The Joint Select Committee into Commonwealth Procurement has released its recommendations into Commonwealth Procurement rules, which govern the sourcing of materials used in Commonwealth projects, from staplers to submarines.
The review aims to address concerns that procurement culture focuses on lowest cost rather than value-for-money, a lack of accountability and transparency, unacceptable risk shifting and the absence of any requirements to comply with Australian standards. There is also a perception that due to lack of technical skill and expertise-the government has become an uninformed purchaser.
Key recommendations in the report include:
- All goods must comply with Australian standards, unless no standard is applicable,
- A requirement to measure/quantify local content,
- Implementation guidelines including encouragement and higher weighting for local content,
- Transparency of tender process,
- Procurement training to ensure those in the process are informed about the processes.
The joint select committee, chaired by Senator Nick Xenophon, handed down its final report, Buying into our Future: Review of amendments to the Commonwealth Procurement Rules, referring frequently to information provided in submissions made by Professionals Australia, and made 16 recommendations.
Professionals Australia was also part of committee hearings into the review, citing evidence of wastage on infrastructure projects that can extend into the $billions when projects are not appropriately scoped, causing run off impacts to the economy.
Chris Walton, CEO of Professionals Australia was quoted in the report: “If something goes wrong, the government ends up having the risk anyway, and the private sector then tries to either have a big enough balance sheet to wear the risk or tries to ensure against the risk. And who pays for the insurance? We do – the taxpayer.”
The result underlines the power of engineers as a group to drive real change in how we manage major spending decisions.