The Minns Labor Government will introduce legislation to ban suppliers who engage in serious misconduct or abuse of trust from doing business with the NSW Government.
The procurement reforms will establish a debarment regime and define the rules and processes which can be used to stop a supplier from gaining access the state's annual $42 billion spend.
For the first time, the NSW Government will have the power to exclude suppliers that engage in misconduct. Examples of misconduct could include the company, or one of its directors or senior managers, having engaged in fraudulent or corrupt conduct or failing to comply with taxation laws. Lesser penalties, such as suspension, could apply to suppliers depending on the seriousness of the conduct and any mitigating circumstances.
The regime will ensure that any debarment actions taken also apply to any subsequent 'phoenix' operations.
It means dodgy companies won't get an unfair advantage over companies that act in good faith and meet the ethical standards and behaviours the NSW Government expects from its suppliers.
It will protect taxpayer funding from unscrupulous operators by bolstering integrity and improving transparency.
The debarment scheme is part of a series of reforms to modernise the state's procurement framework undertaken by the Minns Labor Government. This includes measures to enhance the integrity of the procurement framework and restore public trust in public spending.
A debarment regime was raised by the Independent Commission Against Corruption (ICAC) in its April 2024 Operation Hector report.
While a debarment scheme operates in Western Australia and in other international jurisdictions, this is a first for NSW. The NSW Government will undertake extensive consultation with industry and other key stakeholders to develop the regime.
Quotes attributable to the Minister for Domestic Manufacturing and Government Procurement Courtney Houssos:
"It's essential that public money is spent responsibly and with integrity.
"This announcement begins crucial reforms to ban dodgy operators and maintain public trust in the way the NSW Government is spending taxpayers' funds.
"Thousands of hard-working, honest suppliers engage with the NSW Government every year. This regime will make sure we are not engaging with bad apples.
"We were left with a muddled and chaotic procurement system by the previous Liberal-National Government. The Minns Labor Government's debarment scheme will continue our program of reforms to deliver necessary change."
