CCC proactively investigates procurement practices at Western Power

Node Title

13 April 2017

Under the Corruption, Crime and Misconduct Act 2003, the Commission can make a proposition about serious misconduct based on its knowledge and experience. The CCC recently used this approach to launch a proactive investigation to obtain and analyse corporate information from Western Power that focused on suspected procurement corruption.

The CCC did not find any evidence of corruption within Western Power - however the investigation found deficiencies in purchasing and procurement practices, and apparent conflicts-of-interest between employees and external suppliers.

The investigation revealed that some Western Power employees hadn't declared their relationships with external suppliers and individuals in the organisation’s conflict-of-interest register.  Not declaring a conflict-of-interest in the workplace is a common indicator for potential procurement corruption, and it can impact an organisation's ability to identify misconduct or suspicious financial transactions.

Based on recommendations from the CCC, Western Power have committed to making improvements to its purchasing and procurement systems, including improving its due diligence when contracting external suppliers.

The CCC also used its investigative powers to detect employees who had previous criminal convictions for dishonesty offences. Some of these employees were in roles that had access to sensitive corporate information - which is a red flag for potential corruption. The CCC shared this intelligence with Western Power so it could identify high-risk areas to potential corruption within the organisation and manage them accordingly.

The CCC can conduct proactive investigations to assist all Western Australian public sector authorities to identify and deal with serious misconduct and corruption threats.  This investigation serves a lesson to all public sector authorities about the importance of:

• Having quality personnel vetting and induction programs that identify people with criminal convictions. Being aware of a person’s criminal history can assist to decide if they are suitable for employment in particular high-risk areas of an organisation.
• Regularly communicate conflict-of-interest policies to employees so they are aware of their declaration responsibilities. This allows authorities to effectively identify and manage any potential conflicts-of-interest in the workplace.
• Having robust internal auditing processes in place. Particularly to monitor procurement practices to determine compliance with contractual and purchasing agreements.