CHAIR – Cassy, I will go to you.
Ms O’CONNOR – Thank you.
My first question is about management of Ambulance Tasmania. It’s obviously a really hard job. In early 2020, Neil Kirby resigned from the CEO role at Ambulance Tasmania. Not long after, in early 2021, Matthew Eastman resigned from the CEO role. In March 2023, Joe Acker resigned from the CEO role. In April this year, Jordan Emery resigned from the CEO role. The organisation is now on its fifth CEO in just five years, albeit an interim CEO.
Minister, this rapid turnover of CEOs must worry you. Can you tell the committee what’s being done to make sure the next person in this critical role lasts for more than a heartbeat?
Mrs ARCHER – I will make some initial comments, and then Dale might want to add to that. Obviously, senior executive health staff are in high demand across the nation and it’s not surprising we see Tasmanian health leaders being recognised for that work. We also recognise the opportunity for fresh thinking and renewal, that new leaders can bring improving healthcare outcomes in Tasmania and note that staff have the right to progress their career wherever they choose to, so we wouldn’t criticise anyone for making that decision. Over that time, we have had continued leadership with temporary appointments during periods of leave and ongoing recruitment processes, but I will ask Dale to make some more comments on what we’re doing.
Ms O’CONNOR – Yeah. It’s very high turnover, most of them within a year of each other, which is unusual.
Mr WEBSTER – Yes. To correct that slightly, in fact Neil Kirby’s resignation was not until 2021, he went on long‑term sick leave and Matthew Eastham acted in the role when the job was advertised because Neil wasn’t returning. Matt chose not to apply at that point. Matt had been acting through that period but didn’t apply because he took up an opportunity with local government in the Northern Territory.
Joe was employed from February 2021. He chose to return to Canada in 2023. I don’t think he would mind me saying, under pressure from his partner who wanted to return home, and Jordan, who we had recruited from New South Wales, stepped up into the role and won the job on merit. To Jordan’s credit, he has now gone to a much larger, more complex and I would say –
CHAIR – Better paid.
Mr WEBSTER – better paid role in Victoria. Moving up from an 800 head‑count ambulance service to a 6,500 thousand ambulance service. Perhaps we take credit for the fact we trained him ready for a bigger role.
We’ve gone through a recruitment process. We expect that the next person will be a long‑term prospect – as we expected all the previous by the way – but the reason I went through the reason they left are because they’ve all left for very different reasons. Not necessarily because the job’s a terrible job or whatever –
Ms O’CONNOR – I am sure it’s not a terrible job, but I’m sure it’s a very difficult job, and constant cost pressures and stresses within the system and a lot of public scrutiny of the performance of Ambulance Tasmania, for better or for worse.
Mr WEBSTER – That’s right. But incredibly, Joe Acker coming in started us on a pathway of reform with Ambulance Tasmania, which Jordan has continued, which Michelle, to her credit, has continued in her period since Jordan left. We recruited Jordan from New South Wales as we recruited Michelle from Queensland to bring experience into our service. That’s actually improved our service by bringing in that expertise from interstate to add to our local expertise.
Ms O’CONNOR – I want to wish you all the very best of luck with the next CEO and hope that next year at the table we meet that person, whoever they may be.
I would like to go now to the fixed and rotary‑wing contracts for aero‑medical services. There’s been a 10‑year extension of the Royal Flying Doctor Service with no tender. Perhaps you could provide some information to the committee on the value of the contract, noting that the original 10‑year contract without tender was a consequence of an MOU signed between the Royal Flying Doctor Service and then Liberal premier, Peter Gutwein.
In the context of the Rotor‑Lift contract, the government said the competitive open tender process has ensured the best aero‑medical services being provided at competitive cost. Why wasn’t there an open tender for the Royal Flying Doctor Service and why was Rotor‑Lift treated differently?
Mrs ARCHER – Thank you. As you’ve noted, the Department of Health has contracts with aviation providers to deliver emergency rotary-wing or helicopter services for both Ambulance Tasmania and Tasmania Police and emergency fixed-wing or plane air ambulance services for Ambulance Tasmania.
The rotary-wing aircraft are currently provided by Rotor-Lift and operate at Hobart Airport, and these helicopters support essential aeromedical search and rescue and aerial law-enforcement functions. The Department of Health recently completed a competitive request for tender process for the new long-term rotary-wing contract. As we recently announced, following a rigorous open tender process, Australian Aviation provider StarFlight has been selected to provide these helicopter emergency services to commence on 12 January.
