The Canberra Business Podcast
A podcast about all things Canberra Business.
The Canberra Business Podcast
How SMEs Can Win Commonwealth Contracts
Australia’s biggest customer isn’t a corporation; it’s the Commonwealth. We sit down with AQMN Legal’s Matthew Bautz to map a practical path for SMEs that want to sell to government without getting lost in rules, panels, and paperwork. Matthew explains why procurement inside Canberra runs on transparency and value for money, not speed. Including how that changes the way you bid, partner, and protect your IP.
We get specific about entry points that work: subcontracting under primes, joining the right panels, and targeting sub-threshold opportunities where agencies can buy faster. You’ll hear how the CPR changes could tilt more work toward Australian businesses and SMEs, why carve-outs and panel dependence still matter, and how to use AusTender as a live radar for who buys what. We also dig into ASDEFCON complexity, the unfair contract terms regime that helps SMEs fight IP overreach, and the uncomfortable truth about limited recourse under the GPJR Act when panels are involved.
This is a playbook you can act on: pick a niche, partner where it lowers risk, deliver flawlessly, and build a track record that makes renewals easy. Then, when you’re ready to scale, look to the United States—larger contracts, deeper programs, and a market that rewards proven value. We share how a planned chamber delegation to Washington, DC can accelerate relationships and help you set up the right onshore footprint.
If you’re serious about winning government work at home and abroad, listen now, subscribe for future episodes, and share this with a founder who needs the roadmap. Got a question or a win to celebrate? Drop us a note and leave a review to help more SMEs find this conversation.
Hello and welcome to the Canberra Business Podcast. I'm Greg Harford, your host from the Canberra Business Chamber, and I'm joined today by Matthew Bouts, the uh one of the directors of Acumen Legal to unpack the mysteries of Commonwealth Procurement. Matthew, welcome to the podcast.
SPEAKER_00:Thanks, Greg.
SPEAKER_01:Um let's start at the beginning. Acumen, uh, you're one of our corporate members, but um tell us a little bit about what you do and who's involved.
SPEAKER_00:Um thanks. So Acumen is a law firm. We uh we essentially established ourselves by demand. We had both of us had actually moved out of law um a couple of years ago. We were more focused on trying to do uh growth for businesses, and then we moved into more procurement commercial contract management uh business advisory position in different uh in a different company based on demand from some people who we knew. Uh, we actually created Acumen because people wanted uh advice, contract reviews, negotiation assistance. They want to understand uh how to engage with the Commonwealth, how to deal with other businesses and negotiations and all of that. And we thought that you know we don't want to do it for somebody else, so we'll do it ourselves. And we want to focus on, I guess, growth-focused law. So, what can we do and what services can we provide that are actually going to be beneficial and help businesses make more money rather than the cliche law of just being risk mitigation and sort of being overly cautious?
SPEAKER_01:Yeah, and that growth mindset is really exciting. How long have you been going for now in the business?
SPEAKER_00:Acumen's relatively new still. So I think we established it about two and a half years ago in July, but it took so long to get some of those initial regulatory requirements that it's only about two years now. So as of the six months after we incorporated, that's when we started officially uh engaging and doing some uh actual services.
SPEAKER_01:Yeah, and how's it going over two years?
SPEAKER_00:Yeah, it's it's gorge. We are surprised by the level of engagement we've received. Um, it was definitely assisted by a large client of ours. Um, we provided a lot of assistance to them when they were doing a large defense procurement, um, and we're very proud of this. We provided a lot of support. They actually beat Lockheed Martin for a massive defense contract, and we were very, very happy because the environment at that time, similar to now, the environment at that time was that a lot of SMEs and Australian businesses hadn't won much work. And this was a big announcement when it came out. That's a big contract, so we supported that, and now we have uh a number of staff full-time on that engagement. They're doing awesome work. Um, we get to pick and choose our clients as well. It's not a firm where we're focused heavily on billables. We are just trying to focus on supporting businesses, and we get to work with CEOs and executives and senior managers of very uh impressive companies that are able to do very cool work, stuff that just we would never be able to do ourselves. And so when word got out as well, we've started getting a lot more interest, um, and we've got a new person joining us as of next week, actually. And she used to be the special advisor to the CIO at Defense, uh, brings a lot of experience, incredibly uh experienced and qualified in the technology law space. So it's been exciting, it's been a big learning curve. Um it was, you know, a new business after all, so there was a lot to learn and sort of get your hands on. But I guess the benefit of that as well has been we understand what owners are facing and what their actual issues are, and it's not normal legal advice you're getting, you're getting commercial business focused advice that helps the business grow and focus on things that are actually worth spending money on rather than just you know traditional legal where it's all about this could be a problem or that could be a problem.
