible rorting, but chose not to listen in its rush to get the scheme going.

The Environment Minister, Peter Garrett, was warned in August 2008 when the government was considering more modest investment in home insulation that the sector was poorly regulated and third-party certification was needed to ensure the quality of both the product and installation.

The Minter Ellison report (commissioned by the Environment Department to conduct risk assessment) concluded in April 2009 that retro-fitting insulation “could result in a high level of hazard from hazardous materials and occupational health, fire and safety issues, with a likelihood of death or injury”. The report recommended that the scheme be delayed until September 30 rather than July 1 (with owners to pay for insulation and then claim a rebate). It also warned that hundreds of millions of taxpayer dollars could be wasted if the risks were not properly managed, and that there was an “extreme risk” of fraud if appropriate mitigating steps were not taken.

At a Senate hearing on February 22, 2010 the Secretary of the Environment Department, Robyn Kruk, confirmed that Garrett was repeatedly briefed on updates and safety concerns.

Perhaps Garrett’s hands were tied. Letters released to the Senate (after the government initially refused, citing cabinet-in-confidence) forced Rudd to admit that he had been aware of safety risks after the death of one installer and before the deaths of three others. A letter from Garrett to Rudd on August 28, 2009 raised concerns about “new entrants to the market not adequately meeting required standards on work undertaken and engaging in price manipulation”.

An October 28, 2009 letter from Garrett warned Rudd of “unacceptably high occupational health and safety risks”.

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An October 30, 2009 letter from Garrett to Rudd indicated that a new raft of safety measures would “reduce unacceptably high occupational health and safety risks”.

A fourth letter sent by Garrett on August 14, 2009 was not released on the basis it was a cabinet document.

The Electrical Trades Union raised concerns about poor electrical safety aspects of the program in early 2009 during discussions with a departmental advisory group reporting to Garrett.

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About the Author

Chris Lewis has an interest in all economic, social and environmental issues, but believes that the struggle for the ‘right’ policy mix remains an elusive goal in such a complex and competitive world.

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