3.1
The Australian Taxation Office (ATO) seeks approval from the Committee to proceed with the proposed integrated fit out of new leased premises at 152 Wharf Street, Brisbane, Queensland. The aim of the project is to improve occupational density in line with government targets, provide a fit for purpose, flexible workspace that can respond to the changing needs of the ATO business with minimal cost and disruption, and an improved efficient building design that reduces operational costs into the future.
3.2
The estimated cost of the project is $49.59 million (excluding GST).
3.3
The project was referred to the Committee on 27 November 2019.
Conduct of the inquiry
3.4
Following referral, the inquiry was publicised on the Committee’s website and via media release.
3.5
The Committee received one submission and one confidential submission. A list of submissions can be found at Appendix A.
3.6
On 26 February 2020, the Committee conducted a project briefing, public and in-camera hearing in Canberra, Australian Capital Territory. A transcript of the public hearing is available on the Committee’s website.
Need for the works
3.7
The Australian Taxation Office (ATO) is the principal revenue collection agency of the Australian Government. Its role is to effectively manage and shape the tax and superannuation systems that support and fund services for Australians.
3.8
Currently the ATO leases four sites in the Brisbane area, ‘one at Chermside, one at Upper Mount Gravatt and two in the Brisbane CBD, one of which is fully sub-leased’. The ATO told the Committee that that project will facilitate the exit of the ATO’s current Chermside accommodation, due to expire in February 2020.
3.9
The ATO stated in their inquiry submission that:
In order to deliver the required fit for purpose high quality office accommodation that meets the professional needs of employees and the nature of the employees’ work, the ATO needs to deliver a fit out of 17,867 meters squared in the building being constructed at 152 Wharf Street.
3.10
The ATO note that ‘the space being fitted out in the new building being constructed at 152 Wharf Street exceeds the square meterage in the existing lease at Chermside’, however, the additional space will be used to provide relief for the high demand for accommodation at the existing 55 Elizabeth Street site.
3.11
At the public hearing the ATO told the Committee that currently there were 1,228 staff at the Elizabeth Street site and the ATO was planning on accommodating 1,150 staff at the proposed Wharf Street site.
3.12
When asked by the Committee if the ATO planned to consolidate staff from Elizabeth street into the proposed Wharf Street site the ATO stated:
We have a lease already on our Elizabeth Street building in Brisbane. That lease doesn't expire until 2028, so financially it wouldn't be the most cost-effective for government if we actually broke the lease. There's a whole range of issues that come with that, so we aren't able to do that.
3.13
The ATO further stated that it was a possibility that the Elizabeth Street site may be consolidated into the Wharf Street site in the future, however this was dependent on ‘what happens when our leases come up for expiry’.
Options considered
3.14
The ATO stated in their submission that it has ‘engaged the expertise of external consultants, including a Project Manager and architectural design team, to work with business to establish the user requirements for the design of the fit out and to provide a fit for purpose design that meets ATO guidelines, Commonwealth property requirements and the ATO’s vision and values.’
3.15
The ATO noted it their submission that their recent ‘experience delivering fit out projects at their Gosford and Docklands sites supports the benefits of open plan, flexible work environments,’ which the ATO attests has ‘provided the ATO with improved flexibility to adapt to changing operational requirements that easily respond to new ways of working’.
3.16
The ATO also noted that ‘post occupancy reports and staff feedback following these fit out projects has confirmed the flexible fit out design as a suitable option for a majority of business areas in the ATO’.
3.17
At the public hearing the ATO stated that:
The building at 152 Wharf Street is centrally located, close to public transport, childcare services, retail and shopping amenities, and employment and education institutions. The location enables the ATO to leverage, source and maintain a high-quality workforce; and partner with tertiary institutions.
3.18
At the public hearing the ATO told the Committee that despite going out to market in 2017 ‘we weren't able to source accommodation that met our requirements within the Chermside region, and we had no further options on the lease that we had with Chermside.’ Therefore, the ATO planned to close its Chermside site and [was] relocating those staff to the proposed Wharf Street site.
3.19
Additionally, the ATO told the Committee that it was ‘consolidating [it’s] information technology and data people who are at other buildings in the Brisbane region into this new Wharf Street building.’
Scope of the works
3.20
At the public hearing the ATO told the Committee that:
The building at 152 Wharf Street is a 24-level commercial tower, and the ATO proposal is to fit out 14 floors. This fit-out will provide an occupational density rate that meets the Department of Finance target of 14 square metres per person… The fit-out will include a range of workspaces, including a mix of traditional, agile and unallocated workstations. Meeting rooms, videoconferencing and other corporate rooms will be available, along with a range of new spaces such as informal collaboration and meeting room areas that will be supported by mobile technology.
3.21
The ATO note in their submission that the fit out concept is for a contemporary open-plan office space and includes:
Professional, contemporary, ‘Grade A’ office accommodation which meets government occupational density targets and offers large and efficient floor plates, maximising space and future flexibility
A flexible and adaptable work environment in order to cope with ongoing changes in business operation and technology
Modular work points that can be easily and quickly reconfigured
Collaboration, offices and meeting areas that are flexible and designed for future reconfiguration
A robust security system that protects ATO information, people, other assets and operations
Enhanced conference, training and video conference facilities to support contemporary work practices
IT infrastructure which will support the needs of the site
First aid room and amenities areas
Contemporary end of trip facilities to support staff wellbeing including showers, lockers and secure bike storage
Interconnecting stairs between floors to promote connectivity and wellbeing in the workplace
3.22
In their submission, the ATO stated that the proposed fit-out will ‘meet all applicable codes and standard, including access requirements and provision of services’, including wheelchair access, lift arrangements, toilet and shower facilities.
