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Legislative Assembly for the ACT: 1996 Week 13 Hansard (3 December) . . Page.. 4303 ..

MR KAINE (continuing):

design and construction processes for the AIHS building and site works were effectively managed

the early operations of the School conformed with projections and other data provided to the Government during the establishment decision-making process

financial arrangements for establishment costs and operating losses are appropriate

AIHS fees are comparable with other similar service providers

AIHS management is delivering services efficiently

the latest independent assessment on the viability of AIHS operations used appropriate methodology and was based on relevant, accurate and complete information, and whether current AIHS operations are consistent with the independent viability assessment.

Mr Speaker, this was not an audit on the quality or delivery of AIHS educational programs, and the audit stressed that nothing in its findings could be construed as a criticism of the quality of the AIHS program or its delivery; it had to do with the establishment of the school rather than its ongoing management. Members should be aware that the performance audit was conducted against the background of significant losses by the AIHS in 1994-95 and again in 1996.

The audit's findings, I think, can be summarised as being not very complimentary. They found that cost control of the Kurrajong Hotel refurbishment was generally poor; that assumptions about the operations of the AIHS were badly estimated and, in fact, in most cases conservatively estimated; that the financial structure was not appropriate; that the cost per student is very high and, consequently, enrolments have been low; that the AIHS will not be commercially viable, in the audit's opinion, in the foreseeable future; and that a statutory authority would, in the opinion of the audit, provide effective and accountable management. There is obviously much that needs to be done, on the basis of the Auditor-General's review, to get that school into long-term economic viability.

The committee has noted the Government's intentions to rectify the situation. Those intentions fit with the committee's recommendation. The Government has responded to the Auditor-General's report and that response has been tabled in the house already. The committee also notes that legislation to be dealt with, perhaps later today but certainly this week, will address the issues identified by the audit. I think the committee wants to make it clear that, in their view, the AIHS was, in principle,

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