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Swan warns of Budget cuts because of foil stripping

News Clippings AAP, March 11 2010

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THE Federal Government has warned of Budget cuts to offset the cost of stripping foil insulation installed in up to 50,000 homes under its bungled rebate scheme.

There have been estimates it may cost as much as $50 million.

“It certainly will be quite expensive, there’s no doubt about that,” Treasurer Wayne Swan told ABC Radio today when asked whether the cost would run into the tens of millions.

The Government yesterday announced the foil insulation would be ripped out or homes would be retro-fitted with safety switches.

Mr Swan said it was impossible to accurately determine the full cost of the measure yet because it would take some time to carry out roof inspections.

“We will account for this as soon as we practicably can.”

Mr Swan warned that the additional cost could impact on other government programs.

“We will certainly have to make our budget fit these costings.

“It could well be the case that we will have to make adjustments elsewhere in the Budget.”

Opposition Leader Tony Abbott says the insulation rebate program has been a litany of disaster.

“Everyone living in those homes is, obviously, going to be very anxious until this is done,” he said in Canberra.

Mr Abbott questioned the Government’s ability to deliver other programs.

“If the Government cannot successfully give away free insulation how can it possibly be trusted with Australia’s public hospitals because that is the most complex service delivery of all.”

Family First senator Steve Fielding said someone needed to be held accountable for the bungled scheme.

“Do you realise how much money was absolutely wasted with ineffective insulation,” he said, adding it could have been as much as 40 per cent of the scheme.”

Labor backbencher Mark Dreyfus admitted problems.

“The Government is acting on those problems,” he said.

His colleague Yvette D’Ath said the Government’s priority had always been in ensuring safety.

“It is about making sure that households are safe,” she said.

Opposition climate action spokesman Greg Hunt said the Government remained in denial and it was time for the Prime Minister to make a statement to parliament.

“We know that there are a million roofs that need to be checked in order to find and fix 240,000 dodgy roofs,” he said, adding only three cases of fraud had been referred to police when there were indications there may be as many as 5000 cases.

“It is time for the Prime Minister to step in.”