Use of consultants and service contractors

... the private and community sectors now play an increasing role, not only in implementing programmes but in advocating policy, lobbying government and contributing their experience to public sector advisory boards. They, too, need to ensure that they fully appreciate the particular qualities of due process, perceived conflict of interest, risk management, performance reporting, community service obligations and competitive neutrality that appropriately apply when it is public funds that are being spent.

Peter Shergold at the launch of Public Sector Governance in Australia, Canberra, 5 August 2004

The policies and procedures for selecting consultants, and approving expenditure for them, are set out in the department’s Chief Executive Instructions (CEIs). The procurement method is determined having regard to the nature of the work involved and the broad cost thresholds set out in the CEIs.

During 2004–05, 15 new consultancy contracts were entered into, involving total expenditure of $203,620. In addition, five ongoing consultancy contracts were active during the 2004–05 financial year. Those contracts involved total expenditure of $300,769 in 2004–05.

Table 7 shows total expenditure on all consultancy services, covering both payments made on new contracts let in 2004–05 and payments made on contracts let in previous years. The larger consultancy contracts—those to the value of $10,000 or more—are detailed in Appendix 4 to this report, along with brief notes on the procurement methods used.

a Office of the Status of Women funding was transferred to the Department of Family and Community Services in 2004–05.

In 2004–05 the department let two contracts within the definition of ‘competitive tendering and contracting’. Under Output 4.4, contracts were awarded to Optus, to provide voice and switchboard services, at a cost of $745,000 ($305,584 was spent in 2004–05); and to Acumen Alliance, to assess and update information technology security policies and procedures, at a cost of $146,597 ($139,942 in 2004–05). In addition, during the year Macquarie Telecom was paid $612,472 for secure internet and web hosting, as part of a contract of $1,414,243 let for the period April 2004 to March 2007; and Exceed Systems Integration Pty Ltd was paid $2,239,044 for information and communication technology support services, as part of a contract of $5,804,52 let for the period 2004–05 to 2006–07.