Why we lost everything and live on a negative budget

We are currently living on a negative budget, although we still enjoy life. I know firsthand, as within a very short period of time from June 2009 when we registered for the government’s Home Insulation Program (HIP) until its closure in February 2010. We were involved in this program and it was not supposed to conclude until 2012. We went from owning a small business in 2009, where we were enjoying life comfortably, with money in the bank our home and cars paid for and superannuation in the Super Fund to living on nothing at the early closing of the program. After it closed, we paid our all staff and business expenses and had nothing left.

Our business had been established 20 years before the HIP. it was a home-insulation business we had built up from the ground.

We were one of the first businesses to be accepted into the government’s Home Insulation Program.  We set up our infrastructure to run the length of the program, complied with all insurance requirements, sent staff for safety training, rented a factory and bought a truck, as well as great deal of stock. We worked like hell, spent our savings setting it all up, and we were organising and running the business and complying with everything the government requested.

Then the government administration did not notice the cowboys and routers of the registration process who invaded the program without complying with the requirements and were accepted into the HIP. Some of these employers had never installed insulation before, they did not comply with the requirements required to be registered installers, they did not send their staff for safety training, and they let the program down. Young men died who were employed by these cowboy companies.

The administration of the HIP investigation began to identify these employers; unfortunately, it did not happen soon enough. Therefore, the government were forced by the public outcry led by people who were calling the program, ‘The Pink Batt Program’ (how stupid that ‘statement’ was), although as we know it was made by stupid and uninformed people. ‘Pink Batt’ was, in fact, one supplier’s brand name in a very diverse range of insulation products from many suppliers. The outcome was that the government was forced to pull the plug on the whole program and all registered companies – even those that did comply.

The established home insulation business owners; were left with factory ownership or leases, stock, trucks, staff and creditors to pay. We always ran our business honesty and had ethics, so rather than cry about it, we used our superannuation to pay for the fall-out from the failed HIP. We were left near retirement age with no savings, no super, no apology, nothing. Then my partner was diagnosed with emphysema and huge medical bills followed – plus an oxygen machine 24/7. This is when it began to get really tough.

Now I will get to my point. We had to work out a plan, we were thankful that we were not as unfortunate as some companies who lost everything including their homes and vehicles and stock and had unsurmountable debt. We only lost money. Our home and cars were safe. Then we faced the prospect of no income and medical bills, we were forced to apply for the pension and this in no way covered our expenses. Therefore, it was back to the drawing board for this ageing girl, now a full-time carer looking after my partner who was limited to a 30 metre hose and attached to an oxygenator permanently so I needed to sit down and begin restructuring our very bleak-looking finances.

It is now nearly five years on, all debts are paid, and we live on a tight budget. I have our budget on an Excel spreadsheet and our banking on internet banking, and I sit down once a fortnight and pay our living expenses first. Then I buy petrol and go grocery shopping with what is left after sticking to my budget. My sick man now has a portable oxygen machine and goes to his club once a week for a couple of beers with his friends, it is so good to have him socialising and enjoying life again. My big day out is where I become creative with what is left. We are learning to live without luxuries and we can laugh at how life threw us a curve ball – actually two, with his chronic health.

At least we can laugh. Each moth it gets easier as I stick to the budget, soon we will be back to where we were before the government’s HIP – although with no savings or superannuation. We have each other and our home, only one car now, as it is all we need. We do not blame the government for the HIP downfall – we blame the uninformed people who routed the program and others who wrongly named it ‘The Pink Batt Scheme’ and demanded its closure. Where, in fact, it was poor administration that was to blame by letting these routing employers into the scheme without first complying with the HIP’s training and safety requirements and by not sending their young staff to courses to be trained in safe work practices in the installation of the insulation, or even to obtain their Green Card. In addition, the employers who did not comply with the training also did not employ a supervisor who was either an electrician or builder as the program requested.

As long-time business people, we realised that we were in trouble when the program closed on 19 February 2010 due to the deaths and calls to close down the program. We were all left with the staff and infrastructure in place. Then when we were hit with the double-whammy of my partner’s health, we were forced into a restructure of our thinking and developed the negative budget to save our sinking ship. It has taken five years to get used to our new budget and we now can see our way forward.

We all would like to blame others for our misadventure although in reality we should all understand that we chose to believe this was a great government Initiative to get our nation back into the black during the Global Economic Crisis. I believe It would have been successful had it not been for the routers. Therefore, it would have been a good business move to register and comply with our government’s requirements. Who knew these devious cowboys and routers would find a way to break down something that was meant to help all Australian households. Get Australians working and hold our own throughout the Global Economic Crisis.

Have you been through financial hardship like Sylvia? How did you adjust your lifestyle to better suit your needs? Tell us in the comments below…