Ventia wins $1.7bn contract to maintain government buildings
The SA government has awarded a $1.7bn contract to a private operator as it moves to outsource maintenance services at hundreds of government-owned facilities.
Business
Don't miss out on the headlines from Business. Followed categories will be added to My News.
The South Australian government has awarded a $1.7bn facilities management contract to infrastructure services provider Ventia as part of a new outsourced operating model.
Ventia will take over the co-ordination of maintenance and building works on the vast majority of state government-owned facilities across the state, including schools, prisons, police stations and hospitals, but excluding the Royal Adelaide Hospital.
The state was previously split up into regions, with private operator Spotless managing government-owned assets in the northern and central metropolitan districts, and the Department for Infrastructure and Transport overseeing the southern suburbs and regional areas.
Ventia will service the entire state when the new contract comes into effect on December 1.
Its role will be to co-ordinate maintenance and buildings works across more than 3500 government-owned facilities, and to oversee the delivery of works by subcontractors.
The company will be paid $300m annually over the initial contract term of five years and seven months, with the potential for three two-year extensions to the contract.
Infrastructure Minister Corey Wingard said the new service model, known as Future Across Government Facilities Management Arrangements (AGFMA), would “maximise opportunities for local contractors”, while affected government employees would be offered jobs with Ventia.
“Approximately 160 government employees are impacted by the reforms, but the transition will provide staff who wish to continue to perform facilities management roles or trade staff the opportunity to transfer to Ventia on the same employment terms they have with government,” he said.
“Staff that do not wish to transfer will be provided with employment opportunities across the South Australian public sector through the existing redeployment provisions of their relevant enterprise bargaining agreements.
“Importantly, under the old arrangement, 98 per cent of work under the AGFMA was done by private sector subcontractor tradies. Under this new model 100 per cent will be done by the private sector – that’s around $6m in additional business up for grabs.
“It (the new model) will deliver better maintenance and repair services for government assets, safer facilities and better co-ordinated services, while delivering the same strong work opportunities for local contractors, including in regional areas.”
Ventia, a joint venture between ASX-listed CIMIC Group and US private equity giant Apollo Global Management, previously provided ICT services to the Royal Adelaide Hospital, and from August will provide prisoner movement services across South Australia.
Its selection for the facilities management role follows a tender process that kicked off last September.
Ventia Group chief executive Dean Banks said the company would work with local small and medium size businesses to deliver ongoing maintenance and building works.
“South Australians rely on the essential services delivered at more than 3500 government locations across the state and Ventia is pleased to support the government of South Australia with the delivery of facility management services to the community, seven days a week, 365 days a year,” he said.
The facilities management model was restructured and outsourced by the state government in response to matters raised by the SA Ombudsman, SafeWork SA and the South Australian Productivity Commission.
Mr Wingard said the new model would deliver improvements for local subcontractors and their staff.
“Ventia is a large and proven facilities management company that provides services throughout regional and metropolitan South Australia, and already works with more than 3000 South Australian contractors and employees,” he said.
“The new arrangements will make it easier to quote for jobs, with less paperwork, and contractors will be able to plan further ahead.”
Superannuation fund Aware strikes Brisbane office deal
Investment giant and superannuation fund Aware has bought into a major tower in Brisbane’s CBD from a venture run by heavyweight Dexus.
Mysterious departure of two key banking directors
Westpac chair Steven Gregg has some explaining to do at the AGM after noting in his annual report two of four directors would renominate – but they have now stepped down.