Meeting your probity obligations in a crisis21 May 2020
In a crisis, there’s a temptation to assume that anything goes. But does it? What is the status of probity obligations in an emergency, and what do officials need to do to meet them?
As we’ve seen all too clearly this year, when a public crisis is unfolding the internal and external pressure on agencies to achieve results is immense. When time is of the essence, steps that would normally form part of officials’ every day practises can easily be sacrificed or overlooked in the pursuit of an outcome.
The Commonwealth’s financial management framework has built into it an enormous degree of flexibility to allow senior public officials to do whatever is needed to meet urgent needs. But there are limits to this flexibility which – if not identified – can lead to significant breaches of core statutory obligations.
So how can officials find those limits? Which steps in the process can be put to one side, and which obligations are non-negotiable?
A good starting point with any activity is: What is the source of my authority to do this?
For a procurement, this will be the Commonwealth Procurement Rules (CPRs). Limited tender is often the only practical approach in an emergency. But keep in mind that:
- a limited tender must satisfy one of the conditions in paragraph 10.3 to be authorised, with ‘unforeseen urgency’ (paragraph 10.3(b)) likely to be the most helpful, and
- you must still comply with Division 1 of the CPRs and the record keeping requirements of paragraph 10.5.
Many agencies involved in a direct response to the COVID-19 pandemic have utilised a Secretarial direction under paragraph 2.6 of the CPRs to authorise a range of activities, including extending existing contracts and entering into new ones. When relying on a 2.6 exemption, though, be mindful of the precise wording – is it an exemption from a competitive tender process (such that Division 1 of the CPRs still applies) or is it even broader than that? Does it apply only to activities connected with a particular objective, and does my activity fall within that scope? Ask to see a copy of the instrument if you are asked to act in reliance on it.
There are, of course, a range of opportunities to obtain goods and services that are always available to the Commonwealth without the need to meet an exemption. These include exercising an option available under an existing contract, procuring services from an existing panel (yours or one managed by another agency), or undertaking any activity set out in Appendix A to the CPRs.
Remember, too, that the Government Procurement (Judicial Review) Act continues to apply. This means that if a limited procurement is not properly authorised by a provision in the CPRs, or is not conducted properly, the Commonwealth may be liable to an affected party. It also means that if the procurement is authorised, but officials fail to document properly the basis of the authority, a challenge may be difficult to defend down the track.
In situations of urgency, it is appropriate to pare back the visible manifestations of probity. There is no expectation on agencies to engage a dedicated probity adviser, prepare a Probity Plan, conduct probity briefings or have communications with suppliers vetted from a probity perspective before being sent.
The core principles of probity, however – ethical conduct, transparency and accountability - must remain embedded in every decision if officials are to meet their statutory obligations.
The obligations that survive
Some core obligations must be met, even where a procurement is authorised under paragraph 10.3 or 2.6, or Appendix A, and regardless of the urgency involved. These relate to the obligation on all public officials to act in an ethical manner in discharging their duties.
There must always be a proper basis for every decision made by an agency, that is made in the best interests of the agency and not impacted by a conflict of interests. Time pressures can result in significantly reduced scrutiny over procurement decisions in a crisis situation, but:
- those exercising delegated authority from the Secretary must never lose sight of their obligations under s. 15 of the PGPA Act to govern the entity in a way that promotes the proper use and management of public resources, and
- every APS officer has a duty under the Code of Conduct to use resources in a proper manner and for a proper purpose, to avoid and declare conflicts of interest and to behave with integrity.
Delegations, too, must be observed. It can be tempting to push a contract under the nearest SES nose for approval, but delegations must be checked to avoid asking an official to act outside of their authority.
Managing pressure to deliver
No one wants to be a blocker to an agency meeting public need. Sometimes risk management is as simple as taking a moment to reflect on the potential issues that an activity could raise and making a record of what you have done and why.
An experienced external adviser may be a useful asset in these situations, but in a slightly different role to the one they may normally fill. Someone outside of the agency can act as an independent touchstone or fresh set of eyes, allowing agency officials to test their thinking about the best way to approach a problem and talk through alternatives.
For those in team leader positions, empower your team to raise risks with you so that they understand this will not be interpreted as unwanted criticism. Use every available source of knowledge to inform your decisions, to ensure that you are fully discharging your PGPA Act obligations and assisting your superiors to discharge theirs.
No matter how pressured you feel, you can protect yourself and others by remembering SAFE:
Source of your authority
Act ethically and impartially
Financial management legislation
Everything gets written down.
For independent advice on your procurement and decision-making activities, contact Liana Westcott.