Budget Review 2022–23 Index
Philip Hamilton
Small and medium-sized enterprises (SMEs)
The Budget papers foreshadow changes to the Commonwealth
Procurement Rules by 1 July 2022 to ‘give SMEs a fairer opportunity to win
Government contracts’. The Department
of Finance has reported that ‘in 2020–21 there were 84,054 contracts
published on AusTender with a combined value of $69.8 billion’.
The new rules will require officials to consider
disaggregating larger projects into smaller work packages to encourage greater
participation by more businesses, regardless of their size. We will also
require that agencies limit the extent of pre-contract insurance and liability
requirements, to reflect sufficient risk sharing while not imposing
unreasonable or disproportionate risk transfer that unduly restricts the number
of suppliers who can bid. Our pay on-time commitment will be extended to all
suppliers, regardless of contract value.
Reflecting some of the unique issues involved with national
security, and consistent with Australia’s international undertakings, we have
also authorised the Department of Defence to undertake limited tenders with
SMEs for procurements up to $500,000 from 1 July 2022. (BP4, pp. 21–22)
Consultancies
In
February 2022 it was reported that ‘a new whole of government agreement for
management advisory services to government has been established to replace all
panels related to financial, corporate and commercial consultant work’. In the
Budget papers the Government highlighted this previously announced procurement initiative:
Just as we have required Commonwealth agencies to become more
efficient over time, the Government is driving better value out of the
consultancy sector. We are consolidating 20 previous panel arrangements into a
single arrangement that has lowered rates of fees by 22 per cent when compared
to rates on similar panels and improved the conditions and performance
management standards for consultancies. (BP4,
p. 21)
Typically, remuneration is based on milestones and project
completion for consultancy contracts, and time worked and hourly rates for non-consultancy
contracts (such as labour-hire). Media
reporting and a Senate
committee have highlighted concerns about the transparency of contractual
arrangements with consultants, the quality of consultants’ advice and, more
generally, the potential for erosion of the APS’ strategic policy capacity due
to a perceived over-reliance on policy advice from consultants.
Selected public sector ICT initiatives
An ICT-trade website has summarised
public sector ICT initiatives in the Budget. The following Budget measures
relate to cyber security and the proposed Digital Identity system.
Cyber security
The Australian Signals Directorate (ASD) is allocated $9.9
billion over 10 years to 2030–31 to deliver a Resilience, Effects, Defence,
Space, Intelligence, Cyber and Enablers (REDSPICE) package. The cost will be partially
offset from the Defence Integrated Investment Program (BP2, p. 72). REDPSICE is
discussed in more detail in the ‘Cybersecurity package’ article in this Budget
Review.
The Cyber Hubs Pilot was funded in the 2021–22 Budget to establish
‘centres of expertise to respond to rapidly increasing and persistent cyber
security threats’. The Digital Transformation Agency (DTA) coordinates the
program in partnership with hosting agencies, supported by technical advice
from the Australian Cyber Security Centre (BP4, p. 15). Current hubs are hosted
by the Department of Defence, the Department of Home Affairs, and Services
Australia. In this Budget, $30.2 million is provided to extend the Pilot, with the
Australian Taxation Office to host a fourth hub (BP2, p. 157).
Digital Identity system
The Government has been developing a Digital Identity system
(the System) since 2015. As explained
by the DTA:
A secure Digital Identity replaces the need for multiple
logins to access different services and makes getting things done with
government faster and easier. The system will expand over time to include more
government agencies as well as private sector organisations.
Taking into account commitments up to and including the
MYEFO in December 2021, it is estimated
that more than $600 million will have been spent on the System by the end of
the 2024–25 financial year.
The System currently has functionality available for
citizens to access a range of Australian Government services. However, Your
guide to the Digital Identity legislation, an explanatory publication
circulated by the DTA in a consultation
process in October 2021, notes that legislation is necessary to expand the
System. This legislation would enable state, territory and private sector
entities to, for example, ‘participate in the System as an accredited onboarded
participant (provides identity services) or a relying party (services that
require their customer to verify their identity online)’. The DTA guide also
notes that ‘Australians will not need to pay to use the System … The charging
framework will only apply to businesses and governments who will participate in
the System’. The charging framework is being developed.
As part of the consultation, the DTA also circulated an exposure
draft of a Trusted Digital Identity Bill 2021, but the Bill is yet to be
introduced.
The Budget allocates $1.8 million in 2022–23 to the DTA to ‘further
support the development of the Digital Identity system, including the
governance, regulatory frameworks and funding arrangements associated with the
Digital Identity legislation’ (BP2, p. 158).
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