Home Insulation Scheme

09 Feb 2011 questionsarchive

I seek leave to make an explanation before asking the Minister for Consumer Affairs a question about home insulation.

The Hon. J.M.A. LENSINK: Yesterday, in response to my question about 12,000 homes in South Australia being installed with insulation by unlicensed people, the minister responded by stating:

Our OCBA licensing laws ensure installation contractors must meet requirements in respect to solvency. These include technical skills and experience, supervision of work and fitness and propriety to conduct a business, and a police clearance is required.

The minister then went on to state:

The law also helps to ensure that home installations are performed to an appropriate standard and that unfair practices are minimised. Licensed contractors are subject to legal sanctions and can face penalties of up to $20,000 if they are in breach, so that is quite a disincentive for people to breach those provisions.

The minister stated numerous times that there are some 61 installers who are under investigation. My questions are:

1.What specific details have been supplied to the minister between the dates July 2009 and February 2010 in relation to unlicensed operators?

2.Does the minister believe that 12,000 examples of breach of provisions is a sign that the current licensing and monitoring requirements are a disincentive to cowboy operators?

3.How were 61 dodgy installers able to engage in business over a period of at least six months, if not longer?

The Hon. G.E. GAGO (Minister for Regional Development, Minister for Public Sector Management, Minister for the Status of Women, Minister for Consumer Affairs, Minister for Government Enterprises) (14:30): In relation to the question relating to the 61 operators where we found problems relating to their practising outside the current regulatory provisions in relation to insulation installation, the honourable member asks why they were able to get through the safety net.

I have been advised that it was through the federal funding incentive that was paid directly from the federal government to these operators. It was simply providing anyone who was eligible for those federal allowances which met its criteria which meant they were eligible for those funds. Given that South Australia was the only state that had a regulation around this, the federal government obviously did not believe it was its responsibility to determine, nor probably could it determine, where those operators were operating, that is, exactly where their jobs were located.

So, the onus is actually on the operator (the company or the organisation) providing the insulation service; the onus is on any business to make sure that they operate within the laws of that jurisdiction in which they are operating. Clearly, in this case, they grabbed the money from the federal government and did not bother to check what the provisions were here in South Australia and were operating outside the current regulations.
I have already put clearly on the record the steps OCBA undertook to identify those specific operators and to pursue them in relation to making sure they did operate within our regulatory requirements and, where they were falling outside that, we are taking further action. The other issue is that there were a number of brand new companies that operated at that time. There were some organisations operating across borders that failed to update themselves with South Australia's legislation and began operations in this state.

Once they became aware, they certainly did fulfil the requirements in this state and they did so very quickly, and they had the qualifications necessary to be able to register here, so it was quite simple for them to meet the requirements. Some of the other operators were brand new operators that simply took advantage of that particular initiative. So, they did not previously exist. They opened up an operation and operated for a short period of time, and they no longer exist.

So, part of the problem has been that often these are very small operators; they no longer exist and existed for only a very short period of time and are therefore very difficult to follow up and prosecute. Nevertheless, OCBA has put an enormous amount of work into this and has done everything within its power to follow that up and ensure that all operators meet current requirements.