SPEAKER_01:And it's it's great to hear that that's um going so well. Um and and you're a Canberra company, right? Or based here in Canberra?
SPEAKER_00:We are in Canberra, New South Wales, and now also Queensland.
SPEAKER_01:Excellent. So expanding from a Canberra base to take over the country. We are trying our best. Fantastic. Um government procurement, defence procurement are obviously really, really big and really important for Canberra businesses. Um Do you think that all businesses need to be interested in government procurement and looking at the opportunities?
SPEAKER_00:I agree, it's it's a massive market. The Commonwealth government is the largest client in the country. Uh last financial year, I think the numbers were$99.6 billion was spent in Commonwealth procurement, uh, which is the procurement being the purchase of goods and services. The year before that was roughly$75 billion.
SPEAKER_01:Um those are massive numbers. I mean, absolutely huge. I mean, most businesses um here in the ACT would be turning over, certainly under a million. So so that's that's absolutely huge and clearly a huge source of opportunity.
SPEAKER_00:It's a massive source of opportunity. I mean, those numbers, in fairness, we have to put some qualifiers there. Uh, between 2012 and 2022, I think the overall spend was about 666 billion. That is significant. There is a lot of good that the Commonwealth can do as being a good purchaser because what they get to do is determine who gets the work, what type of work gets out there, uh, and then they get to put in, you know, some of these uh restraints and compliance obligations, such as the supplier code of conduct, which has come out recently. But it's in relation to your question, I think the most important thing is everyone should be interested in it. Not everyone should try and have a crack at it, I think. Um it's important because it's such high-value contracts, but it's also very important to understand that it's a difficult environment at the moment. So if people are um purely relying on private work, fantastic. We would encourage them to have a look at the government work as well. If you are able to provide a valuable service uh that is low risk, the Commonwealth's gonna have a look at you.
SPEAKER_01:And do you find um, I mean, it is true to say, I think, that that um government spending, government procurement is really diverse. It covers the full range of goods and services that the government consumes, right? So there's there's a myriad of things that that fall within that basket.
SPEAKER_00:Yeah, I mean it's everything. It's everything from services, from goods, infrastructure, you know, you've got$10 million war vehicles, you've got syringes, you've got clothing, footwear, food, cleaning services, you've got complex ICT construction as well. Um I mean it's it's the full remit of everything.
unknown:Yeah.
SPEAKER_01:So, I mean, it sounds um sounds a bit like a golden goose in some some ways. Um, you know, uh get a big contract with government and and uh the world's your oyster, but um obviously it's not that simple and not that straightforward. What are some of the issues that you have encountered or that you've seen with your clients over the last couple of years?
SPEAKER_00:Oh, that's a that's a big one. Um so straight away I agree. It is it looks appealing, but I think there is something that everyone has to understand, and that's it's that Commonwealth procurement is not private sector procurement. Private sector procurement is definitely a financial function, I understand that, but commonwealth procurement is more of a commercial regulatory function. They buy goods and services because they have a need they have to fulfill, and they are purchasing this with taxpayer money. As a result of that, what they need to do is make sure that they are spending their money transparently and there is accountability for poor procurement practices. They also want to make sure that whoever is getting the work are ethical companies that do not have judicial decisions against them, especially as it relates to unplayed employee entitlements. There are a range of different procurement connected policies that people need to abide by as well, and it can take a very long time to get government work. So I want to give you an example of this. DroneShield is a absolutely phenomenal Australian company. They are probably one of Australia's golden child in terms of uh impressiveness. They are known all around the world. It is an Australian business, it's absolutely impressive, and they have so much work overseas, and they have not that many contracts in Australia. And that is not something we say lightly because you look at Ukraine, drone shield have been involved from the beginning. Everyone knows they are the best when it comes to counter UAS services and goods. Um they have million, multi-million dollar contracts in the United States throughout Europe, and them getting work here is proving very difficult. And obviously, that is not something I say lightly because it might dissuade other people from trying to provide services and goods to the Commonwealth because if you're not if they're not a drone shield, well, if drone shield is struggling, what chance do other people have?
