Australian government agencies breach purchasing regulations

30 June 2011

30 June 2011 | Adam Leach

Public sector bodies in Western Australia are ignoring the government’s procurement policy, auditors have discovered.

The Office of the AuditorGeneral for Western Australia has uncovered unsatisfactory buying practice, including the failure to source appropriate quotes for services, poor controls for managing conflicts of interest, unjustified use of exemptions from competitive tendering and inadequate record keeping.

In his assessment of nine government agencies, auditor general Colin Murphy found seven had failed to consistently implement the government’s purchasing policies.

Regional MPs were told “agencies may be missing opportunities to get best value for taxpayer dollars” when Murphy’s findings were published in the Publicsector performance report 2011, and tabled in the Parliament of WesternAustralia yesterday.

The document said 12 per cent of audited purchases involved exemptions to competitive tendering. However, the auditor general said 22 per cent of these exemptions did not satisfy government requirements for granting a sole source of supply. Murphy concluded: “A value for money procurement could therefore not be assured.”

The auditor general also discovered that some agencies engaged with suppliers without confirming key terms and conditions in writing, and did not have contract databases showing deals worth more than AUS$20,000 (£13,284).

“One of the fundamental ways of ensuring transparency of decision-making is through public reporting and yet five agencies failed to publically report on all their procurement contracts over AUD$20,000,” said Murphy.

The seven agencies not following policy were the Botanic Gardens and Parks Authority, the Chemistry Centre Western Australia, the Department of Culture and the Arts, the Perth Market Authority, the Subiaco Redevelopment Authority, the Western Australian Institute of Sport and Western Power. The Department of Water and the Department of State Development were the only two following procedures.

The report also said “not all agencies had registers to record declared interests and actions taken to mitigate them.”

Murphy has called on the public bodies to declare conflicts of interest, maintain all records and increase public reporting where relevant. He said: “Parliament and the community need to know that they are getting good value for their money – and much more needs to be done to give that assurance.”

In response to the report, all the public agencies said they had already taken action to improve procurement practices or were working on implementing the auditor general’s recommendations.

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