Media Release – Tuesday, 26 March 2019

Draft Report on Government Procurement Released

The South Australian Productivity Commission (SAPC) today released its draft report for its inquiry into government procurement.  The Commission was asked by the South Australian Government in late October 2018 to inquire into the efficiency and effectiveness of policies and practices in government procurement for goods and services.  The scope of the inquiry was expanded to all government procurement in February 2019.

Chair of the South Australian Productivity Commission Dr Matthew Butlin said government procurement is important and complex and has a large impact on the South Australian economy.

“The South Australian expenditure on goods, services and construction is equivalent to around 10 per cent of Gross State Product,” Dr Butlin said.

The Commission received many submissions and engaged with almost one hundred participants from businesses, government authorities and not–for–profit organisations.

Participants raised many issues, including perceptions of red tape, excessive delays, inadequate knowledge of the market place, including local suppliers and barriers to innovation. These issues are being considered against the importance to the State of a procurement system that is fit for purpose and delivers what government expects of it.

“I greatly appreciate the contribution and goodwill of all the participants in the inquiry to date”. Dr Butlin said.

“Our draft report begins to set out some directions for reform. I look forward to further discussion and input in this next round of refinement of the inquiry.”

The SAPC is the South Australian Government’s independent research and advisory body on opportunities to improve the accessibility, efficiency and quality of government services; facilitate structural change; and promote regional development and development occurring in an ecologically sustainable way.

It provides the government with advice and recommendations based on evidence, rigorous analysis and impartial assessment.

BACKGROUND

  • On 31 October 2018, the Commission was asked to undertake an inquiry to assess the efficiency and effectiveness of South Australia procurement and processes and practices.
  • Initially, the scope of the inquiry was limited to all public authorities subject to the State Procurement Act 2004 and did not include capital projects.
  • On 15 February 2019, the Premier advised the Commission he had accepted its recommended approach to expanding the scope of the inquiry to include prescribed public authorities and capital projects.
  • The Commission will complete the inquiry in two parts.  The stage 1 report is focussed on the original terms of reference and the stage 2 report will be the final report on the whole procurement system.

STAGE 1 REPORT

  • The Commission has released its draft report on Stage 1 of its inquiry. A copy of the draft report is available on the SAPC website – www.sapc.sa.gov.au
  • The draft report gives interested participants an opportunity to comment on the Commission’s analysis, conclusions and draft recommendations so far.
  • The Commission encourages input from participants, with a deadline of 19 April 2019 for written submissions.
  • The Commission will hold further consultations.

NEXT STEPS

  • The Commission will complete Stage 1 of the inquiry.
  • It will gather evidence for Stage 2 but will not start work until Stage 1 is completed.
  • Any issues in Stage 1 that would benefit from being considered in the context all government procurement will be considered in Stage 2.