Insulation companies attack Government for rebate scheme failures

The insulation industry is awash with fraudulent activities with companies taking advantage of the Government’s $1,600 rebate, industry experts have said.

The comments come after about 100 companies were dumped from the Federal Government’s $2.7 billion insulation rebate program after breaking the Government’s guidelines.

Peter Gerster, who owns and manages Melbourne-based insulation business Golden Fleece, says the Government scheme has been a failure.

“These 100 companies are gone, but about 90% of the companies registered should be dropped. I’ve been in the game for about 50 years, and I see this type of stuff all the time.”

“This whole thing is crazy and the Government didn’t think it through very well. It’s ruined the business of genuine people, and it’s probably too late to do anything about it. There are still Government training courses going on, so I don’t know how it’s going to stop.”

Peter Schuback, founder of Queensland-based insulation provider Comfort Zone, says a number of companies using the rebate are overcharging customers in a massive rort.

“There are a lot of shonky providers out there. You name it, and they are doing it. I hear about this because people ring me and tell me what’s going on and then I gain their business.”

While Schuback says he will receive more business as a result of a number of companies being rejected from the program, he warns customers will suffer if “dodgy” traders are permitted to continue working.

“What the Government needs to do is have inspectors on every second job to make sure what’s going on. There needs to be some more regulation about the industry, and there needs to be regulation on what products they are using because no one is out there checking the chemical compounds which could end up harming people.”

But while the Government says the problem is being dealt with by ditching some companies from the grant program, the Opposition said the Auditor-General should investigate the matter with claims of wasting Government funds.

The Government is offering up to $1,600 for ceiling insulation, with more than 370,000 homes covered under the program so far. But over 1,200 complaints have been received about unscrupulous companies, with environment minister Peter Garrett yesterday telling the reporters that 100 companies have been dropped from the program.

“If there are any instances of installers who are taking advantage of the program, where there’s any instances of improper behaviour, of illegal behaviour, or of installers not fulfilling the requirements they have, then they will be struck off the register and that’s what’s happening,” he said.

Accusations regarding the insulation providers include fraudulent invoicing and overcharging, with the opposition saying the Government has lost millions of dollars.

Coalition environment spokesman Greg Hunt also said the 100 companies deregistered from the program may be representative of a bigger problem.

“Mr Garrett might try to pretend there’s not much rorting and waste going on, but if you’ve got hundreds of dodgy installers doing hundreds of jobs each costing taxpayers $1,600, then you’ve got a remarkably big problem.”