[release]THE Australian Federal Government's decision to end its bungled $2.45 billion home insulation scheme will force dozens of companies into bankruptcy and result in hundreds of workers being sacked, accredited Sydney insulation firms say.
The scheme was open to fraud and never about aiding the environment, but rather a chance to splurge unprecedented amounts of public cash, Tony Arundell, manager of Hoxton Park-based Eureka Insulation, said.
"Blind Freddy could have seen the scheme was open to fraud from day one," he told.
"It was a scheme to get people working but all it's done is hurt the real workers of this country and I think the Government deserves to be punished." Doug Mill, owner of Chatswood-based The Demand Group, added: "We're all looking at the likelihood of failing and today's announcement will push us all further towards that."
Federal Energy Efficiency Minister Greg Combet confirmed today that the controversial home insulation scheme was being canned. The Federal Government suspended it in February after evidence of shonky installation came to light, but had said it could resume in a modified form in June.
Mr Combet blamed the scheme's failure on "unscrupulous operators" and admitted a significant number of jobs would be lost.
But Mr Mill and Mr Arundell both said "cowboys" found the scheme easy to rort and that sufficient auditing was not in place until it was too late.
"Anybody with a white card, which takes five hours to obtain, and the ability to get insurance was able to get in on the game," Mr Mill said.
Mr Arundell admitted the scheme initially worked well, with home insulation firms almost universally making extra cash. But cowboys had quickly exploited loopholes, he added.
Eureka Insulation upped its staff from 16 to 40 to meet increased demand and splashed out on advertising, marketing and stock.
The Demand Group upped its headcount from six to 20 and is now back to five, with the likelihood of shedding at least one more job.
Eureka owes about $200,000 in advertising costs directly associated with the insulation scheme.
Mr Arundell says his firm will survive but says other firms will be liable for millions of dollars and are likely to cease trading now the scheme has ended.
At least two Sydney-based insulation manufacturing firms have also closed with the loss of hundreds of workers, he said.
"It was a complete joke. We became acutely aware that it was not about the long-term standing of the industry but about putting cash into the community.
"It really wasn't about the environment either but about throwing money out there," he said.
"We knew that it was fraught with danger. The murkiest crystal ball could have picked it up."
'Safety first'
Energy Efficiency Minister Greg Combet announced the termination of the program following a decision by Cabinet yesterday.
Cabinet is understood to have decided the Government's top priority should be assuring the safety of homes which had already had insulation installed rather than installing more.
The Government had promised to install safety switches into about 50,000 homes which had foil insulation installed and to carry out safety inspections on at least another 150,000 homes which had batts and other non-foil insulation installed.
Mr Combet rejected suggestions the Government had misled the insulation industry into believing the scheme would resume from June 1.
"No, the Government certainly hasn't deceived the industry," he said.
The Government already had announced various programs to help the industry and soon it would release guidelines for those businesses with significant stockpiles of insulation material.
The Government also was assessing the incidence of alleged fraud of the scheme, Mr Combet said.
Cabinet's decision was made after a review of the scheme by a former senior public servant Allan Hawke.
His assessment reportedly is highly critical of the scheme's policy development and implementation process.
Dr Hawke also found that the arrangements and timeframe for the modified scheme would not ensure the highest safety standards, The Sydney Morning Herald said today.
The review would be released publicly, Mr Combet said.
Mr Combet rejected suggestions there should be a royal commission into the scheme, saying the Government was doing what was necessary to rectify this work.
The Government had asked the Commonwealth auditor-general to expedite its inquiry into the program with a report expected by the end of September.
As well, the environment department had appointed forensic auditors to review claims to identify cases of fraud.
Some had already been referred to the Australian Federal Police, Mr Combet said.[/release]
Well, if you're Australian and you were planing on getting insulation discounted, it's too late...
[b]Source[/b] [url]http://www.news.com.au/national/federal-government-axes-home-insulation-scheme/story-e6frfkvr-1225856865739[/url]
Good. Too many risks involved with untrained workers installing insulation. It only takes one live wire touching the metallic insulation cover to make your whole roof a live circuit. Bloody dangerous if they've got diddly-squat knowledge in the industry.
Don't get me wrong, great idea to give rebates on home insulation; it was just very poorly executed.
Took me half the page to figure out this was for Australia
[editline]07:23PM[/editline]
Should have caught it at "sydney"
[QUOTE=Rooster Assassin;21508082]Took me half the page to figure out this was for Australia
[editline]07:23PM[/editline]
Should have caught it at "sydney"[/QUOTE]
Yea, should've put Australian Government bans Home Insulation as title
[QUOTE=S.T.O.R.M;21501423]
Well, if [highlight]your[/highlight] Australian and you were [B]planing[/B] on getting insulation discounted, it's [highlight]to[/highlight] late...[/QUOTE]
I have highlighted your spelling and grammar mistakes
please learn the difference between "your" and "you're" (aka "you are") and "to" and "too".
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