The WA government has been slammed for the way it managed the purchase of rapid antigen tests at the height of the COVID-19 pandemic, with a report finding there was no "clear, considered and coordinated" plan.
In her report released today, Auditor-General Caroline Spencer said the rapid escalation in cost to $580 million in total was unlike anything she had ever seen.
She said what started as a $3 million spend on tests for health workers and returning travellers quickly spiralled beyond $440 million, "around twice the cost of the Bunbury Hospital redevelopment".
"Public entities spent the equivalent of 10 per cent of the state's 2022 operating surplus on diagnostic plastics without demonstrable evidence of clear, considered and coordinated planning or ongoing advice as to the necessity of the expenditure," Ms Spencer said.
"I acknowledge the uncertainty that the pandemic created … however I have never before witnessed such escalation in the cost of a program over such a short time frame, occurring with a lack of due consideration of the impacts, or without a record of anyone pausing to ask what level of procurement was sufficient and whether this had been achieved."
An ABC analysis in January found WA had purchased the most RATs per-person of anywhere in the country, with a significant amount still in storage and millions either expired or due to expire.
But Deputy Premier Roger Cook defended the government's decisions on Wednesday, saying they kept West Australians alive and the economy strong.
'Large increase' in RATs caused problems
To cope with the 110.7 million rapid antigen tests purchased by the state government, the part of WA Health responsible for managing them, Health Support Services (HSS), increased the number of warehouses they used from two to 10.
Parliament was told last year that discussions to purchase RATs began in November 2021, with orders placed by mid-December.
Some of those tests were rushed to WA onboard two charter flights from Korea with a total cost of $1.4 million.
"HSS struggled with the large increase in inventory," the report reads.
"We found their controls over inventory, including receiving, recording and distribution were poor.
"Regular stocktakes were not performed at the warehouses and records of stock moving in and out of the warehouse were not well maintained, meaning that HSS was not able to reliably determine the quantity of stock at each warehouse at any point in time, or the precise stock distributed."
When full stocktakes were taken by the end of June last year, they revealed "significant inaccuracies" according to the report.
HSS has since committed to ensuring regular stocktakes were performed.
Health authority defends response
In its response to the report, HSS said when it was asked to procure the RATs, demand far outstripped global supply.
"Time was of the essence to secure and purchase RATs for Western Australia with our borders about to reopen," it read.
"The purchase of RATs was considered an emergency procurement for a number of reasons including short lead times to secure supply, significant delivery logistics challenges, a highly competitive and time-sensitive global market and the risk to the WA community if RATs were not made available.
"The procurement pathway used ensured that RATs were delivered to the WA health system ahead of other agencies purchasing RATs concurrently."
The response said because of large volumes of tests arriving over a short period, "there was insufficient time and not enough people to put in place more robust inventory management practices at these facilities".
"The RATs had only been in storage for approximately six weeks (since April 2022) when the … audit commenced, and the plan was to perform a year-end stocktake process by 30 June (within a few weeks)."
We protected people's health, economy: Deputy Premier
Deputy Premier and former health minister Roger Cook said the government had made difficult decisions when there was no rulebook about how to handle the pandemic.
"A lot of people look back in history and are very wise after the fact," he said.
"We'll continue to learn from the experiences of COVID-19, and I hope that in our lifetime we don't have to implement those learnings.
"At the time, we made decisions that were best informed by the health advice, by the legal advice, by the technical advice and the financial advice."
Mr Cook said while he was not health minister at the time the RATs were ordered, the government was constantly reviewing its decisions.
"[We] understood that having an abundance of rapid antigen tests was a key way that we could continue to protect peoples' health [and] save lives, while we were dealing with the onset of Omicron and as it made its way through the community as we opened up our borders," he said.
"You sit back and you reflect on those decisions and you think, my God, I'm just so pleased that we made them in the way that we did because it protected lives and in addition to that, protected Western Australia's economy."
Mr Cook did acknowledge the government "might want to reflect on whether we paid too little or too much, acted too soon or too late".
'Right lessons' must be learned: AG
The auditor-general acknowledged the pandemic had created "uncertainty and pressure" on government to ensure they provided what was required.
"There needs to be a point where we take a step back and assess if the ongoing decisions being made are sound, in the public interest and represent value for money," Ms Spencer said.
"It is important that the right lessons are learned from this period."
Her report makes five recommendations, including ensuring appropriate risk assessments are performed when making decisions around large purchases, and that after initial purchases are made under emergency guidelines government should consider whether standard processes can be used to ensure due process.
"WA Health needs to decide the best use for the remaining stock of RATs, including expired stock, to ensure that they are appropriately destroyed or used in some way by the community or community-based organisations," another recommendation reads.
HSS said it welcomed the report and its recommendations.
RATs 'clearly overkill': opposition
In response to the findings, the opposition said the government's purchase of RATs was "clearly overkill".
"The findings confirm what we have long suspected – the McGowan Labor Government splashed out over half-a-billion dollars of taxpayers’ money to purchase 110 million rapid antigen tests without appropriate methodology, planning or coordination," Shadow Minister for Regional Health, Martin Aldridge said.
"The auditor-general has also confirmed something the state government has consistently denied – WA Health and the Department of Finance did not collaborate on the procurement of RATs.
"This is a damning finding from the auditor-general and shows the state government has misled the people of WA of the facts around this costly use of taxpayer funds.
"The state government must come clean about how they intend to use or dispose of this massive surplus."