The reason why that process went to tender instead of the contract being renewed is that I’m advised around three years ago the premier and then minister for Health met with Rotor-Lift, at which time Rotor-Lift requested an open competitive tender. There is an expectation under the Financial Management Act and the Treasurer’s instructions that from time-to-time contracts are opened to ensure the state is getting the best service and value for money. Rotor-Lift held the contract since 1 August 2000.
In relation to the difference in the procurement processes, that is because they requested an open tender. Also, the procurement approach, whether open or closed, reflects the specific market and the service delivery considerations relevant to each model. Both services differ significantly in their operational design, clinical scope, and logistical and infrastructure requirements. It’s not really appropriate to compare the tender processes.
Ms O’CONNOR – Well, there wasn’t a tender process for the RFDS.
Mrs ARCHER – That was, as I’ve previously stated, because it was Rotor-Lift themself who requested an open tender, as they have previously publicly acknowledged.
Mr WEBSTER – Minister, if I could correct that. There was a tender, it was a closed tender. RFTS actually did have to respond to the specification and satisfy us that they met the requirements of the TI in terms of an assessment of their tender. Including, value for money. Whilst they weren’t assessed against other tenderers, they had to meet a tender specification including showing that they demonstrated value for money in their tender.
Ms O’CONNOR – I haven’t often heard of closed tenders being used in government procurement processes. Particularly, for a contract of this length and value to the RFDS and cost to the taxpayers of Tasmania. The question still stands. Why didn’t the RFDS – which has had favoured treatment and, acknowledging the good work they’ve done all over the country for many years, but favoured treatment from this government for a very long time – why didn’t the RFDS have to go through what the Minister described as a rigorous open tender process, presumably in compliance with the Financial Management Act as well as Treasurer’s instruction?
Mrs ARCHER – I would reiterate the fact that Rotor-Lift held the rotary-wing contract for 25 years, so also a long-term arrangement there. I will ask the secretary if he’s got anything further to add, but still a closed tender process have to meet specifications in terms of capability required and that sort of thing as well as meet the value for money test.
Rotor-Lift asked for a competitive tender process to be conducted.
Ms O’CONNOR – Is it appropriate to go outside Treasurer’s instructions about tenders on contracts of this size?
Mrs ARCHER – It hasn’t gone outside the Treasurer’s instructions.
Ms O’CONNOR – Is it appropriate to give such an extensive and expensive contract to a provider with no tender process?
Mrs ARCHER – There’s a closed tender process, so it still has to meet our process.
Ms O’CONNOR – No open tender process, then.
Mrs ARCHER – Do you want to make some more comments about the circumstances under which you would have those different types of – perhaps – some other examples, if you have some.
Mr WEBSTER – The decision whether to go with a closed tender as we call it – or a limited tender is the more correct term – is because you can use it to say we only want one tender. Or you might use it in a circumstance where you would say we’re going to approach three people or three different organisations as a way of doing it is available within the Treasurer’s instructions and under the Financial Management Act. The reason why with the RFTS contract we went with a closed tender is, firstly, the specification was very clear what we needed. The type of aircraft that we needed was really clear and we had a long-term provider.
I took the decision and signed off on a decision that we would go with a limited tender, but it was made clear to the RFDS that they had to demonstrate all aspects of the tender and if they didn’t then I would then open it up to the market more generally. Importantly, they had to meet the value for money provisions of the Treasurer’s instruction as part of that assessment.
It was made very clear to them, failure on that specification would mean that I would then cancel the closed process and move to an open process. Then we got in market experts to help us assess that value for money to make sure that we’re actually getting value for the taxpayer dollar. It also aligns with the fact that RFTS and Ambulance Tasmania are joint base and RFDS have a base at Launceston Airport.
In addition to that, commitments made by the federal government in terms of upgrades to the Launceston Airport to align with a new RFDS contract.
Ms O’CONNOR – We will get to that, but I need to clarify whether the in part, the decision not to go to an open tender for the fixed-wing contract was to do with the Memorandum of Understanding that had been signed, and it was in 2017 or 18, but correct me if I’m wrong, between the then Liberal premier, Treasurer, and the RFDS, because that’s a very clear agreement between a political party hoping to achieve government and a major provider of fixed aeromedical services.
Mr WEBSTER – There is a Memorandum of Understanding between the government and RFDS signed.
Ms O’CONNOR – That’s between the Liberal Party.
Mr WEBSTER – No, sorry, I can only talk about what’s between the government but there is actually an MOU sign between the government and the RFDS that was signed by the current Premier and then Minister for Health in July, and I could get this year wrong, 2022 which covers just more than aeromedical. It also looks at other services like oral health that are provided through RFDS.
