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Chapter 3 Issues and Conclusions

Need

3.1                   According to DFAT, while the apartments have been well maintained over their 17 year life span, routine wear and tear has taken its toll on surfaces, fixtures and fittings.  The submission lists the following specific issues which require addressing:

n  bench and fixture heights, which were based on Japanese standards, require redesign;

n  services access doors off corridors require fire rating in order to fully isolate shaft from apartment spaces;

n  inadequate drainage in bathrooms;

n  stairs and handrails in stairwells need to be upgraded to meet current standards;

n  inadequate sound proofing between apartments;

n  removal of asbestos from bathrooms and terrace balcony under-surfaces throughout the apartment blocks;

n  upgrades to power and data reticulation, electrical and fire detection infrastructure, engineering services access and air reticulation;

n  OH&S concerns, particularly in relation to fire, electrical and ventilation require addressing; and

n  amalgamation of some of the apartments to meet new requirements.[1]

Bench and Fixture Heights

3.2                   The Committee questioned the Department as to the rationale for initially designing bench and fixture heights to Japanese standards.  The Committee was concerned that had the benches originally been designed with Australian occupancy in mind, then fixtures and benches would not now require redesign.[2]

3.3                   DFAT responded that the Japanese standards, which were utilised in the construction of the apartments, do comply with Australian standards.  However, practical occupation of the apartments has highlighted the deficiencies in the design of fixture and bench heights.[3] 

3.4                   The Committee sought assurances that, given the high number of overseas properties that had recently been before it; that the issue of fixture and bench heights was addressed in the design of those works.  The Department assured the Committee that

…those projects certainly have been built to the Australian Standards and do meet the norm in Australia.[4]

Asbestos

3.5                   Given that the building was occupied in 1990 and constructed in the late eighties, the Committee was surprised to find that asbestos had been discovered in the complex.  The Department responded that once the issue had been brought to its attention, investigations had revealed that it was not against Japanese standards to use the asbestos sheeting which had been discovered.[5]

3.6                   During the confidential hearing the Committee heard that the asbestos is in the form of sealed hardboard.  Asbestos had been discovered in the car park basement area, and in some of the wet areas of the apartments and the balcony areas.  Further, the Department stated that the asbestos which had been found in the car park had already been removed, and that the refurbishment works presented an opportunity to remove the asbestos sheeting from the apartments.  The Department added that while the asbestos was in its sheeting form it presented no danger, but that there was always a risk that it could be broken.[6]

Codes and Standards

3.7                   DFAT submitted that the works would comply with current Japanese building regulations and relevant Building Code of Australia (BCA) requirements and that the works will comply with current Occupational Health and Safety (OH&S) regulations.[7]

3.8                   The Committee sought an explanation as to the extent of the OH&S upgrades; in particular works relating to fire, electrical and ventilation upgrades, that the works would entail.[8]

3.9                   The Department responded that with regard to fire upgrades, it would be installing a second method of egress from the apartments which was required so as to comply with Japanese standards.  The Committee sought clarification as to what form the additional egress would take, and heard that it would be a harness mechanism from the external balconies.  According to DFAT, these systems are specified and approved by the fire department in Tokyo.[9]

3.10               DFAT added that the building was originally constructed to the highest seismic standards, and that it still meets the local codes.  Further, the emergency procedures for the building are ‘finely calibrated and practiced’ for the sorts of crises that the Tokyo location may present.[10]

3.11               The Committee heard that the ventilation upgrades were to satisfy the Japanese requirement that air is cycled through the apartments every two hours.  The electrical upgrades would improve services to meet current standards,[11] including the number of power points available throughout the apartments and reticulation of data and television outlets.[12]

3.12               The Committee questioned the Department about the provision of wireless broadband within the complex in order to save on the expense of cabling.  The Department responded that the advice from the local technician had been that it would be beneficial to hardwire in the first instance.  In addition, the cabling was a combined voice data system, which had to be done through hardwiring.[13]

