The relationship with Defence is managed under a variety of directives and agreements, including:
- a directive from the Minister for Defence to the CEO DMO (refer to Figure 3.1);
- a Memorandum of Arrangements between the Secretary and the Chief of the Defence Force and the CEO DMO, which outlines the overall relationship between Defence and the DMO. It covers principles, intent, business model, and subordinate agreements;
- a military staffing policy agreed by the Services and signed by the Minister for Defence;
- Materiel Acquisition and Sustainment Agreements, outlining the prices for products to be delivered and the responsibilities and accountabilities of each party; and
- other service and free-of-charge agreements, covering such things as information technology, banking, payroll, shopfront and contracting. During 2005–06, free-of-charge agreements were re-named as Shared Services Agreements.
Figure 3.1 Ministerial Directive to the CEO DMO
Dr Stephen Gumley, CEO DMO, and the Secretary of Defence, Mr Ric Smith, formalise the new relationship between Defence and the DMO on 1 July 2005, when the organisation became a prescribed agency.
Defence Procurement Advisory Board
The creation of the Defence Procurement Advisory Board arose from a recommendation of the Defence Procurement Review. The Board's role is to monitor the implementation of the recommendations of the Defence Procurement Review, and provide advice and support to the Secretary and the CEO DMO on strategic issues relating to the direction and management of the DMO. The Board is accountable to the Ministers for Defence and Finance and Administration, and reports to the Government on the implementation of all Defence Procurement Review recommendations.
The Board consists of four private sector members (one of which is the chair), the Secretaries of Defence, Finance and Treasury, and the Chief of the Defence Force. The CEO DMO attends as an ex officio member of the Board and a senior representative from the Department of the Prime Minister and Cabinet is present at all meetings.
In 2005–06, the board held six meetings.
Chart 3.1 Defence Procurement Advisory Board Members
