Scott Morrison not told of extra Nauru costs

The price of Transfield’s asylum services blew out by $1.1bn due to requirements being amended during negotiations.

The price of Transfield’s services on Nauru and Manus Island blew out by $1.1 billion due to the Department of Immigration amending its requirements during negotiations.

The national audit office found Scott Morrison, as immigration minister, was not told that the contract Transfield signed in 2014 would require the government to pay a significant premium over and above the historical costs of services.

The report, tabled in parliament yesterday, said Mr Morrison was advised the department had negotiated a 5.9 per cent saving overall and greater savings against benchmark costs had been achieved at higher occupancy levels. However, he was not advised that under the contract, actual capacity levels (at the time) represented significant additional expense nor of the contract price on a per capita basis.

The total number of asylum-seekers in offshore processing centres was forecast to be more than 6000 at November 2015, according to the report, but the actual number was closer to 1500. Modelling by the Department of Finance on average per capita costs placed the daily cost of asylum-seekers at more than $1570.

“Calculating per person costs would have enabled the department to more accurately advise its minister of the cost implications of the consolidated contract,” the audit found.

The analysis also found that accommodating asylum-seekers on Nauru until it reached full capacity before placing anyone on Manus Island would have reduced costs.