Moorebank Intermodal Company (MIC) has been told to change its ways after an audit by the Australian National Audit Office (ANAO) found it had not received value for money in its procurement of advisers and consultants over a six year period between 2012 and 2018.
The audit also found MIC’s management of probity risks associated with conflicts of interest and gifts and hospitality had not been effective.
The audit recommends that the Moorebank Intermodal Company promptly implement the recommendations made in its June 2018 internal reviews in a way that addresses both the findings of those reviews and the findings of this ANAO performance audit.
Moorebank Intermodal Company has already agreed with the audit recommendation.
MIC was established in December 2012 under the Corporations Act 2001 and is responsible for the delivery of the Moorebank Intermodal Terminal.
In December 2017 the ANAO completed its first audit of the contractual arrangements for the delivery of the Moorebank Intermodal Terminal.
During the conduct of the first performance audit, the ANAO says it observed a number of practices in respect of MIC’s operations and procurement activities that merited further examination.
Under the Auditor-General Act 1997, as a Government Business Enterprise, performance audits of MIC can only be undertaken at the request of the Joint Committee of Public Accounts and Audit (JCPAA).
A request from the JCPAA was received in December 2017.
The second ANAO audit, tabled in Federal Parliament and published on its website today, found that:
“It is not evident that MIC has obtained value for money in its procurement of advisers and consultants. The company’s management of probity risks associated with conflicts of interest and gifts and hospitality has not been effective.
“MIC has engaged a range of advisers and consultants to assist it to deliver on its purpose. Open and effective competition has not been a feature of MIC’s procurement practices. This has contributed to the company being unable to demonstrate that value for money has been achieved through its procurement activities. Probity risks (including conflicts of interest) have not been well managed.
[social_quote duplicate=”no” align=”default”]“MIC has not had in place an appropriate and effective framework to manage and control the use of corporate credit cards and reimbursement of staff expenses.[/social_quote]
“MIC has not effectively managed the risks associated with accepting and providing hospitality, gifts or benefits. Initially this was due to the absence of relevant policies and guidance. Subsequent to the development of policies and guidance, poor compliance and ineffective governance arrangements resulted in the acceptance of offers that should have been declined under MIC’s policy framework.”
The audit found that “MIC did not have a policy or supporting gifts and benefits register until September 2014.
“This was approved some 21 months after MIC was established,’’ says the audit report.
“MIC has not adequately considered the risks involved in providing or accepting offers of hospitality, gifts or benefits. This has resulted in the acceptance (and provision) of gifts, benefits or hospitality that, had the risks been properly considered, should have been declined.’’
