Gold Coast 2018 Commonwealth Games contracts data reveals local companies missed big contracts

COMMONWEALTH Games organisers promised Gold Coasters’ investment of time, productivity and cash would be repaid with business benefits. It was a lie with ‘ghost offices’ set up to fake a Gold Coast presence.

COMMONWEALTH Games organisers promised Gold Coasters’ investment of time, productivity and cash in GC2018 would be repaid with business benefits.

But detailed scrutiny of publicly-available awarded contracts exposes their promises to “buy local” as a multimillion-dollar lie — with just 8.2 per cent of the cash awarded to companies which are based on the Gold Coast.

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And it’s likely to be the tip of the iceberg, with public data only available for two financial years and organisers revealing they’ve spent another half a billion on contracts outside that period.

They are refusing to say whether the rest of the data will ever be released - despite laws which say all Government contracts over $10,000 must be made public.

Companies listed by Goldoc as having a “Gold Coast presence” are under a cloud, with line-by-line analysis of awarded contracts revealing some local addresses given to Goldoc were pop-up offices used only during the Games period, while others never existed.

Organisers classified US-based Jack Morton Worldwide as Australian due to it running a Sydney office — while many key staff who worked on the Games travelled from the firm’s London office.

Crowds leaving the closing ceremony. Picture Mike Batterham

Goldoc also classified shuttle bus provider Games Linq as local due to it opening a temporary office at Bundall — despite the holding company’s operations being based in Victoria.

Less than a week after the closing ceremony, they’d packed up and left, with an accounting business moving in last month.

This sign is all that’s left of $20m-plus bus contractor Games Linq. Photo: Kathleen Skene

Local business owners who tendered for Games work and missed out say they are “livid” with organisers, who have deflected criticism by questioning the capability of local companies and pointing to the number of contracts awarded instead of their value.

Goldoc’s definition of “Gold Coast presence” was vast. It included companies headquartered outside the Gold Coast that have genuine, established offices and staff in the city like Hays Recruiting, the Commonwealth Bank and Toll Transport.

However others they’ve classified as local have offices that are either temporary or not offices at all. For example the “suite” listed as the local address of Victoria-based EPG Convergence Technology, awarded a $4.9 million contract for data cabling, is a residential unit at Mermaid Beach.

This week the unit had no company signage and no signs of life apart from a doormat and a pair of thongs at the front door. Calls to the Melbourne number listed for the company went unanswered, while a mobile number reached the voicemail of a man named Andrew, who did not return the Bulletin’s calls.

The entrance of the Mermaid Beach "office" of a Melbourne company awarded a $4.2 million Commonwealth Games contract. Photo: Kathleen Skene

Another company classified by Goldoc as having a Gold Coast presence, recruiting firm Talent 2, gave a Bundall address which agents say it has never occupied and which lists a Gold Coast phone number which is disconnected.

Company records show the Sydney-based company hasn’t operated under that name since 2016.

The Corporate Centre in Bundall, the address Goldoc had for successful contractor Talent2. There’s no record of them being there. Pic Tim Marsden

The local phone number listed for a third company, Programmed Electrical Technologies, also classified by Goldoc as Gold Coast presence but actually based in Melbourne, is not in service.

There was no sign of that company, which received a $30,000 contract for computer equipment, at the Southport address listed in Goldoc’s data.

If Programmed Electrical Technologies were ever based at One Lawson St, they’re not there now. Photo by Richard Gosling

Goldoc could not clearly articulate their criteria for assessing Gold Coast presence, saying only that “a local presence is determined by the location of the branch of the business where the majority of work is being undertaken (not necessarily head office) excluding post office boxes and residential addresses”.

They said they relied on companies to disclose information about office locations and staff numbers on their tender documents and could not say how they verified the information provided.

The Gold Coast Bulletin has re-categorised publicly-available Games contract data according to whether the companies are actually based on the Gold Coast; are based elsewhere with an established Gold Coast presence; are based elsewhere in Australia; or operate mostly overseas.

In the two financial years between 2015 and 2017, $190.3 million worth of contracts valued at $10,000 or more were awarded by Goldoc.

Of that $190.3 million, Gold Coast-based companies were awarded contracts worth $15.7 million, or 8.2 per cent; those based elsewhere with genuine Gold Coast presence were awarded another $20.3 million or 10.7 per cent; companies from elsewhere in Australia were awarded $98.4 million, 51.7 per cent; and international companies, including Jack Morton Worldwide, were awarded $55.7 million — representing 29.3 per cent of contracts for the two years.

There was one key local winner in Robina-based Condev Constructions for its work on Goldoc’s Ashmore headquarters.

The true local powerhouse received $12.4 million of the $15.7 million total awarded to local companies overall.

Seven Gold Coast businesses were also among 43 companies which shared in joint contracts totalling $11.6 million - however the amounts were not itemised and they have been excluded from the Bulletin’s calculations.

This week organisers revealed another $491.5 million had been spent outside of the two years’ data that is publicly available — but would not provide details of where the contracts went.

They also refused to confirm whether contract details for the 2017-18 financial year, the biggest of the Games, would ever be publicly released.

“The Goldoc Board will assess its position in relation to the reporting of 2017-2018 contracts as part of its end of financial year activities,” Goldoc said in an email.

Games organisers stopped publishing details of supplier contracts for the $2 billion event in November 2016, and only after persistent questioning from the Gold Coast Bulletin, lifted the blackout last December.

Goldoc this week said it had awarded contracts and purchase orders totalling $681.7 million from the 2012-13 financial year until February 2018.

Under its criteria, 23 per cent of the value has gone to companies with a Gold Coast presence; 38 per cent to companies with a Queensland presence; 33 per cent to companies with an Australian presence and 6 per cent to companies with an international presence.

Goldoc refused to release details of contracts valued under $10,000.

Goldoc chairman Peter Beattie was unavailable for comment.

GOLDOC CEO Mark Peters and Gold Coast 2018 Commonwealth Games Corporation Chairman Peter Beattie talking to the media post Commonwealth Games Picture: Jerad Williams

Goldoc CEO Mark Peters said Goldoc had “a strong track record of ensuring businesses on the Gold Coast and throughout Queensland and Australia have every opportunity to secure contracts to deliver services for GC2018”.

“Events of this scale require significant and complex solutions. It also needs to be cost effective and provide the best value for money,” he said.

“It should also be noted that some contracts have been awarded to companies outside of the Gold Coast and Queensland, largely because the specialised services required aren’t located here.”

But Robina-based Transit Australia Group, which is among Australia’s biggest mass transit operators running bus companies in six Australian cities, with major operations in the Middle East, begs to differ.

TAG, which also runs a specialty transport company for major events, missed out on the contract for the Games buses - thought to be worth over $20 million - in favour of Wangaratta-based Games LinQ which has since left town.

Michael McGee, CEO of Robina-based global mass transit company Transit Australia Group, which was overlooked for the Games transport company for a Victorian business. Pic Jono Searle.

Mr Peters said Goldoc’s figures did not include subcontracts, nor other major capital works including the athlete’s village and other venues.

The $550 million athlete’s village was built on gifted public land by Melbourne developer Grocon, which made headlines last year for not paying local subcontractors on time after losing more than $20 million on the project.

The $113 million Carrara Sports Precinct was built by Melbourne-based company Hansen Yuncken, which also built the $33 million Coomera Sports and Leisure Centre.