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Public Sector e-Negotiations and e-Auctions

Throw off your shackles

Robust parliamentary debateIn addition to cost savings, probity compliance and safer price negotiations represent two of the most important arguments in favour of the use of e-Negotiations in the public sector (see 'Transparency' section).

For public sector procurement, probity is the highest order consideration. All it takes is for a disgruntled supplier to take their complaint through political or other channels (one Australian jurisdiction has five entry points for procurement disputes) and the organisation suddenly has twice as much work to do as they review, investigate, document and report every interaction and justify every decision.

As a result of this, the default approach for many public sector organisations and their procurement professionals is not to negotiate once tender responses have been received. This provides the highest level of safety for both the individuals and their organisations. But, safety comes at a price: There is often a considerable difference between the price the supplier would like to receive and the price they are willing to sell for (see 'Saving Time' section). Further, there is the importance of clustering suppliers around true market price in order to provide a greater choice of supplier for the buying organisation (see 'More Choice' section).

The massive growth in the use of e-Negotiations in the public sector in Europe and North America is driven in large part by the high probity levels and the ability to negotiate in relative safety.

ANZ Public Sector Usage

Whilst established as a standard procurement practice in the public sector in North America and Europe, usage in Australian and New Zealand public sectors is less widely adopted. Organisations that have used them include the health departments of QLD, NSW, VIC, SA and NZ QLD Education, VIC  and QLD Police , Federal Dept of Finance, NZ Ministry of Business, Innovation & Employment, WA Dept of Treasury and Finance.

Whilst interest in e-Negotiations is high across many ANZ public sector jurisdictions, QLD is leading the way. QLD Health, Education, Police and Rail and Brisbane City Council have all successfully used the tool.