Ethical, value for money issues raised about ACT procurement process

Dominic Giannini 2 July 2021 9
ACT Government logo on building

The ACT Auditor-General has raised issues with the ACT’s procurement processes. Photo: Michelle Kroll.

A number of high-value ACT Government contracts which were exempt from normal procurement guidelines were inconsistent with probity and ethical considerations and value for money assessments, the ACT Auditor-General found.

About one in seven contracts issued by the ACT Government in 2019-20 – worth about $119 million – were exempt from usual processes, which means agencies did not need to seek three quotes or conduct an open tender.

This increased to one in five tenders over the past three years, or 770 procurements valued at about $395 million.

Almost 60 per cent of the 33 procurements considered by Auditor-General Michael Harris did not have an evaluation plan and of those that did, just under half did not produce an evaluation report.

“Where a Tender Evaluation Plan and Tender Evaluation Report has been used in a procurement there is evidence of a comprehensive assessment of value for money,” the Auditor-General’s report said.

“In the absence of these documents, entities could not systematically and comprehensively demonstrate that they effectively considered value for money in the procurement.”

READ ALSO: Is Canberra too small to manage conflicts of interest in the public service?

There was also no evidence about government entities explicitly considering ‘whole of life’ costs associated with the procurement.

As competitive tendering is not a feature of exempt procurements, it is imperative government entities demonstrate that receive value for money has been assessed, the report noted.

“Whole of life costs should be considered as part of the value for money assessment because it encourages a comprehensive evaluation of the total cost of a procurement,” it said.

“[This includes] the future possibilities of selling or disposing of a product, or the availability of more sustainable products and services that may have lower running and disposal costs.”

READ ALSO: Public sector push to upgrade procurement skills, grow talent pool

Exemptions were mainly granted because government entities said there was a limited number of suppliers able to provide the goods and services required, the report noted.

But Mr Harris found only one third had signed confidentiality declarations and conflicts of interest while there was no evidence that whole of life costs were factored into value for money assessments.

While no conflict of interests were documented, the absence of signed declarations for all of the procurements that were considered ” does not give confidence that conflicts of interest are being systematically captured and addressed in procurement”, the report said.

The report made four recommendations, including training to educate people about using documents for procurement processes, improving staff understanding about the importance of integrity during the procurement process, and better consideration about the whole of life costs during value for money assessments.

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9 Responses to Ethical, value for money issues raised about ACT procurement process
Ol L Ol L 5:08 pm 06 Jul 21

I worked in a section of six people, all except me were related. That’s not an issue apparently as they were employed as the best people for the role. The public service needs a good clean out.

Simon Gadgets Simon Gadgets 8:19 pm 05 Jul 21

surprize me!!!!

jwinston jwinston 2:47 pm 05 Jul 21

Jeekay Dee – no matter how laborious and long the process, it is there to be followed.

Those who didn’t follow the correct procedures should be sacked and, if anything unlawful has occurred, then ACT policing should be called in to investigate.

Emma Wright Emma Wright 2:36 pm 05 Jul 21

Depends what you consider as “value for money”.

I’d be interested to read the full report and not just what is reported here.

    Tania Shaw Tania Shaw 7:23 am 06 Jul 21

    he should have linked it -

JeeKay Dee JeeKay Dee 12:57 pm 05 Jul 21

Maybe process is side stepped because the government procurement process is laborious and takes a lot of time and things sometimes need doing quickly.

Sometimes a when requirement becomes apparent, there is a short timeframe to get from the market whatever it is you need. When upholding all of the required (or in some cases, self imposed) processes around procurement, the ability to quickly meet requirements is totally stifled. It's why no one wants to work in procurement. Because on one side, you have your business telling you to get something from market right now, and on the other side a compliance team telling to to document and plan everything to the tiniest degree. The CPRs are super clear that the effort should be commensurate to the scope and scale of the procurement but that still means hours of work to do something that private sector could do in 5 minutes over the phone.

You either have total transparency OR an efficient and responsive public service. Under the current rules, you can't have both.

Paul Baverstock Paul Baverstock 12:56 pm 05 Jul 21

Well surprise me not

Karen Evans Karen Evans 12:53 pm 05 Jul 21

Whole of life costs don’t really matter to this current government as they don’t care about what happens in the future, only what buys them power now.

Brett Jarius Brett Jarius 11:19 am 05 Jul 21

Should look into their employment process as well.

Nepotism at its best

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