The ACT Integrity Commission held its first public hearings last week. The hearings were part of its investigation into the procurement for an expansion of Campbell Primary School.
The procurement process for the expansion attracted the attention of the Integrity Commission following a referral in March 2021.
In late-2021 there was also a damning audit report into the procurement process for the expansion, which found the process lacked probity and tenderers were not dealt with fairly, impartially and consistently.
This audit showed two companies, Manteena and Lendlease, had both put forward proposals for the project. Two separate tender evaluation teams identified Manteena as the preferred tenderer but the government chose Lendlease.
The hearings have revealed the commission is investigating alleged ministerial interference, union interference and high-level bureaucratic interference into the awarding of the contract.
The commission heard evidence that Education Minister Yvette Berry's former chief of staff, Josh Ceramidas, allegedly told officials in the Education Directorate that Manteena was not to receive the contract.
The commission is investigating the relationship between Mr Ceramidas and the CFMEU, with the union also alleged to have told officials to not choose Manteena.
The first two days of hearings heard from an acting executive in the education directorate, John Green who made these allegations.
Who is John Green?
John Green is a pseudonym given to the ACT public servant who was responsible for overseeing the awarding of the contract to build the Campbell Primary School expansion.
The commission put a suppression order on Mr Green's identity.
Mr Green has held numerous roles within the service but his roles in the education directorate and the secure local jobs code are relevant to the Integrity Commission investigation.
The secure local jobs code is applied to construction, security, cleaning and traffic companies in the territory who want to vie for ACT government work. Under the code, companies are required to be audited at least every 18 months to ensure they have not underpaid their staff. Companies are also required to hand over addresses, working hours and contact details so unions can exercise their right of entry.
The code was essentially the formalisation of a longstanding agreement between the ACT government and unions, where the government agreed it would not award tenders to companies that did not comply with workplace safety laws.
In this role, Mr Green had regular dealings with construction companies, the CFMEU and other unions during this time.
But in January 2020, Mr Green moved to the education directorate to take up an acting executive branch manager role. It was his job to oversee construction projects within the education directorate.
The commission has heard evidence from Mr Green he was allegedly directed by the Education Directorate director-general Katy Haire and Mr Ceramidas that Manteena was not to receive the contract to build Campbell Primary School.
Mr Green also had a meeting with former CFMEU ACT secretary Jason O'Mara shortly after coming into the role who expressed the same thing.
"To the best of my recollections it was 'Manteena shouldn't get it, they don't do the right thing by their workers'," Mr Green said of the meeting with Mr O'Mara.
How is the CFMEU allegedly involved?
The commission has heard allegations that CFMEU did not like Manteena and counsel assisting Callan O'Neill highlighted this in his opening statement to the hearing.
"Rumours were circulating within the education directorate that the Minister for Education, Ms Berry, the member for Ginninderra and a Labor candidate, may have been approached by the unions and asked why Manteena was getting all the jobs," Mr O'Neill said.
"I expect that the evidence before the commission will be that the ACT branch of the Construction Forestry Maritime Mining and Energy Union did hold a negative view of Manteena. This was conveyed to the minister and/or her chief of staff at various times while the procurement process was underway."
Mr Green told the hearing he had a meeting with former CFMEU ACT secretary Jason O'Mara in February 2020 where he said he was allegedly told by the union official that Manteena should not get the contract as they did not do "the right thing by their workers".
"Lendlease are a better contractor, government's just going to take the lowest price again and workers are going to be worse off," Mr Green said he was told.
The commission heard of a dispute between the CFMEU and Manteena. The CFMEU had sought to represent workers in enterprise bargaining negotiations but Manteena negotiated with the workers directly.
There is no evidence before the commission that either Lendlease or Manteena were involved in any wrongdoing. In fact, Mr O'Neill also made this point in his opening statement.
"I do not presently anticipate there will be any criticism of either entity during the course of this process," he said.
What was the difference between the two tenders?
The government put out a request for tenders for the primary school's expansion on October 30 2019. The companies had nearly two months to respond with the tender closing on December 19 2019.
There was an assessment of the two tenders and Manteena was given a score of 79 out of 100 and Lendlease's score was 52 out of 100.
Manteena's tender was also 8.5 per cent cheaper, with the company putting forward a price of $17,303,579 compared to Lendlease's $18,768,465. However, both companies offers were higher than the budgeted amount for the project, this being 11.4 per cent for Manteena's offer and 20.8 per cent for Lendlease's offer.
However, the tender evaluation team recommended the government choose Manteena but enter a "value management" process to change some of the requirements and make the price lower.
In certain circumstances where prices are higher than the allocated budget, government can also go back to the applicants and asked for a "best and final offer". This option can be pursued under certain conditions, including that "costs submitted by all tenderers are unacceptably high".
Mr Green decided not to accept the recommendation of the tender team and asked for a reevaluation. Members of the tender evaluation team did not wish to be part of this second process.
Two of the new members were Mr Green's subordinates, Dylan Blom and Pal Patel and Mr Green said he had expressed to these members that the Minister's office had a particular view on the matter.
This led to a new tender evaluation team being stood up who evaluated the tenders again and produced a different report which showed the scores were much closer. They delivered this report in 10 days but it took the previous team three months to make their assessment.
Based on this much closer scoring, the tender evaluation team was able to make the recommendation to pursue a "best and final offer" process.
As part of this, the budget was reduced and tender submitted different proposals in line with new criteria.
Following the "best and final offer" process, Manteena came out on top again.
Manteena's offer was nearly $900,000 less than Lendlease, with the offers at $15.1 million and $15.9 million, respectively. The budget for the project was $15.5 million.
Manteena also provided 20 per cent more learning area and if Lendlease were to provide the same amount of area it would be $2 million extra. The principal of Campbell Primary School even preferred Manteena's tender.
Mr Green had a meeting with Ms Haire in the days after receiving this report, when he told of the outcome Mr Green alleged she said something along the lines of: "that's not what the Minister's office wants".
He then said the director-general asked if there were other options and how this could be pursued. Mr Green suggested he could write a brief recommending Lendlease be awarded the contract instead.
The hearing finished before Mr Green could give evidence about this brief. Hearings are set to resume on September 6.
