Procurement risks have expensive lessons for the Water Corporation

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28 January 2021

Today's Review of an investigation by Water Corporation into serious misconduct allegations in procurement report revolves around a misguided project director and a series of inexperienced project managers who were involved in purchasing water meter testing rigs for a total contract cost of around $650,000.

Ultimately, the equipment was found to be completely defective and the Water Corporation is now considering selling it for scrap. It has been valued at about $28,000. The Water Corporation estimates that the project and its subsequent investigations cost more than a million dollars.

The Commission’s report documents how the procurement process for the rigs went awry when the Water Corporation employee responsible for the process engaged a neighbour and a friend to help procure the rigs from China. 

Proper procurement processes weren't followed; there were ‘unorthodox’ irregularities in the tender process; the personal relationship between the project director and his neighbour was well-known by some but not flagged as a conflict of interest; early concerns identified in the quality of the rigs weren’t acted upon; and contract payments were made before milestones were achieved.

Despite the mistakes, the Commission did not form a view of serious misconduct against the project director or anyone else involved, which is consistent with a WA Police Force investigation which did not result in criminal charges.

Read the report

Review of an investigation by Water Corporation into serious misconduct allegations in procurement

Download the media release

Media release - procurement risks have expensive lessons for the Water Corporation