Auditor General criticises unethical administration of the $182M Entrepreneurs' Program

A 2019 tender worth $182 million issued by the Department of Industry, Science, Energy and Resources as part of the almost half-a-billion Entrepreneurs Program announced by the previous government in the middle of the last decade has been sharply criticised by the Attorney General's department.

In particular, the report notes that the significant majority of tenders received were not fully evaluated against each published criteria.

One of the bidders for the work, who flagged the report with Digital Nation Australia but wished to remain anonymous said, "We put in what we thought was a competitive bid and missed out. Now we have a sense of why.

"The department's conduct of the procurement process also fell short of the ethical requirements set out in the CPRs, with key aspects of the approach employed either not outlined in the RFT or inconsistent with the RFT, competing for tenders not being treated fairly or equitably, and probity risks not being appropriately managed."

The AG report, released on Friday reveals that the design and conduct of the procurement did not comply with the Commonwealth Procurement Rules, and the signed contracts are not being appropriately managed.

In other findings, the report reveals;

• In its conduct of the procurement, the department did not demonstrate achievement of value for money. There was not an open and effective competition for the delivery partner roles as competing tenders were not treated fairly or equitably.
• The delivery partner contracts are not being appropriately managed. The contract management framework is inadequate and the contracts do not include an effective perform.

The program's purpose was to provide business advice and facilitating services for the Entrepreneur's Program. 55 companies replied and ultimately the department signed 7 contracts worth $144 million.

According to the report, the department did not demonstrate achievement of value for money, which the AG describes as the core rule of the CPRs.

"Although the request for tender (RFT) resulted in 53 compliant tender responses being received suggesting a competitive selection process, the department’s approach was deficient in significant respects such that there was not open and effective competition for the delivery partner roles."

Problems continue with the scheme, according to the AG. "The delivery partner contracts are not being appropriately managed. The contract management framework is inadequate, and the department’s approach has not resulted in contract deliverables being provided on time or required that service provision is to an appropriate standard before payments are made."

And, the AG says, "The contracts do not include an effective performance management framework."

The incoming government flagged during the election campaign that it would cut the vast majority of the remaining funding for the program.