17-01-2017 -

The Department welcomes the finalisation of the Australian National Audit Office’s (ANAO) latest report titled Offshore Processing Centres in Nauru and Papua New Guinea - Contract Management of Garrison Support and Welfare Services.
 
The Department has carefully considered the ANAO’s findings and agrees broadly with the three formal recommendations.

The Department is committed to robust and effective procurement and contract management, and would dispute any suggestions that it spent $2.3 billion without proper authorisation or that that it did not progress work to remediate mould problems at the Nauru RPC.

The Department’s response to these issues have been outlined in the Department’s response to the Offshore Processing Centres in Nauru and Papua New Guinea: Contract Management of Garrison Support and Welfare Services report. Similar concerns were raised in 2016 during the course of the audit when the ANAO was finalising its Offshore Processing Centres in Nauru and Papua New Guinea: Procurement of Garrison Support and Welfare Services report released on 13 September 2016. The Department’s responses have been included in the final published reports.

This was a complex and lengthy audit with extensive information requests. The Department, at all times, worked to support the ANAO in its investigation.

It is important to put the appropriate context around these reports. These contracts were developed – and continue to be managed – in a unique and highly complex environment.

The contracts were established during a period of immense pressure on the Department that involved simultaneously managing thousands of illegal maritime arrivals, negotiating with host governments, engaging service providers and coordinating the logistics for the regional processing centres (RPCs).

Consistent with expectations, the Department placed contractors on the ground in 2012 to support the Governments of Nauru and Papua New Guinea in delivering support and welfare services for illegal maritime arrivals in RPCs within weeks of the Australian Government decision to commence regional processing.

Regional processing of protection claims and settlement in third countries are critical elements of Australian Government policy and are very complex and fast-paced areas of operation. Staff are required to make significant decisions, in negotiation with foreign governments, often within very short timeframes.

The environment around RPCs remains extremely complex and the scope of services is rapidly evolving. It remains open to the host governments, at any time, to make changes to the administration of the centres that have far reaching implications for the scope and operation of these contracts.

The Department must therefore adopt procurement and contract management practices that are sufficiently agile to respond to new requirements and emerging security issues.

The Department acknowledges that its decision-making processes in this complex and rapidly evolving environment may not have been adequately documented.

In accordance with regional processing arrangements, the Department will continue its role in supporting the Governments of Nauru and Papua New Guinea to provide a range of services that contribute to the safety and welfare of people in RPCs.

Actions taken by the Department to improve procurement and contract management processes

Many of the recommendations made in the reports are already being addressed by the Department.

Over the past nine months the Department has developed and is implementing a comprehensive Contract Management Framework for its detention services contracts.

The Department will embed these improvements across all its major contracts over the next 12 to 18 months.

Collectively these measures will enable the Department to continue developing a professional procurement and contract management workforce, ensuring future procurement and contract management processes are conducted in a fully compliant manner.

The evidence of this hard work on contract management has already borne results in other contracts. The ANAO audit on health services in Australian immigration detention, Delivery of Health Services in Onshore Immigration Detention published on 1 September 2016, acknowledges that the Department has significantly improved the current contract management for health services: mechanisms were applied to control the risk of cost escalation and over-servicing, deliverables were more clearly defined and a system of penalties and incentives was applied to improve performance.

The Department will continue to work collaboratively with the ANAO on its future work program.

Media contact: Immigration and Border Protection (02) 6264 2244