In a 1986 Hollywood comedy, aptly entitled The Money Pit, Tom Hanks and Shelly Long were a hapless New York couple nearly brought undone by the crippling costs of renovating an old house. Whatever financial Pandora's box their characters grappled with in that fable, they were as nothing compared to the cost blowouts in the renovation of The Lodge.
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The refurbishment of the prime minister's official Canberra residence began in 2013 under the control and direction of the Finance Department. It was originally estimated to cost $3.19 million and be complete by mid 2014. It is almost axiomatic that major renovations run over-time and over-budget, and almost as soon as contract workers converged on The Lodge, the blowouts began. In April 2014, it was revealed that the contract price had reached $4.45 million; by December 2014, it had climbed to $6.38 million, double the original estimate. Finance announced at that time that work would be complete by mid 2015. This week, Finance announced that a July finish was now highly likely, but that the final cost would be $8.8 million.
Executive mansions of the sort where a prime minister might feel at home and have room to entertain sell for between $3.9 to $4.5 million in Canberra. That the renovation of a heritage-listed building, albeit one slightly larger than the average Canberra executive residence, should have cost $8.8 million will leave many taxpayers nonplussed. Even $3.3 million, the initial contract let by Finance with project and construction management firm Manteena, seemed a whopping sum for a renovation.
The nearly 90-year-old residence was riddled with faults and defects when Kevin Rudd departed in 2013. The slate roof and guttering needed replacing, as did dangerous old wiring. The ceiling had been damaged by possum infestations, and there was asbestos in some of the guardhouses. The contract called for these to be remedied, for bathrooms and kitchens to be renovated, and for a new central heating and cooling system, modern security and fire protection systems, and ceiling insulation to be installed.
It's understood that the requirement for heritage fittings, and for toilets to meet modern safety and accessibility standards, contributed to the delays and to the rising costs. A 175 per cent increase in that original contract, however, suggests either that there was a major mishap (or mishaps) during renovation or that the planning and execution of the original contract was hopelessly inadequate.
Taxpayers eager for clarification are unlikely to glean anything from the Department of Finance. Its officials have repeatedly denied freedom of information requests from this newspaper on privacy or commercial-in-confidence grounds, or even demanded fees of close to $70,000 for the release of documents. Only Senate probing will counter such obstructionism, and even then a full explanation may not be forthcoming.
One thing probably now beyond dispute is that this costly renovation of what was originally intended to be a temporary dwelling renders any future push for a new prime ministerial residence next to impossible. Nor is public opinion likely to countenance a prime minister settling in at Kirribilli House in Sydney in preference to The Lodge.
