The DIBP Receives Harsh Criticism from ANAO over Mishandling of Offshore Detention Centres

A report has been released by the Australian National Audit Office (ANAO), which severely criticises the Department of Immigration and Border Protection (DIBP) for its handling of asylum seekers and offshore detention centres.

The DIBP was found to have significantly mishandled multiple areas of the offshore detention system, including welfare, security, catering and cleaning services.  The report also identified a Broadspectrum contract with cost overruns of more than $1 billion, which the department entered into without first seeking alternative pricing quotes.

ANAO also found that the department was unable to demonstrate that it had secured adequate value for money in three out of the four hiring processes currently in place at detention centres on Nauru and Manus Island.

According to the report, the department also significantly mishandled the centres’ initial set-up in 2012, with infrastructure maintenance provider Transfield being granted the contract despite having failed to submit a proposal specifying services and pricing structures. Details regarding the cost for services provided were only established after the service provider contracts had already been finalised.

“As a result, it was very difficult for the department to demonstrate that it had conducted a robust value-for-money assessment which considered the financial and non-financial benefits of the proposal,” the report said.

The consolidation of contracts for the Nauru and Manus detention centres was also found to have gone significantly over budget, with the bid for Manus Island exceeding historical costs by $200 million to $300 million. Furthermore, the report claims that due to the decreasing number seekers being held in detention, the cost of running the centres is more than double the previously estimated figure.

“Finance advised the ANAO that under the consolidated contract, the per-person-per-annum cost of holding a person in the offshore processing centres in Nauru and on Manus Island, was estimated at $573, 111, at the time of the Mid-Year Economic and Fiscal Outlook 2015-16,” it said.

“Prior to consolidation, Finance estimated the cost at $201,000.”

“The Prime Minister had requested that per-head costs be lower as a result of retendering the contracts, but the department did not calculate a per-person cost.”

Concerns were also raised about the centres open tender process from the period of 2014-2016, arguing that the department gave insufficient consideration to the use of benchmarking.

“The value of expanded services was estimated by an external adviser [KPMG] at between $594 million to $835 million above historical costs. The Government had not provided policy authority to expand the services or increase the funding value of the contract to accommodate service enhancements or adjustments,” the report stated.

The Minister for Immigration Peter Dutton has laid the blame for mishandling the detention centres on the previous Labor governments.

Dutton has issued a statement regarding the ANAO report, saying that the Labor party, “must acknowledge that its incompetent performance placed an impossible burden on the public service which was charged with reopening regional processing centres in Nauru and Papua New Guinea within a matter of weeks.”

“Total responsibility for the problems and processes outlined in the report falls upon Labor,” he said.

The Department of Immigration has also released a statement addressing the report’s findings, saying that it needs to be considered within the larger context of the “unique operational environment” in place at the time the centres were established.

The DIBP has also acknowledged the accusations of overspending, arguing that the overall amount spent on detention centres has dropped from an initial high point, “in early 2012-13 of $698,000 average per person down to $529,000 per person in 2015-16.”

“When capital expenditure is excluded, the average cost per head has been relatively stable, at between $427,000 (2012-13) to $464,000 (2015-16).”

“Expenditure was consistent with the department’s overall policy authority under Operation Sovereign Borders. Funding and appropriation levels were adjusted, in accordance with the cabinet-agreed processes, at the Commonwealth Budget updates over the period in question,” it said.

However, the DIBP has also agreed to implement both of the major recommendations proposed by the ANAO report, which identified a chronic skills gaps and capability shortages within the department’s staff.

The CEO of Absolute Immigration Services (AIS), Jamie Lingham, also offered a scathing assessment of the department’s detention centre system, characterising it as inhumanely cruel, as well as being a significant financial burden on the Australia taxpayer.

“The ‘Pacific Solution’ #2 may have been successful in deterring the boats, but the human cost has been great.  We [AIS] do not support or agree with this program, or with the mistreatment of these people, many of whom have significant mental issues and no hope for a life that is better than that they have left behind,” Lingham said.

“The financial waste for this program has been significant, and we are shocked by the lack of accountability on all levels in protecting both the finances of the Australian people, and the wellbeing of those seeking refuge from an untenable situation.”

“It is our view that this money could be better used to manage caseloads and provide more effective and efficient processing times by Case Officers, across the whole program,” he said.

Jamie Lingham (MARN 0108123) ~ CEO Absolute Immigration Services


This update is intended for explanatory purposes only. Any questions should be directed to a Registered Migration Agent at Absolute Immigration Services on 03 9827 3721 or via email to



You can follow Jamie Lingham on Twitter @JamieLingham.