The National Disability Insurance Agency (NDIA) is under scrutiny following revelations of ethical breaches and procurement deficiencies.

A parliamentary inquiry has highlighted significant issues in the NDIA's procurement practices and its relationship with customer-relationship-management software company, Salesforce.

Over a span of nearly five years, NDIA officials accepted over 100 instances of gifts and hospitality from Salesforce before and after the bid, and the awarding of a major ICT contract, as well as throughout the contract's variation periods. 

The initial contract, valued at $27 million, eventually ballooned to over $100 million. By December 2023, the total Salesforce contract value had reached $125.95 million.

The NDIA's handling of this contract, particularly its cost control and value for money assessments, came under fire. 

MPs have expressed surprise at the lack of explicit price weighting in the NDIA's tender ranking process. 

Significant changes in the contract's scope, including a substantial increase in user licences, were found to have contributed to the cost escalations, denying other vendors the opportunity to tender for the altered product.

Salesforce provided nearly 50 gifts and offers of hospitality, each worth more than $100 per person, to NDIA officials. 

These included meals, drinks, and golf outings, which were in clear violation of the NDIA's gifts and benefits policy. The policy mandates that items over $100 must be pre-approved and recorded in a compliance log.

These breaches are described as “the most egregious issue” revealed by the report. 

The NDIA's policy is clear that public servants should not accept any gifts from the start of procurement planning. The report emphasised that maintaining the integrity of public officials while accepting gifts from vendors is challenging.

The report also raised concerns about the behaviour of both NDIA officials and Salesforce, noting that the ethical standards expected in contract management processes were compromised. 

An internal review of the NDIA's procurement management is ongoing, but no individual public servants have been named, as this fell outside the inquiry's scope.

The Australian National Audit Office (ANAO) has been urged to consider an audit program to examine gifts and hospitality in the public sector. 

The report suggests that the practice of “cultivating” public servants through gifts and hospitality might be widespread among Commonwealth entities.

Salesforce has been asked to report on the hospitality extended to public servants from all Commonwealth entities over the past three years. 

The NDIA's Salesforce contract, awarded in 2020, has not been implicated in any misconduct regarding the software's functionality. 

However, the committee has requested an update on cost savings and anti-fraud measures due to the PACE system, with a report expected in December 2024.

The inquiry's interim report from September 2023 also examined Synergy 360's activities and its clients' access to former minister Stuart Robert. 

The report notes the absence of records for three meetings between Stewart, Synergy 360, and Salesforce, highlighting a pattern of undeclared hospitality and significant procurement activity.

The committee's final report included five recommendations, urging the NDIA to provide updates on its internal investigations and the PACE system's implementation. 

It also called for the Department of Finance and the Digital Transformation Agency to assess the potential for inappropriate cultivation of officials by ICT vendors. 

The ANAO has been asked to consider further audits to identify and address practices of concern, promoting ethical cultures within the public sector.