The Opposition has laid out a proposal to simplify tendering and help SMBs win Federal Government business. But although supportive of plans to give them a fair go, IT industry representatives said there was a long road ahead. Shadow minister for the service economy, small business and independent contractors, Craig Emerson, said plans to help SMBs included tailoring terms and conditions to specific contracts. In particular, it would look at reducing red tape on tenders worth less than $1 million.
"The liquidated damages, losses and insurance requirements that tenderers have to meet are way over the top for contracts less than $1 million," he said. "If you transfer these obligations to SMBs, they simply won't bid. It's not possible or sensible to enter into contractual arrangements that could end up with them being bankrupt. The terms and conditions and legal assurances on a contract to build eight submarines for example, are surely not suitable for a smaller contract. "Cutting SMBs out of the bidding process is not in the interest of SMBs nor tax payers. We want to ensure tenders for ICT services are well subscribed. It provides more competition and opens the prospect of greater innovation. If we have small groups of approved tenders, it excludes those who might have a good idea for a particular project."
Emerson refuted suggestions that a customised approach would directly contradict the push towards centralized procurement across state and federal agencies. "We would have a set of templates - one for bigger contracts, one for medium and one for small that reasonably allocate the risk for each one. These would achieve the balance between efficiency of drawing up contracts and tailoring terms to the size of projects," he said.
While applauding initiatives to help SMBs win government work, AIIA president, Sheryle Moon, said significant inroads had been made over the past 12 months with the removal of the Endorsed Supplier Arrangement (ESA). "We now have agreements with the Federal Government and the Victorian Government to limit liability," she said. "In May, contractual restrictions were also lowered around intellectual property [IP]. This is a positive for SMBs who are now able to take IP developed for one agency while doing an implementation and use it again. "Towards the end of May, we also saw Source IT contracts [introduced] which was a simplification of IT contracts at a government level."
Astron Technology sales and marketing manager, John Deacon, agreed removing the ESA had made it easier for SMBs to interact with government but said his business was still wary of public sector deals.