SPEAKER_01:Yeah, and that's a complaint I hear quite often that often it's easier for firms to get work uh overseas and export services rather than providing them here to the Commonwealth. Um, why do you think that is?
SPEAKER_00:I'll be careful on how I say this. I think there's a lot of good that the Commonwealth government tries to do in terms of its procurement practices. However, there is a lot of there is a requirement for the procurement teams to upskill. Uh, this was not a personal view. This is a re a view from a report that came out uh in September 2023 called Report 498, and it basically said that Commonwealth procurement needs to professionalize. It's not a it's not a pathway that most people choose to go down. A lot of people find themselves in this area. And when I say that, I found myself in Commonwealth procurement. I had never even considered or heard of it before I found myself there. But it's a complex area. You deal with everything from you know getting people into clean buildings to purchasing F-35 jets, which are some of the coolest jets in the world. So it's just it's just the buying of goods and services by the Commonwealth. There is a difficulty that the, and I don't know why, but the Commonwealth has in terms of their risk appetite. They're not a fantastic buyer. Some of them are excellent, and other groups don't understand what they should be looking for. They don't understand what their requirements should be, and that's the I want something versus I need something that gets conflated all the time. And then it's also just not knowing who to go to. Uh, and a common complaint we hear, and I've heard it when we were on that New Zealand trade delegation mission that you guys hosted, there is a requirement that people need to go and network. They need to introduce themselves, they need to market, they need to let the government know who they are, what they do, and how they can sell or be bought, um, how the Commonwealth can buy from them. So it's it's interesting because we don't exactly understand why Australian businesses find it so difficult to sell to the Australian government. We do see a lot of international businesses selling a significant number of um goods and services to the Australian government, and we are seeing an increase in the number of um Australian businesses that are having to export their product, and they're finding essentially better opportunities in the US markets, UK and Europe, um, in the UAE. Opportunities overseas are proving quite lucrative. I mean, for example, again, Drone Shield, they've got the majority of their contracts are international.
SPEAKER_01:You touched on the question of visibility with government officials. Have you got any advice for firms on how they can try and uh market themselves or at least make officials aware of the services they offer?
SPEAKER_00:Yeah, I I do. The number one tip we have here is the best BD you can do is good delivery. That's that's the number one. If you are very good at what you do, people will hear about you. So I guess what that means is you need to find a way into the government. And if it depends on who you are and depends on what you're doing, and as we say, procurement is such a significant area. If you're trying to do defense, if you're trying to provide services or goods to defense, then and you're an SME, your best avenue for doing this is either partner or subcontract through the primes. Uh, and there's uh you know, there's nine primes or something like that that defense um use majority of the time. And there's the global supply chain programs. There's also the MSP arrangement as well, um, it's a managed service provider. You also have other larger organizations and medium organizations that have large contracts and they need expertise to come in. So if you're providing a generalist service, it's gonna be more difficult. If you have a niche product that nobody else has, you're gonna find it much easier. So that's why in the beginning, when I'm saying everyone should look at this, but not everyone should apply for it, there's a reason, and that's because you need to go out of your out of your comfort zone, you need to talk to people, go to these networking events, you need to try and subcontract initially. If you can get your hands on a direct contract, that's fantastic. All kudos to you. I'm glad you're able to do that. But most of the time you're not gonna be able to do it. So you're gonna subcontract your way in through these other providers. And if you're doing that, again, give the best possible service you can, if we're talking about service firms, give the best possible service you can, and that company's gonna want to use you again. I mean, everyone's in it for themselves. Um, it's a it's a business, they have to be profit-focused. And if you're a business, so put yourself in the shoes of these larger companies, if you have a subcontractor who is low risk, doesn't cost that much money, and they are delivering an exceptional value, you're gonna want to use them every single time. And people can build up fantastic relationships. I know of a company that's got about 60 people, and they don't have any direct contracts with the Commonwealth, they subcontract all of their resources in. They don't have a problem with it. So people trying to find their feet for the first time, they shouldn't have a problem with that either.
