MARK COLVIN: The Federal Opposition says a scathing audit report on the Australia Network tender process calls into question the future of the Communications Minister, Stephen Conroy. The Auditor-General says the 13-month process to decide on an operator for the overseas television service was flawed and cast the Government in a poor light. The Government eventually abandoned the tender and awarded the contract to the ABC indefinitely but the Opposition says the audit report is further evidence of Government bungling, and Stephen Conroy and other ministers have serious questions to answer. A senior minister acknowledges that the process was “inelegant” and says lessons have been learned.
From Canberra, Naomi Woodley reports.
NAOMI WOODLEY: The Auditor-General, Ian McPhee, is clear about the damage caused by the bungling of the Australia Network tender. In his report he states…
VOICEOVER: The manner and circumstances in which this high profile tender process was conducted brought into question the Government’s ability to deliver such a sensitive process fairly and effectively.
NAOMI WOODLEY: The report sets out the process the Government followed, from when Kevin Rudd as Foreign Minister decided in November of 2010 to put the Australia Network contract out to a 10-year tender, worth $223 million.
The ABC and Sky, known as the Australian News Channel, both submitted bids but, by December 2011, the Government had abandoned the tender process and decided to permanently award the contract to the ABC.
The senior frontbencher, Trade Minister Craig Emerson, says it’s clear there are lessons to be learned.
CRAIG EMERSON: We made the decision, the one that we believed that was in the national interest, but I’m not going to stand here and say that it was an elegant process. There were problems with it.
NAOMI WOODLEY: The Auditor-General’s report says initially the tender process was “silent” on precisely how a final decision would be made, and that key ministers did not hold a common view on whether Cabinet should have the final say.
A tender evaluation board, set up to assess the bids, twice recommended that the Sky consortium, ANC, was the best value for money and should succeed but, in the 12 months that the tender was live, the responsibility for making a decision shifted from the secretary of the Foreign Affairs Department, Dennis Richardson, to the Communications Minister, Stephen Conroy, despite the fact he has responsibility for the ABC and in 2009 supported a recommendation that it permanently be given the contract.
The Opposition’s Senator Simon Birmingham has been pursuing the issue in the Upper House.
SIMON BIRMINGHAM: They didn’t know at the beginning who was going to be responsible for ultimately approving this tender and that was at the root of many of their problems and they ultimately put Senator Conroy, the Communications Minister, who’s in charge of the ABC, in charge of this tender and the Auditor-General has identified that that quite obviously created a perceived, if not a real, conflict of interest.
NAOMI WOODLEY: In June of 2011 additional criteria were also added to the tender request, the audit report says this was “unusual and raised further questions about the process”.
It also states about that decision and the final termination of the tender that…
VOICEOVER: While the Government was entitled to take such a decision, the Australia Network tender process has presented the Australian Government in a poor light and cost the two tenderers time and money.
NAOMI WOODLEY: But the Trade Minister, Craig Emerson, has defended the process.
CRAIG EMERSON: There was a process, as set out in the Auditor-General’s report, where further information was sought. The seeking of that information was to help guide the Government to make a decision based on the national interest.
We believed that we got the decision right but I’m not going to stand here, as a politician, and pretend that the process was beautiful and smooth. There were problems in the process.
Everyone can learn from the Auditor-General’s report and we will.
NAOMI WOODLEY: The Opposition’s Communications spokesman, Malcolm Turnbull, is overseas but on his website he says the report makes for “scarcely believable reading” and “it’s another compelling piece of evidence as to why voters shouldn’t trust the Government.”
Senator Birmingham is questioning the future of the Communications Minister.
SIMON BIRMINGHAM: Senator Conroy has many questions to answer, as does the Prime Minister, over why they got this so wrong, how they got this so wrong, and if they don’t give adequate questions [answers] then Senator Conroy’s ongoing role should be brought into question.
NAOMI WOODLEY: PM sought a response to the report from Stephen Conroy’s office. He’s currently in Macedonia for a broadband conference and wasn’t available to comment but a spokeswoman said the Government welcomed the audit report, will closely consider the observations and factor them in to future tender processes.
The report says information control about the tender process was not as tight as it should have been, particularly in Stephen Conroy’s department. The Government used leaks about the process as the justification to abandon it.
The Australian Federal Police says it began an investigation into the leaks in November last year. It says it finalised the matter yesterday, and there was insufficient evidence to lay any charges.
MARK COLVIN: Naomi Woodley.