As DFAT seeks business partners, officials give insight on the process

Even though Australia’s aid program focuses heavily on the Indo-Pacific region, the country’s Department of Foreign Affairs and Trade has said it receives twice as many bids on average as the U.K. Foreign, Commonwealth & Development Office for business opportunities associated with its aid program. Darren Sharp, assistant secretary with DFAT’s Aid Business Branch, said this shows demand for businesses seeking to get their foot into the world of development assistance. “While … we have a pretty unique environment in which we operate, we still have lots of interest,” he said this week at DFAT’s supplier engagement conference. “We want to keep it competitive, we want to keep it successful, and we want to keep your interest in it. We will do all we can to get the best bids from you.” The conference provided insight into new open and upcoming opportunities with DFAT, and staffers offered guidance to suppliers on making their businesses and tender responses stand out. The key message was for partners to reflect and support the goals of DFAT — including workplace diversity, localization, and a secure Indo-Pacific region. “We want a sense that … you as a company are committed to diversity and inclusiveness like we are.” --— Darren Sharp, assistant secretary, DFAT’s Aid Business Branch Devex was there to learn about the highlights of the day: What’s in the procurement pipeline? A total of 29 business opportunities are currently listed in the aid procurement pipeline at various stages of the procurement process. Open for responses is the PNG Partnerships for Improving Education opportunity, valued at up to 75 million Australian dollars ($55 million). Open for expressions of interest are the Cambodia Economic Development Program, valued at AU$154 million; PROSIVU — short for “Timor-Leste: A Partnership for Inclusive Prosperity” — valued at AU$61.5 million; the Samoa Parliament Legislative Assembly Office Construction Project, valued at up to AU$14 million; and Support Unit for Gender Equality, valued at AU$1 million per year for at least two years. Pacific Women Lead Enabling Services, valued at AU$20 million, has recently closed for tender responses and is in the evaluation stage, along with the PNG Institutional Partnerships Program. Shortlisted organizations have been requested to provide final tender responses to the Australia – PNG Economic Development Partnership, Building Community Engagement in PNG Program, Australia – PNG Subnational Program, Australia Solomon Islands Partnership in Governance, and Health Technical Advisory Services – Specialist Health Service. The Samoa Human Development and Social Inclusion Program, valued at up to AU$37 million; South Asia Regional Infrastructure Connectivity - Training Component, valued at AU$10 million; Australia Solomon Islands Partnership in Justice, valued at AU$32 million; Basic Education Quality and Access in Lao PDR, valued at AU$28 million; Tonga Resource Platform; and Pacific Recovery Economic Support Program are finalizing contract negotiations with the preferred tenderers. Soon to be released are opportunities for COVID-19 vaccine logistics, gender-focused efforts in Papua New Guinea, education in Nauru and Tuvalu, sustainable economic recovery, addressing regional disparities in Indonesia, scholarships in East Timor, and a platform sharing knowledge between Australia and Indonesia. Sharp said that tender opportunities entail “no one-size-fits-all” approach. Two-step tender processes — involving expressions of interests and shortlisted applicants responding to the final tender requests — aim to reduce the cost involved in responding, leveling the playing field. But these tenders are for large projects that tend to be run by managing contractors. Abt Associates, Cardno, Palladium, and DT Global are shortlisted for a number of opportunities in the pipeline. Subcontracting opportunities with these managing partners are where new partners are playing a greater role, and these can be found through the AusConnect platform, with dozens of opportunities currently listed. Opportunities from infrastructure financing Other opportunities for new business with Australia’s aid program are available through the Australian Infrastructure Financing Facility for the Pacific. AIFFP has moved slowly since it was first announced in 2018, with just a small number of projects receiving financing. No new projects have been announced, but AIFFP Chief Investment Officer Robert Jauncey said he is hopeful that 2022 will see additional initiatives. Indicative new investments, Jauncey said, include electricity, road transport, and ports projects in PNG, as well as information and communications technology for the Pacific. But electricity will be a key focus after Australia confirmed its commitment to coal at the United Nations Climate Change Conference, Jauncey said, adding that AIFFP still has the option to fund large-scale electricity programs using nonrenewable energy sources. “AIFFP’s approach is going to be consistent with the approach the Australian government takes domestically [with] energy sources,” he said. “But I can say that everything we are looking at substantively at the moment is renewable. I expect that will be a key focus for us going forward.” While Pacific infrastructure projects may have slowed during the COVID-19 pandemic, Jauncey said he expects them to increase in the coming years. The focus for AIFFP, he added, was to support “high-quality firms” able to contribute to infrastructure development in the Pacific, as well as to directly finance companies from Australia and elsewhere looking to invest in the region. He added that AIFFP expects to “see some very different procurement outcomes from aid finance and investments, compared to what we might have seen from other financiers across the region over the past few years.” “We … are going to be encouraging our Pacific friends to focus very much on quality and value for money, not just price,” Jauncey said. “We’re also very keen to see a strong focus on local content and so keen to encourage Australian and other firms to build partnerships with local industries in the Pacific.” Advice for prospective partners In delivering on aid programs, DFAT is looking for partners with good judgment, policy knowledge, flexibility, innovation, and strong local networks and understanding, according to Angela Corcoran, assistant secretary with the department’s Southeast Asia Mainland Branch. Partners need to understand the complex environments in which aid programs operate and have processes to identify and respond to risks. “Fraud will happen, and it’s OK,” said Juliette Brassington, assistant secretary with the Aid Risk Management and Fraud Control Branch. And while discovering fraud is not a sign of failure, she added, not finding it would be. Risks will change, Brassington said, and partners will need to adapt and evolve to counter them. To prevent fraud, businesses must operate in an environment in which staffers have “a degree of professional skepticism” and are “attuned and aware” of red flags. With responding to tenders, Sharp said that all of these attributes need to be clearly identifiable. “Good bids give us confidence that you can hit the ground running,” he said. A bid can distinguish itself from the pack by showing an understanding of risk, as well as demonstrating the corporate support, networks, and knowledge to deliver on outcomes. What stands out negatively is a low bid, which can raise concerns that a respondent doesn't understand local costs. A good bid also shows that an organization shares DFAT’s values. DFAT wants “genuine diversity and inclusiveness” in its contracted workforce, Sharp said, with less fly-in programming and more local delivery. And increasing Indigenous involvement is fundamental, so demonstrating a commitment to that could be the difference between success and failure for a bid with Australia’s aid program. “We want a whole-of-procurement commitment to diversity,” Sharp said. “We want a sense that … you as a company are committed to diversity and inclusiveness like we are, and we … want to see that as part of the culture of your organization and in how you deliver on the ground.”