SPEAKER_01:Now we've talked about um some of the challenges associated with government procurement, but what are what are some of the positives?
SPEAKER_00:I guess the positives are if you're able to get yourself a government contract and you are delivering a valuable service, the Cornwall's gonna see that and the Cornwall's gonna want to use you again because again, they don't want to have to go out and do these complicated procurement processes which take a lot of time uh and expertise. Sometimes they have to get in external providers to come and actually run some of these processes. They're subject to error, they have to restart it on occasion, and that's just part and parcel of you know doing work. People make mistakes. The most important thing is if you do good work, you're gonna have a long-term client. And if you keep doing right by them, you're gonna get repeat work, and that's gonna give you this massive opportunity to grow. And if you're able to do government work and you have private work, it's gonna put you in the best position to expand. And we know, we know firms, um, so for example, Birdon, they came and did a presentation for a different group quite some time ago, and they made it very clear that what's gonna be very important for businesses is to do both government and private work. And they were saying that the Australian environment's very different. It's very, they described it, I believe, as you're a wolf on the plains. You are scrapping for food, and it's very competitive. And then they went overseas to the US and they said obviously they were very good at what they did, they worked very hard, but they went over to the US and they said their first contract there was worth more than any contract they had ever received in Australia.
SPEAKER_01:Yeah, and there's a question of scale, right? I mean, so the Australian Commonwealth procurement is is big for Australia, um, but Australia is still only a middle-sized power on a global basis.
SPEAKER_00:So I had a conversation this morning uh on this exact point, and I think it's a it's a great point. One of the issues defence has is it's the largest department in Australia, so it thinks it's got really solid bargaining power when it's dealing with some of these larger organizations. When it comes to Australian organizations, they do. They have the most bargaining power, uh, and that's completely understandable. But they will go and they'll talk to you know one of the major primes, and they will try and say, you know, these are our terms, take it or leave it if you want this hundred million dollar contract. And some of these primes are willing to walk away from that because they've got billion-dollar contracts with the US government, for example. Um, so you know, Australia, I think when two years ago or two financial years ago, when it was 70, roughly$75 billion in the annual procurement spend, defence was about 52% of that. So roughly$35 billion or$37 billion, roughly, whatever the numbers are. That is not even the annual revenue of some of these larger organizations. So Defence is massive in terms of the opportunity it could provide to Australian businesses, especially SMAs. But when you go overseas, the market is significantly more.
SPEAKER_01:And does that create a challenge for Aussie businesses that are looking to go offshore, do you think? Or or is it just more of an opportunity?
