Australia: ICAC Review of New South Wales Government Procurement

Last Updated: 27 July 2011
Article by Ashley Tsacalos

Following its recent examination of NSW Government procurement, the Independent Commission Against Corruption (ICAC) "has identified procurement as a major risk area for corruption in the New South Wales public sector".

According to the ICAC, in its 22 year history of investigations and public inquiries, procurement has been found to be the most common area for corrupt behaviour to occur. Approximately 12% of complaints received by the ICAC each year include allegations of corruption in NSW Government procurement and approximately 30% of its public inquiries make findings of corrupt conduct related to NSW Government procurement activities.

During July 2010, suppliers to NSW Government were asked to provide their perceptions of corruption in NSW state and local governments by responding to a survey that had been prepared by the ICAC. The ICAC surveyed 1,515 government suppliers in relation to their perceptions of corruption of which 42% believe corruption is a moderate or major problem when doing business with government with 32% indicating that they did not bid on a contract because of corruption concerns.

As part of its research into procurement corruption risk, the ICAC analysed NSW Government's procurement policy, the regulatory and legislative framework, undertook a survey of 153 state and local government organisations, conducted interviews and focus groups with public sector procurement specialists and suppliers to government, analysed the ICAC investigation and complaint data, invited submissions to a consultation paper as well as undertaking the survey of government suppliers discussed above.

The ICAC released two reports which contain its research and recommendations:
1. Corruption risks in NSW Government procurement: Suppliers' perceptions of corruption, and
2. Corruption risks in NSW Government procurement: Recommendations to government.

The ICAC's examination of NSW public sector procurement "has revealed a system that has grown and evolved over time without any clear leadership or direction". As a result, the ICAC made seven recommendations aimed at establishing clear leadership, a clear structure, a simplified regulatory environment and effective assistance to operational agencies in NSW.

The seven recommendations are outlined below:

Recommendation 1: Establish a procurement leadership role in NSW

The ICAC recommends that a single, administrative NSW Government entity be given explicit leadership responsibility for:
a. formulating and maintaining the state procurement policy framework, including standards of conduct or practice
b. building the capacity of the sector
c. promoting the policy and compliance with its provisions
d. monitoring and reporting on compliance and performance standards.

Recommendation 2: Undertake a comprehensive review of the NSW approach to procurement

The ICAC recommends that, as part of the reform program already commenced, the NSW Government, under the leadership of the relevant Ministers, conducts a broad-based review of the system of public sector procurement in NSW that specifically includes the issues discussed and recommendations made in this report.

Recommendation 3: Simplify the regulatory framework in NSW

The ICAC recommends that the NSW Government develops a simplified regulatory framework for procurement that is contained in a single source, clearly distinguishes between mandatory obligations and advisory guidelines, has minimum exemptions and includes an explicit role to monitor procurement compliance of agencies.

Recommendation 4: Align local government and state procurement policy

The ICAC recommends that the NSW Government takes steps to unify elements of the local and state government procurement policy frameworks and associated procedures.

Recommendation 5: Improve information, advice and support

The ICAC recommends that, as part of the process of sector-wide procurement reform, the NSW Government reviews the central procurement information, advice and support functions and tests these activities in order to ensure that they effectively meet the identified needs of end users. As part of this review, the relevant central agency should take steps to ensure that it:

a. fully understands the needs of end users (agencies and suppliers)
b. implements client-centred advice and support services
c. obtains feedback from end users and implements a program of continuous improvement.

Furthermore, during the review process, the relevant agency should take into account the need for:

d. simplified, user-friendly processes and support materials, including best practice guidelines, tools and templates
e. more accessible information about how the DFS is organised, the services it provides and the value of using DFS services
f. the provision of experienced procurement advisers to agencies
g. advisory services to be efficient, timely and user-focused rather than serving the achievement of central-agency business objectives.

Recommendation 6: Build procurement competence

The ICAC recommends that the NSW Government introduces a sector-wide procurement education and training assurance framework that provides for:

a. mandatory minimum standards linked to levels of procurement responsibility
b. auditing of agency procurement capabilities and associated training initiatives
c. a system for mandatory certification of procurement policy and process awareness and compliance by agency staff.

Recommendation 7: Oversee policy compliance

The ICAC recommends that the NSW Government establishes a centralised investigation/complaint management function with the capacity to receive, assess and manage reports about breaches of compliance with the regulatory controls that form part of the procurement policy framework.

For further information in relation to the ICAC's recent research see:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Ashley Tsacalos
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Mondaq Advice Centre (MACs)
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.