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Interview with Ray Hadley, 2GB Mornings, Sydney
4 August 2009
RAY HADLEY: I'm about to be joined by Peter Garrett. I've been inundated with calls and emails for the last two days about this rort involving the Federal Government grant for insulation. Now, I was made aware of an increasing number of fly-by-night companies who were using Google to quote for insulation, and that's concerning people who've been in the industry for quite some time.
Some companies even allow you to receive a final quote and booking insulation online without ever seeing your property because they take your credit card payment. Oddly enough, many of the quotes are around $1600, exactly the amount of the Federal Government rebate.
Now, we've done tests on websites where the difference between a one- bedroom unit and a five-bedroom home is $42. I've been contacted by reputable family companies who've been doing this for years. They say ever since the grants were introduced in February this year, the industry is being flooded by companies including pest exterminators, odd-job contractors, large organisations with no prior experience. It's led to insulation bats being almost rationed within the industry, and established companies are struggling to survive.
I took a number of calls yesterday in relation to all of this. Have a listen to what they said.
[Excerpts from earlier callers]
CALLER 1: I had quote a few weeks ago with a mob, and they tell me that they Googled my house. They didn't want to come out but they said they Googled the house, and gave me a quote, they faxed me a quote, and has put down 95 square meters for the - what the needed for insulation.
I kept saying there's a part of the roof that you can't actually squeeze into, so you need to come out and measure it because it'd be a bit cheaper.
CALLER 2: I actually work for an insulation company that we actually go to site. We don't use the Google Earth method.
RAY HADLEY: Well, what a rare breed you must be.
CALLER 2: We're probably one of the biggest around. I was just interested as you were speaking about the Google Earth. I had one this morning and he had been given about 125 square metres and would have to pay about 100 bucks extra. I actually got to the site and checked it out. There was about 65 square metres, so it ended up being about under $1000.
CALLER 3: This stimulus package was created, Ray, and the insulation industry did have certain levels of expectations and delivered those. And after this is all done and dusted, it will still exist.
The problem is, all these new guys that have come into it have nothing to lose. The guys that have been in it for so long have a lot to lose, and we are losing.
CALLER 4: I got a quote for insulation, $1599.40.
RAY HADLEY: Just under the $1600. Isn't that a shock?
CALLER 4: Isn't that wonderful? The company did tell me that they would provide the second quote from another company, which they own, so I didn't have to get two quotes if I didn't want to. I ended up getting it done for $900 from a local company.
CALLER 5: A friend of mine got burnt by having insulation done where, one, the rating wasn't the same as it should have been, thus bringing the price down; and two, the quality of the work was very rough.
There shouldn't be such a discrepancy. It should be pretty much a flat rate per square metre.
[End of excerpts]
RAY HADLEY: Federal Minister for the Environment, Peter Garrett.
Minister, good morning.
PETER GARRETT: Morning, Ray.
RAY HADLEY: Are you aware that many of these quotes are being done without physical inspection of the property, and it's amazing that after GST it comes to a figure just under the $1600?
PETER GARRETT: I do know, Ray, from what we're hearing from your listeners and others that there are some instances where installers may be actually putting in quotes which are close to the $1600.
What I would say is simply this: I take a very dim view of any installer abusing this program in any way because this is one of our most important and it's also one of our most popular programs.
We've got a comprehensive compliance program in place. I know that Virginia Judge was on GB, I think yesterday, saying that people ought to report any abuses that they think are taking place to Fair Trading. I encourage people to do that as well.
I want to hear from anybody, and the department wants to hear all the details from your listeners and others, of any potential abuses of this program because this is really important to us that people get value for money with their installers. We're working closely with the industry to make sure that the compliance program is a thorough one, and we're going to be checking tens of thousands of homes.
And I've also made a decision that we will write to every single person so far who has received insulation - that's over 130,000 households we'll be writing to - asking them whether there are any issues or concerns they have with the insulation and making them aware of the fact that we'll also be doing random inspections of properties to make sure that the work that's been done by installers is consistent with the quotes that they've provided.
Remember, Ray, they've got to provide a written quote. In some remote places, it is appropriate for people to do a quote on the basis of not inspecting the property, but our expectation is that the job that's done is a proper job, that it meets the Government's requirements in terms of the actual program that we put in place. There's a whole range of matters in the quote. They've got to provide the insulation type, the R value, the area to be insulated and the like.
And I take a very dim view of anyone who's not making this system absolutely accountable and proper.
RAY HADLEY: But surely, Minister, we can get to the stage where - and we're talking about big cities. For instance, Coffs Harbour, they went from four installers to 15 since February - and I've spoken to people who are listening to us right now in that part of the world - and many of those new 11 are doing it via the internet.
I mean, Coffs Harbour's not a massive place. You can jump in the car and cover most of it in about half an hour.
PETER GARRETT: No, no, it's not, Ray, you're right. And look, if any installers, particularly installers who are coming into the program recently who weren't in the business before, are shown in any way to be abusing the program, they can be struck off the register, and that's the way it works.
RAY HADLEY: Okay. Well, I've got one for you, okay? And the reason I've been dragged into this is because this organisation used me to advertise, and that's why I'm a little bit angry…
PETER GARRETT: Yes.
RAY HADLEY: …because I've been dragged into it and my reputation's on the line. This organisation's called the House Doctor. They no longer advertise after my comments yesterday.
One of the people who listened to me and got them to do a job found their workbook left in his home. Ten of the 13 official government work orders ranging between 80 square metres and 117 square metres all came to within $100 of $1600. The square meterage rate ranged from $10.77 to $19.81.
I'd like you to do me a favour and make them the top of the list to investigate, the House Doctor.
PETER GARRETT: Ray, I will take those details, we'll take those details from you. I can absolutely assure you and everybody listening, this is one of the most important programs that we're rolling out there. It'll reduce energy costs for people, it provides work for the industry, and it helps us with our greenhouse gas emissions.
I want to make absolutely sure that it is delivered in an accountable way, and any instances of potential or alleged abuse of any kind, we want to know about. There's a 1800 number - 1800 808 571 - we'll take those details from you.
The Government has a really strong interest in making sure people get proper value for money. We know that the industry itself is a good industry. We've worked very closely with them; they're gearing up; they're putting more bats, more insulation in people's roofs; they're employing more people. But we want to make sure it's absolutely accountable.
RAY HADLEY: Okay, thanks for your time. I've got to fly to the news.
PETER GARRETT: Thanks, Ray.
RAY HADLEY: Federal Environment Minister, Peter Garrett.
So, we may have achieved something here, and hopefully something will be done in relation to all of that.