Procurement of Travel Management Services for the
Australian Government
Consultation Paper – December 2013
This document provides information and seeks feedback from prospective tenderers on a proposed
upcoming tender process for travel management services for the Australian Government.
This document is not a notice or otherwise a part of any tender process for travel management
services, which is yet to be determined or commence.
Important Notice: The information in this document is indicative only and the Department of Finance
(Finance) reserves the right, in its absolute discretion, to change any aspect of this strategy at any
time.
Finance makes no representation and does not warrant that:
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any information contained in this document is accurate, current or complete;
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any feedback given or comments made by prospective tenderers in response to this document
will be used or otherwise acted upon or taken into account; or
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a future tender process will be undertaken at a particular time, in a particular manner, or at all.
Nothing in this document or arising from this document gives rise to or is intended to give rise to:
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a contract; or
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any obligation on the part of the Australian Government, or expectation on the part of any
recipient of this document, in connection with any subsequent tender process.
Where appropriate, Finance may incorporate feedback into any subsequent tender documentation, or
otherwise use it to inform the proposed approach to market. Finance does not guarantee that any or
all feedback will be incorporated in any subsequent approach to market. Finance also reserves the
right to respond, or not respond, to specific questions or submissions at its own discretion.
Information contained in any future request for tender material will supersede information contained
in this document.
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Introduction
The whole of Australian Government travel arrangements are coordinated procurements, established
by Finance that service the diverse travel needs of approximately 150 Australian Government
departments and agencies (‘ the Government agencies’).
Prior to the introduction of the whole of government travel arrangements, there was no consistent
approach to travel procurement across Government agencies. A Scoping Study (‘the Study’) into the
travel arrangements noted the decentralised approach to travel procurement, with no overarching
coordination and strategic management, had resulted in a fragmented approach with inconsistent
practices, duplication of effort and different pricing levels across the Government agencies.
In response to the findings of the Study, Finance established and implemented the whole of Australian
Government travel arrangements, with the objectives to:
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reduce the cost of supply to Government agencies;
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continue to meet the business needs of Government agencies;
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contribute to a competitive and viable industry;
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establish fair, equitable and transparent processes; and
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optimise savings through cost reductions, improved efficiencies and promotion of behavioural
change.
Phase 1 of the travel arrangements came into effect on 1 July 2010, with the establishment of a panel
of five (5) Travel Management Companies (TMCs) to provide travel management services, and pricing
arrangements with four (4) domestic and twelve (12) international airlines (Airlines).
Phase 2 of the travel arrangements improved efficiencies further, through the appointment of a single
travel card provider, a sole accommodation program manager, and a panel of two car rental providers.
These arrangements came into effect on 2 July 2012.
Further information on the current arrangements can be found at:
http://www.finance.gov.au/procurement/travel-and-related-services/index.html
Both phases of the travel arrangements have provided bottom line savings to the budget, improved
contractual efficiencies, increased transparency and provided greater value for money in the
purchasing of travel services.
Whilst the current travel arrangements are a significant improvement on the decentralised approach
prior to 1 July 2010, there is scope for further improvements. This paper sets out the potential
strategy for the renewal of the travel management services (‘the Services’).
It is intended that the Services will include integration with the service providers under the Phase 2
travel arrangements, to the extent that the Services:
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allow travellers and travel bookers to directly access the inventory of the accommodation
program manager and the car rental service providers;
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use the whole of government travel card arrangement for travel expenses, where payment
occurs automatically; and
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provide comprehensive (third level) data for all charges incurred.
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Travel Management Services Requirements
Finance intends to approach the market in the second quarter of the 2014 calendar year to establish
new travel management service contracts for the Australian Government. The objectives for the travel
management services arrangement include:
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continuing to maximise value for money for the Commonwealth;
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creating a sustainable business model for the travel industry;
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increasing the use of technology to streamline the interaction between Government agencies,
travel services providers and users of Government travel related services; and
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contributing to transparency of travel expenditure through the provision of accurate and
timely travel data.
Within the context of the objectives for this project, the key elements of the new travel management
services are:
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for individuals – a service that is accessible, easy to use, and allows travellers to easily
manage their travel (air, accommodation and car rental) requirements;
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for Government agencies – a solution that promotes administrative efficiency , with minimal
implementation effort, reduces cost and supports effective reporting and travel expense
management across diverse system, policy and operational environments; and
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for Finance – an arrangement where the service providers are fully accountable for the
services they provide to the Australian Government.
