Senior officials inside the Minns government, as well as construction industry figures, repeatedly raised concerns about a $39 million NSW school building contract before the Independent Commission Against Corruption launched a major investigation into the agency responsible for awarding it.
In March, the ICAC announced it would hold public hearings into corruption allegations against former Schools Infrastructure NSW chief executive Anthony Manning and other staff at the agency.
Murray Ellen, founder of PT Blink which designs software used by manufacturing companies, raised concerns about officials in Schools Infrastructure NSW in 2022. The agency is now the subject of an ICAC probe.Credit: Janie Barrett
The ICAC will next month hear allegations that Manning and others subverted recruitment practices, improperly awarded contracts and misallocated funds to favour friends and business associates between 2017 and 2024.
The explosive allegations come a little more than a year after Manning departed Schools Infrastructure NSW (SINSW), and after a review by the Minns government that saw other senior executives leave the now-hobbled agency.
The Herald can reveal one contract that raised serious concerns within the new government was the $39 million “Manufacturing for Schools” program.
The Herald can also reveal the same contract was the subject of complaints to successive education ministers from Murray Ellen, a construction industry veteran who raised concerns about the SINSW bureaucracy in 2022, alleging his intellectual property had been misused.
Ellen, the chairman of manufacturing software company PT Blink, became concerned after he held briefings with SINSW officials in 2020 to pitch them on using advanced prefabrication technology to speed up the delivery of new schools.
But he was furious after the agency later gave a contract for similar work to the construction firm APP. The contract, awarded in late 2023, was supposed to deliver dozens of new schools and upgrades to existing classroom infrastructure and 100 new public preschools.
At the time, APP said it would use “cutting-edge construction techniques” to deliver schools “faster and at a lower cost”. It would deliver cost savings of up to 20 per cent and slash construction time by up to 30 per cent, the company said.
But after Manning left SINSW, an internal review of the agency launched by the government led to concern about the potential for significant cost overruns from the contract. The Herald does not suggest those concerns were probity related, but has previously reported that issues with the contract were referred to ICAC.
Former Schools Infrastructure NSW chief executive officer Anthony Manning is the subject of an ICAC investigation.Credit: Janie Barrett
That review eventually led to SINSW being folded into the Education Department. Senior sources in the government, not permitted to speak publicly, said there were concerns about the agency’s use of consultants – at its peak in July 2023 there were 319 contractors working in the agency on an average salary of $183,000 – and a lack of oversight of its procurement and governance.
The government says the departure of Manning and several other SINSW executives was a result of the restructure.
The APP contract was eventually cancelled following the review in July last year, just five months after being awarded. In a statement, APP said the decision was “disappointing”.
“APP Group has been informed that the decision to terminate was not based on performance and it’s our understanding the NSW Department of Education has chosen to pursue a different approach to project delivery,” a company spokesman said.
However, the Herald has learnt that concerns were raised with ICAC over the contract, including the involvement of former SINSW staff in the successful bid.
Among APP’s partners in the $39 million tender was a company whose directors included a former SINSW executive who had attended the briefings with Murray Ellen in 2020.
The long-time bureaucrat, who the Herald has decided not to name, worked as a contractor for SINSW between 2019 and 2021 in a high-ranking position.
For some of that time, he worked on the agency’s potential use of so-called “modern methods” of construction, commonly known as pre-fabrication.
After leaving SINSW, the former public servant worked at APP before setting up his firm. It eventually partnered with APP on the $39 million contract bid.
While the contract was awarded to APP in late 2023 – two years after the former public servant left SINSW – the agency published an expression of interest document for the contract in March 2022, a few months after his departure.
SINSW also awarded unrelated project management service contracts to APP for four other schools in 2022, worth $6.4 million.
The Department of Education did not answer questions about whether the former public servant was involved in the establishment of the Manufacturing for Schools tender, though SINSW was aware of his links with APP when it awarded the contract.
In a statement, the former public servant denied having any involvement in the EOI while working at SINSW, and said he had “actively distanced” himself from it.
He said that he had “adhered to the exceptionally high standards of security and probity demanded by his roles on major projects” throughout his career.
“He has always acted with the utmost integrity including in relation to: the disclosure and management of perceived and real conflicts of interest; public service cooling-off periods and probity clearance; and the management and protection of third-party confidential information,” the former public servant said about himself.
“This includes in relation to the SINSW Modern Methods of Construction EOI process.”
After initially providing a statement in response to questions, the former public servant contacted the Herald 50 minutes after the ICAC announced its investigation last month, seeking to withdraw it due to a “change in circumstances”. The Herald declined that request.
He said his company was “a participant in responding to an open and competitive tender that the NSW Department of Education released to the market in 2022” and had “complied with all probity and disclosure requirements” set out by the department.
The ICAC’s announcement that it was investigating Manning and other former SINSW staff followed the concerns raised by Ellen about the agency.
Ellen’s company, PT Blink, uses advanced software to design prefabricated buildings manufactured in warehouses off-site, then assembled by “integrators”. In Brisbane, the company made headlines after it designed a seven-storey apartment building which was topped out in just 11 days.
He told the Herald he was first approached by officials inside the agency to brief them on his company in 2020, and said he held a series of meetings with SINSW officials about using his technology to roll out the construction of new schools.
“Everything was going well. We were actively discussing how we do our buildings, how we would be able to integrate it into their system. We agreed it was all confidential,” Ellen said.
But he was furious when a few years later, the agency issued an expression of interest for technology he said was “appallingly similar” to his.
In September 2022, he wrote to then-minister for education Sarah Mitchell asking the government to look into potential “misconduct and misuse of confidential information” in relation to the tender processes at the agency. He raised those concerns again with the current Minister for Education, Prue Car, in 2024.
Ellen says the experience has given him pause about working with the government. It also raises fresh questions about the former government’s reliance on consultants in the public sector.
“I’ve worked in places like Hong Kong and Singapore, the Middle East, this sort of thing would never happen,” Ellen said.
“The government is setting the right policies, but at the practical level, what I went through with the bureaucracy, if that’s what you want to call it, is just horrific. I think people should know about it.”
In its statement last month, the ICAC said it was investigating the conduct of Manning and other staff and contractors at Schools Infrastructure. Its probe also includes whether Manning and SINSW’s then-human resources strategic adviser, Wendy O’Brien, and others, “dishonestly exercised their official function by taking reprisal action against certain staff following complaints or public interest disclosures at SINSW”.
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