Report expected to unlock procurement questions in Australian government departments

Australia’s Auditor-General will delve deeper into the buying habits of government departments with his report  due to be released in October.

Ian McPhee and his staff will analyse the practices of panel procurement, where suppliers are narrowed down and remain on a list to make competitive tendering easier.

Already McPhee has found examples where panel arrangements also called 'standing offers' have avoided the open tender process in the first place and instances where departments have taken part in these offers when they were not allowed.

In one case, the Department of Families, Housing, Community Services and Indigenous Affairs procured services from another agency's panel, but the department was not listed as a participating agency for the panel.

In two instances, the department procured from a standing offer notice. In each case, the standing offer notice had not been established using an open tender process.

A department spokeswoman said it related to a data misclassification and the procurement was done correctly.

The Auditor-General also found the Australian Crime Commission had breached mandatory procurement procedures when it bought security services.

The report said the commission had not estimated the value of the services, including likely future services, as was required under mandatory procurement procedures.

'The [procedures] state that procurements must not be divided into separate smaller procurements to circumvent a threshold,' the report said. 'However, in some instances where [Department of Veterans Affairs and Australian Crime Commission] procurements were reported as contract notices with values of $80,000 or less, the agencies had procured the same services from the same supplier on a continuing basis.'

The report said the total value of these purchases exceeded the procurement thresholds. The commission has since gone to open tender for security services.

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