Allygroup’s CEO, Joanne Rees, was quoted in the Australian Financial Review on Tuesday 6 March 2012 in regards to government procurement.

The Australian Financial Review, 06 March 2012

Emily Parkinson

The NSW government will scrap fees to businesses to deliver its contracts and give certain of its agencies new powers to buy goods and services direct.

The overhaul will decentralise procurement and give larger government agencies new purchasing powers, a move designed to cut “red tape and thicket”, NSW ministers told industry yesterday.

A centralised body, the NSW Government Procurement Board, will replace the State Contracts Control Board, and comprise directors-general.

Michael Coutts-Trotter, director-general of the Department of Finance and Services, said he hoped the new structure would simplify doing business with the NSW government, which spends an estimated 12.7 billion on goods and services annually and has the largest expenditure under whole-of-government contracts, according to statistics in its discussion paper.

Mr Coutts-Trotter said past procurement often produced poor outcomes for tax payers and provided limited opportunities for small to medium-sized enterprises.

“We’ve made it … too easy for people bamboozled by this rule book to suspect the decisions that those rules produce,” he told about 100 industry executives, including information technology, energy and pharmaceutical company heads.

While some welcomed the plans, others doubted how they would cut red tape. Joanne Rees, chief executive of legal management consulting firm Allygroup, said more skilled public servants were needed. “Often departments and agencies don’t have procurement expertise and are not out there to be bold and innovative,” she said.

Andrew Stevens, managing director of IBM Australia, told ministers he wanted the framework to address probity issues. “In the past that has got in the way of innovation being offered because people were concerned their intellectual property would be shopped around as part of the tender process,” he said.

Mr Coutts-Trotter said procurement would be more efficient if it was devolved to agencies with a direct interest in the goods and services they bought.

The supply management fee of up to 2.5 per cent will be removed on July 1, as existing contracts expire.