Bob Carr (NSW, Australian Labor Party, Minister for Foreign Affairs) Share this | Hansard source

The Minister for Defence has provided the following answer to the honourable senator's question:

(1) No.

(a) A separate independent investigation into stock discrepancies concluded that an actual physical loss could not be confirmed and that no reparation action be pursued. To ensure the ongoing sustainability of the contract and the maintenance of logistic support for critical Australian Defence Force activities, the Secretary of Defence and the Chief of the Defence Force directed that the broad range of contractual issues between Defence and TenixToll Defence Logistics (TTDL), including stock discrepancies, be resolved through mediation. The mediation process was overseen by a Defence Integrated Distribution System (DIDS) Oversight Board, which was established in November 2007 as a forum for senior Defence stakeholders to oversee Defence's approach to resolving a range of contractual issues.

(b)    The Commonwealth did not breach the Financial Management Act as it did not have a sound basis to pursue the claim. In addition, the scale and complexity of the contractual difficulties at the time meant a more holistic approach to resolve those difficulties was warranted. Through the successful mediation, the Commonwealth was able to ensure the future sustainability of the contract, generate ongoing savings in specific services, and establish a robust contract governance framework to ensure the contract delivers value for money and services that consistently meet or exceed contracted performance standards.

(2) No. An investigation into stock discrepancies concluded that an actual physical loss could not be confirmed and that no reparation action be pursued.

(3) No. The DIDS contract contains robust liability provisions.

(4) At all stages of the DIDS contract tender and implementation processes there were robust governance arrangements in place. This included oversight by an independent Project Board and external probity advisors.