A story in The Australian reports that Senate committee hearings have highlighted how pressure from domestic suppliers to buy local is complicating government procurement, particularly in military related areas:
THE government faces calls to overhaul billions of dollars worth of purchases in a new debate over whether Canberra should use its massive yearly spending to “buy Australian”.
In a submission to a Senate inquiry into purchases that range from the use of government credit cards to big-ticket Defence projects, the Australian National Audit Office says that showing value for money is an “ongoing challenge” for agencies. ANAO points to the botched 2011 tender to run the Australia Network international television service to argue that a failed process can “heavily impact on the commonwealth’s reputation and may affect future interest in procurement opportunities”.
For the Defence Materiel Organisation, keeping major projects on schedule “remains the most significant challenge”, particularly for “Australianised” military off-the-shelf projects and those being developed specifically to meet the requirements of the Australian Defence Force. “The decision between imported and Australian equipment has been the subject of debate in numerous reviews of Defence procurement because of the cost, quality and sustainability differential,” the submission says. “The current approach requires Defence to clearly present value-for-money considerations where Australian equipment is preferred.”
The comments come as a slew of industry groups and unions use the inquiry to argue the government should favour local products in its purchasing decisions, opening a new front in the debate over industry assistance.
