Salvos sue over $9.5m bill for detention work

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The Salvation Army is suing the Commonwealth for almost $10 million in unpaid bills for welfare services provided at offshore detention centres.

According to court documents, the Salvation Army is suing the Commonwealth for $9.5 million in unpaid bills under several contracts for welfare and support services on Nauru and on Manus Island from September 2012 until February 2014.

A spokesman for the Salvation Army, Major Bruce Harmer, said it was disappointing the matter needed to be pursued through the court system.

“We have a firm resolve to do so in order to recover monies spent in delivering services for the Commonwealth,” Mr Harmer said.

But a spokesperson for the Department of Immigration and Border Protection said the matter was a contractual dispute.

“The department considers it has paid all amounts owing under contract,” he said.

According to the court documents, the Salvation Army argues the government failed to provide enough accommodation and facilities, which forced it to deploy fewer staff, who had to work double the hours to do the job.

The claim includes extra remuneration it had to pay plus overheads, along with damages and interest.

The charitable organisation argues that though it was entitled to charge $54.5 million over the life of the contract, it actually charged $33.5 million.

However, the government contends it overpaid some of the Salvation Army‘s invoices and it was therefore entitled to withhold payment of other amounts due.

Under the terms of the agreement, the Salvation Army claims it was required to supply personnel in a ratio of 245 full-time equivalent staff for 900 asylum seekers housed on Nauru, and 111 full-time staff for 500 asylum seekers on Manus Island.

The Salvation Army claims the numbers of asylum seekers at the centres grew dramatically from about 415 on Nauru and 235 on Manus Island in February 2013 to 1010 and 1353 respectively in February 2014.

But the charity could not increase staffing numbers to deal with the increase in asylum seekers, because of a lack of accommodation, transportation and facilities. Staff were required to work “well in excess of 38 hours per week in order to deliver the contracted services”, despite repeated notification to the department of the need for more accommodation, office space and bathrooms, court documents said.

The Salvation Army also claims the government is liable for misleading and deceptive conduct on the basis that it is “carrying on a business” by providing immigration processing services on Nauru and Papua New Guinea.

Representing the Salvation Army, David Pritchard, SC, told the Federal Court on Wednesday that the government appeared to be challenging the court’s jurisdiction in order to make a subsequent application for the case to be summarily dismissed.

But barrister Tom Brennan, for the Commonwealth, said it was only seeking to strike out the charity’s misleading and deceptive conduct claim.

The case was adjourned to June 29.

Key pointsThe Salvation Army says it has not been paid for work on Nauru and Manus Island.

The government says it is a contractual dispute and it has paid its bills.

Fairfax Media Management Pty Limited

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