- Proposed Fit-out of New Commonwealth Parliament Offices, Perth, Western Australia
Department of Finance
5.1The Department of Finance (Finance) seeks approval from the Committee to proceed with the proposed fit-out of new Commonwealth Parliament Offices (CPO) in Perth, Western Australia.
5.2Finance provides office accommodation for Commonwealth parliamentarians in each capital city. The nature of the accommodation is determined by the Special Minister of State. The existing CPO in Perth does not meet the current requirements and cannot be brought up to standard due to cost and space limitations. Finance proposes new offices at One The Esplanade, Perth.
5.3These works will provide fit-for-purpose, safe and secure accommodation for ministers, parliamentarians and their staff, as well as accommodating CPO facilities and administrative support staff who operate and manage the CPO.[2]
5.4The estimated cost of delivery of the project is $38.2 million (excluding GST).[3]
5.5The project was referred to the Committee on 27 February 2024.
Conduct of the inquiry
5.6Following referral, the inquiry was published on the Committee’s website and via media release.
5.7The Committee received one submission, one confidential submission and two supplementary submissions. A list of submissions is at Appendix A.
5.8On 3 May 2024, the Committee received a private briefing, and then conducted a public and in-camera hearing at Australian Parliament House, Canberra. A transcript of the public hearing is available on the Committee’s website.
Need for the works
5.9The current Perth CPO was established in 1993 at the Exchange Tower, 2 The Esplanade, Perth. The fit-out consists of the entire levels 38, 39 and part of level 40, totalling 2,052m2 of net-lettable-area (NLA). The lease for the building expires in December 2024, however Finance is seeking an extension to cover the interim period until the new fit-out is completed.
5.10The current fit-out is end of life and considered no longer fit-for-purpose. The business requirements of the CPO require greater functionality than is currently available within the tenancy. At the public hearing, representatives from Finance provided information about the required functionality of the CPO:
The CPO typically provides office accommodation and facilities for visiting parliamentarians and for several permanent office holders. CPOs tend to be in the CBD of a capital city, with good access to the airport and other transport. Increasingly, CPOs are required to provide flexible and highly secure facilities that support government and parliamentarians to communicate and conduct business in a safe and secure manner across Australia. In addition to housing permanent residents, the Perth CPO hosts regular international delegations, meetings of the cabinet, visiting parliamentarians, ministers and high office holders. During peak times, the CPO can host up to 20 ministers, which can often significantly exceed current capacity.
5.11The fit-out is not consistent with a modern workplace in terms of technology, amenity, collaboration, serviceability or flexibility. At the public hearing, representatives from Finance commented:
The current CPO was established over 30 years ago. Since this time, the security, IT, accessibility and operational requirements of a modern parliamentary office have changed significantly, and the current Perth CPO is no longer fit for purpose. For some time now, this has been impacting upon many stakeholders, including ministers, parliamentarians and staff.
5.12The new fit-out will increase the NLA from 2,052m2 to 3,998m2 to allow for increased staff, offices and secure facilities (not currently available in the existing CPO) to meet current and future demands. It will also maximise the use of space to provide better value for money.
5.13Finance advises that the new fit-out will provide facilities consistent with those provided in other states, including a dedicated Government-only floor with secure Cabinet and communication facilities.
Options considered
5.14Due to the upcoming lease expiry, Finance has explored options to continue to provide CPO functionality in Perth.
5.15The option to renegotiate the current lease and remain at the current site was considered, however, it was discounted following commercial market advice from Ventia Property Pty Ltd. This advice suggested that remaining at the current site would not provide value for money due to cost, disruption to current occupants and lack of space to meet requirements.
5.16A two-stage open approach to market for leased office accommodation was commenced in 2021. On 29 November 2023, the Special Minister of State (SMOS) amended the Parliamentary Business Resources (Commonwealth Parliament Offices) Determination (No. 1) 2019 (the Determination) to provide that One The Esplanade, Perth would become the new Perth CPO. The amendment will take effect at a future transition date, allowing Finance to enter into a lease and undertake the fit-out before the new premises are available.
5.17Finance state that the selected property was chosen due to the following advantages:
- It is a premium Property Council of Australia graded office tower, with significant environmental credentials.
