The length of time it takes for Defence to approve large acquisition projects will be cut by up to a quarter under a range of contracting changes introduced by the federal government to reduce red tape and save industry millions of dollars.
The major overhaul of Defence procurement follows the completion of the Australian Standard for Defence Contracting (ASDEFCON) and Defence Procurement Review.
Minister for Defence Industry Melissa Price, who ordered the Review, said it had identified significant opportunities to reduce red tape, saving industry time and money in supporting the delivery of capability to the Australian Defence Force.
“The implementation of the Review’s recommendations will significantly improve the way Defence does business,” Minister Price said.
“It will also improve how Defence works to fast-track the delivery of capability to the ADF and how it communicates with industry.”
Under the changes, Defence will focus on reducing the time it takes to progress large materiel acquisition activities from the identification of a capability need to the signing of a contract.
“For a project that would have previously taken four years, or possibly even longer to get the point of a contract signature, these changes will reduce that period by up to 12 months,” Minister Price said.
“This change and other the initiatives introduced following the Review will help industry be better prepared and ready to respond to the needs of Defence and Government.”
Defence will focus on strengthening its communication with industry as part of the procurement overhaul, with a particular focus on the tender process.
- Defence will now allow industry to brief its project teams on tenders they submit to further clarify the offer proposed in support of Defence’s evaluation;
- Defence processes will be amended to require tender debriefs to be offered at the time a tenderer is advised it has been unsuccessful, rather than after the process is concluded. This will give small businesses feedback on unsuccessful tenders up to six-to-12 months more quickly in some cases, helping them improve their tender responses;
- There will be greater transparency of upcoming procurements through its Annual Procurement Plan on AusTender;
- There will be an assessment of how a centralised contractor accreditation framework could be adopted to cut red tape for industry;
- There will be an improvement of probity practices, guidance and training for procurements in order to reduce communication barriers between Defence and industry;
- Industry will be kept better informed as to the status and progress of tender processes, especially where delays occur.
“The ASDEFCON and Defence Procurement Review is one of the Five Pillars that I announced in August 2020 as an improvement priority for Defence, to better support industry,” Minister Price said.
“I have mandated specific, measurable, and enforceable Australian Industry Capability and Content commitments in the body of contracts under a new contracting framework in Defence, which has been rolled out this year on future projects above $20 million. The Review completes the delivery of the Five Pillars that I set out to support Australia’s defence industry. Our strategic environment is deteriorating and creating new challenges for us to overcome, so we must have a more agile procurement system that delivers capability for our ADF more quickly and treats industry as a fundamental partner in the delivery of this capability.”
Defence will continue to engage with industry to inform and educate it on relevant changes to the ASDEFCON template suite, and procurement processes and policies, as they occur.
Defence industry and industry advocates were consulted on the Review via a survey in December 2020. About 250 survey responses were received, with 144 of those from industry across all stakeholders groups, from micro businesses to large primes. Targeted engagement was also undertaken with industry and Defence.