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Thursday, 25 May 2017
Page: 5136


Mr McCORMACK (RiverinaMinister for Small Business) (09:34): I move:

That this bill be now read a second time.

The Government Procurement (Judicial Review) Bill will implement recommendation 11 of the July 2014 Senate Finance and Public Administration References Committee's report into Commonwealth procurement procedures, for the Department of Finance to establish an independent and effective complaints mechanism for procurement processes.

The bill is consistent with obligations in the World Trade Organization Agreement on Government Procurement, to which Australia has submitted a bid to accede, and the Trans-Pacific Partnership, which was signed on 4 February 2016.

These obligations require Australia to maintain an impartial and independent body to review and provide remedies for government procurement complaints.

The bill designates the Federal Circuit Court (FCC) with jurisdiction (concurrently with the Federal Court of Australia) to receive and review local and international supplier complaints in relation to a breach of the Commonwealth Procurement Rules (CPRs).

The bill requires the supplier to first complain to the Commonwealth entity responsible for conducting the procurement. The entity must investigate the complaint and if the supplier is not satisfied with the outcome of the procuring entity's investigation, they can seek remedies from the FCC, including compensation.

Compensation will be limited to the reasonable costs for the preparation of the tender, or the costs relating to the challenge, or both.

The FCC, with its streamlined processes, will provide an accessible way to lodge complaints, particularly for regional suppliers as it maintains a continuous presence outside major capital cities. Suppliers from rural and regional Australia will not need to travel to major cities to lodge a complaint.

The bill is not intended to fully prescribe the procedures by which the FCC hears procurement complaints, but rather address three key areas where the FCC will need different jurisdiction and procedures than its current functions.

I will briefly outline the key elements of the bill:

Jurisdiction

The bill will confer jurisdiction on the FCC to hear government procurement complaints where the CPRs are breached.

Suppliers must provide evidence of their complaint, including attempting to resolve the complaint with the procuring entity in the first instance.

Timely, Transparent and Effective Review Procedures

The bill will ensure that the FCC can facilitate timely, transparent and effective review of complaints. Timeliness is an important feature for current procurements, where there still may be an opportunity for the supplier to continue to participate.

Remedies and Corrective Action

The bill will preserve a supplier's ability to participate in procurements by offering remedies and/or compensation if the FCC finds the CPRs have been breached. Any compensation ordered would be limited to the supplier's reasonable costs incurred in preparing the tender and/or seeking to resolve their complaint. The FCC will not be able to overturn awarded contracts.

The decision to vest jurisdiction on the FCC was informed by extensive consultation between the Department of Finance and the Attorney-General's Department. This included the development of a scoping study considering three options for a body to hear supplier complaints. These were vesting a federal court with jurisdiction, designating an existing administrative entity, and establishing a new tribunal.

This bill shows the government's commitment to transparent and competitive procurement by giving suppliers the opportunity to seek remedies and improve Commonwealth procurement practices.

Debate adjourned.