Maintaining the integrity of your procurement process requires an adherence to the principles of probity and understanding common probity pitfalls. This article discusses those common pitfalls and how to avoid them.

1. June 2019
Procurement in Focus
Common probity pitfalls and how to avoid them
What is probity?
Dictionary definitions of probity usually refer to
uprightness, honesty, proper and ethical conduct and
propriety in dealings. The word ‘probity’ is also often
used in a general sense to mean ‘maintaining the
integrity of the process’.
Maintaining the integrity in a procurement process
requires adherence to a number of principles:
▪ fairness and impartiality
▪ use of a competitive process
▪ consistency and transparency of process
▪ security and confidentiality
▪ identification and resolution of conflicts of interest
▪ compliance with legislative and policy obligations
▪ clear audit trails
Objectives of probity
Maintaining probity in procurement is essential to:
▪ ensuring processes are designed to achieve best value
for money
▪ improving accountability
▪ encouraging commercial competition on the basis that
all bidders will be assessed against the same criteria
▪ preserving public confidence in the process
▪ strengthening defensibility of decisions to potential
administrative and legal challenge
Probity is a key principle in government procurement
but may also have significant importance for
contractors who are contracted by government and
need to comply with government procurement policy.
Common pitfalls
There are common pitfalls which can undermine an
otherwise sound procurement process, and in the
worst cases, can risk damaging the process to such a
degree that it must be abandoned. The obvious time
and cost implications of having to abandon a
procurement process and restart it can be crippling to
an organisation and put the procurement at further risk
by limiting resources available for the ‘re-do’.
Communications – before, after and
during
Equality and fairness are of highest importance when
communicating with bidders during a procurement
process. This is true whether it be pre-evaluation
communication or communication during the evaluation
process. Communication during a procurement
process requires discipline from the evaluation
committee and other persons involved in the
procurement.
Issues may arise where discussions are held between
relevant persons in public places, or with people not
directly involved in the procurement. Information may
be divulged to parts of the industry prior to the release
of the invitation to market, or certain enquiries made by
bidders may be answered but the information not
disseminated to other bidders. All of these scenarios
have the potential to undermine fairness and equality in
the process.
Conflicts of interest
The independence and impartiality of any procurer is
central to the requirement for an unbiased and fair
outcome to the process. All members of the evaluation
committee and other persons relevant to the
procurement must disclose any conflicts of interest
(actual or perceived) that exist at the time of their
involvement in the process, are likely to arise during
their involvement or that do arise during their
involvement.
The duty to declare is ongoing and probity planning
(particularly in high-value or high-risk procurements)
should include provision for regular check-ins regarding
conflicts of interest. It is common to see an initial drive
to declare conflicts of interest, without any ongoing
checks throughout the process.

2. Paul Muscat Stephen Lewis Craig Tanzer Carla Mazibuko Aaron Williams BJ Doyle
PARTNER CONSULTANT SENIOR ASSOCIATE ASSOCIATE SENIOR PARALEGAL LAW CLERK
T: +61 7 5553 9485 T: +61 7 5553 9400 T: +61 7 5553 9481 T: +61 7 5553 9518 T: +61 7 5553 9546 T: +61 7 5553 9400
paul.muscat@minterellison.com stephen.lewis@minterellison.com craig.tanzer@minterellison.com carla.mazibuko@minterellison.com aaron.williams@minterellison.com bj.doyle@minterellison.com
*Disclaimer: The information contained in this update is intended as a guide only. Professional advice should be sought before applying any of the information to particular circumstances. While every reasonable care has been taken in the preparation of this update, MinterEllison does not
accept liability for any errors it may contain.
Breach of confidentiality
Procurement is reliant on an exchange of information
between the procurer and the bidders. The procurer
indicates its requirements and objectives through the
invitation and the industry responds with solutions and
commercial terms in their bids. It is essential for the
integrity of the procurement process to ensure the
information provided by bidders is strictly controlled
and confidentiality maintained.
To achieve probity objectives, particularly in relation to
the competitive nature of procurement, it is necessary
to ensure the information provided by bidders is strictly
controlled. This is achieved through stringent
confidentiality and security of information procedures
including access to and storage of bids.
Bidders have a right to expect that their commercial
information will be treated in confidence. Lapses in
security or confidentiality, such as leaving bids
accessible to others, not password protecting
electronic devices which contain the bids, losing
storage devices that contain bids or disclosing
confidential information of a bidder to another bidder,
may seriously jeopardise the procurement.
Requests for clarification
A procurer is under no obligation to seek clarification
on any issues raised by a bidder in a bid. However, to
enable the evaluation committee to thoroughly evaluate
a bid it may be necessary to request clarification of
information provided in a bid.
Bidders sometimes attempt to use the clarification
request as an opportunity to improve their bid by
providing additional information or changing pricing or
service levels. If this happens – in the interests of
fairness that information must not be considered in the
evaluation of the bid.
Possible consequences
As outlined above, the possible consequences of not
maintaining probity through the procurement process
can be fatal to the process. Outside of that crucial
issue, and in some cases of more consequence,
breaches in probity can also:
▪ cause damage to the reputation of the procurer
▪ risk legal action by bidders to recover bid costs and
anticipated profits
▪ disqualify competent bidders
▪ lose the trust and confidence of industry and the public
in the procurer’s process
▪ decrease competition for the opportunity and future
opportunities
And if you are a government body:
▪ risk political intervention, audit or investigation
▪ risk legal action for breach of legal or policy obligations
Probity advisers
Engaging a probity adviser should be considered for
complex, high risk or high value procurements. A
probity adviser provides guidance from
commencement to completion in relation to maintaining
probity and meeting legislative and policy
requirements.
MinterEllison Gold Coast are experienced probity
advisers and can be your trusted adviser for all probity
and procurement matters. If you have any questions
relating to the above material and would like further
information, please contact Paul Muscat on the details
below for assistance.
Strategies to avoid pitfalls
DO
1. Establish probity protocols and plan for probity at
the outset
2. Disseminate information about the process on a
‘need-to-know’ basis
3. Engage a probity adviser for complex, high risk or
high value procurements
4. Have one contact point for respondents
5. Make detailed records about the process, all
communications and evaluation of bids
6. Implement ongoing conflict of interest declarations
7. Get each person involved in the process to make
a confidentiality declaration
8. Ensure confidentiality and security of information
9. Establish clear communication protocols at the
outset of the procurement
DON’T
1. Discuss the procurement process (and particularly
evaluation) with any person outside of the process
or in public places
2. Give one or more bidders a ‘heads-up’ about an
impending procurement or information outside of
that which is advertised to all bidders
3. Accept gifts or hospitality from potential bidders
4. Put yourself in a position with a bidder which
might be perceived as creating bias
5. Accept clarification information from bidders which
change the bid