Councils collectively spend approximately $8 billion each year in procuring goods and services.  Having strong procurement processes is crucial to ensure that public monies are wisely spent. Achieving value for money is part of the sound contracting principles that all councils must follow under the Local Government Act 2009.

Why did QAO develop a procure-to-pay model?

Each year, we find a large number of issues with councils’ procurement and contract management practices. We have long reported these issues in our local government reports to parliament.

As part of our latest report for this sector, Local Government 2022 (Report 15: 2022–23), we developed a procure-to-pay maturity model to help councils assess the maturity of these functions across 5 key attributes of internal controls.

How do councils use the model?

This model helps councils self-assess their procure-to-pay practices to identify the strengths of their practices and the opportunities for improvement. It is available to download from our website, under our better practice resources: www.qao.qld.gov.au/reports-resources/better-practice.

The model contains 20 questions, grouped by 5 key components of internal control:

• framework and policies
• systems
• procuring
• contract management
• reporting.

For each of the questions, you should select a level of maturity from 1 to 4, with 4 being the strongest.

A desired rating can also be added to compare to current processes. The model collates the result across the key components, and where lower levels of maturity are identified, this helps provide areas of focus for councils.  

Should our entity be using this tool?

The guidance within our tool is targeted towards the local government sector and the legislative requirements applicable to local governments in Queensland. We highly encourage all councils to use this tool.

Opportunities to improve procurement and contract management exist for all types of organisations. See our blog series on contract management for advice: www.qao.qld.gov.au/blog and our report to parliament Contract management for new infrastructure (Report 16: 2021–22). 

Resources

• QAO better practice guide: Procure-to-pay maturity model

QAO reports to parliament where we mention or cover procure-to-pay practices

• Local government 2022 (Report 15: 2022-23)
• Prior Local government reports (filter the webpage by 'local government')
• Contract management for new infrastructure (Report 16: 2021–22).

Prior QAO blogs that relate to procure-to-pay practices

• A contract register is more than a list
• How effectively are you managing your infrastructure contracts?
• Managing contract extensions.