VICIOUS CIRCLE

Hokitika Guardian, 23 May 1932, Page 2

VICIOUS CIRCLE

PUBLIC WORKS SYSTEM.

CONTRACTS THE SOLUTION.

(By Telegraph—Per Press Association)

WELLINGTON, May 21

“There' is a solid hacking of facts to the charge against our present State policy of public works of groat extravagance and iunclamental unsoundness,” states the Associationed, Chambers of Commerce, in a circular statement.

“The Public Weeks Department, expanding beyond the purely supervisory function originally designed for it, has through 62 years assumed greater aißl greater eonstructMmal powers, developing into a huge employing machine and causing works to he undertaken which were not so necessarv for the proper development of the Dominion as they were for keeping the department em-ployed—-a vicious circle, ever growing. Parallel with this development, if not preceding it, political and local pressure on the Government in power lias resulted in the prosecution in different districts' of public works whK-h were commercially unsound, and which represented, an expenditure out of a'l proportion to the financial capacity of the country.

Absehce 6? Cohipeiition

“As a State department, the Public Works Department is not directed to report authoritatively as to whether a project, local or national, should o* should not be undertaken ; it is directed to carry out work regardless cf whether that work will prove to be properly productive or not. The department is subject to no competition and so it enjoys an absolute monupo-y of public works, all of which are handed over to it hy the Government to executive or cause to he executed, the department is subject to no expert check or supervision, other than its own, and the accuracy of its estimates (which have repeatedly proved gravely at fault) cannot he authoritatively challenged by the. Minister of PublicWorks, who is not an engineer, or hy the Government at all.

- “In the comparatively few cases where the department decises t 0 call tenders for public works, the Government makes it clear that it declines to accept responsibility for the accuracy of the department’s plans and specifications. By denying liability for any errors by its engineers, the Government'' thereby creates ..conditions conductive to error. Further than this, the. standard conditions of contract imposed by the department 611 every .private contractor undertaking work for it. contain so many harsh and unreasonable provisions that reputable contractors are strongly reluctant to assume the risks and responsibilities entailed. Add t» this the fact that the department is guaranteed by the State —which means that even the biggest •bills-.will always be met —-and there is completed a combination of conditions which is totally foreign to economy. Tfc is clear that the Public Works Department, and not the Government, is the real master of expenditure on public works. The whole system has proved itself to he fundamentally wrong, uneconomic- and undesirable:

Remedial Measures.

“What are the remedial measures? They are simple. Future public works should be undertaken only after most definite and convincing proof </ their necessitv and productiveness, and only under the most rigid- conditions as to extent and cost that commercial experience can dictate. These conditions should include the thorough examination bv Parliament of the necessity for the spending of the nation’s money on any project at all. If. however, a project is decided on as being necessary to the national economic welfare, it should be carried out under contract made with private enterprise by the Government on the same terms as commercial contracts are usually made in the interests of both efficiency and economy the world over. “The necessary reform can be summed up as follows :—O) All public works should be submitted to public tender and carried out bv private contract; (2) the Public Works Department should he confined to the function originally intended for it when tb P Immigration and Public Works Act of 1870 was passed, namely that of a supervisory authority without constructional powers: (3) the plant and equipment of the department should be sold. “The State svstem of public works has failed and the Government can do no better than to revert to private enterprise,” concludes the statement.