In the week the Earthquake Commission was forced to start an independent review of its hiring practices after revelations of nepotism, the cost of the contractors' bill has been released. By Victoria Robinson.
A $144 million spending binge on contractors to assess damaged houses in Christchurch has outraged residents, but Earthquake Recovery Minister Gerry Brownlee says it "is what it is".
Figures obtained by the Sunday Star-Times show the Earthquake Commission spent $144,528,907 on contracted assessors to inspect damage from September 4, 2010, until September 30 this year. The commission said it contracted 814 assessors in that time, 95 from Australia, meaning the $145.5m bill averaged out to more than $177,000 per assessor in just over a year.
Although the amount includes food, flights and accommodation costs for out-of-town assessors, it was much larger than the standard salary expectation.
Recruitment company Hays' 2011 salary guide listed the expected salary of an insurance loss assessor in Christchurch or Wellington at between $55,000 to $80,000 a year, with seniors expected to earn $70,000 to $100,000.
Reverend Mike Coleman from the Wider Earthquake Communities Action Network, WeCan, is disgusted by the figure.
"I think it's appalling but I'm not surprised. We've been battling for little, small amounts for people and here we've got the commission spending vast amounts. It just seems unbelievable, really," he said.
Coleman said the assessors knew they were on to a good thing. "I've talked to two contractors and one was very concerned. He said he was getting $5000 clear in his bank account every week. He said if that ever comes out the whole thing's going to be quite a major story.
"But no one who is getting that kind of money is going to blow the whistle. Why would you if you're getting $5000 every week? $144m is phenomenal."
But Brownlee said he had no problem with the figures. "The cost of addressing an event of this magnitude was always going to be high, that's just a reality of the situation. On the whole, I think the cost is what it is, and the commission has managed this enormous challenge pretty well."
Commission Canterbury event manager Reid Stiven said the cost of contracted assessors was more than expected because it had been pushed up by the long hours required, and the demand for experienced workers.
"But the cost pales into insignificance when compared to the multibillion-dollar job of repairing Canterbury homes and paying for damaged possessions, which is at $2.5 billion and counting."
Stiven said contracted estimators had to be builders with relevant trade qualifications, while contracted assessors "must be a person experienced and competent in communicating effectively and empathetically with a wide range of people, often in stressed situations".
He said, ideally assessors had backgrounds in loss adjusting, building, real estate or other similar roles, but people from other professions, such as law enforcement, also performed well in the role.
"One of the most valuable qualifications a prospective assessor can have is prior experience. Many of the assessors brought from outside Christchurch to help with the 160,000 post-February home assessments have experience working in events such as the Gisborne 2007 earthquake. Assessors are paired with an estimator – usually local – when they conduct assessments."
The commission's 2012 plan was to scale back the number of assessors contracted to between 120 and 170, and reduce the number of staff based outside of Christchurch to cut down on travel costs.
The amount spent on contracted assessors included meal allowances for all staff, $15 a day for Christchurch-based staff and $70 for "food and incidentals" for out-of-towners.
The base rate for contracted assessors was $75 an hour, while contracted estimators earned $60 an hour. Contractors worked a 10-hour day, six-day week for three weeks in a row, before taking the fourth week unpaid.
A "small number" of assessors were paid more to reflect their qualifications, skills and experience.
- © Fairfax NZ News