As part of that, there was no guarantee to RFDS they would get a contract. There was a commitment that where under following the FMA and the Treasurer’s instructors, we would look at what the long-term strategic relationship was with RFDS. It didn’t actually oblige me to give them a contract.
Ms O’CONNOR – Probably not under law, but there would have been an understanding in your mind.
Mr WEBSTER – I took advice at that time from the then secretary of Treasury around that MOU, and also took advice from Crown Law around that MOU to make sure that it wasn’t outside of the law.
Ms O’CONNOR – Is it possible for the committee to have a copy of that MOU? I don’t think I’ve ever seen it, but it may be a public document.
Mr WEBSTER – Yes, it is a public document we released it at the RFDS base in July 2022.
Ms O’CONNOR – The Commonwealth has awarded the RFDS $15 million for a new purpose-built base at Launceston Airport, and the cost has since gone up, I understand it, to $21 million. The state has committed to a six $6 million funding injection towards that base. Is that enough given the cost of people asking for everything? And is the state going to be left to carry any overrun costs on that base?
Mr WEBSTER – We have no reason to suspect that’s not enough, and in fact, it started as a $10 million base and has increased at 21.
Ms O’CONNOR – That’s why I’m asking the question because the risk is.
Mr WEBSTER – That’s because they went to the process of design and costing of the actual base. The commitment from both the federal and state government is capped at their current levels and RFDS, as the owners of the asset, would be drawing on their own funding beyond that.
Ms O’CONNOR – What’s the latest budget for the new rotary‑wing facility at Cambridge?
Mr WEBSTER – The rotary‑wing base will be a leased base. We’re not building it. It’s a lease base and we are still in negotiations on the lease.
Ms O’CONNOR – Has there been any budget set aside or any understanding of what the budget might be for that lease and is it anywhere identifiable in the budget papers across the forward estimates? Or is this another unaccounted‑for expenditure?
Mr WEBSTER – There is actually a key deliverable, which is actually related to increased expenses for aeromedical.
Ms O’CONNOR – What was that quantum of funding that’s been projected?
Mr WEBSTER – In the budget document, $5.439 million this financial year, which is a part year given the contract starts on 12 January and then $11.7 million, rising to just under $12 million over the forward Estimates. That’s for all aspects of aeromedical.
Ms O’CONNOR – My final question. Regarding the base at Cambridge that was being utilised by Rotor‑Lift Aviation, which is already in place, is there any reason why government decided to spend another $17 million worth of public money replicating a facility or investing in the replication of a facility at Cambridge?
Mrs ARCHER – It was part of the new contract for the rotary-wing services. The department committed to developing a new southern air base that’s independent of any operator, which provides the state with capacity to change operators either at the end of the contract term or if the Crown needed to terminate the agreement for any reason to ensure we were able to have continued delivery of an essential service.
Relevant to your last question, Rotor-Lift presently charges $234,497 per month or $2.8 million per annum for shared base costs.
Mr WEBSTER – I should correct the figures I gave you for the uplift in the Ambulance Tasmania budget for aeromedical, not just for the base –
Ms O’CONNOR – It’s not specific to Cambridge.
Mr WEBSTER – That’s right. Exactly.
Mr WEBSTER – The other thing is the Rotor-Lift base is actually owned by Hobart International Airport, and we did engage with them, as well as Cambridge, in a limited tender process to say –
Ms O’CONNOR – There are not many airport operators in the south of the state, are there?
Mr WEBSTER – Exactly. To say where would it be, et cetera, and the Rotor-Lift base was not put forward by Hobart International Airport.
CHAIR – Before we move on to public health. Minister, the secretary mentioned earlier about the decision to update the fleet as one hit. Was that more cost effective? Are there still vehicles in the fleet that need updating?
Mrs ARCHER – Of the Ambulance Tasmania fleet?
Ms O’CONNOR – Yes.
Mr WEBSTER – We have a target of 250,000 kilometres on our Sprinters. We therefore replace them on an ongoing basis. This was an uplift because we’re getting a number of new paramedics. We actually had to increase the size of the fleet. There was money in the 2024‑2025 budget -or it might have been the one before – which spread that money over a number of years. We decided we needed all of those in the fleet ordered immediately and we’ve done that. That’s why the money was brought forward into that year. We will still have a replacement program going forward –
CHAIR – How much is allocated to the replacement program for the others that are currently in the fleet? Not the new ones, obviously.
Mr WEBSTER – I don’t have the figure in my head, but I think it’s –
Mrs ARCHER – It does say they have a lifespan of five years or 250,000 kilometers and that’s consistent with other ambulance services across Australia.