Staff consultation
3.23
The ATO stated that it would follow a staff engagement and design process ‘where each business area will make a decision on the appropriate design for their workforce. The design team will assess the information captured and make a recommendation to the ATO on the fit out design direction that is best suited to proceed to detailed design’.
3.24
The ATO stated that staff will be engaged on the design of the fit out by:
Obtaining team specific requirements such as team sizes, storage, use of corporate facilities, team specific equipment requirements etc.
Attending information and Q&A sessions about the design process
Distribution of staff surveys to seek input and feedback on individual preferences that could be considered
Discussing and seeking input (or even voting) on themes and colours for the building
3.25
The ATO also stated that ‘the fit out will be designed to suit the workforce occupying the building which is achieved through the establishment of a Site Working Group. Members of this group include nominated business line representatives, site leaders, site executives, union representatives and other specialty group representatives (e.g. Work Health and Safety, Environmental team, and Fire Wardens).’
3.26
At the public hearing the ATO stated that with regards to involving staff in the design process:
We haven't put together what the layout or the workspaces will look like in this building, because we need to go and consult with our staff to understand what they want, and then, obviously, we do a detailed consultation process with them. What we are offering is three different types of workspace within this building. We're looking at the allocated, the unallocated and the agile workspace. That's the feedback that we've got generally from our staff that are looking to move into Wharf Street. But, obviously, once it goes through the Public Works Committee, we'd be looking at then doing that detailed engagement and consultation with our staff to understand what the workspaces and fit-out will look like.
3.27
The ATO stated that the project imposes ‘no change to jobs or functions undertaken in the Brisbane region and continues to support the development and maintenance of a skilled and professional workforce’.
Community consultation
3.28
The ATO stated in their submission that the project at 152 Wharf Street would benefit the local community as it:
Is it the most cost-effective option for the Commonwealth
Creates jobs during construction and fit out works
Supports local trades and services through ongoing maintenance and supply requirements
Supports local businesses which will be frequented by ATO employees and visitors to the Brisbane building
Makes use of existing public transport facilities
Strengthens an important link with tertiary campuses in the area
3.29
At the public hearing the ATO told the Committee that:
On all of our property projects the ATO has been committed to maintaining its strong track record of engagement with the Indigenous and local business sector. The ATO actively promotes and facilitates engagement of Indigenous business and local business. In the first six months of this financial year we've invested $20 million in contracts with Indigenous business. Our commercial partnerships are supporting sustainable benefits through Indigenous employment, business growth and community investment…We will promote the engagement of Indigenous businesses and local businesses for 152 Wharf Street.
Cost of the works
3.30
Australian Taxation Office, Integrated Fit out of New Leased Premises, 152 Wharf Street, Brisbane, Queensland has an estimated cost of $49.59 million, exclusive of GST.
3.31
ATO provided further details on project costings in its confidential submission and during an in-camera hearing.
3.32
The Committee is satisfied that the costings for the project provided to it have been adequately assessed by the proponent entity.
3.33
The Committee was pleased to hear that the ATO will fund the fit out within existing departmental capital budget.
3.34
At the public hearing the ATO told the Committee that:
The proposed fit-out maximises value for money, as it enables the ATO to improve occupational density, provide a fit-for-purpose, flexible workspace that can respond to the changing needs of the ATO with minimal cost and disruption, and provide an approved, efficient building design that reduces operational costs into the future.
Revenue
3.35
There will be no direct revenue generated by the project.
Committee comment
3.36
In relation to the staff consultation process, the Committee was pleased to hear that ATO business areas would be given the opportunity to feed into the design for their workforce based on their specific needs. The Committee encourages ATO to continue to engage openly with staff throughout the project to ensure that staff are adequately informed and accommodated.
3.37
The Committee was concerned about the impact that having to relocate from Chermside to Brisbane city centre would have on staff with regards to increased commute times, access to parking and public transport. The Committee encourages the ATO to continue to seek feedback from staff and to ensure that all staff concerns are adequately addressed.
3.38
The ATO informed the Committee that design of the proposed interconnected circular stairs were a health and wellbeing opportunity for staff, as they were more appealing that the concrete fire stairs. While the Committee acknowledges the health and wellbeing benefits, the high per square meter cost of the proposed staircase was of concern to the Committee. The Committee encourages the ATO to consider a final stair case design with a lower cost per square meter.
3.39
The Committee notes that the current Elizabeth Street office could potentially be consolidated into the Wharf Street site in the future and encourages the ATO to consider this solution should the opportunity arise.
3.40
The outlining of the process used by the ATO to identify the Wharf Street site for the works, highlighted a number of concerns to the Committee. This is outside the remit of the Committee’s scrutiny, however, the Committee considers the process to be of sufficient concern that the Australian National Audit Office should consider investigating the process of site selection for the Wharf Street site.
3.41
The Committee recommends that the Auditor-General considers conducting an audit into the process undertaken by the Australian Taxation Office in identifying and selecting 152 Wharf Street as the preferred site for the works.
3.42
Having regard to its role and responsibilities contained in the Public Works Committee Act 1969, and bearing in mind the current lease expiry date, the Committee is of the view that this project is fit for purpose, having regard to the established need.
3.43
The Committee recommends that the House of Representatives resolve, pursuant to Section 18(7) of the Public Works Committee Act 1969, that it is expedient to carry out the following proposed works: Australian Taxation Office, Integrated Fit out of New Leased Premises, 152 Wharf Street, Brisbane, Queensland.
3.44
Proponent entities must notify the Committee of any changes to the project scope, time, cost, function or design. The Committee also requires that a post-implementation report be provided within three months of project completion. A report template can be found on the Committee’s website.