Finance expects the eventual Travel Service Provider(s) (TSP) will contribute to these objectives by:
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developing a strategic partnership with Finance to provide exceptional levels of service to the
Government agencies, where issues are quickly identified and resolved;
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representing the Australian Government’s interests when dealing with relevant parties in
delivering the Services to the Australian Government;
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acting reasonably at all times to ensure the success of the arrangement, including minimising
risk for the Government agencies;
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maintaining open and effective communication with Finance as the manager of the
arrangement and with the Government agencies as the recipients of the Services;
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providing transparent fee arrangements, including reflecting any discount or other reduction
linked to the Services;
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recognising the need for delivering consistent and high quality products and services across
the Government agencies, allowing tailoring where appropriate to suit the specific needs of the
Government agencies;
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actively contributing and supporting innovation in service delivery;
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actively managing an integrated supply chain to deliver seamless services, data and reporting;
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driving efficiencies in service delivery to support value for money to the Australian
Government; and
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providing services consistent with the Australian Government’s travel policies, including any
individual guidelines of the Government agencies in respect of travel (which may include
policies that restrict the use of certain fares).
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Key features of the new arrangement are likely to include:
a. a whole of government arrangement, managed by Finance, consisting of a panel of one, or
more, TSP(s) delivering consistent and high quality products and services across the
Government agencies, tailored to the requirements of approximately 150 Government
agencies where required;
i.
TSP(s) must have the capacity to deliver the Services to the Government agencies.
This involves the accurate and timely processing of approximately 700,000
domestic and 65,000 international bookings per annum, and the management of
approximately 100,000 traveller profiles;
b. clear contractual arrangements will be established so that service providers are
accountable for delivering the Services to the highest possible standards. This includes
having the appropriate contractual (or other) mechanisms in place with (and potentially
between) the parties (including those contracted under Phase 2) delivering the Services to
Finance and Government Agencies;
c. a one stop shop that meets Government agencies’ travel needs, with an online booking tool
or system (‘the OBT’) as the preferred booking channel for domestic and international
travel. That is, travel bookings and amendments (pre- and post-ticketing) can be made
online for air, accommodation and car rental;
d. to the extent possible, direct contact with the travel service provider (i.e. consultant
assisted travel bookings) would be used: for VIP services; in emergencies; where the OBT
is unable to perform the function; or when access to the OBT is restricted (e.g. due to
geographical location);
e. the Services (OBT and consultant support) would need to be available 24/7 (except for
OBT scheduled maintenance requirements) and also accessible through mobile devices
(e.g. smart phones, tablets);
f.
transparent pricing that reflects the cost efficiencies from booking online compared to less
efficient and potentially more expensive booking methods, but only to the extent that the
OBT has the requisite functionality (e.g. making changes pre- and post-ticketing, booking of
international travel);
g. provision of comprehensive pre-defined data that does not require extensive manual
intervention by Finance or Government agencies for reporting purposes; and
h. the TSP contract will be for four years, with two extension options – the first extension
option of two years and the second extension option of one year.
Attachment A – provides an overview of the Australian Government travel profile.
Attachment B – sets out the high level functions and travel management service requirements.
Attachment C – sets out an overview of the current travel management service processes.
Attachment D– provides a schematic of the proposed travel management services model.
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Indicative Timeline and activities
The following table sets out a high level indicative timeline and activities in order to deliver the
project.
Start-up
RFT Process
Implementation
(Now – Feb 2014)
(Mar – Oct 2014)
(Nov 2014 – Apr 2015)
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Appointment of
resources
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Consultation with
agency and suppliers
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Draft RFT
documents
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Establish due
diligence data room
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Issue RFT
Evaluate bids
(including testing of
solutions)
Negotiate and execute
Develop change
management plan
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Finalise Transition Plan
Implement new
arrangement
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Agency communication
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Services commence
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Industry Consultation
Finance welcomes any relevant feedback on its intended approach. In particular Finance would like
feedback on the following:
A.
The current average online adoption rate (for booking
domestic travel) across the Australian Government is approximately 60%. The adoption
rate has been gradual (from an approximate average of 14% prior to the introduction of
whole of government travel arrangements). The rate also differs across the Government
agencies, ranging from approximately 10% to over 95%. The introduction of the OBT has
proven successful in simplifying travel bookings; delivering efficiencies; reducing cost; and
influencing traveller behaviour.
Finance is now considering extending the use of the OBT to booking of international travel.
Finance is also looking at ways to increase the OBT adoption across the Australian
Government to further influence traveller behaviour, reduce cost and deliver greater
efficiencies.
Ideally, the OBT should be the preferred mechanism for booking domestic and
international travel (including the management of pre- and post-ticketing changes).
Consultant assisted travel bookings would be used: for VIP services; in emergencies;
where the OBT is unable to perform a function; or when access to the OBT is restricted (e.g.
due to geographical location).

