Permissions Capability Procurement Shortcomings
It’s been a busy week for government procurement audits globally, including the most recent report from the Australian National Audit Office(ANAO), looking at the Department of Home Affairs (Home Affairs or the department) procurement process for a ‘Global Digital Platform’ (GDP), an IT workflow system to modernise the processing of Australian visa applications.
The procurement process originally began in 2017, before being terminated on 18 March 2020 due to changes in Australian Government policy, including a broader scope for the system. In October 2020, Home Affairs commenced a new procurement process for the broader ‘Permissions Capability’ system with a Request for Tender (RFT) released in October 2020. Accenture Australia Pty Ltd (Accenture) was awarded the initial three year contract.
The ANAO audit objective was to assess whether the Department of Home Affairs’ procurement process for the Permissions Capability employed open and effective competition and achieved value for money.
There findings were:
- Home Affairs employed an open approach to market and the procurement was designed to demonstrate that value for money could be achieved. However, the department’s conduct of the procurement reduced its ability to demonstrate that value for money was achieved.
- While the procurement was undertaken through an open request for tender, there were a number of shortcomings in the approach taken by Home Affairs. In particular:
-The two shortlisted tenderers from the terminated procurement process for the Global Digital Platform had a competitive advantage as a result of their ‘deep engagement’ with Home Affairs through that 24-month process. The department implemented in full or in part three of the nine strategies identified by its legal and probity advisers to ‘level the playing field’;
-The department had approached the market for a tenderer to take end-to-end responsibility for the Permissions Capability. Some tenders accepted for evaluation proposed an alternative commercial model that involved a material shifting of risk to the department. The department’s ability to compare prices was also impacted by tenderers bringing forward alternative commercial models.
-There were inconsistencies in the available evaluation records which meant that the extent to which the successful tenderer met the criteria relating to the solution proposed (‘very good’) and capacity and capability (‘good’) was not clearly supported.
The ANAO recommendation, post the review was;
Paragraph 2.27
When undertaking procurements, the Department of Home Affairs clearly identify in its request documentation whether responses that depart from its preferred contracting approach will be accepted and, if so, identifying in its tender evaluation plan how those departures will be addressed in the evaluation and ranking of competing tenders.
Home Affairs partially agreed to this recommendation, agreeing that it could have sought multiple quotes when engaging procurement advisors and that in some instances, its probity administration was not timely. They disagreed with the ANAO’s finding that its conduct of the procurement reduced its ability to demonstrate that value for money was achieved, saying it undertook a full assessment of all tenders, and the relative benefits and risks of each. The ANAO further responded that a key issue identified by the audit was that a number of tenderers proposed a different commercial model to that included in the RFT, which involved additional risk for the department and impacted upon the evaluation of the value for money offered by the competing tenderers. This affected the evaluation of tenders. In addition, there were gaps in the records of the evaluation against the two technical criteria and the higher rating of Accenture’s tender against the criteria was not clearly supported by the department’s evaluation records.
You can read the full details of the ANAO audit here
