What the Govt’s proposed IT procurement framework means for providers
A reduction of the number of procurement panels the Federal Government draws upon for its IT buying activities and an even bigger focus on smaller suppliers could be on the cards, under new changes proposed by the Digital Transformation Agency (DTA).
The DTA, which is charged with handling a large chunk of the Government’s IT services procurement arrangements, on 3 April released a consultation paper and called on the local IT industry and other stakeholders for feedback on its draft ICT Procurement Framework.
The proposed framework is aimed at providing the foundation needed to ensure the Federal Government is able to deliver a simple and clear approach to IT procurement, for both government buyers and industry sellers.
“We are working on a series of reforms to make it easier for small and medium businesses to sell to government, simplify processes, avoid duplication, and consolidate and coordinate whole-of-government buying,” the DTA said. “At the centre of this work is a new ICT Procurement Framework.”
According to the DTA, a team made up of people from various Government agencies and departments worked together earlier this year, researching how a framework for IT procurement could be used, and what those using the framework need out of it.
At the end of the research, the team had written the draft framework, which has now been released.
Broadly, it is hoped that the framework demonstrates the principles, policies and guidance work together to help deliver a fair, effective and efficient IT procurement process.
One of the main focus areas of the proposed framework revolves around the existing state of government procurement panels, which the DTA suggests could do with an overhaul that sees fewer and more flexible panel arrangements.
“Panels are good but they could be better,” the DTA said. “We found many government procurement officers see panels as rigid and lacking flexibility. This can mean new players and emerging technologies are locked out because traditional panels are not set up to bring on new service categories.
“There is a sentiment that there are too many panels, there is a wide variance in the way panels are managed and it can be difficult to find the panel manager for non-mandated panels,” it said.
The findings referred to by the DTA come from recommendations made in the Government’s Report of the ICT Procurement Taskforce.
The Government’s ICT Procurement Taskforce initiative, the details of which were revealed in 2016, is aimed at helping to overhaul the way the country spends its $9 billion-plus annual IT investment dollars.
Another major procurement initiative stemming from the recommendations of the taskforce’s report were the procurement reforms revealed last year by then Federal Assistant Minister for Cities and Digital Transformation, Angus Taylor, which saw IT contracts capped at $100 million.
The procurement changes also see a pledge by the Government to inject an additional $650 million annually into local tech companies that fall into the small to medium-sized enterprise (SME) category – reflecting a long-term goal by the DTA to give SMEs a better chance to vie for Government contracts.
Along with potential improvements to the Government’s existing panel arrangements, there was strong support for increasing the $80,000 procurement threshold which, according to the DTA, adds red tape for buyers and is seen as a barrier to entry for sellers. This threshold forms part of the Government’s international trade agreements, making it a complex issue to tackle.
At the same time, many agencies suggested that they would like to see an IT procurement ‘One Stop Shop’ from the DTA, which includes guidance, tools and reporting.
“Agencies would like the DTA to create an [IT] contracting suite for medium value procurements (targeting SMEs). This could include adding clauses for contractor poaching, piggybacking and others where appropriate,” the DTA said.
Meanwhile, the DTA said it found that there is support for, and value in, like-minded people talking, sharing and collaborating.
“This could be in the format of a panel manager forum or ICT professional’s forum,” the agency said.
As a way to address some of the findings of the procurement taskforce, the DTA’s draft framework includes several principles, including the principles of encouraging competition, being innovative and to iterate often.
Other principles include being structured in a way that enables SMEs to compete fairly to directly provide components of significant IT projects, being outcomes-focussed, using open standards and being cloud first.
Additionally, the principles of minimising security risks and not duplicating the building of platforms built by other agencies were also included in the proposed framework.
The proposed framework also outlined four policies. These include a new fair criteria policy, aimed at encouraging competition and support SME participation by including considerations such as insurance, limiting liability, security, and separate financial criteria for large enterprises and SME.
Another new policy, the “ICT consider first policy”, is intended to make sure all options are considered before procurement starts. This could include consideration of cloud first, open standards, cyber security, shared platforms, digital service standards and commercial off-the-shelf (COTS).
Two existing policies proposed for the framework include the ICT portfolio panels policy, also aimed at encouraging competition and support SME participation, and a review of the ICT capped term and value policy.
The proposed framework also makes mention of guidance, in the context of making the Government IT procurement process consistent, easier and more efficient.
Meanwhile, the framework references reporting, suggesting that it should focus on data that can be easily tracked and monitored, and that measures both the principles and the policies.
“We want to hear from anyone who will work in this framework,” the DTA said. “That’s both people from government agencies -- especially those in procurement -- and from industry, especially those that sell ICT to government, or want to in the future.”