NSW Premier Barry O'Farrell must reverse a decision to shut down the Cronulla Fisheries Research Centre and consider sacking Primary Industries Minister Katrina Hodgkinson over the debacle, members of a parliamentary committee say.
In its scathing report, the upper house inquiry said the decision to close the centre in southern Sydney and move jobs to regional NSW was "an example of how not to undertake decentralisation".
The relocation, part of the government's drive to decentralise services, has triggered anger among more than 100 Cronulla staff opposed to moving to new headquarters in Port Stephens, Nowra and Coffs Harbour.
Inquiry chairman and parliamentary veteran Fred Nile said he had never "seen a matter so badly handled from day one".
Mr Nile was particularly critical of the government's failure to consult with staff and its failure to undertake "any kind of economic appraisal" before deciding to close the centre.
A cost-benefit analysis was completed only hours before hearings in September - 12 months after the decision to relocate the facility was publicly announced.
"I suggest to the government they should print a manual on how they conducted this issue and give it to public servants and say this is how you do not do it," he said.
"It broke almost every rule in the book. There was no consultation in any way with the staff. There was no consultation with the chief scientist, Professor Steve Kennelly. There was no business plan prepared.
"I believe it is so important an issue that (Mr O'Farrell) should take a role in this now and not leave it to the minister."
Labor committee member Steve Whan described the relocation as a "political fix" to back the government's decentralisation policy, and said Mr O'Farrell should not "accept a minister who has been so demonstrably incompetent".
Fellow committee member, the Greens' Cate Faehrmann, also called on Mr O'Farrell to intervene and halt the "absolutely disgraceful" relocation.
"If the minister does not reverse this decision, the premier should ask the minister to step down from this role," Ms Faehrmann said.
Mr Nile, asked if he agreed Ms Hodgkinson should be sacked, said: "I think it is something the premier should seriously consider."
But Ms Hodgkinson said she would ignore the committee's recommendation to halt the research centre's closure.
"A Decade of Decentralisation... was always going to involve tough decisions but the government has never wavered or created any public doubt about the decision to decentralise NSW Fisheries services," she said in a statement.
Assistant Secretary of the Public Service Association, Shane O'Brien, said Mr O'Farrell should "take responsibility and fix this".
"The staff will be relieved that finally there's been somebody prepared to listen," he said.
"The real test for staff will be what the government does in response. If there is no corrective action, then really it's a hollow victory."
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