A performance audit into whether water procurements by the Department of Agriculture, Water and the Environment (DAWE) were consistent with Government policy under the Murray Darling Water buyback scheme has found the arrangements in place to support procurements were not fully effective.
In her report, Procurement of Strategic Water Entitlements, Acting Auditor-General Rona Mellor says the Department did not consistently apply approved policy, planning and guidance to the assessment of all limited tender procurements.
“The program design and planning to support strategic water procurements was largely appropriate,” Ms Mellor said.
“The Department developed guidance that aligned with the high level policy objective to assist in the assessment of limited tenders,” she said.
“However, it is not clear how the Department assessed individual procurements to determine their strategic priority or considered how to encourage competition within the limited tender process.”
Ms Mellor said DAWE had not adequately planned for evaluation of the strategic water purchasing program.
She said it was also unclear whether two of the seven instructions given to the Department by the Minister were fully executed.
“The Department did not develop a framework designed to maximise value for money,” she said.
“The Department only negotiated price for one procurement.”
The Acting Auditor-General said DAWE had not appropriately managed procurement risks.
“While the Department identified risks associated with the broader water recovery strategy, there is limited evidence of risks being raised or managed for individual procurements.”
She made four recommendations aimed at improving procurement guidance; developing assurance mechanisms; updating conflict of interest arrangements; and the development of evaluation strategies.
Ms Mellor said the audit held key messages for all Government entities, including that entities should ensure advice provided to Ministers and decision-makers clearly and consistently addressed key policy commitments; that entities should actively manage risk; and entities should seek to negotiate on price to optimise value for money outcomes.
The Acting Auditor-General’s report can be accessed online at this PS News link and her 61-page printed report at this link.
The audit team was Tara Rutter, Jacqueline Hedditch, Taela Edwards, Yvonne Buresch, Jason Depasquale and Michael White.