SPEAKER_00:I believe it's an opportunity. I think the the challenge there is it's complicated and it's scary, and people don't know what they're doing. Um, I mean, if if you're in the defense industry again, this is what Acumen does. We are defense industry focused. Uh we do some probity and compliance work for some government departments, but primarily 99% of the work we do is is aimed at private industry, especially those trying to do work with the Commonwealth, and our expertise is within the uh Department of Defense. So trying to engage with the Department of Defense, that's us. Um, and if people are trying to go overseas, well, we can help them with that. Uh, Canberra Business Chamber can help them with that, Ostrade can help. Um, there's a lot of other organizations that are willing to help even have discussions. And so, land forces, for example, if you go to land forces, you can walk around, you can find somebody else. The people from these stands who are Australian businesses who are now providing um services and goods overseas, they're more than willing to have a chat and to give some tips and advice. And one of the most important things we got told was Ostrade is set up to help with this. I mean, it you need to reach out to them, you have to have a crack, essentially. But it shouldn't be scary for businesses and it shouldn't be an impediment. It should just show the opportunity that exists overseas as well. But if you're not even doing business with in Australia and you haven't even contemplated doing business for the Commonwealth, because I completely understand some of the contracts you see are huge. I mean, we're ranging from contracts between eight pages, which some people still consider to be a lot, to contracts that are a thousand pages. Um I mean, when you're dealing with defense, you've got the as DEF CON contracting suite, and that is very, very complex. But if you're able to get a defense contract using as DEF CON, I mean your business is going to be you're doing okay. So as DEF CON stands for the Australian Defense Contracting Suite. It is a suite of different documents used for construction, services, goods, all the way from simple purchase orders up to complex um procurement. So for example, we're trying to get submarines. Um I mean, if we're using as DEF CON templates, we would use the comp uh as DEF CON complex documents for those ones. I mean, these are documents that might take teams of lawyers years to put together and negotiate. So when we're talking about some of the Canberra Business Chamber members, it's going to be the smaller contracts, and they might, some of the most complicated ones they have to deal with will be the services, the ASDEFCON services suede. What we usually recommend for people is, and what we usually provide advice on, is just accept what you can get from the Commonwealth and just show them how valuable your services are. Um and then once you've done it a few times, then you can start looking to negotiate. There's always things to watch out for, and the main one as well as the intellectual property, especially when you're dealing with large organizations and primes. We have seen SMEs who offer an absolutely fantastic product. Um, and this we did a recent negotiation with one of them. They offered a fantastic product, and they were working with one of the larger primes, and the prime essentially wanted all the intellectual property that went with it. We're saying you absolutely can't have that. This business doesn't exist without this product. You want the product, you can have a license to it, but that's about all you can have. And in Australia, we are a very bureaucratic state. We have a lot of rules and regulations, and some of this is absolutely fantastic for SMEs. You got the unfair contracting sway, uh, unfair contracting term regime. Um the UCTs changed, I think it was last November or even maybe two Novembers ago, time flies when you're absolutely smashed. What it does is if you're doing business with within Australia, it's a standard form contract and you're dealing with a small business, these terms that used to be uh held as unenforceable, they now attract massive penalties for companies. So we've seen it's uh it's actually one of the bits of regulation that's been brought in that I think has provided the most benefit for Australian businesses and for SMEs. Now, when you're dealing with other Australian businesses and other SMEs, obviously it gets quite annoying. But when you're dealing with some of these larger organizations, especially those that only have a presence in Australia and they're not Australian, they don't know. And some of their teams are just trying to get the work done. They provide a standard form, people think they need to accept it, and then we've come in and we've managed to say to them, no, you don't need to accept this. And hey, it's actually an education piece now. Hey, prime, you can't do this, or else you're going to get a massive fine if the relevant regulatory body finds out, they're more than happy to change those because they just didn't realize. So there is sometimes an unfair perception, be it you know within Commonwealth departments as to consultants and contractors, be it from SMEs towards some of the larger vendors. You need to be careful when you're dealing with them, but most of the time they just want to deliver and they're competing against other groups. So they want to provide a product that is um you know better and cheaper and more valuable than their competitors. And so if you can show yourself as a good subcontractor or a good supplier, you will have repeat work.
SPEAKER_01:Now you mentioned a moment ago that Australia is a fairly bureaucratic country. Um there's lots of rules and regulations, right? Um but I understand there's some changes coming up in mid-November to the Commonwealth procurement rules. Do you want to just unpack those for us a little bit? What is it that members and other businesses need to know?
