AUDITOR GENERAL EXPOSES SERIOUS FAILURES OVER $1B IN HEALTH PAYMENTS

The Cook Labor Government must explain how almost $1 billion in WA Health payments were allowed to pass through a system plagued by weak controls, inadequate documentation and failures to follow basic procurement requirements.

A damning Auditor General’s report released today found WA Health was not effectively managing $989.9 million in payments made outside its normal procurement system in 2024-25.

In a sample of just 198 transactions, auditors found 60 where there was no evidence that at least two separate people had been involved in the payment process, 33 without sufficient information to support the payment and five authorised by officers withoutthe required financial delegation.The Auditor General also found almost every WA Health entity examined was using the direct payment pathway inappropriately.

Shadow Health Minister Libby Mettam said the findings raised serious questions about financial governance across the health system.“Nearly $1 billion of taxpayers’ money was being processed through a pathway the Auditor General says was not being effectively managed,” she said.

“These are not minor administrative shortcomings. The Auditor General found weak controls, payments without adequate supporting evidence, failures to follow procurement rules and an environment with an elevated risk of fraud and inappropriate payments.

“West Australians rightly expect every dollar in our health system to be properly accounted for, particularly when hospitals are under enormous pressure and frontline services are crying out for resources.”

The report found two suppliers were paid approximately $2.5 million for the recruitment and placement of healthcare professionals despite each engagement exceeding the $500,000 open tender threshold, with no evidence of a tender, approved exemption or formal contract.It also identified a $10,000 grant payment where the health service could not demonstrate the recipient met eligibility requirements, explain how the amount was determined or produce a signed agreement.WA Country Health Service (WACHS) was the largest user of the pathway, processing almost $613 million through it in a single year.

“This report should be particularly concerning for the Minister given the questions already raised about governance and financial practices within WACHS,” Ms Mettam said.

“Before the winter break, I raised serious concerns about radiology arrangements within WACHS. Those matters were referred to the Corruption and Crime Commission, and we now have a separate Auditor General’s report identifying significant weaknesses infinancial controls across WACHS.“

The Minister cannot dismiss almost $1 billion as insignificant simply because the Department says it represents about 16 per cent of non-salary health expenditure.”

Ms Mettam said it was important to recognise the Auditor General had not identified fraud, but the report stated its Forensic Audit team was continuing to work with the Department of Health on several matters.

“The Minister should immediately explain whether she has been briefed on those outstanding matters and, to the extent she is able, what concerns remain under examination,” she said.

“There is also a legitimate question about why the Department has merely ‘acknowledged’ the two recommendations directed specifically to it rather than clearly accepting them.

“West Australians deserve to know that those recommendations will be implemented in full, not simply noted and filed away.”

‍Media contact: Graham Mason 0419 194 792