Procurement complaints handling: be the example for others to follow

Let’s face it, no one wants to be on the receiving end of a complaint about their procurement.

But with over 800,000 procurements by Australian Government entities in the last decade, complaints are almost inevitable. So it is timely that hot on the heels of its report into the huge number and value of Commonwealth procurements in the last decade, the Australian National Audit Office (ANAO) has published its performance audit report into procurement complaints handling. We’ve taken the ANAO’s comments on good practice for procurement complaints and come up with our “top tips” to make sure your entity is setting the standard for others!

Background

The purpose of the audit was to provide assurance to Parliament on the effectiveness of procurement complaints handling, including that the complaint mechanisms are accessible to suppliers and that processes are in place to receive and investigate complaints.

Handling complaints effectively is especially important given the volume of procurement activity handled by Australian Government entities. The ANAO’s Australian Government Procurement Contract Reporting – 2022 Update revealed that 824,178 procurement contracts, valued at $564.5 billion, were reported on AusTender in the last decade. With that volume, complaints are almost inevitable so robust processes for handling them are critical.

The Commonwealth Procurement Rules (CPRs) require entities to apply timely, equitable and non-discriminatory complaint handling procedures. Suppliers dissatisfied with the outcome of their complaint can refer it to the Procurement Coordinator in the Department of Finance for review under the Department of Finance’s Procurement Complaints Handling Charter.

Further, the Government Procurement (Judicial Review) Act 2018 (GPJR Act) provides suppliers with an independent complaint mechanism for contraventions of certain CPRs for ‘covered’ procurements (procurements covered by Div 1 and 2 of the CPRs which haven’t been declared excluded by the Minister for Finance).

What the ANAO wants entities to do and how to do it

The ANAO identified some key messages and areas of good practice that Australian Government entities should aim to achieve. Here are our tips for being the example for others to follow:

Recommendations

There were four recommendations to the Department of Finance aimed at making the GPJR Act and the Procurement Coordinator complaint mechanisms more accessible to suppliers. Finance agreed to all four recommendations, so watch this space as we expect Finance will action those soon. To read more about this performance audit report, the Australian Government Procurement Contract Reporting – 2022 Update or to view other performance audits and information reports visit the ANAO website.

ANAO good practice tips	How entities can implement these tips	Example uses 2
Affirm the right of suppliers to make a complaint about the conduct of an Australian Government procurement and that they will not be punished for it in future procurements.	In approach to market documentation: set out in plain English how suppliers can make a complaint about the conduct of the particular procurement (e.g. provide email address for complaints and describe any information about what the respondent should include in the complaint notice such as contact details for a response); include a specific reference to the supplier’s right to refer complaints to the Procurement Coordinator in the Department of Finance for review if they are dissatisfied with the entity’s response; and make an express statement that any complaint made in good faith will be irrelevant to any consideration of that respondent in future procurements.
Be aware that an expression of dissatisfaction by a supplier, where a response is sought, expected or required, may be an implied complaint. The ANAO’s commentary is consistent with the definition of complaint in the Office of the Commonwealth Ombudsman’s Better Practice Complaint Handling Guide.	Make sure you keep records of all correspondence with suppliers and that someone is responsible for monitoring correspondence to assess whether it is a complaint. Ask yourself: is this supplier dissatisfied and would the supplier reasonably expect a response (even if they didn’t ask for one)?
Make it easy for suppliers to find the procurement complaints page on your website.	Tell suppliers on your website and in request documentation: where and how to lodge a general procurement complaint; what information to include in their complaint; and how it will be handled by the entity. This information should be consistent with what you say in the approach to market documentation. Make sure your website is searchable (so searching “complaint” will find the relevant information). Webpages and headings should be intuitive – e.g. “How suppliers to the Department can complain about a procurement process”. Include a hyperlink on your website to any guidance issued by Finance in relation to covered procurements. Explain that certain complaints can be made under the GPJR Act. Make sure you refer to the ability to refer complaints to the Procurement Coordinator in the Department of Finance if they are dissatisfied with your response.
State clearly in approach to market documentation whether the specific procurement is, or is not, a covered procurement for the purposes of the GPJR Act. A procurement is a covered procurement if the rules in Divisions 1 and 2 of the CPRs apply to the procurement, and it is not included in a class of procurements that has been determined by the Minister for Finance not to be covered procurements (s 5 GPJR Act).	Clearly explain in the approach to market documentation: what ‘covered’ procurements are; and what it means if a procurement is ‘covered’ i.e. what rights suppliers of covered procurements have under the GPJR Act.
Keep the supplier informed of progress when investigating their complaint and explain the reasons for a final decision and the review options available to the supplier if they are not fully satisfied.	Acknowledge receipt of a complaint promptly. Provide updates at relevant points in time including when a decision has been made – give an idea of timing if you can. Provide a thorough explanation of a decision to increase the likelihood of complainant satisfaction. Clearly explain the escalation process, including both internal and external review options, to complainants when a decision is delivered. Keep records of review requests and correspondence about decisions.
Make it a priority to resolve complaints promptly.	Have a tracking system for complaints and make sure they are being responded to. Some complaints will need legal or probity advice – get onto that quickly if it is needed and agree to a timeframe for delivery of the advice. Develop a timeliness benchmark to mitigate risk of delay.