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Joseph Brookes

Horror audit had ‘material impact’ on DTA relationships

A damning audit of the procurement practices at the Digital Transformation Agency has harmed its “psyche” and had a material impact on its relationship with other agencies, its chief executive said on Friday, while confirming no individuals would be punished for the scandal.

The Australian National Audit Office examined nine ICT-related procurements worth $54.5 million earlier this year, finding a raft of problems in technology buys that “fell short of ethical requirements”.

The Auditor General on Friday said it appeared the DTA’s procurement failings stemmed from a “tone at the top” rather than the delegates executing the technology buys.

Parliament House Canberra

While fronting a Parliamentary inquiry into Commonwealth procurement sparked in-part by the damning DTA audit, its boss Chris Fechner said the findings had an “incredibly hurtful impact” on staff and damaged relationships with other agencies.

“The DTA… takes its responsibilities for digital transformation in Australian Government very seriously. And this [finding] goes to our credibility,” Mr Fechner said.

“It goes to the effect under which our advice can be taken. And it has had material impacts on our relationships with central agencies — with line agencies — and there is not a person inside the DTA that is not moved and hurt by that particular outcome.”

After having its delivery responsibilities cut, the DTA’s main purpose is now to provide strategic and policy leadership and investment advice and oversight to drive government digital transformation, including leading whole-of-government and shared ICT and digital services.

To rebuild its reputation after the audit findings, the agency insists it is instituting new procurement policies, transparency controls, governance and staff training, as well as a review of in flight and future procurements.

But no individual will be formally punished for the failings uncovered by the Auditor General this year, with the poor documentation of the procurements also hampering efforts to identify individuals’ involvement.

“What we actually saw is that for people that were no longer with the DTA there was no mechanism [to reprimand them], apart from a formal HR requirement,” Mr Fechner, who joined the agency after the procurements in question, told the inquiry.

“And I think that the extent to which we could prove a failure in that particular place, the documents also didn’t support that well as well.”

More than 60 per cent of all DTA staff left the agency in the 2022-23 financial year.

Mr Fechner said the DTA has now instituted controls that mean poor behaviour or performance in procurement could see the individual lose their financial delegation.

“Everybody’s performance plan who is a functional delegate for procurement now has procurement effectiveness as their performance plan,” he said.

“So if in the future anyone was to actually fails to meet the obligations then they would be not sufficient in that performance. But historically, no [this has not been the case].”

Auditor General Grant Hehir said pinning the failings on one individual delegate or procurement would not necessarily be useful for the inquiry because the theme of his audit was about “governance and senior leadership”.

“An attempt at getting down to individual accountability for someone doing a procurement when you’ve got a governance framework which appeared to be failing so systematically would be problematic. Because it was really the ‘tone at the top’ type of issues that… you could argue, more drove what was happening in the organisation than any individual involved in individual procurement.”

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