- It provides superior base build amenities in a newly constructed building with large, open floors that provide superior design flexibility.
- It has appropriate base building security features such as CCTV and electronic access control that meets Finance’s security requirements, reducing cost and risk to the tenancy.
- It provides appropriate Commonwealth vehicle (COMCAR) curb-side drop off and secure underground car parking with discreet access to the lifts.
- It provides a degree of future proofing, noting the CPO has a potential life span of 20 years, enabling Finance to adapt to the changing needs over the life of the lease.[12]
- The selected building includes large, efficient floor plates which will allow for expansion if new members or senators wish to take up office at the CPO, as well as for surge capacity. Finance provided further details at the public hearing:
We are currently at 70 per cent occupation in terms of the suites. That will potentially rise to a higher level because we have another senator wishing to come into the CPO. That would leave only two visiting suites available. In terms of occupancy, we also look at the use of meeting rooms and other amenities. We only have two meeting rooms in the CPO, and it is difficult for those residents to access meeting rooms. That feedback has come through quite clearly in our consultations. Also, when we do hold meetings, particularly cabinet meetings—we've had three in the last 12 months—we significantly exceed 100 per cent, which is understandable, of course, because it's a cabinet meeting. But the issue is that we have no overflow for those meetings to take staff. In the other CPOs we have more suites, or we might have bigger meeting rooms and other touchdown points that can be used, but, unfortunately, in Perth, when we are running those sorts of meetings, that additional space is very limited, so we have to restrict the number of staff that can come into the CPO at those times.
Scope of the works
5.19The proposed fit-out of the Perth site has two floors of office accommodation with multiple security zones, meeting facilities and working accommodation for Commonwealth parliamentarians, enhanced security measures and additional conferencing facilities.[14]
5.20The proposed fit-out includes:
- a purpose-built facility providing offices, meeting spaces, media facilities and conferencing facilities for the permanent and visiting ministers including the Prime Minister
- a layered security approach with security zones for multiple purposes including acoustic requirements
- enhanced IT infrastructure and technology that future proofs the needs of the site and supports flexibility for varying ways of working
- meeting rooms located away from the perimeter for security and efficiency
- similar sized suites along the perimeter to provide equitable access to natural light and views
- staff amenity including breakout areas, beverage points, first aid facilities, and multi-purpose private rooms.[15]
- The following list provides an overview of facilities which will be included in the fit-out, based on the concept design (this may be adjusted after a detailed design process and stakeholder consultation):
- fourteen Suites for ministers and parliamentarians including offices and workstations for ministerial staff
- Prime Minister office (and support) area
- sufficient meeting, training, media, telepresence and conference areas
- Finance office area for CPO Facilities and Administration Support Staff
- secure reception and lobby areas
- communications rooms, storage and shower amenities
- kitchen, tea points
- parents / first aid and reflection spaces.[16]
- The security classification of the suites and rooms requires enhanced building construction, perimeter hardware, security alarm systems, CCTV systems and access controls in accordance with the Commonwealth’s Protective Security Policy Framework.[17] The design of the fit-out has been driven by highly specific security and confidentiality requirements. At the public hearing, Finance explained that these requirements have influenced every aspect of the proposed works:
The proposal includes several independently secured suites for permanent residents; a dedicated space for the Prime Minister and Cabinet functions, including a secure cabinet room and the associated facilities to run effective in-person and virtual meetings; secure and flexible communication and IT facilities that support multiple departments to provide infrastructure required for ministers.[18]
Stakeholder consultation
5.23For this project, interactive design workshops have taken place with key business line representatives. Additional walkthroughs will be done during design development to ensure business requirements are met.
5.24Formal consultation with Finance staff and targeted Members of Parliament (Staff) Act 1984 (MOP(S) Act) personnel have been undertaken and will continue over the coming months.
5.25The following stakeholders have been, or will be, consulted and engaged with throughout the fit-out design project:
- targeted parliamentarians and staff;
- Finance Executive and relevant business lines;
- CPO Facilities and Administration Support staff;
- CPO Steering Committee;
- Department of the Prime Minister and Cabinet;
- relevant portfolio agencies;
- Ventia Property Pty Ltd (Property Services Provider);
- RPS Group (Project Manager Contract Administrator);
- Cox Architecture (Architectural Design) and their subconsultants:
- NDY Management Pty Limited (Services Engineer);
- Security Consulting Group Pty Ltd (SCEC Consultant);
- Turner and Townsend Pty Ltd (Quantity Surveyor); and
- Brookfield Properties (Landlord and Facilities Manager).
