Cutting travel spend through whole-of-government procurement strategy

The situation

The Australian Government had identified Commonwealth travel expenditure as a potential source of significant savings.

The Commonwealth Department of Finance was charged with identifying a strategy for quantifying and realising these savings. One realisation strategy for detailed consideration was the establishment of whole-of-government purchasing arrangements for travel.

The challenge

Finance faced a number of challenges in establishing a whole of government purchasing arrangement, including:

• resistance from some of the large agencies who might only achieve limited benefit, while having to endure through substantial changes to their travel processes and systems
• the potential to massively impact (i.e. reduce) market competition.

• meeting varying business needs of the different agencies
• resistance to changes in policy and/or travel patterns by APS employees.

Additionally, seeking advice from travel service providers would risk potential for conflicts of interest.

The project

Having previously had our approach to Commonwealth government travel procurement acknowledged positively by the Australian National Audit Office, Grosvenor was able to provide Finance with independent advice on the travel industry with a thorough understanding of the Commonwealth’s requirements and challenges.

In conjunction with Finance and its other advisers, Grosvenor conducted a cross-agency information gathering exercise to inform the definition of the requirement, and quantified the potential for cost savings through analysis of a range of procurement strategies.

The results

Following determination of the procurement strategy, Grosvenor was subsequently engaged by Finance to contribute to packaging the services, drafting procurement documents and developing pricing models. The Whole of Government travel purchasing arrangements were successfully implemented and continue to be utilised by Commonwealth Departments and Agencies.

Following completion of the project Grosvenor was publicly recognised by the Minister for Finance for our contribution to the project’s success.

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