Dodgy contractors and respected industry name companies are once again taking advantage of an ill-conceived and badly implemented Labor Government scheme, with the now-familiar result of taxpayers being rorted, along with vulnerable Australians that the scheme was supposed to assist.
Sources within the antenna industry* report that government contractors are taking advantage of loopholes in the Household Assistance Scheme to qualify for increased government payments, by fraudulently claiming costs for employment of out-of-area workers to conduct installations.
It is alleged that contractors are also taking advantage of insider foreknowledge of the digital TV rollout, by deliberately installing low cost, sub-optimal antennas that are likely to require more costly replacements within 2 years, at the expense of pensioner and disabled recipients of the government scheme.
These reports appear to bear out the warning given by Master Electricians Australia in May 2011, that Labor’s pensioner set-top box scheme would attract unscrupulous contractors:
Master Electricians Australia yesterday said the Household Assistance Scheme, which received $308 million in Tuesday’s budget, threatened to attract ”shonks and shysters chasing a quick buck”, as seen in the disastrous insulation program.
Under the scheme, the government will pay for the installation and supply of digital set-top boxes for pensioners and, where necessary, install antennas to receive digital TV.
Over the past year, the scheme has attracted widespread criticism for poor planning, mismanagement, and cost blowouts:
EVERY set-top box delivered under Labor’s digital TV rollout could be costing the taxpayer an average of $698 — almost double the government’s original estimate, more than 30 times the cost of a box bought at a department store and far more expensive than a new 106cm flatscreen TV.
The scheme, which was initially funded with $69.5 million in the 2009-10 federal budget before receiving a further $309m last year, is aimed at pensioners and the disabled, who the government says are unable to buy and install their own set-top boxes to receive digital TV signals.
Industry sources say that contractors are maximising profits (thus cost to taxpayers) by many different “lurks”, such as offering to install brand new antennas and cabling for customers who already have suitable products installed. In a damning indictment of what appears to be a growing attitude of perceived “entitlement” in our society, it is reported that many pensioners have been only too happy to go along with this rort, with some expressing the view that “It is a government program for pensioners, so if other pensioners are getting one, then it is my right to get a new aerial too”.
Most concerning are reports that contractors are deliberately installing low cost single band antennas in some regions in order to maximise initial profits from the Government, and pave the way for further profits in future. Sources say that some contractors are taking advantage of industry insider knowledge that once the digital TV rollout is completed, “stacking” of channels in regions such as Wollongong will likely result in these cheap single band antennas becoming unsuitable, requiring pensioners to pay for installation of new and more costly multiband antennas at their own expense.
* Your humble blogger has been informed of these rorts by a childhood friend who owns and operates a one-man antenna installation business in the Newcastle region, and is in daily contact with wholesale parts suppliers to regions across Australia.
Barnaby Is Right 
I applaud your articles, and many of your others, but, in these cases we always blame the Government, and never mention the fact that these contractors are part of the free market system, that seems beyond reproach from commentators.
Steve
It is not free market and as soon as a government starts throwing money around you will get bad outcomes. The fact that people will rip off the government is normal unfortunately and it is up to the government to make sure people don’t do that. How many people are rotting in jail for the insulation rorts? I suspect it is 0 which is the governments fault and the antenna rorters know it is the same deal so nothing to lose.
I agree Kelly. This was part of an incompetent goernment not scrutinising contractors before they rorted the system especially targetting the elderly.
Could you please contact me? Cheers, Jeff Waters, ABC News
Firstly, haven written the fraud control plan for this scheme I stress that all allegations of fraud can be reported via your MP or Ministers office (Minister Conroy) whose department will assign resources to establish if fraud has occurred and if so will launch an investigation. I encourage your friend to report this issue ASAP. Secondly, Having implemented all fraud controls, including a multi million dollar contract whereby random inspections are carried out on these Contractors by a third party, I can state that these allegations appear to be unsubstantial and to date 100% of jobs for the scheme have been electronically tested for fraud patterns such as those you have described, excessive bonus trends (which occurred in the Green Loans Scheme) etc. Further random testing of a percentage of installer jobs are selected each month and tested by a third part for all contractual compliance which includes technical testing, OH&S and installation costs. Thus far no fraudulent activity has been detected by DBCDE/HAS. Lastly, all installations including those with Antennas carry a 1 year after care warranty, so if any stacking issue occurs, such as the Wollongong one you described earlier, the contractor will have to reinstall the antenna/cabeling and satelite dish at their expense, in my opinion, if these scams are happing then the individual or individuals responsible are the sharpest tools in the shed. Yours sincerely Ex HAS Public Servant Fraud Control/Risk and Governance Officer.