Three agencies have failed to comply with the NSW Procurement Board’s Direction for engaging probity practitioners, the NSW Auditor-General has found.
The audit, released by Acting Auditor-General Ian Goodwin, looked at whether Transport for NSW, the Department of Education, and the Ministry of Health complied with procurement probity policies.
It also evaluated their effectiveness in ensuring value for money when using probity practitioners.
Goodwin said the agencies lack the effective processes necessary to achieve compliance and value for money.
“These agencies tended to rely on a limited number of external probity service providers, sometimes using them on a continuous basis,” he said.
“Also in some instances, agencies did not always manage probity practitioners’ independence and conflicts of interest transparently.”
The NSW Procurement Board, launched in 2013, has not asked agencies to report on their use of probity practitioners since its initial creation, and fails to effectively monitor agencies’ compliance with requirements, the Audit Office found.
It recommended that the Board develop and implement criteria to ensure prequalified practitioners can deliver quality outcomes.
The Auditor-General also suggested that agencies review and revise probity policies, processes and systems to ensure they comply with requirements, and the Department of Premier and Cabinet develop probity guidance with Gateway Coordination Agencies.
“Probity is important for NSW government agencies as it helps ensure decisions are made with integrity, fairness and accountability, while attaining value for money,” Goodwin said.
All three agencies agreed to consider the recommendations.
However, Rodd Staples, Secretary of Transport for NSW, said the agency has already “implemented an extensive system to ensure probity is maintained throughout procurement and project activities”.
“The effectiveness of this system is evidenced by the very low number of engagements over the three year period assessed, in which less than 1% of our procurement events resulted in the engagement of an external probity advisor,” Staples said.
Secretary for the Department of Education Mark Scott said “the department believes it materially complies with the requirements of the Procurement Board Direction…when engaging probity practitioners and that it has effective processes established to achieve compliance and assure the engagements achieved value for money”.
“However, the department notes the recommendations within the report and will complete these as requested by the Audit Office.”
Secretary for NSW Health Elizabeth Koff acknowledges the “significant need for assurance on probity within the NSW Public Sector” and suggests that “there has been some difference in the interpretation of [the Board Direction] during the course of this audit”.
“I request that any recommendation seeking to strengthen processes includes action for the Board to revise their guidance to be more supportive and to consider the practical needs of NSW Government Agencies,” Koff said.