Over 600 road-maintenance related jobs will be brought in-house by the Western Australian state government over the next few years as part of a decision by Main Roads Western Australia to directly oversee the road network rather than out-sourcing to contractors.
The state government announced the decision in a statement on April 1, noting that the agency’s employee numbers had dropped from 2605 employees in 1985 to 819 in 2001, leading to Main Roads WA losing the ability to train local regional people and employ local workers.
The move is expected to create 660 permanent jobs within Main Roads, with 490 in regional WA and 170 in the Perth metropolitan area.
Operations will be brought in-house progressively as contracts conclude, with a majority of the work to be completed by March 2024.
The last region will be the Kimberley which will be brought in-house when the current contract ends in January 2026.
Existing workers employed by the contractors will be offered direct employment with Main Roads, with their previous service recognised for long service leave and parental leave purposes, and a transition team is being established in Main Roads to facilitate this.
Four new Main Roads offices and depots will be established in regional WA, including in Manjimup, Esperance, Karratha and Broome. Existing depots and offices will also be expanded and improved.
In addition to road maintenance, this decision will cover the delivery of incident response services by Main Roads on the Perth metropolitan road network.
“This initiative is a return to the Government directly employing white and blue collar workers to maintain the state’s road network,” WA Premier Mark McGowan said.
“It is also consistent with Labor’s pre-election commitment that where possible and beneficial to do so, outsourced services will be brought back into the public sector.”
The Premier noted that the move would trigger increased regional economic growth and a range of permanent job opportunities, particularly for Aboriginal people and businesses.
WA Transport Minister Rita Saffioti said the state government’s decision had been based on a detailed analysis by Ernst & Young in 2021 that had concluded an in-house delivery model would “drive jobs and economic growth in the regions; enhance Aboriginal employment and engagement outcomes; improve education uptake; and increase capacity and capability of Main Roads.”
“In particular, it will also mean a stronger focus on Aboriginal employment, with Main Roads able to engage directly with local Aboriginal businesses and workers,” she said. “It also helps us to train young people and retain them in the regions.”
The decision has, however, been criticised by the Chamber of Commerce and Industry WA (CCIWA) – an organisation representing thousands of WA businesses.
In a statement, CCIWA CEO Chris Rodwell said the move sent the wrong message to WA businesses about the risks of investing in the state.
“CCIWA expects the decision will diminish rather than improve our roads in the long term. We could potentially see taxpayers bearing higher costs for road maintenance, a reduction in the quality of our roads, a negative impact on innovation in the sector, and an erosion of contractor confidence when bidding for state government contracts,” Rodwell said.
Mr Rodwell encouraged the state government to release the modelling used to justify the decision.
“It’s unclear how the decision can produce savings, when labour and training costs will increase,” he said.
Based on the Ernst & Young study, the WA Government estimates the in-house model of delivery would save more than $25 million a year and produce economic benefits, including increasing gross regional product by up to $335 million over the next 10 years.