SPEAKER_00:No, it's a great segue. Um it's actually coming up uh 17 November 2025. So the when we're talking about Commonwealth procurement, it's the purchasing of goods and services. These this entire system is governed by the Commonwealth Procurement Rules. Now it's not just the CPRs, you also have procurement connected policies, you have internal department AAIs, you have the PGPA Act, you've got the GPJR Act, there's a lot out there. But the primary set of rules here is the Commonwealth procurement rules. The and which we call them the CPRs. So they are the government's rulebook for how contracts are formed, how the procurement should proceed, and how people should be treated, essentially. The primary purpose of the CPRs is to is the pursuit of value for money outcomes. Value for money is a is a difficult term to define because there's no one size fits all. What's value for money for one department is different for another. What's value for money for one department, one specific procurement might actually be different for a separate procurement within the same team, within the same department. It all depends on what the requirements are. Essentially, if you are a procurement official, your obligation for the department is to undertake a procurement ethically, compliantly, and to obtain value for money solutions. This is the best use of taxpayer money, and this is what the procurement officials and delegates, they they know all of this, and this is what the CPRs guide and essentially regulate this environment. The CPRs also talk about open tender versus limited tender. It talks about uh what is ethical, it talks about uh you know a range of different requirements. What we find very important is if you're an SME and if you're an Australian business, you have a lot of opportunities under the CPRs to engage with the Commonwealth directly without the Commonwealth having to follow additional rules. So there are Appendix A exemptions, and very recently there was some government change, maybe it was July last year, I can't remember off the top of my head, there were some changes where the Appendix A exemption 17, I believe, increased to$500,000. So if you're an SME, which means government departments are allowed to approach SMEs for contracts worth up to$500,000 directly without having to do an open tender. And I thought that was fantastic. Um we are seeing some hesitation to it because there has also been a cut down on the number of uh consultants and contractors. This seems to be more in the above-the-line space rather than below the line. So if you are a small business providing below-the-line services, um just be aware that if there is a delegate you're talking to and they are interested in the product or service you have, they can engage you directly using this exemption. So the CPRs regulate the entire procurement uh environment. There are changes coming in November. Now, these changes, we have to wait to see if they're going to be good. They are being stated as being only focused or heavily focused on providing support for Australian businesses and SMEs, but the wording of the CPRs doesn't actually, or the proposed CPRs, I should say, doesn't actually support what they're saying. So I'll start with a good, I guess. That's probably always the best place to start. So there's going to be mandatory requirements for some procurement officers, or for all procurement officers, sorry, to um have the rule here. For procurements with an expected value at or uh$10,000, above$10,000 and below the relevant procurement threshold, excluding procurements from a standing offer, non-corporate Commonwealth entities, which is defense and other organizations like that, they must invite only Australian businesses to make submissions. So that's between 10,000 and the new threshold, which would be$125,000. So between$10,000 and$125,000, procurement officials must only invite Australian businesses to make submissions. Now, obviously, that is fantastic news for Australian businesses and for Canberra Business Chamber members. There is another rule which is for SMEs. So for procurements with expected value below$125,000 from the Management Advisory Services Panel, the people panel, or any standing offer managed by the DTA, these same type of departments, must invite only SMEs on the relevant standing offer to make submissions. And because these are not exceptionally high value contracts,$125,000, that's going to make it much easier for SMEs to get that initial engagement. The problem with this, these two points, however, and this is what my issue with them saying it's you know fantastic for SMEs and it's only good things, there are carve-outs in these exact two rules. So 5.4 and 5.5, they have a subsection C for both of them that says a procurement official might determine that they don't need to approach an Australian business or don't need to approach an SME. So it's not like a must. It kind of defangs it a little bit. Completely. And you just have to record the decision. There's no guidance on what the decision should be, what the uh criteria for a decision should be. So I I do I don't like that. I understand why they've put it in, but there isn't that stick anymore, uh, that it's a must. And so that is quite disappointing. Uh the other problem is you have to be on these panels. And getting on a panel is incredibly time consuming and it's difficult. And I know that Senator David Pocock has made a lot of noise recently about the inappropriate use of panels. Uh that is, I guess, my first or second recommendation for your members would be step one would be to subcontract or partner or use other organizations. Step two, try and get yourself on a panel. Panels aren't always open, they're only open every couple of years. The DTA is doing a better job of this because they are doing constant refreshes to their larger panel. But uh, some of the other panels, you'll, if you don't miss out, three or four years is how long you have to wait before you can actually uh apply for it again. So it's it's really damaging for the long-term longevity of a business if you don't get on the panel.
SPEAKER_01:So, how do businesses know when a panel is open?
