What you need to know:

• By stipulating a single supplier or holding group will handle all NSW Government media business, indies cannot win the account. Even smaller multinationals such as Havas unlikely to be able to manage entire account alone.
• Independents furiously lobbying MPs. Brad Hazzard's office managed to extract information on procurement approach.
• Indie association IMAA demanding to know which holding company execs make up EoI advisory committee, fear conflict of interest driving agenda.
• Baffled by government's interpretation of its own procurement rules, which are supposed to set aside 10 per cent of contract to SMEs.

The NSW Government is pressing ahead with a tender for its $73m master media services account that effectively precludes any Australian-owned agency from winning in favour of multinational holding companies.

The deadline for expressions of interest (EoI) passed 4pm Wednesday 18 August. But independent agencies, which claim the EoI is "anticompetitive", are still furiously lobbying for the tender to be rewritten and reissued, questioning the government’s interpretation of its own SME procurement rules and demanding to know which holding company execs make up the EoI advisory committee.

They have also raised concerns that the government will end up recreating the problems it had solved when it ditched a single master buyer arrangement for the current roster set-up, with bigger spending government agencies like Destination New South Wales hogging agency bandwidth and leaving smaller-spending departments scrapping for service.

You can bid (but you can’t win)

The wording of the tender document – which aims to consolidate the current roster into a single agency or holding group to handle all buying, planning and strategy – means independents cannot win the account.

While the Department of Customer Service insists any agency is welcome to bid, no single independent agency could handle all of the buying nor service all of the departments within government. It is also unlikely smaller holdcos such as Havas, on the current roster, could manage the entire account alone.

That means the business will almost certainly go to one of Dentsu (Japan), IPG (US) Omnicom (US), Publicis (France) and WPP (UK).

SME procurement: on a promise?

But independent agencies have questioned the Department of Customer Service’s interpretation of NSW Government SME procurement rules, which state all government services contracts above $3m must include "10 per cent allocated to SME participation".

The department told Mi3 the EoI “complies with the SME and Regional Policy and Aboriginal Participation Policy”, but did not elaborate.

However, according to information obtained from Customer Services by Brad Hazzard’s office (independent agencies have been lobbying their local MPs to put pressure on Customer Services), the department appears to be allowing the successful bidder to promise to use SMEs for 10 per cent of service delivery down the track.

The email from Hazzard’s office states:

• The successful respondent will be required to use SMEs and Aboriginal businesses as part of their delivery.  This will be outlined in the contract.
• As part of the tender evaluation process a minimum of 10 per cent weightage will be allocated to SME participation.
• A further 10 per cent weightage will be allocated to support the NSW Government’s economic, ethical, environmental, and social priorities.

Independent agencies are baffled. They question how that interpretation can work in practice, whether it means independents will have to be subcontracted by the winning holdco, or whether it may ultimately mean 10 per cent of spend must be allocated to SME media owners.

Who’s on the advisory panel?

It is not clear whether any independent has actually submitted an expression of interest. However, via the Independent Media Agencies of Australia (IMAA, an association which represents 80 small agencies), they continue to lobby Customer Services Minister Victor Dominello to change the EoI scope and reissue the tender, “as in its current format, it locks out indies,” said an IMAA spokesperson.

The IMAA is also determined to find out the make up the Government’s advisory committee for the EoI, submitting a freedom of information request. “To date, we have received no response,” said the spokesperson. “The question needs to be asked: why isn’t anyone telling us who is on this committee?”

The association believes the department is being advised solely by holding company executives and seeks fair representation.

Per the spokesperson: "In our correspondence with Mr Dominello we have implored the NSW Government to make the following changes to the EOI:

• Review and amend the EOI process as in its current format, as it locks out independent agencies.
• Ensure an equal share of government campaigns are awarded to independent agencies.
• Australian owned, independent agencies are included on the government preferred supplier lists.
• To ensure equal distribution and a fair balance of all government campaigns, an independent voice should be secured on the selection
  board.

If the government does not amend the EoI, the consolidated account will go to one of the holding groups in September 2022.