K40m housing project contract should never have been signed

The K39m Public Service housing project hit a snag because the materials used are banned in Australia and New Zealand.

Australasia Pacific Panel Ltd, a company owned by former diplomat Sir Fredrick Reiher, is now in a protracted dispute with the PNG Government over the delivery of 200 houses for Port Moresby-based public servants.

PNG Party President Robert Akunai said yesterday that the dispute is the result of a contract that should never have been signed in the first place.

He said the National Works Department has refused to certify the technical aspects of the housing project for a number of reasons.
One of these reasons is that Australasia Pacific Panel Ltd company is using material in prefabricated kit homes that are banned in Australia and New Zealand, a claim which was vehemently denied by company chairman and CEO Sir Frederick Reiher yesterday.

The material is called polystyrene which the National Capital District Commission building board has recommended to the National Standards Board to ban. The PNG Institute of Engineers and National Board of Architects have also supported the ban, Mr Akunai claimed.
He said he has been informed that the material is highly hazardous foam which melts under extreme heat and is volatile in acidic form. He said if polystyrene is banned in Australia and New Zealand, then it has no place in PNG.

“PNG is not a dumping ground,” the vocal community leader and PNG Party President said.
But Sir Frederick said yesterday: “No, the houses we supply are not prefabricated houses. We produce in our factory in Port Moresby the building panels and roofing sheets and we build the houses on site from the foundation up.

“The building panel we produce is the EPS steel insulated panel – that is, a fire-retardant polystyrene foam bonded together to colourbond steel sheets on either side.”
He said he had no knowledge of EPS being banned in New Zealand and Australia. He said he had in fact built a house in 2008 in Brisbane using the EPS panel with the approval of all the relevant authorities.
The former diplomat said: “The type house we supply for the public service housing was approved by the PNG Fire Service and the NCD Building Board. The EPS is also widely used in Papua New Guinea particularly in the mining sites.”

Sir Frederick said the Works Department was not concerned about the public service housing project but another project in Port Moresby that used imported low quality EPS panel which was not fire retardant. He said the Department of Personnel Management had pointed this error out to Works.
When asked if the project was ever publicly tendered and went through the normal Central Supply and Tenders Board vetting, Sir Frederick claimed his company was selected from eight others who had tendered for the project.

However, Mr Akunaii maintained the project was never publicly tendered and that Sir Frederick’s company was allegedly handpicked by the then Somare government for the job.
PEA President Michael Michael Malabag yesterday refused to comment on the issue. When the Post-Courier raised the issue last Tuesday, debate on the housing project in Parliament was gagged by the Speaker when Markham MP Koni Iguan directed a series of questions to Public Service Minister Bart Philemon.

South Pacific Post

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