AUDIT: Political Advisor contracts undermine fair procurement

Auditor General Sonia Webster has raised serious concerns over the appointment of ministerial political advisors, citing their involvement as undermining the government’s procurement process.

In her 2024 Audit Report on Major Public Contracts, Webster revealed that political advisors were often hired through petty contracts before their roles were upgraded to more substantial contracts under the guise of “continuation of service.” According to the Auditor General, “There was a noted trend whereby political and politically affiliated consultants were initially hired under the petty contracts regime, after which their assignments were bumped upwards to a waived major contract.”

Webster’s scrutiny of the “Ministerial Political Adviser” position in July 2021 showed that three contracts under the Premier’s Office were converted under this provision. These contracts bypassed the normal public tendering process, raising concerns about transparency and value for money.

Webster argued that this method of contracting undermines the public procurement process by sidestepping the competitive bidding system intended to ensure fairness and accountability in awarding public contracts. “This practice has evolved to facilitate the hiring of individuals or services on major contracts over the long term,” she added, underscoring that such actions undermine the integrity of the public procurement process.

As outlined in the Public Finance Management Act, the public tendering process requires contracts above $100,000 to be awarded through competitive bidding unless exceptional circumstances allow for waivers. However, the report revealed that only 42.36% of major contracts from 2019 to 2022 went through the tender process. In contrast, 57.10% of contracts were awarded through Cabinet waivers, many involving political consultants and advisors.

Broader pattern of concerns

This revelation aligns with a broader pattern of concerns highlighted by Webster. She pointed to instances where ministries frequently bypassed the tendering process, often citing urgency or the continuation of service as justifications. While these reasons can be valid in some cases, the report emphasized the need for better planning to reduce reliance on waived contracts and ensure that public funds are spent efficiently and transparently.

Webster’s findings called for stricter adherence to procurement rules and an end to practices that allow politically affiliated individuals to secure long-term contracts without fair competition. The report also highlighted the potential for these waivers to give certain contractors an unfair advantage, creating an environment favoring those with political connections over others.

The audit, conducted under the Audit Act 2003 in response to the Commission of Inquiry’s Recommendation B18, aimed to identify weaknesses in the contract process, including the misuse of waivers, deficiencies in contractor selection, and ensuring value for money in project completion.