Insulation dud scheme bills roll in
The Daily Telegraph
February 12, 201312:00AM
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THE bungled home insulation program is still costing the taxpayer, with the federal government deciding not to recoup $24 million in suspect claims.
Nearly $14 million owed by companies believed to have wrongly claimed subsidies under the failed scheme has been written off, a senate estimates hearing was told yesterday.
The government has also decided to reverse $10.2 million in “potential debt”, ruling it would have difficulty proving and collecting it.
The botched scheme was plagued by dodgy practices and led to the deaths of four installers and 224 house fires.
Department of Climate Change and Energy Efficiency deputy secretary Subho Banerjee told the hearing 671 debts from 516 installers totalling $6.69 million was still owed, but even that might not be recovered.
“The experience in these debt recovery operations across the Commonwealth is that the expected recovery rates are very low,” he said. “That’s our advice in this case as well.”
He said $1.89 million had been recovered.
The hearing was told $13.77 million of debts were written off – seven because companies were declared bankrupt, one because of death, 445 because the companies ceased operating and 35 were deemed “uneconomical to pursue”.Liberal Senator Simon Birmingham asked what lengths the government had gone to to chase down the 445 cases.
“Or was it just the case that people managed to set up companies, fleece the taxpayer of $13.7 million and then close down their companies and get away with it?” he said.
Dr Banerjee said civil action was still being considered.
“But our advice is that on the basis of the information that we have from the ASIC records that the proper course of action was that that debt was unlikely to be recovered and therefore it should be written off.”
Dr Banerjee said $1.9 million paid to insulation installers to try to stop them going under through the Insulation Industry Assistance Package had also been written off, although $310,000 had been recouped.