Building an election result

The Murdoch press has a reputation for destroying governments that offend Rupert Murdoch’s commercial ambitions or conservative agenda. Using emotive language such as “waste” to prosecute its anti-Labor agenda is a classic example of tabloidization, especially where little context or background information is provided. An example of this is The Australian‘s response to the Final Report by the Building the Education Revolution (BER) Taskforce, published on 8 July 2011. The continuous claim of “widespread waste” is prosecuted day after day. Applying the lens of the specialist team set up to audit the schools building program, this claim is tested against the findings of the Taskforce which was set up to investigate allegations of waste.

The BER Taskforce commenced on 3 May 2010. The first Interim Report was published in August 2010. In the Executive Summary, the Taskforce sets out its benchmark for establishing whether the program was a success or failure. Given the need for urgent stimulus, the faster the roll-out the better. The Taskforce estimated a premium of between 5-6% given the short time-frame:

“Overall, delivering BER P21 within the short timeframe to achieve the economic stimulus objectives may have added a premium to pre-BER business as usual costs of between 5-6%.” (p.9)

Coming to the actual number of complaints, the report reads:

“To date, the Taskforce has received complaints in respect of 254 schools; approximately 2.7% of all schools involved in the BER program, and of these over half relate to value for money.”

So, if less than 5-6% was the yardstick by which to measure success, the answer was loud and clear. Yes, a success! A figure of less than 2% (as quoted by Brad Orgill) hardly equates to “widespread waste” as claimed over and over again in The Australian.

The First Report (which followed the interim one), published in December 2010 states in the Executive Summary:

“We conclude that 17 schools have not received value for money.

It goes on:

“Of those that have failed the value for money assessment, 13 are from the NSW Government system.”

Is it balanced journalism to deliberately leave out any mention of the additional 5-6 per cent “premium” to pre-BER costs established by the Taskforce in order to report a figure of less than 3% of complaints relating to “value for money” as “widespread waste”?

Frustrated by the Opposition and Murdoch’s joint campaign to unfairly discredit the schools stimulus program, Crikey’s Bernard Keane retaliated with a fact-filled response.

Headed:  “The BER outcome:  time to correct the record”, the “120,000 jobs”, “sorely needed infrastructure” and a “derisory” complaint rate of “3% of the 10,000 odd school projects” amounted to what Keane described as “gold standard”.

In short, he said the BER Report was a comprehensive demolition of the Opposition’s and The Australian’s campaign.

Indeed, the claim of “widespread waste” would be news to anyone versed on the findings of the Taskforce.  The third and Final Report of 8 July 2011 backed up the findings of the previous two audits by the Taskforce along with the Auditor-General’s report.

All were unequivocal that the BER delivered good value for money.  In Chairman Brad Orgill’s own words, it was

“a significant achievement”.

With over 10,000 primary schools involved, the total number of complaints was just 332 or 3.5% of the schools.  Of these, about half, or less than 2%, failed to deliver value for money.  Understandable, the report explains, given the urgency of the roll out.

But this was not the story reported by The Australian on 8 and 9 July 2011.

The first piece on 8 July 2011 was headed: “BER Waste tops $1.5 billion”.

Miraculously, overnight, the “waste” fell by $400,000 to $1.1 billion in another sensationalist headline: “Building the Education Revolution waste blows out to $1.1 bn”.

Regardless of whether journalist thought the waste was $1.5 billion one minute and $1.1 billion the next, the word “waste” is nowhere to be found in the Taskforce’s final report.  The word “success”, however, features thirteen times.  In fact, at the media conference with Brad Orgill in Sydney the day before, Mr. Orgill clearly stated:

“I think the rollout of the program, overall, was successful. Twenty out of twenty-two education authorities did a very good job”.

Both the 8 July and 9 July articles focussed on the two major Labor states:  New South Wales and Victoria.  To get some perspective of the scope of the analysis, the number of schools that did not deliver value for money was 18 in New South Wales and 4 in Victoria, or just 22 out of a total of 10,000.

