A VICIOUS CIRCLE

Hawera Star, Volume LI, 24 May 1932, Page 6

A VICIOUS CIRCLE

PUBLIC WORKS SYSTEM. CONTRACTS THE SOLUTION. There is a solid backing of facts to the charge against our present State policy of public works of great extravagance and fundamental unsoundness (writes the Associated Chambers o'.' Commerce). These facts can he briefly stated.

The Public Works Department, expanding beyond the purely supervisory function originally designed for it, has through 62 years, assumed greater and greater constructional powers, developing into a huge employing machine and causing works to be undei-cuken which were not so necessary for tlie pro*vi* development of the Dominion as tliev were for keeping the department employed—a vicious circle, ever growing. Parallel with this development, if not preceding it, political and local pressure on the Government m power has resulted in the prosecution in different (districts of public works which were commercially unsound, and wh.'-h represented an expenditure out of ail proportion to the financial capacity of the country. ABSENCE OF COMPETITION.

As a State department, the Public Works Department is not directed to report authoritatively as to whether a. project, local or national, should or should not be undertaken; it is directed to carry out work regardless of whether that work will prove tc be properly 'productive or not. The department is subject to no competition and so it enjoys an absolute monopoly of public works, all of which are I-and-jed over to it by the Government to execute or cause to be executed. ibe ) department is subject to no expert ' check or supervision, other than its own, and the accuracy of' its estimates (which have repeatedly prove a gravely at fault) cannot be authoritatively challenged by the Minister of Public Works, who is not an engineer, or by the Government at all. In the com p>arative]y few cases where tlie department decides to call tenders for public works, the Government makes it clear that it decline's 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 conducive to error. Further than this, the standard conditions of contract imposed by the department on oei’.v private contractor undertaking work for it, contain tso many harsh and unreasonable provisions that reputable contractors are strongly reluctant to assume the risks and responsibilities entailed. Add to this the ’’act that the department is guaranteed by die State—which means that even lie biggest bills will always be met—and there is completed a combination of conditions which is totally foreign to economy. It is clear that the PublicWorks Department, and not Hie Government, is the real master of expenditure on public works. The whole system has proved itself to be fundamentally wrong, uneconomic and undesirable.

REMEDIAL AIEASURES. AATiat are the remedial measures? They are simple. Future public works should he undertaken only after most definite and convincing proof of their necessity 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 by Parliament of the necessity for the spending of the nation’s money on any project at all. If, however, a nroject is decided on as being necessary to tlie 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 tlie world over. The necessary reform can be summed up as follows: (1) All 'public works should be submitted to public tender amt carried out by private contract. (2) Tlie Public Works Department should be confined to the function originally intended for it when tlie In-migration and Public AVorks Act of 1870 was passed, namely that of a supervisory authority without constructional powers. (3) The plant and emiinment of the department should be sold. The* State system of public works has failed and tlie Government can do no better than .to revert to private enterprise.