Appendix 3 I Competitive tendering and contracting

Appendix 3 I Competitive tendering and contracting

Competitive tendering and contracting

FaCS has had in place for a number of years a range of CTC contracts that have had a significant impact on its administrative work. Many of these have been reviewed, renewed or replaced during the financial year in accordance with existing contractual provisions, changes in the department’s business needs or amended Service—level requirements.

FaCS has also carried out a detailed analysis of its corporate activities as part of the Government’s requirements for market testing of these functions. Opportunities for process re-engineering identified as a result of this analysis, coupled with the results of market testing, which is to be implemented during 2002–03 or 2003-04, are expected to have an impact on the current range of CTC contracts.

The department did not have any contracts exempt from the gazettal requirement during 2002–03.

Payments under these contracts are on a GST-inclusive basis.

The following list reports on CTC contracts in excess of $100 000 that were entered into, or remained current, during 2002–03.

CTC contracts: additional information

Acme Consulting

As a result of a restricted tender process Acme Consulting were selected to undertake professional writing, editing and communications services for FaCS. The current standing offer arrangement commenced in April 2003 and will expire in April 2006. Expenditure for financial year 2002–03 was $109 043.

Stockland Property Management

The arrangement with Stockland Property Management was in place prior to the Administrative Arrangement Orders in October 1998, when two divisions of the former Department of Health and Family Services transferred to the Department of Family and Community Services. FaCS has continued to use the services provided under the arrangement. The contract expired on 30 June 2002 but the arrangement will continue on a month-by-month basis pending the outcome of market testing of FaCS’ corporate services. Expenditure for financial year 2002–03 was $135 671.

Mercer Communications

The arrangement with Mercer Communications resulted from the decision to separate FaCS telecommunication responsibilities from Centrelink. From a select tender process Mercer Communications were contracted to assist with the separation, and provide the department with voice management services. The contract is currently on a month-by-month arrangement pending the outcome of market testing of FaCS’ corporate services. Expenditure for financial year 2002–03 was $232 646.

CITEC

The arrangement in place with CITEC resulted from FaCS’ decision to establish its own corporate Enterprise Resource Planning Systems using the SAP R/3 application. An open tender process was conducted and CITEC was engaged under the Commonwealth Government Information Technology and Communications’ terms and conditions dated 1 October 1998 under the whole-of-government head agreement. This contract provides SAP R/3 Bureau Services and related network services. A change order was executed in November 2002 and the contract now expires in November 2005. Expenditure for financial year 2002–03 was $1 280 000.

Enterprise Outsourcing

Enterprise Outsourcing was engaged as a result of a restricted tender in 1999 by means of a standing offer arrangement to provide additional resources for procurement advice within FaCS. Expenditure for financial year 2002–03 was $189 210.

iContact

Following an open tender process FaCS engaged iContact to provide warehouse, fulfilment and distribution services for a period of three years. The contract expires on 23 April 2004. Expenditure for financial year 2002–03 was $1 157 510.

DGJ Projects Pty Limited

Following an open tender process DGJ Projects Pty Limited was engaged to manage FaCS Legal Services Branch. The original contract was for a 12-month period but has been extended to 14 March 2004 to enable FaCS to better manage the market testing of its legal services. Expenditure for financial year 2002–03 was $572 219.

Ernst & Young

Ernst & Young were engaged following an open tender process to provide internal audit, risk management, fraud control and investigation and business continuity planning services. The nature of the contract provides FaCS with an opportunity to establish a partnering arrangement with a focus on business improvement. Expenditure for financial year 2002–03 was $84 333.

DBM Australia

As a result of an open tender process DBM Australia were contracted to provide career support services for staff of FaCS affected by the market testing of corporate services. Expenditure for financial year 2002–03 was $165 656.

Corrs Chambers Westgarth

Following a restricted tender to firms listed on the Office of Asset Sales and Commercial Support’s panel of contractors a standing offer arrangement was entered into with Corrs Chambers Westgarth. Corrs Chambers Westgarth provides specialist legal and probity advice in support of the FaCS market testing of corporate services. Expenditure for financial year 2002–03 was $144 107.

Wilton Hanford Hanover Pty Ltd

Wilton Hanford Hanover Pty Ltd was chosen as a result of a select tender process conducted in November 2002 to project manage the production and distribution of a consolidated child care handbook. The contract expires in September 2003. Expenditure for financial year 2002–03 was $174 335.

Acumen Alliance (ACT) Pty Ltd

In December 2001 the CSA executed a contract with Acumen Alliance (ACT) Pty Ltd as a result of an open tender process for the provision of national occupational health and safety services. The contract expires in June 2004. Expenditure for financial year 2002–03 was $568 689.

Manpower Services (Australia) Pty Ltd

In 2000 the CSA conducted an open tender for the provision of entry-level staff. A standing offer arrangement with Manpower was entered into in February 2001 for a period of two years. This was extended for a further period of two years to February 2005. Expenditure for financial year 2002–03 was $244 128.

Ozjobs (a division of IMP Group)

In 2000 the CSA conducted an open tender for the provision of entry-level staff. A standing offer arrangement with Ozjobs was entered into in February 2001 for a period of two years. This was extended for a further period of two years to February 2005. Expenditure for financial year 2002–03 was $1 767 578.

Market testing

Agencies subject to the Financial Management and Accountability Act 1997 must market test relevant activities and services, beginning with corporate services—that is, they must invite external service providers to tender for business.

In 2002–03, FaCS continued its program to market test its corporate services.

Audit and Risk Services were market tested. Contracts were signed with Ernst & Young to provide FaCS with audit and risk management services and KPMG to provide supplementary services.

After examination of ministerial, parliamentary, media and public relations services and consideration of the risks and experience of other agencies FaCS decided not to proceed to market test these services.

To complete the final stage of this program, FaCS will formally approach the market with its property management, legal, finance, business support and human resources services, during 2003-04.

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