State Government responds to SA Productivity Commission's Inquiry into government procurement

09.08.2019
Better Services

The Marshall Liberal Government has announced its formal response to the final report of the SA Productivity Commission’s Inquiry into Government Procurement (Stage 1) – the first conducted by the Commission since it was established in October.

Treasurer Rob Lucas said the Government has accepted all 30 of its recommendations – the majority in full – which identify ways to cut red tape, reduce duplication of approvals and promote greater local business participation in local government tenders.

Many of the recommendations are expected to be implemented by the end of the year.

The Commission, Chaired by Dr Matthew Butlin, was asked to evaluate the effectiveness and efficiency of the Government’s procurement policies and practices, in response to SME concerns about the cost and time involved in tendering for government contracts.

It was also asked to identify options to improve procurement practices and their impacts on local industry.

“As a Government, we are committed to driving positive economic and jobs growth, increasing productivity and creating an environment that helps local businesses become more competitive on the national and global stage,” said Mr Lucas.

“These reforms will not only reduce red tape and promote greater understanding of procurement processes, but further support entrepreneurial start-ups and scale-ups by encouraging them to test their ideas and concepts or conduct trials with the Government as their first customer.

“Each year, the Government spends more than $5.1 billion on a range of goods and services and taxpayers expect us to make the best procurement choices that represent value for money and also support local business and industry.

“We have already made a good start, by reviewing aggregated contracts to identify procurements that can be broken into smaller contracts, where possible, and we expect most of the recommendations will be implemented by the end of the year.”

 

Among its initiatives, the Government will:

 

· deliver on its election commitments to:

o   establish a pre-registration system that will allow tenderers to pre-load their business details, making the process of bidding for government tenders simpler, quicker and easier;

o   ensure at least one local business has the opportunity to submit a tender for procurements between $220,000 and $550,000;

 

· expand the Office of the Industry Advocate’s Meet the Buyer Program to allow better communication of information between local businesses and government procurement staff, including a specific meet the buyer forum for ‘start-up’ businesses;

· develop a proposal to encourage start-ups and scalable businesses in SA to bring forward innovative solutions where the government can be the customer for new innovative ideas;

· streamline processes internal to government to eliminate delays for tenderers;

· improve procurement data to allow better demonstration of outcomes from expenditure of public monies on goods and services;

· improve guidance for procurement staff on how to incorporate both price and non-price factors (e.g. local employment, environmental sustainability, social objectives) in determining the overall value to government from the acquisition of goods and services.

 

The second stage of the Commission’s inquiry will consider capital works and prescribed agencies, such as SA Water and the South Australian Housing Trust. Its final report is due at the end of October.

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