Procurement Reform Strategy

Ms DIGANCE (Elder) (14:11): My question is to the Minister for Small Business. How will the state government's procurement reform strategy benefit small businesses in South Australia?

The Hon. M.L.J. HAMILTON-SMITH (Waite—Minister for Investment and Trade, Minister for Small Business, Minister for Defence Industries, Minister for Veterans' Affairs) (14:12): One of the key objectives of the Industry Participation Advocate is to remove unnecessary barriers and costs associated with government tenders. Last week, the government's procurement reform strategy was launched, and I am happy to provide the house with more detail on how it will apply. The strategy focuses heavily on the removal of process and compliance barriers for small business in procurement. It establishes:

a higher, simple procurement threshold, up from $220,000 to $550,000, to streamline procurement practices for both small business and government agencies;

a document simplification exercise that will be launched to streamline simple procurements;

a Better Customer Charter to reduce the amount of information required in tenders; and

sets standards of ethical practices for the state government to adopt.

There are also proposed benchmarks for timely decision-making in procurement which will be monitored by the State Procurement Board. This builds on earlier reforms, including the removal of all fees for prequalifying, which will save businesses around $62,000 collectively per annum, and setting limitations of liability for low-risk contracts up to $1 million, which are now capped at five times the contract value.

These reforms add to the robust results we have already seen from the Office of the Industry Advocate. Since its establishment in 2013, there has been significant improvement in the value of goods and services contracts awarded to local suppliers, and it's important for every member in the house to note that we now stand at 90 per cent—an increase of more than 40 per cent since 2012-13, and a nation-leading result.

In the past 12 months, South Australian subcontractors have been awarded projects worth an estimated $637 million out of a potential project pool of $698 million from major construction projects valued at over $50 million. I give all this information to the house, particularly to those opposite, so that, when they make comment, they can do so based on informed advice—

Mr GARDNER: Point of order.

Members interjecting:

The DEPUTY SPEAKER: Order! I uphold the point of order.

The Hon. M.L.J. HAMILTON-SMITH: —and facts.

The DEPUTY SPEAKER: Minister!

The Hon. M.L.J. HAMILTON-SMITH: These benefits will be extended through the Industry Participation Advocate and external commercial specialists being required to sit on procurement governance committees of major purchasing agencies, enhanced commercial acumen in state government through targeted staff training, and oversight of agencies using spend analytics to identify opportunities to improve and to report to the budget review committee of the cabinet.

Finally, publishing forward procurement plans for contracts from $220,000 will make opportunities more transparent. These reforms are an example of this government backing local businesses, particularly small businesses and South Australian workers.