Tasmanian Independent MLC Bec Thomas has slammed the health department over $61 million worth of contracts awarded without a tender process, calling for an explanation.
Documents tabled in the Legislative Council show that as part of the Bluegum Digital Transformation Project 742 labour hire contracts were awarded at a value of $99,999 or lower.
Tasmanian government contracts worth $99,999 or less can be awarded directly without a tender process.
The 742 contracts were awarded to just 65 companies, with 22 companies receiving 10 or more contracts.
One company, Ignite Project Services Pty Ltd, received 86 contracts worth a total of $6.96 million.
Of the $61 million in contracts, $50.6 million has been spent thus far.
The Bluegum Digital Health Transformation is a collection of IT projects in health, overhauling record keeping and systems management in the state's health department.
Ms Thomas said the figures demanded explanation.
"The issue isn't simply whether each individual contract fell below the relevant procurement threshold. The issue is whether anyone was looking at the cumulative picture and ensuring this approach represented good procurement practice and value for taxpayers."
Auditor-general Martin Thompson has also raised concerns about the practice, finding 80 occasions where the department was in breach of the treasurer's instructions.
He also found several cases where the contract was awarded after the successful company had begun work.
In response to questions from Ms Thomas in the Legislative Council, the government said that "revised procurement arrangements" had been agreed to by the Department of Health and Department of Treasury and Finance for labour hire on this project.
A "structured quotation process" was being used for projects under $250,000, while open tenders were used above that amount.
A procurement review committee is also in place for oversight.
The government said the Bluegum Digital Health Transformation Program was a "uniquely large and complex undertaking" in Tasmania, which had a greater reliance on labour hire.
"The scale, specialist skill requirements and pace of delivery associated with implementing a statewide digital health transformation necessitate access to highly specialised ICT resources that are not readily available through the local labour market," the response read.
The Bluegum Digital Health Transformation is not the first ICT project to be questioned by auditor-general Martin Thompson.
In May this year he wrote that the Human Resource Information System (HRIS) program had not been effective or economical.
The program, which began in 2020, had spent $47 million without delivering any intended human resource modules.
Premier Jeremy Rockliff pushed back on the findings, calling them "incomplete" and "potentially misleading".
Responsibility for the project was transitioned away from the Department of Health to the Department of Premier and Cabinet.
There has also been criticism of the Tasmanian government's direct contract rules.
In May this year the state opposition questioned a $95,000 contract given to JackJumpers head coach Scott Roth to become an ambassador.
Labor's Ella Haddad claimed the contract had been kept under the $100,000 threshold "so it could be hand-picked without open tender".
Former minister Jane Howlett said the contract had been awarded in line with appropriate procedures.
