Meeting global standard for open procurement data might cost too much

By Stephen Easton

Tuesday July 25, 2017

If Australia complied with the international Open Contracting Data Standard, the federal government would publish information about most of the goods and services it purchases on behalf of the community in a standardised form of machine-readable data.

A new report quietly published last week by the Department of Finance looks at what the Commonwealth would have to change to meet that standard — so much, it turns out, that the cost might be prohibitive.

Members of the public are invited to comment on the review until August 10, then the government will receive advice from the department, and decide if it wants to aspire to the higher standard of transparency.

And just like that, by commissioning a review from a law firm and posting its report on the Department of Finance blog, the federal government has mostly fulfilled one of the pledges it made when it agreed to sign Australia up to the global Open Government Partnership last year.

The government is not obliged to take any further action or do anything different in future under its pledge to “ensure transparency in government procurement and continue to support the Open Contracting Global Principles” in Australia’s Open Government National Action Plan.

“Finance will take the feedback provided by the public into account, as applicable, when finalising this report and providing recommendations to Government, as required by the NAP,” according to the review. The government has not promised to publish the department’s eventual recommendations or its response.

The public consultation phase is roughly on time, being only about a month behind the NAP schedule, and all that remains is for the government to “implement agreed measures to improve compliance with the Open Contracting Data Standard” — assuming it agrees to some.

“The OCDS is a data publication model for the publication of government contracting data, and is promoted by the Open Contracting Partnership, a collective international body which promotes the publication and use of open data,” explains John Sheridan, the department’s first assistant secretary responsible for procurement.

The report begins by pointing out the OCDS publishing requirements are “fundamentally different” to the current system, where information about most contracts and approaches to the market can be found on AusTender.

The Open Contracting Partnership recognises three levels of transparency — basic, intermediate and advanced — and complying with them is somewhat complex, involving both “required” and “recommended” data fields. The reviewers concluded information published on AusTender “generally” meets the basic standard in terms of what is there, but is not in the right data formats and usually doesn’t contain enough detail.

Numerically, AusTender provides users about 61% of the required data fields to meet “basic” compliance and 29% of the recommended data fields for that level, according to the review. It also provides 29% of required fields for the “intermediate” level but has only 8% of the recommended features, and it is nowhere near the “advanced” standard.

The trusty procurement portal would have to be redesigned significantly or replaced with an entirely new system to meet the OCDS, the review found, and the reviewers comment “it is reasonable to expect” that will cost a fair bit, given the government recently spent several million dollars on “minor changes” to meet obligations under international trade agreements.

There could also be economic benefits to meeting the standard, however, as with other kinds of open data when it is provided in the right formats, and the review was not asked to weigh these up and determine if the government would get value for money from striving for OCDS compliance.

But the report does raise the possibility that the whole idea could be seen as too expensive, and suggests the government might decide to set a lower bar of making sure AusTender “more closely aligns” with the standard, instead of trying to meet it.

AusTender ain’t half bad

“The results of the review are largely positive,” writes Sheridan in the blog post. “The Australian Government is already compliant, in data terms, with approximately one third of the data field requirements of the OCDS.

“This compliance increases when considering some of the information already published in other online locations (such as, or through means that aren’t explicit data releases (such as annual procurement plans on AusTender).

“The remaining non-compliances relate to significant differences between the contracting data collected by the Australian Government and the OCDS, such as the collection and publication of unsuccessful tenderers, and the linking of data systems such as budget/planning data from the Budget Papers to released Australian Government business opportunities.”

Such standards are helpful in demonstrating how open government ideals can come to fruition with a little help from people who know what open data is good for, but at the same time, it’s a fair point that AusTender isn’t half bad.

Ministers only have the time and inclination to loudly and proudly tell the public about a small fraction of what the government does and lots of citizens want to know more. Information that is already available about what agencies have agreed to buy or plan to buy provides this basic public transparency and accountability. regardless of format.

It might not be earth-shattering news but just this week, for example, one can see the Commonwealth Grants Commission is probably about to go through a major review examining the “appropriateness, efficiency and efficacy” of all its business processes, and how it calculates the relative “fiscal capacities” of the states to distribute taxes.

And the fact that the Department of the Environment is looking to upgrade its Australian Greenhouse Emissions Information System might be of interest beyond the IT sector as well.

Of course, data covering the whole breadth of the Commonwealth procurement — worth over $56 billion in 2015-16 — can reveal high-level insights and broad trends that might be of great value to the community, and the OCDS provides a best-practice model to make that data as useful as possible.

Procurement is also the area where integrity and probity risks are highest, as the Open Contracting Partnership notes in an article promoting the benefits of “shareable, reusable, machine-readable open data on public contracting across the entire cycle of public procurement” that can be used in third-party applications for various purposes.

Open government utopia vs capitalist reality

It’s a great vision, but aside from the cost, the review suggests some of the OCDS standard might also be a little too utopian for Canberra.

Sheridan acknowledges that meeting the OCDS would be a “significant shift” from the current AusTender system and would not only cost a lot, but also “require consideration of the benefits of such data availability and any commercial or risk sensitivities associated with the publication of such information”.

On that second point, the review explains that giving away too much information can lead to suppliers taking taxpayers for a ride:

“For example, disclosure of the Commonwealth’s budget for a project (which may include internal and external costs) may not be appropriate to disclose if it could distort the tendered pricing for a procurement or otherwise reduce competitive tension in the market (for example, there is a risk that tenderers price to the budget, which may exceed normal competitive pricing, and it may also limit innovation by tenderers and the ability of the Commonwealth to obtain value for money).”

Progress is also being made towards another commitment under the NAP — to establish a set of uniform metrics to describe how people make use of freedom of information (or right to information) legislation, in a consistent way across all Australian jurisdictions. The relevant commissioners from each government have agreed on six proposed metrics and invite public comments until August 9.

The action plan was developed last year by a group of bureaucrats and interested “civil society” representatives, who were supposed to have been replaced by a multi-stakeholder forum by now, but we’re yet to see any announcements about its membership or its first meeting.

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