The ACT Government Procurement Board meets its statutory obligations to review and advise on proposals, but is not operating optimally, according to a report presented by the ACT Auditor-General this week.
The Government Procurement Board, which has operated for more than 20 years, reviews procurement proposals and advises the Territory Entity intending to undertake the procurement.
“The Board is not optimally effective or efficient in fulfilling its functions,” Auditor-General Michael Harris’s report stated. “Its effectiveness is compromised by the lack of clarity about what its primary role is, and by its insufficiently challenging review of, and advice for, higher risk procurement proposals.”
The audit looked at the Government Procurement Board’s role in reviewing procurement proposals and providing advice on the proposals. The audit examined the Board’s review of and advice on 411 proposals between 2017 and 2022. It also selected three case studies for closer examination: proposals related to the procurement of linear accelerators (Canberra Health Services), the supply of asphalt (Roads ACT), and the Canberra Institute of Technology’s $8.78 million contracts for organisational transformation services.
The report found that the procurement process was inefficient because of duplication of work for low‐risk proposals involving multiple entities (the Board, Procurement ACT, and Major Projects Canberra). The direct and indirect costs associated with the Board would be better applied, and could be minimised, if the Board reviewed fewer, higher‐risk procurement proposals.
The Government Procurement Act 2001 and Government Procurement Regulation 2007 also limited the Board’s effectiveness. The report recommended that the Board be more independent; have express authority to advise, approve, and give directions; and to focus on specific proposals and matters for its review.
The Board’s advice was constrained by last‐minute proposals, by a lack of authority, by predetermined courses of action, by loose and inconsistent terminology, and by incomplete disclosure of information.
“As a result, the Board’s advice was insufficiently probing and sceptical, was unassertive and at times equivocal, and was not consistently sound,” the report concluded.
The ACT Government acknowledged the report and would consider the recommendations and respond in line with the required statutory timeframe, a spokesperson said.
“The Government notes the report acknowledges the substantial procurement reform program already underway, and legislation is proposed to be introduced to amend the Government Procurement Act later this year.
“Implementing recommendations from the report as part of this legislative process will be considered.”
Canberra Liberals MLA Peter Cain, Shadow Assistant Treasurer, claimed the “scathing” report showed that Special Minister of State Chris Steel’s “incompetence had passed a tipping point”.
It was, Mr Cain noted, the sixth report the Auditor-General had tabled detailing Mr Steel and the ACT Government’s mishandling of procurement in the ACT. Mr Cain expected that two more reports the Auditor-General would table this year would also discuss procurement.
“This is becoming parody,” Mr Cain said.
“The Minister, who directly appoints Board members and writes the policy that informs the Board’s function, is wholly responsible for contracts that have egregiously wasted taxpayer money.
“Procurement is vitally important to the fiscal wellbeing of the Territory. Getting it right is the first step on a path towards surplus.
“With hundreds of millions of taxpayer dollars already lost in contracts that do not follow procedure under this Minister, it is clear we are sailing a ship destined to sink.”
