The federal government should scrap the planned outsourcing of Australia’s new billion-dollar visa processing platform and instead build the system in-house, a senate committee has found.
The finding is contained in the legal and constitution affairs committee report [pdf] into the impact of changes to service delivery models on administration and running of government programs.
The report, released on Thursday, recommends the government “not proceed” with the request for tender for the global digital platform and instead “fund and deliver an in-house solution”.
It comes just days after one of the main backers behind one of two consortia bidding on the deal, Pacific Blue Capital CEO Scott Briggs, made the decision to bow out of Australian Visa Processing.
Australian Visa Processing, which also consists of Ellerston Capital, PwC, Qantas Ventures and NAB, has been competing with Australia Post and Accenture for the build since December 2018.
The Department of Home Affairs first began looking for an external provider to design, build and operate the platform to replace the country’s two existing visa processing platforms in June 2017.
The platform is envisaged to process 90 percent of all visa applications – which are expected to climb to more than 13 million in the next decade – when it is rolled out in 2021.
It could also could integrate with other third-party systems to allow individuals to apply for visas at the point of booking travel, or purchase travel and accommodation at the same time as their visa.
Home Affairs has repeatedly stressed the tender does not amount to outsourcing as it will retain “full responsibility and accountability for policy, security, risk assessment and visa decision-making”.
But the committee largely made up of Labor and Green senators rejected the department’s “assertion that tendering for a private partner to host the global digital visa processing platform is not privatisation”.
“The global digital platform project would see a private entity design, build and administer the system that processes the vast majority of Australia’s visa applications,” the report states.
“As such, the project would see the Department of Home Affairs hand over control of large amounts of sensitive and critical data to a profit-making conglomerate.”
The committee said it was not satisfied the department has sufficiently addressed risks associated with the project as outlined by a number of stakeholders, including the former architect of the country’s immigration visa system, Abul Rizvi.
Rizvi, a former deputy secretary at the then Department of Immigration during the Howard era, used the inquiry to warn that the outsourcing of visa processing to private infrastructure carried “immense” IT risks.
The committee said the department had not offered any explanation for why an in-house solution was not suitable, pointing to the experience of the UK’s visa privatisation which has resulted in a significant increase in visa costs.
“International experience, particularly in the UK, has shown that the consequences of such outsourcing can be dramatic,’ the report states.
“Profit-making entities are driven to find ways to maximise their profits, and this inevitably leads to reduced service quality and/or higher fees.
“The UK project has resulted in both.”
Labor have previously argued that introduce a similar arrangement in Australia would create a monopoly and negatively impact competition.
The committee also rejected the “department’s assertion that the project will not impact jobs” and that there was still “ambiguity around precisely how many permanent APS jobs may be lost”.
“For these reasons, and the fact that any decision to outsource would be extremely difficult to reverse, the committee cannot support the project,” the committee said.
“The committee suggests the department fund and further explore options for developing an in-house solution that does not require the government to ostensibly ‘hand over’ control of the processing functionality and data management to private entities.”
The findings were not supported by Coalition senators, who said the global digital platform would “support digital visa application and decision making”.
“This modernisation process is necessary to reduce processing times and to ensure visa decision making continues to support key export industries like tourism and education, and helps keep us all safe,” the dissenting report states.
“The Australian Government will always remain responsible and accountable, as it is today, for all visa decision making. It will determine visa rules and how decisions are made.”
The department is yet to announce the successful bidder on the project, despite indicating that a decision would be made last October.
The Sydney Morning Herald has reported the government was advised by the department ahead of the May 2019 election that legislation would be required for the global digital platform.