UPDATED 7:15 pm: CIT CEO Leanne Cover has been “directed” to take leave by the board while it undertakes an internal audit of millions of dollars in contracts awarded to companies owned by “skills and complexity” thinker Patrick Hollingworth.
The news follows an unusual public announcement from the Territory’s Integrity Commission today that it would also independently investigate the series of contracts.
Earlier this month, the ACT Legislative Assembly had urged the Auditor-General to look at the contracts after the Opposition flagged concerns with the use of jargon and unclear language in the “unusual” contracts.
Outgoing board chair Craig Sloan said a performance appraisal of Ms Cover would also be undertaken after she agreed to take leave on the board’s direction.
The board had previously told Minister for Skills Chris Steel it could not confirm if the contracts represented value for money as it had not overseen the procurement process.
“The Board will be working closely with the ACT Government to reset the Governance Framework for CIT, including establishing clarity regarding the independence of the board, appropriate delegations and the level of integration of CIT with Skills ACT going forward,” Mr Sloan said.
Incoming board chair Kate Lundy, who will take over from Mr Sloan next month, said the board’s primary concern was the CIT workforce and the community it serves.
“I look forward to working with the ACT Government to review the governance frameworks around CIT and ensure CIT continues to excel as the ACT’s public vocational education provider of choice,” she said in a statement.
4:30 pm: The Territory’s Integrity Commission will formally investigate millions of dollars worth of contracts awarded to a “systems and complexity thinker” by the Canberra Institute of Technology.
Over the last five years, more than $8.5 million was given to companies ThinkGarden and Redrouge Nominees Pty Ltd owned by consultant Patrick Hollingworth for services including mentoring and organisational transformation.
The contracts have been criticised for using jargon and not containing measurable outcomes.
In particular, the most recent $4.99 million contract has sounded serious alarm bells after the CIT board was last week unable to confirm whether it represented value for money as it had not had oversight over the procurement process.
That specific contract has now been put on hold.
It was also revealed Minister for Skills Chris Steel had raised questions about the contracts as early as March last year.
Mr Steel now welcomed the independent review, saying it would get to the bottom of what had occurred and whether the contracts represented value for money.
He noted the investigation would also uncover what the contracts would deliver as well as an explanation for why they were undertaken.
“We will provide any support necessary, as I’m sure CIT will too,” he said.
The Skills Minister had previously indicated he expected CIT to reset and focus on teaching and learning, arguing the affair had caused “significant reputational damage” to the institute.
The board has also committed to conducting an audit.
The Territory’s Integrity Commission confirmed this afternoon that it would “investigate the circumstances surrounding the awarding of … the contracts”.
It is the first time the Commission has publicly confirmed its decision to investigate a matter, which it attributed to public discourse in the media and the ACT Legislative Assembly.
But Integrity Commissioner Michael Adams said this would not become standard practice.
“Commission investigations are almost always conducted covertly, particularly in their early stages,” he said.
“This minimises the risk of the investigation, or indeed the safety and reputation of witnesses and other persons of interest, being compromised. Public announcements about investigations will only be made where there are substantial countervailing reasons for doing so.”
He noted the public announcement did not relieve witnesses of their secrecy obligations and requested that any person with information relating to the contracts come forward to provide their information to the Commission.
The announcement of the review was also warmly welcomed by ACT Greens spokesperson for integrity Andrew Braddock and Opposition Leader Elizabeth Lee.
Ms Lee argued neither Mr Steel nor Chief Minister Andrew Barr had been transparent with the public about what they knew and when about the contracts.
“I hope the Integrity Commission’s investigation will allow a comprehensive, independent review into these serious issues and we see an outcome in the best interests of the staff, students and the CIT going forward,” she said.
The Canberra Liberals Leader has also raised questions about the appointment of the incoming board chair, current deputy chair and former ACT Senator Kate Lundy.
But Mr Steel today said it was important some continuity did remain in place on the board.
“[Ms] Lundy has considerable experience in both the cyber security and defence sector which was why she was appointed to the board,” he explained.
“I’m very confident, having spoken to her, that she will strengthen the governance of the CIT board and put in place risk controls to make sure this type of thing doesn’t occur in the future and the CIT board has much better visibility over procurements.”
Ms Lundy, whose term will begin on 1 July, has been contacted for comment.