ICT corruption inquiry: Witnesses say contractors were ripped off

ICT corruption inquiry: Witnesses say contractors were ripped off

One contractor received $290 per day, when the university was paying $750 per day

A public inquiry this week by the Independent Commission Against Corruption (ICAC) has revealed contractors awarded jobs at the University of Sydney (USYD), under the recruitment of Canberra Solutions, were substantially ripped off.

The inquiry is in relation to allegations that USYD’s former head of projects for ICT, Jason Meeth, dishonestly gained money from recruiting ICT contractors from non-accredited firm, Canberra Solutions.

It is alleged that Meeth had dealings with Canberra Solutions’ Balu Moothedath during February 2012 to July 2013 to recruit ICT contractors, and exercised his decision-making powers at the university to see those contractors be awarded jobs.

It is claimed that the $24-29,000 in cash that was deposited into Meeth’s bank account during the period could be a financial reward for bringing profits to Canberra Solutions, with the company taking a significant portion of the contractors’ fees charged to the university.

It is claimed that the university employed nine candidates from Canberra Solutions directly under Meeth, and paid the company at least $1.6 million for the contractors’ services. Through subcontracting arrangements, Meeth was able to hire candidates from Canberra Solutions even though the company was not on the NSW government accredited ‘C100’ list, which the university is required to use when recruiting contractors.

Sean McNulty, who worked on procurement and at times closely with Meeth, said he first found out contractors from Canberra Solutions were being paid at a much lower rate than what the university was paying when he took up conversation with one of the contractors.

McNulty said he had a meeting with recruitment firm, Michael Page, which was used for subcontracting, to inquire why the contractor was being paid much less than what the university was charged. When Michael Page looked into the issue, the company informed him that there was a subcontractor involved called Canberra Solutions.

The university paid a daily rate of $950, McNulty said, but the contractor received around $450. He said with all due respect to the contractor, the university’s expectations were not met with the rate it was paying, so was not a contractor he considered worth $950 a day.

McNulty then approached Meeth to let him know the situation, to which Meeth told him words to the effect of, “If need be, we can just stop using them.”

When McNulty was asked whether it was ever communicated to him during discussions with Michael Page that the firm was involved in some way as a favour to Meeth, he replied yes.

A few weeks later, after Meeth left the university, McNulty discovered another contractor recruited through Canberra Solutions was paid much lower ($290) than what the university paid ($750). The contractor was the successor of Pranav Shanker, another contractor recruited through Canberra Solutions, who is a witness at the inquiry. Both of them did not meet the university’s expectation in terms of performance, McNulty said.

When removing the contractor from the university’s projects, recruitment firm, Talent – which was used for subcontracting – informed McNulty that it would let the other company involved know. At that point, he wasn’t aware there was another company involved, and so asked “what do you mean by that?”, to which the reply was “Canberra Solutions”.

After approaching the contractor and showing her the university’s copy of the contract with Talent, he said she got upset and was not aware she was only getting a small portion of the fee. It was then he started to go through all the contractual arrangements with all of the contractors.

When asked if he determined that each contractor recruited through Canberra Solutions all had a similar pattern in being paid much less than what the university was charged, McNulty replied yes.

McNulty was also asked why university staff didn’t ask the candidate their daily rate during the interview before margins are added. He replied that there was no reason not to, but it’s not common practice to discuss that at the interview stage, with the understanding the recruiter would have already discussed with the candidate.

Samuel Williams, who worked at recruiting company Paxus during the period, received a phone call from McNulty in the second half of 2013 informing him that the daily pay rate from the university was significantly higher than what contractors were actually receiving.

Shanker said at the inquiry on Monday that he was never told his daily pay rate by Canberra Solutions, Paxus - which was used for subcontracting - nor the University of Sydney. He signed a contract to work for the university with Paxus, stating ‘as per schedule A’ in place of where a daily pay rate would appear.

He said he did not know what ‘as per schedule A’ meant, but knew the pro rata rate. A copy of the contract to Canberra Solutions was presented, which included the daily pay rate. Shanker said it was the first time he ever saw that document.

Williams said two contracts were produced with Paxus when it came to subcontracting with Canberra Solutions – one that included the daily rate, and another with ‘as per schedule A’.

When asked why wouldn’t the latter document include the daily pay rate in dollar terms, he said his colleague Trish McNally was instructed by Canberra Solutions to write ‘as per schedule A’ in replacement of a daily pay rate.

When he found out about this after his contractor (not Shanker) started working for the university, he said McNally told him Canberra Solutions always asked for a contract without the rate and not to worry as she does this for another account manager’s contractors at NSW Health.

When asked if it had occurred to him that this could have contributed to contractors not being given information on the rate they were really assigned to, Williams said he didn’t directly make the association when McNulty first called him.

Williams first started helping Meeth put forward candidates from Canberra Solutions in early 2012 when he called him and spoke highly of the company. He said he helped Meeth because he felt that if he didn’t it could affect his relationship with him commercially and it was a “fair and reasonable” request.

Williams also put forward his own candidates, but none were successful, with the three Canberra Solutions’ candidates he put forward getting awarded contracts.

Williams also said he did his due diligence on his candidates but was just required to work out Canberra Solutions’ candidates rates and availability and forward on their CVs.

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Tags contractorscorruptionICAC

More about ICACIndependent Commission Against CorruptionNSW HealthUniversity of Sydney

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