A decision on the politically sensitive tender process to choose the successful bidder was last year delayed amid political conflicts of interest within cabinet.
Prime Minister Scott Morrison and Immigration Minister David Coleman recused themselves from cabinet discussions on the issue because of their long personal and professional relationships with Scott Briggs, who is leading one of the bids and was closely linked to Mr Morrison’s leadership contest against Mr Dutton in August 2018.
Mr Briggs is heading the bid by Australian Visa Processing – a consortium consisting of Ellerston Capital, PwC, Qantas Ventures, NAB and Pacific Blue Capital and led by Mr Briggs – while the other bid is a joint proposal between Australia Post and Accenture.
The tender process is being managed by the department, with Mr Dutton given responsibility to make the final decision.
Opposition assistant immigration spokesman Andrew Giles seized on the Home Affairs briefing to claim the government’s plan was “dead in the water”.
“The Department of Home Affairs own advice is that this privatisation requires legislative change. Labor won’t support this. It’s clear that they don’t have the numbers in the Senate,” Mr Giles said.
“Visa privatisation is a massive risk. It could lead to increased costs of visas, worker exploitation, data security breaches and will make protecting our national security more difficult.”
Centre Alliance senator Stirling Griff, whose party holds two votes in the upper house, said the government should remain in full control of all visa systems.
“This is not something that should be outsourced,” he said.
“The government argument for outsourcing the end-to-end system is primarily based on them (government) failing to invest and develop appropriate infrastructure. So they fail and then they consider that’s a good enough reason to drop the ball and spend significant money on having another entity have a go?”
Mr Dutton’s office said the government would not be commenting on whether new supporting legislation was needed while the procurement process was ongoing.
While the government is dealing with its conflicts of interest, opposition home affairs spokeswoman Kristina Keneally’s husband, Ben, is employed by Boston Consulting Group, which is advising the department on the process. But she has not declared a conflict of interest partly because Mr Keneally does not work on BCG’s Commonwealth public sector projects.
Home Affairs confirmed last year that more than $80 million had already been spent on the design and procurement for the new system.
The department’s briefing, dated May 2019, said replacing its ageing processing systems with a single system was “key to ensuring the integrity” of the visa programs into the future.
“The Department will retain responsibility for business rules that determine what the platform does, and accountability for sovereign functions including decision making, security, and risk assessment,” the briefing said.
“The commercial model resulting in the platform being self-funded via collection of fees and taxes by the successful tenderer on behalf of the Commonwealth will likely require new supporting legislation.”
The government claims the proposed changes, which would involve private companies processing certain “low risk visas”, will improve efficiency and reduce costs.
Opponents of the scheme have said the changes will damage the integrity of Australia’s visa and citizenship system and increase the costs to applicants.
Anthony is foreign affairs and national security correspondent for The Sydney Morning Herald and The Age.