But on 8 July, the article in The Australian leads with:

“MORE than $1.5 billion has been wasted in the eastern states under the federal Government’s Building the Education Revolution schools stimulus program, with the nation’s two biggest states failing to provide value for money under the program.”

The theme continues in the third, fourth and fifth paragraphs which, by then, would exhaust the attention span of most readers.  Not that the substance of the Taskforce’s report – that the BER was a success – was buried deeper in the story.  It wasn’t.

The article the following day, 9 July, follows the Murdoch playbook.  Twenty-two paragraphs out of twenty-eight focus on demonising the two Labor states – or, to put it another way, just two authorities out of twenty-two.  Buried on paragraph twenty-five is the “lead” used by the non-Murdoch media:

‘“The majority of education authorities found to have obtained value for money and delivered quality facilities’, Senator Evans said.”

How did The Australian arrive at a different conclusion to audits done by no less than three separate reviews as well as one by the external auditor of the Commonwealth public sector, the Australian National Audit Office?

The answer boils down to comparing apples with oranges and flavouring the results with some cherry picking.

In the schematic graphs provided in the report, the figures are separated into state government, state Catholic and state independent. The reason? Because each authority in each state had a different template. The Victorian government, for example, stipulated sustainable building materials and New South Wales included furniture and fittings as well as removal (in some cases) of asbestos-lined classrooms. Furthermore, the New South Wales buildings were, on average, smaller, which, according to the report, led to a higher per sq. cost.

This is the graph on 9 July 2011:

 Schematic 13           BER-CAM: Total project costs per m2 / GFA for halls + libraries + classrooms: Regionally adjusted

The chart in The Australian (see below) features an additional box on the right showing the cost differences between the schools. Underneath both is the legend:  Source:  “BER Implementation Taskforce Final Report”. There no mention of “premiums” in comparing costs between different authorities in the report. The only reference to “premium” is the “cost premiums” for indigenous and apprenticeship requirements and “cost premiums” for accelerated delivery, both of which were adjusted by the Taskforce.

There is no mention of the “variables” shown on Schematic 23:

Schematic 23           BER-CAM: Project cost breakdown – building works and services versus external works, unique costs and fees

Schematic 22 on page 53 of the report (see below),  carries this legend:

“Much of the variability of total per square metre project costs between education authorities is driven by the level of agency and management fees paid to implement the program, the level of external works and services, and unique project costs.”

The report goes on to say that a further variable in the cost is the size of the building: “Projects with small floor areas may attract a higher cost per square metre than larger projects”.

Schematic 22           BER-CAM: Building costs per m2 / GFA for halls + libraries + classrooms: Regionally adjusted

Schematic 22

As can be seen on the above chart, the actual building costs for government schools in New South Wales were cheaper than the Catholic schools but it would be as wrong to make a case for Catholic “waste” here as it is to compare one authority’s requirements with another’s.

In examining the responses to the Final Report by the BER Taskforce, other than the Murdoch press, the rest of mainstream media got it right.

Channel 9 News (news. Ninemsn) announced:  “Orgill says BER rollout successful overall!”

Likewise, Business Spectator, ran the headline: “BER rollout successful overall: Orgill”.

And, similarly, Fairfax chose: “BER gets thumbs up but not in Vic and NSW”.  The article also gave prominence to Brad Orgill’s quote:

“I think the rollout of the program, overall, was successful.”

The spectacular success of the Federal government’s fiscal stimulus package in keeping the 2008 global recession at bay has received plaudits from economists around the world.  Building the Education Revolution was a key element of the Australian Government’s $42 billion stimulus plan. During his visit to Australia in 2010, acclaimed economist, Professor Joseph Stiglitz, described it as

“…probably the best designed stimulus package of any of the countries….”

By focusing on primary schools, the BER strategy was a clever two-edged sword. It delivered both economic stimulus and desperately needed infrastructure to every primary school throughout the country. It was successfully delivered within a compressed time frame to maximize its stimulatory effect. Tens of thousands of jobs were created and Australia dodged a nasty recession.

How difficult was it to report that?

The Oz’s Sham Bag rating 8/10
(this article first appeared in Independent Australia on 28 August 2012)
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