The Audit Office found that ACT Government agencies did not effectively manage the North Weston Pond project to ensure the project was completed for the budgeted cost within the planned timeframe. The project has required significant redesign to address escalating costs due to risks that were known at the earliest stages of the project.
Instead of one large pond the project now involves two smaller capacity ponds. The smaller ponds are estimated to cost at least $43.4 million, which is $22.6 million (or 109 percent) more than the originally budgeted amount of $20.8 million. The original planned completion date of May 2011 has not been met.
The location of the North Weston Pond presented significant risks to the project. These risks stemmed from the former uses of the site and existence of the critical Molonglo Valley Interceptor Sewer at the site. ACT Government agencies were aware of these risks from the beginning of the project. However, the growing knowledge and understanding of these risks, including their impact on the project, was not adequately recognised by ACT Government agencies and reflected in project design and cost estimates.
Individual processes associated with the planning, design and construction of the pond were generally appropriate and in accordance with industry practice. However, ACT Government agencies did not effectively combine the information and knowledge generated from each process, to ensure the project was completed for the budgeted cost within the planned timeframe. Specific shortcomings in the management of the project included a failure by ACT Government agencies to:
— apply a robust risk management framework;
— implement appropriate project governance or oversight arrangements to benefit from the combined knowledge and expertise of the different agencies and consultants involved in the project;
— critically assess the feasibility or otherwise of the pond at key points throughout the project, including cost implications of information that was available; and
— critically review the work and advice provided by consultants engaged in the project.