As with all NSW Government procurement, innovation procurement must be done within a framework of probity and fairness.
Ethical, transparent and principled work – or probity – is a key objective of government procurement policy.
Any conflict of interest or fail ure to act fairly will undermine an agency’s reputation, diminish the government’s standing as a business partner and lead to poorer procurement outcomes.
When buying innovation, some probity-related risks are amplified.
Buying projects must develop controls around probity risks, and must also be aware that some treatment options can create a roadblock or stifle innovation.
Multiple control options exist and their contribution to innovation outcomes should be considered as part of assessing their effectiveness. After all, taking carefully managed risks is essential for discovering, testing and implementing innovative solutions.
Read more about risk management in innovation procurement
These pages provide practical guidance to help buying teams navigate treatment options for probity-related risks while protecting the sorts of agile procurement practices that foster innovation.
When to consider probity
Buying teams should understand probity risks and treatment options early in a multi-stage procurement and maintain them through every step of the process.
If buying teams are likely to engage directly with suppliers, probity planning should start at the Market research step. If not, formal probity planning will start with the Iteration plan step and may need to be budgeted for in a business case.
Expand the boxes below to learn how to apply the probity framework in each phase.
| Journey step | Overview |
|---|---|
| Align need with strategy |
When determining if a project is fit for an innovation procurement approach, buying teams should recognise that many of the eligibility criteria bring probity risks to drive innovation outcomes. Getting the benefits of innovation requires a commitment to managing probity risks rather than removing them. Buying teams should think about how to approach their initiative in a probity-rich way, including through:
|
| Journey step | Overview |
|---|---|
| Design a buying pathway |
Every buying pathway brings probity challenges and innovation benefits. The more interactive supplier engagement in most innovation buying pathways can amplify probity risks, with careful treatment required to protect innovation benefits. Buying pathway resources: Innovation pathway |
| Mobilise the buying team |
At this step buying teams need to align on probity risks and mitigants. They should also plan what roles need to be involved in addressing probity, and how decisions can be made in a transparent and timely manner. Mobilise your buying team resources: Mobilise your buying team |
| Scope for innovation |
A well-defined, outcome-focused challenge statement helps ensure public funds are used appropriately and suppliers have a level playing field. It signals the full extent of the opportunity to ensure transparency and informed participation for suppliers. Scope for innovation resources: Define your challenge statement |
| Conduct market research |
The selection of any suppliers in the Conduct market research step should ensure there is no actual or perceived advantage for those suppliers in a future opportunity. Buying teams should ensure that suppliers have clear expectations about any commitments arising from their involvement. Any interactions with suppliers need to be well documented. Any insights gained from closed supplier engagement should be made available to all potential tender respondents. Conduct market research resources: Sources of market information |
| Develop your iteration plan |
To be comfortable with an iterative approach, approvers will need assurance that the procurement will be probity-rich. The decision about engaging a probity advisor should be made before or during this step. Probity advice will help buying teams anticipate when to expect probity issues as new information is uncovered, and how to treat them. Develop your iteration plan resources: Develop your iteration plan |
| Journey step | Overview |
|---|---|
| Document your requirements |
Probity advisors may be engaged to review the scope of deliverables and will need to be made aware of how the innovation scope might differ from technical requirements. Define a challenge statement resources: Define a challenge statement |
| Define evaluation criteria |
Well-framed, high quality evaluation criteria and an aligned Evaluation Committee ensure a robust and defensible process. Their focus will be on whether the requirements support competition and informed participation, including for any future scale opportunities. Define evaluation criteria resources: Define evaluation criteria |
| Document your market approach |
The probity controls developed and decisions taken during the Discover phase will need to be documented in the buying strategy. Document your market approach resources: Document your market approach |
An agile procurement approach can involve multiple Source phase(s). As each Source phase begins, insights gathered from prior steps or stages need to be reviewed to ensure any resulting changes to probity controls are made.
Consultation and contribution may be required from probity advisors in preparing market-facing documentation to ensure key positions are communicated appropriately. Their focus will be on whether the requirements support competition and informed participation, including for any future scale opportunities.
An agile procurement approach can involve multiple Manage phase(s) and, like Source, involves bringing forward prior lessons to iterate upon and shape future steps.
Any changes made during these phase(s) should be managed through clear communication with stakeholders covering what the change is, why it has occurred and any potential probity impacts relevant to their role.
Who to involve
Probity is everyone's responsibility, from senior management to project team staff, however it will be the buyer's responsibility to seek and follow advice.
Expand the boxes below to learn about the stakeholders who can help understand probity and embed it in all procurement activities.
Probity specialists within an agency can explain the principles all project staff should follow and ensure good management practices are built into every stage of the process. They can help plan specific activities where probity risks are heightened. Relying on internal expertise minimises reliance on external advice and helps build up innovation capability.
An external input on probity may need to be engaged if:
- the integrity of the process (or part of it) may be questioned
- the process is extremely complex
- the project is politically sensitive, controversial or vulnerable to corrupt practices
- there could be a perception of bias or favouritism
- there are substantial costs to prepare submissions
- there is substantial government funding involved
- internal probity or risk specialists don't have capacity to support the project.
Innovation buying projects with multiple stages can be extremely complex, particularly for agencies that don't routinely support these kinds of projects. Checking early on the agency's view about whether external probity is needed will ensure any external probity advisor can be budgeted for and that advice is timely and effective.
Scope of works for an innovation probity advisor
Read about how to engage an external probity adviser or auditor.
To access a template or sample scope of works for probity advice, contact the Test and Buy Innovation advisory team at InovationProcurement@customerservice.nsw.gov.au. The team will ask you some questions about your project to ensure the scope of works can be tailored to your innovation outcomes.
Probity resources for buying innovation
Break risk down into innovation tactics with smaller manageable risk.
Build confidence to balance probity risk with outcome rewards.
Explore Test and Buy Innovation
- Get ahead of probity and risk
- Manage innovation buying risk
- Key innovation buying risk concepts
- Apply agency risk framework
- Worked risk examples
- Policy support for buying innovation
- The innovation buying journey
- Learn about Test and Buy Innovation Program
- Get help from Test and Buy Innovation advisory