Is the online booking functionality currently and readily available to allow the
Australian Government to manage its domestic and international travel bookings as
described above? If so, can the OBT also perform pre- and post-ticketing changes? Is
your organisation able to provide this system?

Describe any integration (including information) requirements and associated lead
time that you consider are necessary for the provision of the Service including the
rollout of the OBT to Government agencies.

Is the greater focus on an OBT the most effective approach to influencing traveller
behaviour? What other measures could/would need to be taken in conjunction with
the OBT being the preferred channel for booking travel?
B. The Government agencies have a broad range of travel requirements, including, but not
limited to: simple point to point ; multi-leg domestic and international bookings; charter
flights; small and large group travel; excess baggage requirements; long stay
accommodation;, special needs (disabled and elderly passengers, unaccompanied minors,
freight); and VIP services.

Considering the proposed strategy for OBT as the preferred travel booking channel, are
there any limitations to using the OBT to meet the Australian Government travel
requirements?
C. The OBT will need to provide the Australian Government travellers and travel bookers
with access to inventory of the Australian Government contracted: airlines;
accommodation program manager; car rental service providers; and non-contracted
airlines. The online booking tool will also need to support the processing of payment to
these service providers, using the whole of government travel card arrangement.

Describe any integration (including information) requirements and associated lead
time necessary for travel management service provider(s) to integrate their systems
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with the Australian Government contracted airlines, accommodation program
manager, car rental and travel card service providers.

Some service providers (e.g. accommodation program manager, car rental providers)
distribute their inventory through channels other than global distribution systems.
What are the likely challenges for travel service provider(s) to integrate their systems
with such service providers? Is your organisation able to implement this integration?
D. Finance is considering incorporating a pre-trip approval requirement as part of the OBT
where the pre-trip approval function would be made available to those Government
agencies that choose to take up that functionality.
The decision to pursue the inclusion of the pre-trip requirement , as part of the OBT,
remains with Finance. At this stage, Finance intends to assess this during the RFT process,
based on whether the proposed solution by prospective tenderers: meets the business
needs of the Government agencies; is efficient and seamless to implement (including
interfacing with Government agencies’ systems (e.g. with a HR system); and incurs
additional cost (if any).

Is pre-trip approval functionality currently and readily available? Are you able to
provide it? What level of customisation or configuration would be necessary to achieve
the above requirement?

How would a pre-trip approval system accommodate the airline ticketing conditions
such as instant ticketing?

How would a pre-trip approval system accommodate a bundled or consolidated
booking which includes air sector(s), accommodation and car rental segments?

Can a pre-trip approval system facilitate or aid post-trip cost acquittal and
reconciliation (i.e. an end-to-end solution)?
E. Finance expects to routinely receive comprehensive data from the TSP(s), in a consistent
format (as defined by Finance) with little need for manual intervention (including
cleansing and editing) by Finance. Finance is also considering the portability of data,
particularly in relation to traveller profile data.