- The proposed concept design has also been informed by staff feedback and lessons learnt from the delivery of other new Finance accommodation. Some key lessons learnt include: design for security flexibility, incorporation of specific security zoning and acoustic requirements, modern and tempered design to reflect the overall CPO functionality.
Cost of the works
5.27The forecast fit-out budget is $38.2 million (excluding GST).[23]
5.28Project funding will be sourced from Parliamentary Business Resources Act 2017 administered funds.[24]
5.29At the public hearing, the Committee questioned Finance about the reason for the higher-than-average square metre cost of the fit-out. Finance justified the cost as follows:
This is quite a different build to what you would normally see in the types of works that come before the committee. This is a security-driven project. Every aspect of this build is impacted by the security requirements, from air conditioning, plumbing and communications to acoustics, the fit-out, and the way tamperproof seal needs to be put around each of the areas. So there is a lot of additional cost to meet those security requirements.
The other part is that it's not an open-plan fit-out. A lot of the proposals that you would see before this committee are projects that can use the building fit-out as it stands and where they're just adding maybe a meeting room here or there. This fit-out is more of a closed fit-out. It has a lot of suites. Those suites have very thick walls. The acoustic requirements for each of those suites, for confidentiality and privacy, are very high, so what we need to do for acoustics and things adds to the cost. That's where the cost comes in.
We did seek comparable costs from the Property and Construction Division in Finance to compare the costs that we were getting from the project. What I can say is that, when we're looking at a national-security-type build that has these sorts of requirements, those costs can range from about $6,000 to about $15,000 per square metre. The cost of this fit-out is just over $9,000 per square metre.
5.30Further costing details were provided confidentially, and the Committee was satisfied with the justification of the cost and its breakdown.
Revenue
5.31No revenue will be generated by this project.[26]
Public value
5.32Finance considers that the proposed fit-out will provide public value by:
- enabling a more efficient use of space and consolidation of staff and facilities to two purpose designed floors
- providing the contemporary, flexible and scalable office officiation to allow for future changes to business requirements and Government operations
- providing capabilities currently not available in the existing CPO
- creating anticipated jobs during construction and fit-out works
- making use of existing public transport facilities.[27]
- Finance notes the new, more functional facilities will enable parliamentarians to conduct business from Western Australia in a more cost-effective manner.
- At the public hearing Finance discussed how the fit-out will adapt to the changing needs of parliamentarians over the life of the lease:
…we are factoring in future changes—for example, room for additional cables and communications. There is the ability to make changes to some of the footprint... We are trying to bring in that flexibility and agility into the design if it needs to be changed in the future. We do believe that, if there were more demand into the current footprint, there would be room to put in, for example, an additional suite…
5.35The design will prioritise Australian based materials and suppliers to ensure economic benefit for Australian businesses and employees.[30]
Committee comment
5.36The Committee did not identify any issues or concerns with the proposal, and it is satisfied that the project has merit in terms of need, scope and cost.
5.37The Committee acknowledges that the Department of Finance explored a number of options to provide the CPO function and that the selected property represents full functionality with best value for money and least disruption to staff.
5.38It is important that there is safe and secure accommodation for ministers, parliamentarians and their staff, and the administrative support staff who operate and manage the CPO.
5.39The Committee appreciates the design of the fit-out is ‘future-proofed’ and will be able to accommodate new suites and accompanying workspaces if necessary.
5.40The Committee notes the improved surge capacity of the new fit-out will enable cabinet meetings and the hosting of international delegations as needed, bringing the functionality of the Western Australian CPO to the same level as other CPOs across Australia.
5.41Having regard to its role and responsibilities contained in the Public Works Committee Act 1969, the Committee is of the view that this project signifies value for money for the Commonwealth and constitutes a project which is fit-for-purpose, having regard to the established need.
5.42The 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: Department of Finance - Proposed Fit-out of New Commonwealth Parliament Offices, Perth, Western Australia.
5.43Proponent 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.