More than ever, firms must convincingly address the government concerns across probity of process; contestability; conflict management; confidentiality and data security; transparency and accountability; along with environmental, social, and corporate governance (ESG).

And, no, just because you’re a law firm and your lawyers have a duty to the court, it doesn’t go without saying that you have best practice processes in place. You must provide proof of your claims.

So, with the above in mind, and without eyeballing the actual RFT requirements, what should law firms do to prepare?

Decoding what we know so far about the Australian government’s requirements for law firms

We can make some educated guesses based on the consultation and industry briefing documents recently released by the Attorney-General’s Department.

Key points from the Industry Consultation Briefing include:

• The panel formed following the 2018 RFT process has been working as intended. (Meaning it will be difficult for new firms to win an appointment.)
• There will be a raft of changes to the arrangements, both big and small, to improve how the panel operates in the 2020s.
• Value for money remains a top priority, with no room for rate negotiation. Competitive pricing will be pivotal, like the 2018 process and unlike the old multi-use list where any firm who applied would usually be guaranteed a spot on the panel.

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The consultation and industry briefing documents provide further clues as to what law firms need to consider and prepare for.

Law firms must showcase a track record of adding value to be considered

First, the obvious items to prepare – evidence for your appointment – your relevant track record at both the individual lawyer (CVs for key personnel) and the firm level (summaries based on your key personnel’s CVs).

Make it obvious in your examples how you added value, be that a direct impact (saved money, made money) or indirect impact (solved a problem, delivered a big upside). Then, dimension your impact (specifically how, and to what extent, what you did impacted money, time, risk, and qualitative considerations).

A tip for new bidders who lack Australian government experience: my best advice is to showcase transferrable expertise by featuring your work for other public sector clients (i.e., state, territory, local and statutory authorities).

Another tip – keep your firm expertise summaries and CV examples succinct – the RFT will be page- and/or word-limited.

Remember the track record you collect and validate for this opportunity will have a longer shelf life than just this RFT. Government agencies will “shop” from your submitted documents, and done right, your CVs can be morphed into contact cards. A library of key personnel CVs will prove handy for empanelled firms needing to quickly respond to individual agencies’ future “requests for quote”.

New or changed requirements – decisions to take and items to prepare now

Cyber risk solution and insurance coverage

Given the recent spate of high-profile cyber security events (e.g., attacks targeting professional services firms), data security is understandably foremost in the minds of government clients. Firms should expect they will be required to demonstrate a vastly more sophisticated and mature approach to cyber security. More than mere “data protection”, a well-functioning cyber security policy aims to manage internal and external risks across people, systems, and services.

If your law firm wants to serve the government but is not yet investing in appropriate security solutions, you may well find your bid falls short of what the Australian government expects in the 2020s.

Related to this, I have seen recent state government tenders require much higher levels of separate cyber insurance. Engage with your insurance broker if you do not already have an adequate cyber cover in place.

As a rule of thumb, professional services firms managing cyber risk appropriately typically invest at least 10 per cent of their IT budget in security solutions (across a mix of software, third-party support, dedicated team members and regular testing). And your firm’s level of investment in cyber security solutions is a question your broker will ask.

Indigenous participation plans

The Australian government’s Indigenous Procurement Policy (IPP) requires that Indigenous employment and business participation targets apply to contracts wholly delivered in Australia valued at $7.5 million or more in 19 industries, including legal services.

Based on my experience of responding to Australian government bids in other sectors, law firms will likely be required to formally “contract” their commitment to Indigenous Participation.

Usually, bidders can opt to commit to participation targets at either an organisational level or at a contract level. Often, the participation target is set at 3 to 4 per cent of the value of the contract and is derived from employing Indigenous Australians and/or procurement from Indigenous-owned suppliers.

While it remains to be seen how this requirement will be applied to an ongoing legal panel (rather than a one-off project), law firms should consider the pros and cons of specifying whether the firm as a whole (organisational level) will contract to the commitment, or alternatively if they will seek to meet their commitment solely via their contract to provide legal services to the Australian government.

For the future, any firms appointed to the panel should expect to be audited on their Indigenous Participation commitments (possibly quarterly, and certainly annually) and be mindful that a “best endeavours” approach may not cut it. Nor will a basic RAP (reconciliation action plan) or Indigenous art in the boardroom. Be prepared to include an Indigenous Participation Plan as part of your RFT response, and should your bid be successful at the point of contracting, you may need to produce detailed recruitment and workforce development plans and a breakdown of your recent spend with Indigenous suppliers.

Pro bono requirements for all lawyers

Similarly, firms who have paid lip service to pro bono targets need to work out how they will handle the proposed inclusion of suspension clauses and additional reporting obligations to comply with and meet pro bono targets.

It is now not enough to hire a couple of lawyers to shoulder the pro bono hours for the whole firm – the message is clear in the consultation documents that the government expects pro bono hours to be reported on by lawyers rather than averaged across firms as a whole.

Client referees or references

Happily for incumbent law firms, the government has confirmed Commonwealth public servants can act as referees in this RFT process.

The Attorney-General’s Department’s Question and Answer document hints there is potential for written references, noting “(referees) … will be contacted to support or verify a tenderer’s claimed experience”. Many will recall that under the previous multi-use list area of law, specific “referee reports” signed off by each client referee were a requirement.

Hopefully, the dreaded referee reports will not be revived under this RFT.

Either way, firms should shortlist their preferred client referees NOW and be ready to approach them ASAP in November. Many government instructors will no doubt be inundated with requests from firms to act as referees, so it will pay to enlist your referees early.

What about requesting written references now, just in case? In my view, do not bother clients just yet; if written references are required, you will need to fully comply with the RFT’s specified format rather than just submitting a basic recommendation letter.

Statement of tax record

The government’s procurement rules now require bidders to demonstrate ‘satisfactory engagement with the tax system’ by obtaining and submitting a statement of tax record (STR).

Different rules apply as to the type of STR required depending on the entity structure of the tenderer.

Ensure whatever your firm’s business structure you arrange and have to hand in the correct STR(s). These can usually be requested from the Australian Taxation Office (ATO) and received within 24 hours but can take up to four business days.

A note for law firms structured as “partnerships’, the ATO states: “A partnership and each partner directly involved in delivering a contract must request an STR. New partners who become directly involved in the delivery of the contract must request an STR within a reasonable time after they become involved. These STR requirements apply if those involved remain partners in the partnership.”

Conflicts

In the wake of the PwC scandal, firms can expect to provide detailed conflicts of interest policies and procedures. This potentially includes providing “real world” case studies of how your firm identified, communicated, managed, and resolved potential, perceived or actual conflicts of interest. The best case studies will be a little nuanced – showcasing how your firm “gets it” even when the conflict might be subtle or not immediately obvious. The big point to demonstrate, of course, is showing your firm’s preparedness to remain loyal to a particular client sector, even if that sometimes means actively walking away from a paying client.

Of course, some of these recommendations are speculation, and much of this advice is common sense, but if your firm can at least start discussing and identifying gaps in the areas above, you’ll be ready for just about anything the Australian government might require of its refreshed panel. Happy bidding!

Amy Burton-Bradley is a director and lead bid consultant at Bidtique.