ANAO finds IT procurement shortcomings

By Dylan Bushell-Embling
Wednesday, 02 September, 2020

ANAO finds IT procurement shortcomings

An audit of procurement processes for IT talent, including the Digital Transformation Agency's (DTA) Digital Marketplace, has found shortcomings in considerations of price, quality and risk during the process.

The Australian National Audit Office's report into the establishment and use of ICT-related procurement panels and arrangements evaluated the Digital Marketplace, the former IT Services Panel established by the Department of Infrastructure, and the IBM Whole of Australian Government Arrangement managed by the DTA.

The audit found that the DTA had not initially been complying with all the Commonwealth Procurement Rules (CPRS) with its operation of the Marketplace.

Upon being made aware of these shortcomings, the DTA changed its processes to comply with the minimum requirements of these CPRs. But the Agency's "consideration of price, quality and risk could [still] be more robust to better demonstrate that its evaluation of suppliers achieves value for money outcomes", the report states.

Infrastructure meanwhile had been compliant with the CPRs and adopted related guidance when establishing the panel, but also could have adopted a more robust approach to the consideration of price, quality and risk.

The Department also failed to conduct systematic monitoring to assess whether its panel arrangement was meeting its objectives.

On the other hand, this monitoring indicates the Digital Marketplace panel objectives are largely being met and the IBM arrangement is achieving some of its objectives, although anticipated savings have not yet been achieved.

The IBM arrangement was found to support the achievement of a value-for-money outcome given the circumstances involved with the lack of competition, with only one supplier.

On the other hand, while for 15 examined ICT-related procurement panels and arrangements entities could demonstrate that the majority of procurements supported value-for-money outcomes, in three cases this could not be easily demonstrated due to the absence of competition.

In its response to the audit, the Department of Infrastructure said the IT Services Panel ceased operation in February, but the Department will keep the findings of the report in mind when designing any future panels.

The DTA likewise agreed with the audit's findings, and the recommendations that the Agency ensures suppliers are treated equitably and that officials undertaking complex procurements have sufficient understanding of the procurement requirements, characteristics and related risks.

Image credit: © W. Potter

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