BFCSA: PM Turnbull job active tender may be tainted - Ganesh Sahathevan

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Job active tender may be tainted - -Losing bidders may have cause of action against the Commonwealth, Department of Employment and Department Secretary Renee Leon

by Ganesh Sahathevan
22 July 2016

http://sahathevan.blogspot.com.au/

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In 2015 the then Abbott Government ,and its Minister for Employment Eric Abetz(photo above) launched its JobActive initiative which Abetz  described as  "game changing" .  The experience of job seekers has been not quite that, with reports of so called "job service providers" lodging false claims to meet Abetz's targets.

This is not to surprising, given that JobActive contracts have been handed to companies led by persons with no experience in job placement.  Worse, there is now evidence that the tender process for these contracts , handled by the Department of Employment and its Secretary Renee Leon, was itself tainted by the Department awarding a contract to a corporate shell that was meant to be a JV of a number of not for profit organizations wanting to enter the placement market.

The Department and Ms Leon  accepted a bid from a company called Olympus Solutions Ltd, which was , when the tender was submitted and the contract awarded, a JV company limited by guarantee whose members included a not for profit, Ability Options Ltd.  However Ability's 2015 audited annual report includes the following disclosure:
In November 2014 Ability Options established and became a founding member of a consortium operating as a separate entity known as Olympus Solutions Ltd. The entity Olympus Solutions Ltd secured a government contract to deliver Jobactive employment services in NSW commencing from 1 July 2015. During the business establishment period up to 30 June 2015 a number of consortium members left the consortium. After 30 June 2015 Ability Options Ltd became the sole remaining member of Olympus Solutions Ltd.  However, in Ability's own words, Olympus very quickly became a wholly-owned subsidiary:

Despite this material change in circumstances, the contract was not withdrawn.  Instead, there is now evidence that Ability and not Olympus executes the contract, dealing with job seekers, taking their details and dealing with Centrelink.(see notes below).
The tender process and award of contracts was  obviously flawed,and the Secretary , Renee Leon,seems happy to let things go despite the obvious issues. Losing bidders are not likely to be as accepting of these matters, or of Ms Leon and her Department's conduct.Of course, overseeing the entire process was one Eric Abetz.

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NOTES

It has been previously reported  that  a JobActive contract awarded by the DEEWR's Renee Leon to a corporate shell, seems to have been "injected" into a not for profit organisation Ability Options Ltd.

It has now emerged that  Ability even goes so far as to say that, it , not Olympus, is the real recipient if of Ms Leon's lucrative AUD 50 million JobActive contract.

In Ability's words:

As a member of the Olympus Solutions consortium, Ability Options has been awarded a contract to energise employment services

Readers will be aware that consortium members , and not the consortium itself whatever form it takes (eg a partnership, a company) are the actual recipients of whatever the consortium gains, so Ability is at least being transparent, in this instance. However, the DEEWR is not so forthcoming with information, and will only identify Olympus in its official documents, despite the inherent problems.

However, Ability's audited annual report tells a slightly different story:

In November 2014 Ability Options established and became a founding member of a consortium operating as a separate entity known as Olympus Solutions Ltd. The entity Olympus Solutions Ltd secured a government contract to deliver Jobactive employment services in NSW commencing from 1 July 2015. During the business establishment period up to 30 June 2015 a number of consortium members left the consortium. After 30 June 2015 Ability Options Ltd became the sole remaining member of Olympus Solutions Ltd.

Put in another way, there is no longer a consortium , and Olympus , a company limited by guarantee, is wholly-owned by Ability. This leads to a number of issues, first, if in fact the DEEWR contract was awarded a consortium, why was the contract not withdrawn when  " a number of consortium members left the consortium", and when " after 30 June 2015 Ability Options Ltd became the sole remaining member of Olympus Solutions Ltd"? All of these would have been material variations to what Olympus would have claimed in JobActive tender documents, but this does seem to matter.
Indeed, losing bidders might now demand that the whole JobActive tender process be declared invalid.

Apart from the fact that the  DEEWR remains silent on Ability, despite its now seemingly exclusive role, elsewhere there is contradictory information.

First, Ability continues to describe its JobActive contract execution as some type of joint effort:

Olympus Solutions is a joint venture between some of the employment sector’s leading organisations, each bringing its own skills and experience to provide the best employment solutions

This is not some failure to update a website by a business  busy with other things, The website declaring Ability as the recipient of the JobActive contract has been removed (but remains archived)

Even better Ability says it has a "partnership" with Olympus, its wholly-owned subsidiary:

Ability Options in partnership with Olympus Solutions is a jobactive provider.

This suggests that within Ability some if not many consider Olympus something separate and apart from Ability, not part of the group as the audited accounts state.

So many different versions  out of the same company suggest that even senior executives within the company  are themselves being made to believe different versions of the arrangement. It would be a matter for concern with any major corporation, but where a Government service is involved, it becomes a far more serious matter.

At Olympus itself there is further intrigue. Despite claiming Ability as a wholly-owned subsidiary, Ability does not actually own the Olympus website, www,olympus.org.au.

A website is a very valuable asset in today's digital world, worthpossibly  millions , if not billions.

Yet, the Olympus website is registered in the name of Olympus managing director Nic Bolto's Chapter Seven Ltd, a charity like Ability Options, Bolto has a history of flipping charities and not for profits for a profit to himself. This scheme, as mentioned,  seems more like a tax scheme for the benefit of the individuals involved.

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Posted Yesterday by Ganesh Sahathevan