Appendix B—Procurement Practices and Outcomes

This appendix focuses on the Department's procurement practices and outcomes, with attention to:

  • procurement policies and practices
  • competitive tendering and contracting arrangements
  • use of consultancies, and
  • payments for marketing research and advertising.

Procurement policies and practices

The Department's approach to the procurement of goods and services, including consultancies, was consistent with the requirements of the Commonwealth Procurement Guidelines—December 2008—Financial Management Guidance No.1 (CPGs). The CPGs are applied to procurement activities through the Chief Executive's Instructions (CEIs) and supporting operational guidelines. The Department's procurement policies and processes have been developed to help ensure that it undertakes competitive, non-discriminatory procurement processes, uses resources efficiently, effectively, economically and ethically, and makes decisions in an accountable and transparent manner.

As part of these arrangements, in 2011–12 the Department published the following on the AusTender website www.tenders.gov.au:

  • a procurement plan providing details of expected procurements for 2011–12
  • details of publicly available procurement opportunities with a value of $80,000 or more, and
  • details of all contracts, standing offers and consultancies awarded with a value of $10,000 or more.

The Department also publishes on its website, at www.infrastructure.gov.au/department/contracts, details of all contracts with a value of $100,000 or more entered into or active during the previous 12 months.

The Department supports its staff in managing procurements appropriately by providing information and training on procurement policies and procedures, and maintaining a single point of contact for staff to seek advice on the CPGs, the CEIs and tendering processes. Standard tendering and contracting documentation has also been developed to ensure that consistent procurement practices are undertaken.

Australian National Audit Office access clauses

All contracts valued at $100,000 or more routinely include a requirement for access to the contractor's premises by the Auditor-General.

Exempt contracts

In 2011–12, no contracts were exempted from publication on AusTender on public interest grounds.

Consultancy contracts

The Department engages consultants where it lacks specialist expertise or when independent research, review or assessment is required. Consultants are typically engaged to investigate or diagnose a defined issue or problem; carry out defined reviews or evaluations; or provide independent advice, information or creative solutions to assist in the Department's decision making.

Prior to engaging consultants, the Department takes into account the skills and resources required for the task, the skills available internally, and the cost-effectiveness of engaging external expertise. The decision to engage a consultant is made in accordance with the Financial Management and Accountability Act 1997 and related regulations including the CPGs and relevant internal policies.

During 2011–12, 76 new consultancy contracts were entered into, involving total actual expenditure of $15.3 million. In addition, 27 ongoing consultancy contracts were active during the 2011–12 year, involving total actual expenditure of $4.0 million.

Annual reports contain information about actual expenditure on contracts for consultancies. Information on the value of contracts and consultancies is available on the AusTender website www.tenders.gov.au.

Table B.1 Trends in consultancies, 2009–10 to 2011–12 (GST inclusive)

2009–10 2010–11 2011–12
Consultancies
All consultancies, including consultancies let in previous years
Total expenditure $8.5m $15.4m $19.3m
New consultancies valued at $10,000 or more
Number let 76 78 72
Total value over the life of these contracts $9.9m $14.9m $19.8m

Payments for advertising and market research

In 2011–12, the Department paid $277,770 for advertising and market research. Table B.2 lists payments of $11,900 or more made during the financial year, as required by section 311A of the Commonwealth Electoral Act 1918.

Throughout 2011–12, the Department undertook no reportable advertising campaigns.

Table B.2 Details of advertising and market research payments of $11,900 or more

Creative advertising agencies
Firm Service provided Payment made in 2011–12
Total creative advertising   Nil
Market research/polling
Firm Service provided Payment made in 2011–12
Kreab & Gavin Anderson 1000 surveys were conducted of air cargo exporters to inform policy development for the Regulated Shipper Scheme. These surveys collected data about export volumes, commodity types and current security practices. This data will contribute to the development of a Regulation Impact Statement for the Regulated Shipper Scheme

Development and set-up of telephone and online survey script and questions
$35,000.00a
$17,500.00b
$17,500.00c
$15,000.00
Total market research/polling   $85,000.00
Media advertising organisations
Firm Service provided Payment made in 2011–12
Adcorp Advertising for staff vacancies $53,109d
Sensis Whitepages Whitepages listings for the Department $66,679
Adcorp Placement of advertisements for the National Infrastructure Construction Schedule $18,206
Total media advertising   $137,994

a First 500 surveys completed (telephone and online).

b 250 surveys completed (telephone and online).

c Last 250 surveys completed (telephone and online).

d This is the combined amount of all recruitment advertising payments in 2011–12.

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Last Updated: 17 November, 2014