SPEAKER_00:The panels will always be advertised, and it's I would say it's the obligation uh and responsibility of every business to constantly scour OSTender. Um, I guess for some of your members who don't know what OzTender is. Oz Tender is the government's uh essentially panel process. It is it records every single um contract above a certain threshold that has been entered into. It also releases or advertises for all open tender approaches. If the Commonwealth is doing an open tender approach, it must advertise it through OSTender. So we highly recommend if they don't have an account, it's free. Create an account, get on OSTender, scour it. It's so useful because what it allows you to do is see who's winning work, who's issuing contracts, what type of work's being issued, and allows you to restructure or refocus your attention on some of these areas that you can see are lucrative, especially if you're working in a space that just doesn't make a lot of money at this point in time.
SPEAKER_01:Is there anything else in the changes to the Commonwealth procurement rules that you want to draw to people's attention?
SPEAKER_00:There's going to be an increased focus on the economic benefit. Uh there's also going to be then the thresholds have moved up as well, and they're now supporting and they've included the Australian business test, so they'd redefined what an Australian business is. Unfortunately, as well, they've removed the protection. Of discrimination from the relevant provision in Division I of the of the CPRs, and they've moved that over into Division II. And so now we actually might see a position, it depends on how we go moving forward from November. We might see a situation where SMEs are being discriminated against due to their size, and it's no longer something that the vendors can put their hand up and say, hey, we've got a valid complaint now because they've removed it. So they haven't removed it from the CPRs, but they've moved it to Division II. To sum it up very quickly, because it's a complicated document, division one applies to all procurements, division two only applies to certain procurements. If you're a government uh department and you're releasing a procurement through a panel, division two doesn't apply. So the recourse you have for a Commonwealth procurement rules breach is questionable. You can make some noise, and we see breaches every day, and we see the ANAO constantly releasing reports where they say the CPRs were not followed or they were breached and nothing happens. And this is, in my view, it's an absolute disgrace because that's taxpayer money that's being used and it's not being used effectively. I believe the ANAO said in a report that roughly 54% of all contracts over a three-year period, those procurements were either partly effective or not at all effective. So you can imagine even one year of$99.6 billion, 1% is 996 million. We're saying up to 51 or 54% isn't partly effective or not effective. We have a recourse for suppliers, and this is something that I've been advocating for, and I understand other organizations are now also making some noise about. You had the Government Procurement Judicial Review Act. That was brought in in 2018, came into effect in 2019. That same year where it was it came into effect, the CPRs were amended so that if you are if a procurement was released through the panels, Division II no longer applied, and it's no longer a covered procurement. So you can only make complaints if the CPRs are breached, if it's a covered procurement. So if it's through a panel, it's not a covered procurement, and 81% of all contracts were over a three-year period according to the ANAO were released via panels. So that recourse isn't available, especially for SMEs, for any panel procurement. And it's it's just a position now where for those people who did have this avenue for SME discrimination, it doesn't exist anymore because it's now in Division 2.
SPEAKER_01:So, what is your advice for people who might feel aggrieved by a decision or an outcome through the Commonwealth procurement processes?
SPEAKER_00:Primarily you've got to make a commercial decision. Um, we're commercial lawyers, we we won't give advice, which we won't follow ourselves. You can make noise, but you have to be careful because if you make too much of the wrong noise, you might be you know biting the hand that feeds you. However, we've got someone in the ACT, for example, who likes to make noise about this, and it's Senator David Pocock. We highly recommend, if you're not in the ACT and you're listening to this, find who your relevant member is and write letters to them, complain to them, let them know what's occurring. I think if there is a significant enough breach and you can make enough noise, you will see recourse from it. And also a lot of the time, some of the departments they will be apologetic. Uh maybe in the future you'll you'll see something more positive as a result, but right now there is no immediate recourse. If they even acknowledge that they breach the CPRs, it's uh, oh, sorry about that. And and that's it. If they have evaluation criteria and they don't follow the evaluation criteria, nothing, nothing happens at this stage. Um the that act I was talking about, the GPJR Act, came into effect in um 2019. There's been zero decisions underneath it. That's interesting in itself. It's fascinating. Yeah.
