Annual Report 2003-04

Purchaser-Provider Arrangements

Defence Housing Authority

Defence and the Defence Housing Authority have two formal agreements: the Services Agreement for Housing and Related Requirements (the Services Agreement) and the Relocation Services Agreement. The agreements formalise the relationship between Defence (as purchaser) and the Defence Housing Authority (as provider) of housing and related services. The Services Agreement extends to 2010 and the Relocation Services Agreement allows for performance reviews to be conducted in 2006, 2008 and 2010.

Defence, through the Corporate Services and Infrastructure Group's Business Improvement Project, is implementing a revised contract management framework to meet the recommendations made in the June 2003 Australian National Audit Office report on Defence Housing and Relocation Services (Audit Report No. 51). The revised framework aims to put the relationship between Defence and the Defence Housing Authority on a more business-like footing.

A report on Defence's implementation of the Australian National Audit Office recommendations will be provided to the Joint Standing Committee on Public Accounts during 2004-05.

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Department of Foreign Affairs and Trade

Defence maintains a service level agreement with the Department of Foreign Affairs and Trade (DFAT) for the provision of management services at DFAT-managed overseas posts. The agreement is intended to promote efficient and effective Australian Government business overseas by avoiding unnecessary duplication of common services at overseas posts. For these services an agreed fee is charged.

The services provided for Defence under the agreement include personnel, residential and office accommodation, security, financial advice and transactional processing, information technology infrastructure support, and telecommunications and secure network services for Australian-based and program support staff engaged at overseas posts.

The cost of the agreement was $3.3m in 2003-04, an increase of $0.8m from 2002-03. A new agreement is being negotiated for 2004-05.

Defence also maintains a memorandum of understanding with DFAT on the provision of information and communication technology services to Defence personnel at DFAT-managed overseas posts. For these services an agreed fee is charged.

The services provided to Defence under the memorandum of understanding are:

• local area networked desktop office products at the classified and unclassified levels, facilitating emails and cablegrams being communicated to the appropriate Defence networks; and
• telephone exchange services, including the provision of a telephone handset.

The information and communications technology infrastructure providing these services is maintained and supported by DFAT.

The services are provided in 31 countries to approximately 150 Defence personnel and locally engaged staff in overseas posts. The cost to Defence under the two-year agreement was in the order of $1m in 2003-04.

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