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Tetyana Wotton
Senior Associate
25 July 2014
Practical Application of
Probity
Probity
What is it about?
• Fair and equal treatment of all tenderers
• Defensible process
Where does it come from?
• Comm...
Scenario No 1
• A simple public tender for the provision of services
• Three mandatory criteria leading to exclusion
• Six...
Scenario No 1 - continued
• The principal receives a letter from the only initially
complying tenderer asking for de-brief...
Scenario No 1 - Risks
• Process contract challenge:
• Did not treat all fairly and equally
• Did not comply with its own r...
Scenario No 1 – What to do?
• Meet face to face
• Fess up!
• Ideally, settle by entering into a Deed of settlement
(possib...
Scenario No 2
• A tender for the supply of goods (high volume)
• Two tenderers are shortlisted and invited to submit a
BAF...
Scenario No 2 - Risks
• Probity
• Legal:
• Breach of confidence/IP
• Think of commercial consequences for the tenderer
Wha...
Scenario No 2 – What to do?
• Investigate the damage
• Can the damage be repaired?
• If yes – proceed with the repair
• If...
Scenario No 3
• A public tender for the provision of hospital equipment
• One of the criteria in the RFT is financial viab...
Scenario No 3 - continued
• No action was taken on this
disclosure at the time
• At the de-brief, one of the
unsuccessful ...
Scenario No 3 - Risks
• Process contract challenge:
• Did not treat all fairly and equally
• Reputational impact
• Potenti...
Scenario No 3 – What to do?
• Present all steps taken in the process to demonstrate
probity was maintained (including disc...
Avoiding probity risks
• Prevention is the best cure
• Implement a robust probity management framework,
including the foll...
Contact Us
Tetyana Wotton, Senior Associate
tetyana_wotton@tresscox.com.au
02 6156 4332
Disclaimer
TressCox PowerPoint material does not constitute legal advice
The material on this PowerPoint has been produced...
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Tetyana Wotton - TressCox Lawyers - Practical Application of Probity – An Interactive Session. By participating in a role play, the participants will be able to consider:

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Tetyana Wotton delivered the presentation at the 2014 National Hospital Procurement Conference.

The 2014 National Hospital Procurement Conference explored a number of cost-saving measures in the hospital procurement ecosystem. Highlights included sessions on improving efficiency, savings and patient safety within Australian Hospitals.

For more information about the event, please visit: http://bit.ly/hosprocurement14

Published in: Leadership & Management
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Transcript of "Tetyana Wotton - TressCox Lawyers - Practical Application of Probity – An Interactive Session. By participating in a role play, the participants will be able to consider:"

