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Finance’s John Grant outlines procurement changes aimed at stripping away red tape

by Staff Writers •
Free resource

For a vendor looking to conduct business with the Federal Government, there is no shortage of literature that they can turn to for direction.

In fact there are more than 1,000 pages of procurement advice for agencies and suppliers spread across Finance Circulars, the Good Procurement Practice series, individual agencies guidelines, Australian National Audit Office Better Practice Guides, and the Selling to Australian Government: A guide for Business.It’s an awful lot of text to fit into a busy workday.

This, John Grant told delegates at Intermedium’s Half Year Executive Briefing on 6 April 2011, is one of the reasons that makes government procurement appear more complex than it really should be.

“There’s a belief that procurement with the Commonwealth is difficult, but it shouldn’t be,” he said.

Grant, who is First Assistant Secretary in the Procurement Division at the Department of Finance and Deregulation (Finance), discussed the ways in which Finance is aiming to red tape and unnecessary bureaucratic procedures. He said Finance was seeking to make procurement simpler and easier for vendors, which in turn would result in better outcomes for government and for suppliers.

A key supporting objective is the rationalisation of the guidance and documentation referred to above, with Finance aiming for greater consistency and to reduce the amount of procurement advice released and make it simpler to read and understand.

He also spoke about the Department’s goal of reducing the cost of business for suppliers through a range of measures including:

  • introducing a simplified procurement process for lower risk contracts,
  • introducing a standardised contract document suite,
  • reducing the number of panel contracts and
  • encouraging ‘piggy-backing’ arrangements where appropriate.

“Why should agencies go out to the market with a 70 page document for an $80,000 purchase? It’s just too much” he said.

To address this issue, Finance has already introduced a set of standard documents designed to manage the simple procurements, i.e. procurements under $80,000, which make up nearly 75 percent of all contracts signed in the government market.  While these the use of these contract documents has not been mandated, Grant said that they have been well received by agencies.

Grant also spoke on the move to coordinated procurement as a means to deliver value for money through increased competition, and on the need to strengthen the capability of the procurement professionals within government.

He said that Finance was keen to move forward in the pursuit of these objectives, but were also conscious of the risks for both government and suppliers when changing procurement practices.

“If we make a system change it has major flow on effects so we have to get it right” he said.

In 2009-10 there were 124 Australian Government bodies procuring through Austender, at a total of more than $43 billion, of which Intermedium estimates ICT made up 10 percent.

The next IntermediumFederal Government event will be the Budget Briefing scheduled for 31 May in Canberra. This will be followed by a look at Federal Government procurement in the year ahead in Canberra on 4 August.

 

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Jurisdiction
  • Federal
Sector
  • Treasury
Tags
  • AGIMO
  • Budget Briefing
  • Department of Finance and Deregulation
  • John Grant
  • procurement strategy