McKinsey called in for digital trade work, despite new taskforce

Denham Sadler
National Affairs Editor

US consulting giant McKinsey will be paid more than $1 million over just three months to design a digital trade roadmap, despite the federal government creating a new taskforce led by the former DTA chief Randall Brugeaud earlier this year to perform this precise task.

McKinsey was awarded a contract worth $1.001 million by Austrade, running from 11 October to 24 January next year for a “simplified cross-border trade digital roadmap”.

In mid-June this year the government established the Simplified Trade System Implementation Taskforce, which it said would focus on “cutting red tape and simplifying border processes”.

DTA chief Randall Brugeaud
Taskforce chair Randall Brugeaud

Then-Digital Transformation Agency chief executive Randall Brugeaud was appointed to lead the taskforce and left the DTA in order to take on the new role.

The taskforce is looking at helping exporters boost productivity and save time and money by reviewing international trade regulations and modernising outdated IT systems.

The department has now brought in multinational consulting giant McKinsey to undertake many of these roles under the $1 million contract.

A spokesperson for the taskforce said its role is to “make cross-border trade for Australian businesses easier and less costly”, and McKinsey would assist with this.

“McKinsey Pacific Rim has been engaged to contribute to an information and communication technologies scoping study and a simplified cross-border trade digital roadmap. This will support the development of the STS reform agenda for the end-to-end trade environment,” the spokesperson told InnovationAus.

The Coalition provided $37.4 million over three years to the Simplified Trade System, with the vast majority of this to be spent in 2021-22. This funding is for the modernisation and improvement of Australia’s trade system, including regulatory processes and tech systems.

In 2020 the government also provided $28.6 million over two years for the project, with the bulk of funding going to the Department of Home Affairs.

McKinsey landed nearly $2 million from the DTA last year, and its broader work with the federal government nearly tripled in 2020 during the pandemic.

The government’s total spend on McKinsey last year was $50.6 million, up from $18.5 million in 2019, driven largely by work from Services Australia and the DTA.

For the DTA, McKinsey provided key advice on the redevelopment of myGov and the new visa processing system.

The consultancy’s popularity with the federal government has continued this year, with McKinsey being paid more than $4 million to provide advice on efforts to establish a local mRNA vaccine manufacturing capability.

The firm has also been paid more than $6 million to provide key modelling for the government’s net-zero emissions plan, after it bypassed its own science agency to award the contract.

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1 Comment
  1. Elizabeth 2 years ago

    If tasks are outsourced to consulting companies then what do our well paid public servants contribute? The decision to outsource as well as the selection of a big end of town American group?

    Tough gig.

    Meanwhile Australian businesses I know of languish in systems and processes waiting for a decision that might favour them and their technology. Timely and transparent decision making has never been a KPI for public servants.

    Aussie talent and innovation is consistently overlooked by Australian government. And Australian SMEs spend too much time buddying up with the Americans in the hope of negating the risk perceived by those like Mr Brugehard.

    When will ‘Australian’ government and corporate decision makers begin to back home grown? (Understanding that there are times for global perspective and lessons from overseas.) Or what do Australians do to get a seat at the table?

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