1. Introduction
   1. During the course of the Committee’s inquiry into Commonwealth procurement, completed in 2023,[1] issues were raised regarding certain procurements undertaken by Services Australia and the National Disability Insurance Agency (NDIA).
   2. Dr Ian Watt AC had been appointed to lead an Independent Review of Services Australia and NDIA Procurement and Contracting (hereafter referred to as the 'Watt review'), which commenced in December 2022. That investigation addressed questions about the involvement of Milo Consulting (trading as Synergy 360) and associated entities in procurements at the two agencies and reported its findings on 6March 2023.[2]
   3. The Committee held a public hearing on 14 April 2023 to consider the findings of the Watt review, at that time as part of its existing procurement inquiry, and heard evidence from Dr Watt, Services Australia, the NDIA, and other witnesses involved or connected with Synergy 360.
   4. The Committee subsequently resolved on 11 May 2023 to conduct this separate inquiry into the issues arising from the Watt review and issued a media announcement on 17 May 2023. The Committee had determined that because the scope of the Watt review had been limited to the conduct of Australian public servants, it would inquire separately into the issues raised in and associated with its findings, rather than incorporate this new material into the existing procurement inquiry.

Conduct of the inquiry

Interim report on 13 September 2023

1.5The Committee conducted public hearings for the inquiry on 23June and 8September2023 (Appendix B). Six submissions were received by the inquiry at this stage, including one confidentially (Appendix A).

1.6The initial focus of the Committee were the activities of the Synergy 360 consulting firm and its role as an advisor to the technology company Infosys on growing its public sector business and obtaining Government IT contracts.

1.7The Committee published an interim report for the inquiry on 13 September 2023[3] in which it drew the following conclusions:

• Serious questions had arisen about financial impropriety and improper relationships with parties receiving contracts from the Commonwealth
• Infosys paid significant funds to Synergy 360 for a number of contracts
• Infosys held a range of meetings with former Minster Stuart Robert when it was bidding for, or delivering, a later troubled major IT contract, with no public servants present or records kept
• Although alleged, no direct evidence was presented that former Minister Robert benefitted financially from the awards of any contracts, and these allegations were strongly rejected by him
• The Committee’s efforts to obtain further documentation in relation to these allegations were frustrated by refusals to comply with requests for this information.
  8. The Committee noted also in these interim report findings that questions had arisen regarding its statutory powers under sections 13-15 of the Public Accounts and Audit Committee Act 1951. The Committee commented in this respect that:

Comprehensive advice is not available to the Committee regarding the full extent of and procedures relating to these powers, which do not appear to have been used in recent memory. Legal advice is therefore required which can guide this and future Committees when necessary.[4]

1.9The Committee determined that as it did not have the resources or accounting expertise available to it to properly assess or make findings in relation to the allegations, a referral would be made to the newly established National Anti-Corruption Commission (NACC) to consider this matter. The Committee’s view was that consideration of these allegations would need to be made by an agency with compulsory questioning and document gathering and investigatory powers.

1.10The Committee made the following two recommendations in its interim report:

1The Committee recommends that the National Anti-Corruption Commission examine all material gathered through this inquiry to determine whether or not to conduct its own inquiry into procurements at Services Australia and the National Disability Insurance Agency involving Milo Consulting (trading as Synergy 360), the Hon Stuart Robert, and John Margerison [a part owner of Synergy 360 and former business partner of Mr Robert]. In making this recommendation the Committee is not making any findings in relation to the conduct of any individuals.

2The Committee recommends that the Speaker of the House of Representatives approve the commissioning of legal advice in relation to the Committee’s statutory powers under sections 13-15 of the Public Accounts and Audit Committee Act 1951 including but not limited to situations in which a person claims to be resident overseas.

1.11Coalition members of the Committee presented a dissenting opinion in relation to recommendation 1 and the referral to the NACC.[5] The Committee published a corrigendum to the interim report on 15 November 2023 in relation to a minor factual issue which had no impact on its findings or recommendations.[6]

Present (Final) report

1.12The Committee conducted two further hearings for the inquiry on 20 November 2023 and 1 February 2024 (Appendix B). Four additional submissions. including one confidential submission, and six supplementary submissions were received (Appendix A).

1.13The focus of the Committee in the latter part of the inquiry, discussed in this final report, was the procurement of the PACE system by NDIA from the IT company Salesforce. The PACE system replaced NDIA’s previous customer relationship platform to improve its management of the interactions between participants, staff and partners in the scheme.

1.14This procurement by NDIA had been evaluated by the Watt review, which did not report misconduct in relation to the contract award but did note certain behaviours that fell short of the standards expected of Australian public servants. NDIA accepted this assessment and initiated its own internal review, which was ongoing at the time of writing and was expected to conclude in late 2024.

1.15The Committee explored these issues further in the following areas:

• Contract variations
• Increased user licences
• Value for money
• Conduct of the procurement
  16. In its evaluation of the conduct of the procurement, the Committee assessed the findings of the Watt review relating to procurement practices, hospitality and gifts provided to NDIA officials by Salesforce, and the engagement of Synergy 360 by Salesforce to advise on Government contracts. The Committee further examined meetings between Salesforce and former Minister Robert, one of which also involved officials of NDIA, Services Australia, and Synergy 360 while all others were conducted only with Minister Robert, Synergy 360 and Salesforce with no officials present.
  17. The Committee makes a number of observations and recommendations in relation to the NDIA response to the Watt review, and its internal investigations that arose from that report, and regarding the procurement, implementation and operation of the PACE system by NDIA.

Footnotes

[1]Joint Committee of Public Accounts and Audit (JCPAA), Report 498: ‘Commitment Issues’ – An Inquiry into Commonwealth procurement, August 2023.

[2]Dr Ian Watt AC, Independent Review of Services Australia and NDIA Procurement and Contracting: Independent Reviewer’s Report, March 2023.

[3]Joint Standing Committee of Public Accounts and Audit (JCPAA), Report 500: Inquiry into procurement at Services Australia and the NDIA - Interim Report, September 2023, Canberra.

[4]JCPAA, Report 500: Inquiry into procurement at Services Australia and the NDIA - Interim Report, September 2023, Canberra, p. 7.

[5]JCPAA, Report 500: Inquiry into procurement at Services Australia and the NDIA - Interim Report, September 2023, Canberra, pages 9–12.

[6]JCPAA, Corrigendum to Report 500: Inquiry into procurement at Services Australia and the NDIA - Interim Report, November 2023, Canberra.