Competition regulator limits competition on Digital ID tender

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Joseph Brookes

The competition regulator is using a limited tender to build a critical platform behind the government’s digital ID scheme, inviting only a handful of companies and refusing to say if any local suppliers have been approached.

The lack of competition has again frustrated Australian companies that won’t get the chance to bid on what looms as a critical piece of infrastructure for an ID scheme that has already cost more than $600 million over half a decade of development.

The Australian Competition and Consumer Commission (ACCC) will be the regulator of Australia’s Digital ID under enabling legislation expected to be passed next year.

It will oversee the Digital ID Accreditation Scheme, operation of the Australian Government Digital ID system, and manage and regulate a ‘trustmark’ for accredited Digital ID providers.

The ACCC will also be granted a set of powers to ensure Digital ID providers and services comply with the legislation, including the power to give remedial directions, issue enforceable undertakings, and suspend or revoke an accreditation.

Last week, the ACCC issued a request for quotation through the government’s BuyICT platform, seeking an “experienced” provider to build, test and deploy a solution to manage the applications for accreditation.

The regulator this week declined to explain the limited tender, including which companies were among the five-to-10 sellers it had approached, whether any are Australian, or how much it is expected to cost.

A spokesperson for the ACCC said no information could be provided because the opportunity published on the BuyICT marketplace last week remains open. It will close on December 13 or sooner if all the invited applicants respond before then.

The decision by the competition regulator to use a limited tender frustrated some of Canberra’s suppliers that have been effectively locked out.

Australian IT firm Imminently co-founder Courtenay Hollis said it is disappointing and “inappropriate” to use a limited tender approach for what will be a critical platform designed to govern the use of technology for Australians’ sensitive biometric data.

Inviting only selected, likely larger suppliers, limits what could be developed locally and potentially favours multinational companies that have dedicated government sales teams, according to Mr Hollis, whose company works with government and private sector clients across Australia and internationally.

“It’s not creating a genuine opportunity to understand local innovations and achieve value for money assessments,” he told

“To just sit there and say, ‘there’s only five-to-10 companies that would be capable of delivering this project’ is quite an insult to Australians and local industry.”

Mr Hollis said the Digital Marketplace, now part of the BuyICT platform, used for this opportunity has become an anti-competitive problem. While initially established to simplify procurement and expose more opportunities to smaller suppliers, it has increasingly been used by government buyers to “select source” companies, he said.

“It has got out of control to the point that I believe it breaches the Government’s anti-competitive laws,” Mr Hollis said.

According to the listing, the ACCC is seeking an initial one-year contract from January with an opportunity to extend for six months.

Experience, demonstrated capability and capacity will be a key criteria along with pricing and the suppliers’ approach.

A fairer opportunity for local suppliers has been taken up by ACT Senator David Pocock, who last week pressed the government on its decision to trial Microsoft AI technology across the Public Service without ever approaching the local market.

Mr Pocock is understood to be considering an attempt to force the government to release more information about the decision to select Microsoft without competition.

The Albanese government began consultations on the expansion of its digital ID system to the private sector and states and territories in September, revealing draft legislation that has been in the works for years.

The legislation is needed to enshrine in law the privacy safeguards and governance structures behind the system, including the ACCC’s regulator role.

The ACCC this month also began recruiting directors for the digital ID program to manage the team responsible for accreditations.

Do you know more? Contact James Riley via Email.

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