The contractor for the almost $5 million rollout of 20,000 smart water meters in the region tried to employ "local sub-contractors", according to Dubbo Regional Council.
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Taggle Systems, with offices in Sydney and San Francisco, is set to look for "additional staff and/or alternative sub-contractors" to get the project back up and running, the council reports.
The council has been copping flack on social media after releasing a statement on Tuesday afternoon which advised residents that the rollout had been suspended.
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"The current COVID-19 health and border restrictions enforced affecting Victoria does not allow for sub-contractors engaged by Taggle Systems, the supplier, to fit the meters," it read.
Users of the council's and the Daily Liberal's Facebook pages protested the use of Victorian instead of "local" workers.
On Friday morning the council's director of infrastructure Julian Geddes told the community that Taggle Systems had been unsuccessful in its bid to recruit workers from the Dubbo region.
"The company currently has multiple projects they are rolling out nationally and not all sub-contractors are from Victoria," he said in a statement.
"Taggle Systems sought to work with local sub-contractors for the installation process, however, prior commitments and not having the additional/available staffing resources locally prevented local companies from being engaged/contracted by the company."
Mr Geddes also told of the contractor's recruitment intentions.
"When the project restarts, or when COVID restrictions allow, Taggle Systems are investigating options to provide additional staff and/or alternative sub-contractors to ensure the project remains on track," he said.
The director said meter installation was a "contactless" service, the sub-contractors had a "comprehensive COVIDSafe plan" and the relaunch of the project would be guided by NSW and Victorian public health orders.
The year-long rollout of the smart water meters began on June 1.
"The project to install 20,000 smart water meters across the entire Dubbo local government area remains on track as contractors were well ahead of schedule at the time the project was placed on hold," Mr Geddes said.