'Why not an app?' Red tape endures for flights, hotels & car hire

By Harley Dennett

May 12, 2016

No Vacancies Sign outside of Hotel

Government is one of the last customer groups still using a travel agent, but for how much longer?

Brewing federally is a top mandarin backlash at the red tape and learned helplessness of the centrally coordinated status quo.

“Why not an app?” asked Department of Immigration and Border Protection boss Michael Pezzullo while imagining a future APS with fewer administrative officers at an IPAA talk this week. Employing purely administrative staff to help officials fill out the paperwork for air travel, car hire and accommodation doesn’t seem very efficient in the era of Uber and mobile PayWave.

Senior executives in Department of Defence expressed a similar desire for a “complete do-over” striking a balance between savings and not wasting officers’ time with codes and cumbersome processes. The last thing they want is to have to re-hire the staff made redundant when travel paperwork became a self-responsibility, but the experience isn’t living up to the simplicity they expected.

“WiFi, breakfast and car parking still aren’t part of the requirements.”

A hotels discussion paper, released on AusTender this week from the Commonwealth Department of Finance, is high on praise for the centrally coordinated arrangements.

Nonetheless, with the arrangement capturing the travel accommodation needs of 150 federal departments and agencies due to expire in June 2017, a review has been ordered to determine if a new accommodation arrangement is worth taking to market.

The discussion paper is market-focused, flagged for contracted travel agents and suppliers and posted to Finance’s procurement blog by chief technology officer John Sheridan. It doesn’t ask public servants, as the end users, for their needs or ideas.

Rather, the requirements are essentially unchanged since Finance first took over: comprehensive availability, non-commissionable rates, maximise the effectiveness of the government’s buying power, integration with nominated online booking tools, and acceptance of the government’s travel card provider — Diners Club Australia.

Currently AOT Group has the exclusive accommodation contract for the Commonwealth, although in most cases public servants have little or no interaction with AOT, instead booking through the exclusive travel agent QBT Pty Limited.

As one would expect, Finance doesn’t give away how much it hopes to save the taxpayer with the one-size-fits-all consistent process and bulk purchasing power of the Commonwealth.

Big yes, but it isn’t close to the market size of online booking sites that regular Australians now use by default. In the last financial year, the Finance-run setup spent approximately $110 million on public servants’ hotel stays for approximately 660,000 room nights. Around 23% of those bookings were in regional, rural and remote locations.

Existing red tape, real or imagined, has ensured some 60% of bookings are made more than seven days in advance. Meanwhile, the popular booking websites’ marketing and pricing revolve around the idea of leaving decisions until the last minute and still coming away cheaper.

Will anything change?

The questions for contracted travel agents and accommodation suppliers focus on bulk savings efficiencies and preventing hidden cost blowouts. Little of it suggests reform of the system is on the agenda.

The paper asks the obvious question floating around government offices ever since booking websites like Wotif, Expedia and LastMinute began popping up some 16 years ago. One can infer from the phrasing of the question how likely it is anything will change: “How can rates negotiated by the accommodation program manager always be equal to or better than rates offered by the various online websites?”

Travel agents are asked their views on a “one stop shop” approach between the various middle layers, minimising contact with travellers, while hotels are asked which middle layer they would prefer to deal with.

As for inclusions, like free WiFi, breakfast and car parking, those still aren’t part of the requirements, but Finance is hoping hotels will offer them as a bonus.

Government travel, it could be worse

It was worse before they got involved, Finance insists. It means from an accounting perspective. The paper provides a summary of the flaws found in the decentralised approach:

“Prior to the introduction of the Travel Arrangements, there was no consistent approach to travel procurement across government departments and agencies. A scoping study into the travel arrangements noted that this decentralised approach to travel procurement, with no overarching coordination and strategic management, had resulted in a fragmented and inconsistent practices, duplication of effort and different pricing levels across the government departments and agencies.”

Finance took over gradually. First air and ground travel, then accommodation and car hire. The department claims both steps were improvements: “Both phases of the travel arrangements have provided savings, addressed contractual efficiencies, increased transparency and provided greater value for money in the purchasing of travel services.”

Since then, the travel management services panel has expired and has been replaced with just one authorised travel agent, QBT Pty Limited. All domestic and international travel for government business originating in Australia must now made through though it, preferably using its online booking tool Amadeus e-Travel Management (AeTM).

AOT Group has the exclusive contract to manage the Commonwealth’s accommodation needs, but whether public servants book accommodation through QBT or directly with AOT is up to individual agency policies.

Only car hire still has a panel, with Europcar Australia and Thrifty Car Rental the two authorised suppliers.

Consultation is open May 27. Comments and feedback can be made via hoteltender@fiannce.gov.au.

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