Contracting by Australian governments has grown enormously over the past two decades. Today nearly one quarter of all government budgets nationally are spent on procurement with NSW in particular benefitting from a surge in infrastructure investment.
Greg Ewing, General Manager of Engineers Australia Sydney recently appeared as a witness at the NSW inquiry into the procurement of government infrastructure projects.
Greg’s input to the inquiry emphasised the findings of Engineers Australia’s report, Government as an Informed Buyer: How the public sector can most effectively procure engineering-intensive products and services.
Acting as an informed buyer is central to the NSW and Commonwealth Governments achieving value for money from procurement. Value for money should not solely be based on determining the costs and benefits that accrue to the agency from the procurement. It should also consider the costs and benefits that the procurement makes towards advancing Government objectives, the outcomes from other agencies, and interests of key stakeholders including end users, industry and other levels of government.
Achieving a holistic concept of value for money requires agencies to have an effective procurement system underpinned by the provision of a range of expertise. Engineering expertise is an essential component of the professional understanding needed by an agency to procure engineering intensive products and services.
Engineering intensive procurements require technical skill and domain knowledge to make informed judgment on the costs, benefits and risks across the stages of the procurement cycle. Engineering expertise is needed to define desired functional levels, performance levels and outcomes, and to evaluate tenderers’ estimates of whole of life costs.
Engineers in NSW stand ready to help realise Government’s vision of delivering strong sustainable investment in infrastructure that achieves best value. This does not mean simply getting something for the cheapest possible price. It means considering the whole-of-life, financial and non-financial costs and benefits that accrue to all relevant stakeholders including the agency, end users and government as a whole.
Decisions regarding infrastructure procurement in NSW must be made thoughtfully and with strategic oversight to deliver optimum outcomes. Engineering expertise compliments that of economists, accountants, lawyers, policy writers and legislators to ensure considered long- term whole-of-life procurement solutions.