SPEAKER_01:So look, there's obviously a few negatives in there, but but obviously a lot of positives in government procurement as well. So um, if you had sort of one piece of advice for businesses looking to engage with the Commonwealth, what would it be?
SPEAKER_00:One piece of advice I guess is hard. I would say don't try and don't try and have it all. Subcontract, partner, and deliver your best work. The Commonwealth is primarily interested in purchasing valuable services that are low risk. So if you can show that your services are valuable or your goods are valuable and that you are a low-risk supplier, you're going to get more work in the future. I would also recommend you need to be patient. You need to understand that these type of contracts take longer than your traditional business-to-business contracts. Um, but if you're willing to be patient, you're willing to put in the work, you might see some of these contracts, and that's going to be absolutely fantastic for your business. I would say if you don't understand what you're doing in the Commonwealth procurement space, come talk to us if you want. Um because you you don't want to put all this time and effort into a procurement if you have no chance of winning. And we are very experienced in this area. So if you are trying to bid for something, come talk first. Because before you spend 40, 50 hours putting the best submission forward that you can, you're going to want to make sure you're actually going to be competitive for it. And I guess the other part is don't half-ass anything. A lot of people are trying to bid for everything, and they're putting average uh tender responses out. It would be better for you to apply for one procurement that you put your heart and soul into than into a hundred procurements where you think, okay, we'll just put this in and see how we go. Um again, go to the networking events. Uh, Canberra Business Chamber has lots of networking events. Partner with people, subcontract to people, and deliver your best services you can.
SPEAKER_01:Matthew, the chamber is looking to take a delegation to Washington, DC next year to investigate some of the defense and government procurement opportunities available over there in the States. Um are you keen to sort of be involved in that and and how successful do you think that's going to be?
SPEAKER_00:I'm very excited for that. I'm very keen to be involved. The recent trip you did to New Zealand, I I know that it resulted in some contracts for some of the Canberra Business Chamber members. Uh, Washington is a significantly larger uh area than New Zealand is, and obviously when I say Washington, I mean all of the United States. If you're serious about doing business overseas, this would be an absolutely fantastic opportunity. And I we know a couple of our clients that we're already dealing with who have defense contracts, they're all gearing up to get ready for this. They're very, very excited about the prospect of doing business in the United States. It does mean, under the current administration over there, that you're probably gonna have to establish a United States business. That's fine. That's not something that should dissuade you from trying to do it, but it's definitely something that's exciting. It's a massive opportunity. Um, and it also gets to show the United States that you know there is a lot of exceptional talent and hardworking people in Australia, and you know, we're hungry for work, we want to do the work, and if given the opportunity, we can deliver high quality work. So we're very excited. All the clients who uh we've spoken to in the defense space are very excited about this. All your members, as far as I'm aware, should be very excited about it as well. It's a great opportunity, uh, and we highly encourage everyone to um put their hand up and say we're we're interested.
SPEAKER_01:Yep. And you've got to be in market to build relationships and make those connections ultimately, right?
SPEAKER_00:Absolutely. You have to do traditional BD. I know there's been a bit of uh hesitation towards picking up a phone or actually talking people face to face because of COVID. You can't do business just over emails. You have to call people, you have to maintain relationships, you need to go to these events. This and such an event like this is is once in every you know years. It's we haven't seen the last time that something like this was hosted, and you get to go over with a number of other companies from Australia as well. It's a great opportunity, um, and it's it's could be massive for some companies.
SPEAKER_01:Yeah, and if any of our listeners do want to know more about that, get in touch with the chamber. Uh, you can find the details on our website at Canberra Business.com. Some great advice there. Thank you very much. Um, this is the Canberra Business Podcast. I'm Greg Harper from the Canberra Business Chamber, and I've been talking to Matthew Bouts from Acumen. Um, Matthew, thank you so much for joining us today.
SPEAKER_00:Thank you, Greg. Thanks for having me.
SPEAKER_01:Uh, don't forget to follow us on your favorite podcast platform for future episodes of the Canberra Business Podcast, and I'll catch you next time.