Newspaper article Tweed Daily News (Tweed Heads, Australia)

{$$$$$$ LEAK} {}; Work Budget Overflows

Newspaper article Tweed Daily News (Tweed Heads, Australia)

{$$$$$$ LEAK} {}; Work Budget Overflows

Article excerpt

Byline: PETER CATON

TWEED'S new $62million waterworks at Bray Park in Murwillumbah has sprung a massive leak - financially.

A massive blow-out in construction costs has seen several millions dollars of Tweed ratepayers money gushing away.

Former mayor and local businessman Warren Polglase expressed alarm at this week's council meeting about the three-million cost blow-out so far which is expected to swell to more than $4 million by the time the water treatment plant is due to be finished in December.

Council staff however insist the variations are minor. They say that, as percentages of the total project, cost the blow-outs are not great and some of the extra costs were caused by requirements that were not foreseen when the tender was let.

The council's Community and Natural Resources director David Oxenham said a special clause allowing for a certain "rise and fall" in costs was industry practice and after that was taken into account "real variations are therefore in the order of $400,000".

Reed Constructions Australia Pty Ltd, part of the Reed Group specialising in commercial and civil construction projects, won the tender in September 2007 with a price of $62.2 million which was to be largely funded by the council through loans.

"Staff talk in percentages but like everything else in today's environment you have got to question the variations," Cr Polglase said.

"We are going to be $million over on a $62 million project.

"You have got to be very careful you have covered all you bases when you put a programme out to tender.

"I'm just concerned where we may finish up.

"The project is not finished yet and there may be other issues come forward.

"I was putting the officers on notice."

Cr Polglase said councillors had to carefully oversee any cost blowouts with any of its construction projects. …

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