Drainage

3.13               The Committee enquired as to the challenges that DFAT faced regarding drainage issues in the apartments.  The Department responded that the drainage systems under the baths had a collection mechanism under the bath from where the water finds its way into the pipes and runs away.  Problems had arisen, due to the lack of filtration, where the system would become clogged and overflow.  This system would be upgraded to deal with the drainage issues of the apartments.[14]

3.14               Further clarification was sought as to whether these drainage problems had impacted on the integrity of the base building.  DFAT responded that no structural damage had been detected and that it was more of an issue of hygiene, convenience and damage to soft furnishings.[15]

Scope

Amalgamation of Apartments

3.15               The Committee sought clarification from the Department on the rationale for amalgamating some of the apartments.  DFAT explained the reason for this was that some of the smaller two bedroom apartments were no longer being fully utilised.  The current project offered the opportunity to amalgamate units not being fully utilised into larger apartments that could accommodate accompanied officers.  This was consistent with changes to staffing profiles at Australian posts abroad, where the trend was toward fewer unaccompanied junior officers, and more senior staff with accompanying family.[16]  The Committee heard that once the amalgamations were completed, there would be no two bedroom apartments left on the embassy complex.[17]

Furniture Replacement

3.16               During the confidential hearing, the Committee questioned the replacement of furniture and whitegoods.  The Department responded that only items that were built in would be replaced.  Other furniture and whitegoods had been well maintained and would therefore not be replaced.[18]

Tender Process

3.17               The Committee sought additional information as to the tender process and how it would be managed.  The Department responded that once the works had received Parliamentary approval it would engage in a public tender process to appoint the various consultants.  In addition, the process would be competitive and subject to the normal probity requirements, and would be advertised in Australia and Japan in order to give opportunities for Australian participation.[19]

Project Delivery

3.18               The Committee made enquiries about how the department would manage the temporary relocation of staff while the works were being completed.  The department responded that is was looking at leasing approximately six apartments for temporary relocation of families while work was being undertaken.  DFAT stated that it had been informed that this was the most efficient and cost effective way of managing the project.[20]

Prototype Apartment

3.19               DFAT submitted that a prototype apartment – number 421 – had been refurbished to evaluate the finishes, test feasibility assumptions, assess unknown factors, ascertain the time and cost of the works, identify likely problems and solutions and establish a quality benchmark for all apartments.[21]

3.20               The Committee sought clarification as to how the costs of the prototype apartment had been met.  DFAT responded that it allocated funds from the Overseas Property Office (OPO) budget to pay for this type of development activity.  The Department added that the development of the prototype allowed it

…to be better educated and more accurate in the development of the costings for the overall project delivery.[22]

Operation of the Overseas Property Office (OPO)

3.21               At the confidential hearing, the Committee questioned officers from DFAT about the operation of the OPO.  The Committee heard that the OPO charter is to operate the overseas estate on a commercial basis and as such it seeks to have fully commercial rents on the properties.  The commercial arrangement places a commercial framework around the relationship that the OPO has with other agencies, and allows the properties to be managed in a commercial way.[23]

3.22               The Committee explored what, if any, parliamentary scrutiny was exercised on the OPO.  The Department stated that its works go through the portfolio budget statements, are audited by the Australian National Audit Office (ANAO) and are also reported in the DFAT annual report.[24]

Cost

3.23               The Committee heard that the value of the chancery complex in Tokyo was $286.7 million as at 30 June 2007.  DFAT added that the remaining useful life of the complex, subject to mid-life refurbishment and ongoing maintenance, is at least 35 years.  As a consequence, DFAT argued that the projected out-turn cost of $22 million represents a good investment.[25]

 

Recommendation 1
	The Committee recommends that the proposed refurbishment of staff apartments, Australian embassy complex, Tokyo, Japan proceeds at an estimated cost of $22 million.

 

 

 

 

Hon Judi Moylan MP
Chair
9 October 2007