  1. 1. Tetyana Wotton Senior Associate 25 July 2014 Practical Application of Probity
  2. 2. Probity What is it about? • Fair and equal treatment of all tenderers • Defensible process Where does it come from? • Common law • Legislation • Policies
  3. 3. Scenario No 1 • A simple public tender for the provision of services • Three mandatory criteria leading to exclusion • Six tenderers and only one meets all three mandatory criteria • The principal puts the only complying tenderer to the side and approaches the other five with a request to ‘build up their submissions’ to ensure compliance • Evaluation is complete and a contract awarded
  4. 4. Scenario No 1 - continued • The principal receives a letter from the only initially complying tenderer asking for de-brief • The principal realises it forgot to evaluate this submission as it physically put it aside
  5. 5. Scenario No 1 - Risks • Process contract challenge: • Did not treat all fairly and equally • Did not comply with its own rules of the process • Reputational impact • The tender outcome is not the best VFM What do you do?
  6. 6. Scenario No 1 – What to do? • Meet face to face • Fess up! • Ideally, settle by entering into a Deed of settlement (possibly with a pay out if there is a likelihood of further action)
  7. 7. Scenario No 2 • A tender for the supply of goods (high volume) • Two tenderers are shortlisted and invited to submit a BAFO • BAFO is focused on price • 2 days before the BAFO closes, by mistake, the procurement officer emails a comparative pricing analysis to one of the shortlisted tenderers
  8. 8. Scenario No 2 - Risks • Probity • Legal: • Breach of confidence/IP • Think of commercial consequences for the tenderer What do you do?
  9. 9. Scenario No 2 – What to do? • Investigate the damage • Can the damage be repaired? • If yes – proceed with the repair • If no – consider cancelling BAFO and making decision on the initial submissions • In any event: • meet with the affected tenderer and resolve the situation by a settlement; • present all steps taken in good faith to repair the damage
  10. 10. Scenario No 3 • A public tender for the provision of hospital equipment • One of the criteria in the RFT is financial viability of applicants • An External Financial Advisor (EFA) was engaged to assist with assessing submissions against the financial viability criterion • In the conflict of interest form, the EFA team member leading the financial viability assessment disclosed that she has had business relationships with some of the applicants
  11. 11. Scenario No 3 - continued • No action was taken on this disclosure at the time • At the de-brief, one of the unsuccessful applicants states that it is aware that the successful applicant is a major client of the EFA’s employer and alleges bias
  12. 12. Scenario No 3 - Risks • Process contract challenge: • Did not treat all fairly and equally • Reputational impact • Potential for actual bias – impact on integrity of process and outcome, including VFM What do you do?
  13. 13. Scenario No 3 – What to do? • Present all steps taken in the process to demonstrate probity was maintained (including disclosure of business relationship) • Seek further details from EFA as to business relationship – past or current? • Review evaluation records to ensure no actual bias • Consider obtaining statutory declarations from evaluation team members (provided no actual bias) • If actual bias is evident – consider re-evaluating tenders
  14. 14. Avoiding probity risks • Prevention is the best cure • Implement a robust probity management framework, including the following: • Probity plan • Process for disclosing and managing COIs • Single point of contact with tenderers • Information/document security system • Evaluation plan – ensure criteria are same as in RFT • Evaluation records – scores and narratives • Evaluation report • Appoint a probity adviser
  15. 15. Contact Us Tetyana Wotton, Senior Associate tetyana_wotton@tresscox.com.au 02 6156 4332
  16. 16. Disclaimer TressCox PowerPoint material does not constitute legal advice The material on this PowerPoint has been produced by TressCox Lawyers and has been prepared as general information about TressCox and its services. It is not intended to provide legal advice and, as such, the content does not constitute legal advice. Use of this PowerPoint does not create any solicitor-client relationship between the user and TressCox. Copyright The contents of this PowerPoint (Materials) may not be copied, reproduced, republished, uploaded, posted, transmitted or distributed in whole or part for any purpose other than individual viewing of the PowerPoint without the express prior permission of TressCox. Unless otherwise indicated, copyright of the Materials is owned by TressCox. Modification of the Materials or use of the Materials for any purpose will constitute a violation of the copyrights and other rights of TressCox. Linked Sites TressCox is not responsible for the content of any sites linked within this PowerPoint. The linked sites are attached for the convenience of the user only and may be accessed by the user at the user’s own risk. Privacy TressCox is committed to protecting your privacy. In the course of our business we collect, use and disclose personal information provided to us by our clients and other users of this PowerPoint. We do this in accordance with National Privacy Principles established by the Privacy Act 1988 (Cth). Please refer to our privacy statement for more details. Jurisdiction This PowerPoint is the property of TressCox. Legal content is based on laws applicable in the states and territories in Australia in which we practise. TressCox does not represent that it is authorised to provide legal advice in all the jurisdictions from which this PowerPoint can be viewed. Limitation of liability To the extent permitted by the law, TressCox will not be liable for any damage, including loss of business or profits, in relation to usage of this PowerPoint. Where any law implies a liability which cannot be excluded, any such liability is limited and provided for by the Competition and Consumer Act 2010. www.tresscox.com.au http://blog.tresscox.com.au/ linkedin.com/company/tresscox-lawyers twitter.com/TressCox
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