This appeared a few days ago.
New bidders locked out of $65 billion federal procurement opportunity
Tom Burton Government Editor
Mar 13, 2020 – 5.17pm
More than half of the Commonwealth government's $65 billion annual procurement is let without competitive tendering, according to a new Audit Office study released this week.
Lack of competition means new vendors are not able to bid for lucrative government contracts, and taxpayers are not getting the benefit of potentially lower-cost suppliers or innovative vendors able to deliver a better solution.
The ANAO analysis of AusTender data over the last decade showed 44 per cent of eligible tenders had not been opened up to new vendors. In 2018-19, 55 per cent of parent contracts were reported as using the limited tender procurement method.
Limited tender is where one or more potential providers are approached to make a submission rather than opening up the bidding to all potential bidders. AusTender is the system used by the Commonwealth for about two-thirds of its procurement activity.
The preference to work with known vendors often puts departments and agencies at odds with the key objective of the Commonwealth Procurement Rules – achieving value for money.
Many agencies use limited tendering to avoid the burden of preparing the extensive documentation associated with a full tender. Business managers typically try to use vendors they already have a relationship with and know can deliver and understand the agency's operating conditions.
Full tenders also require agencies to specify their requirements upfront. The Thodey review of the Australian Public Service said this encouraged large one-off change programs, rather than more flexible and agile delivery models.
The preference to work with known vendors often puts departments and agencies at odds with the key objective of the Commonwealth Procurement Rules (CPRs) which set out the procedures agencies must follow for purchasing.
"Achieving value for money is the core rule of the CPRs," the ANAO report said.
……
Among the corporatised agencies the highest users of limited tendering were the Murray-Darling Basin Authority (62 per cent of all contracts by value), Australian Pesticides and Veterinary Medicines Authority (58 per cent), Australian Digital Health Agency (54 per cent) and CSIRO (50 per cent).
More here:
So we have the ADHA spending more than half of our funds without a proper competitive process.
As is made clear in the discussion above there is clearcut agency capture by the large suppliers – think Accenture etc. – where one contract win can lead to a decade or two of lack of pressure on the funds the taxpayer finds itself having to part with a particular supplier.
There really should be some form of time-limit on a contractor engagement – say 3 years – to prevent capture and lock-in.
This is not good enough in the stewardship of our money on ADHA’s part!
David.
8 comments:
If you've seen today's media onslaught advising people what to do about COVID-19, notice what's missing?
The government is not telling everyone to go and see their GP to create or update their My Health Record. They did advise people that such a strategy would be a good idea in the bush fire areas, why not for COVID-19?
Because it would cripple the health system. So would all that extra work trying to update the record of those who have tests positive, or negative, apart from being unreliable (yesterday's test may be wrong today) without context, its meaningless.
And the My Health Record won't be of much use at the population level - the data is too little and leaves out most people who have limited or no reactions/symptoms.
Therefore there is no chance that the My Health Record will be of any use in the most serious of health events to hit this country in a long time.
Re-platforming the pimple on the backside of the health system won't fix it, it is a fatally flawed idea.
It's not just the Accenture's, EY’s and Microsoft making a killing there are a few ’consultancies’ which are no more than high-priced resource providers.
https://www.digitalhealth.gov.au/about-the-agency/reporting-agency-contracts/list-of-agency-contracts
There is some interesting patterns and numbers in those published contracts.
NSW does well out of all of this, I thought Jurisdiction had a 12 month tenure on the board? About time Zoran was replaced with someone from another state
The problem is threefold
1. Timelines are to tight because there is little Or no real upfront work done, it goes straight from PowerPoint to green light to production.
2. End dates are set before estimates are provided constraining the projects and forcing risk taking beyound any reasonable threashold. Results in people investing more time and effort in saving their own skin than working out how others can be successful.
3. Hi turnover of staff, most are not skilled in procurement outside Subways.
This results in what we have here, a lot of vendor lock in, dumbing down of organisations. All held to ransom by those at the top who must be seen as the gods of digital health.
If what you say is true (and there is no reason to doubt it) then tight timelines with "little or no real upfront work done", combined with "forced risk taking beyond any reasonable threshold", is the perfect recipe for achieving a complete failure of any large, complex, project riddled with unsolved wicked problems. That politicians and senior bureaucrats do not comprehend this is inexcusable.
@1:16 PM You are so right. The question is - Why has this been permitted to happen? And the answer is because Competent Governance and Focused Risk Mitigation have been neglected. As a taxpayer I am so very angry that this has been allowed to happen.
Can’t recall who to attribute this to but scribbled down when I heard it. Is very applicable:
the ones who enthusiastically take up the latest management initiative are with the odd exception either happy clappy idiots or self-promoting sycophants. The cynical guys at the back of the hall are generally those who care about the organisation.
Strange how the back of the hall is empty these days.
My experience with ADHA is that on one hand you have a high turn-over based on project needs so there is a lack of knowledge continuum. Those that have somehow survived are now so worn down as to almost be disengaged.
Neither group is served well be self centred management that have no time for staff. From someone who visits it is almost because of the seasonal worker mentality there is little respect for individuals and certainly no knowledge transfer going on.
As for the other large collectives that have emerged this is simply eroding quality and thinning what limited skills available.
I am all for new entrants as eHealth is a generational transformation, but without a base to learn from the future looks bleak.
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