What do you consider to be the system limitations in relation to providing uniform,
pre-defined and formatted data? Is your organisation able to meet this requirement?
What level of customisation or configuration would be necessary to achieve the above
requirement?

How do you currently manage profile data?

How do you ensure the security of data, including profile data?

How do you ensure the portability of profile data between the suppliers providing the
Services to the Australian Government?

How do you make this data available to the Australian Government, including hand
over at the expiry of the contract?
F. The key objectives for the travel service arrangements are to: optimise savings through
cost reductions; improve efficiencies; and promote behavioural change.

What travel related services or products do you consider may contribute to these
objectives? Which of these services do you consider would need to form part of the
core services as opposed to optional services?
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
Are these services or products currently and readily available? Are you able to provide
them?
G. Finance is considering the appropriate number of service providers for the Services.

Considering the volume and diversity of Australian Government’s travel, and the
proposed strategy, do you consider that a single provider has the capacity to manage
and deliver the services described at Attachment B? Is your organisation able to
perform this role?

What are the benefits (including in relation to pricing) and the risks of a single service
provider as opposed to a panel of service providers?

Describe any set up (including information) requirements and associated lead time
that you consider are necessary for service provider(s) to transition to the new
arrangement and deliver the services.
Submitting your comments
Comments on the paper can be directed to:
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traveltender@finance.gov.au
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Procurement Coordinator Blog
The closing date for providing feedback on this consultation paper is 10:00am 31 January 2014.
Feedback and comments should not be more than 30 pages in length, including attachments. Where
appropriate, Finance may incorporate feedback into any subsequent tender documentation, or
otherwise use it to inform the proposed approach to market. Finance does not guarantee that any or
all feedback will be incorporated in any subsequent approach to market. Finance also reserves the
right to respond or not to specific questions at its own discretion.
Finance encourages organisations to respond to this consultation paper. However, organisations that
do not respond to this consultation paper will not be excluded for that reason from any subsequent
approach to market.
Finance will not pay for any information requested nor is it liable for any costs incurred by
respondents.
Organisations are directed not to approach Government agencies in relation to this consultation paper
or the upcoming approach to market. Finance asks that correspondence occurs through the email
address or Procurement Coordinator Blog (details set out above).
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Attachment A – Overview of Australian Government’s travel profile
Air Travel (1)
1.
Spend ($):
Volume (sectors):
Bookings:
Domestic:
$265 million
1,200,000
680,000
International:
$150 million
195,000
65,000
Total:
$415 million
1,395,000
745,000
Air travel spend and volume is for the 2012-13 financial year. Air travel spend is Airline spend GST included. International Air
travel includes Trans Tasman. Air travel volume is the number of one way sectors.
Top City Pairs (by volume) (2)
2.
Domestic:
International:
Canberra - Sydney
Sydney – Los Angeles
Canberra - Melbourne
Sydney – Singapore
Canberra - Brisbane
Brisbane – Honiara
Sydney - Melbourne
Sydney – Bangkok
Sydney - Brisbane
Sydney – Dallas/Fort Worth
Brisbane – Townsville
Sydney – Dubai
Adelaide – Canberra
Sydney – London
Melbourne – Brisbane
Sydney – Hong Kong
Adelaide – Melbourne
Sydney – Jakarta
Perth - Sydney
Brisbane – Port Moresby
Top City Pairs is the number of sectors between the cities. Domestic is originating from both cities.
General Profile:

approximately 150 Government agencies

approximately 100,000 travellers
The Australian Government has office locations in all Australian capital cities and a large number of regional
areas. Most travel originates from Canberra, Sydney, Melbourne and Brisbane.
The Australian Government’s travel requirements are wide-ranging. In addition to the standard domestic and
international booking services, they can include (but are not limited to) services such as:

VIP bookings

Excess Baggage and small freight

Group travel


Conference bookings
Limousine transfer and services / Local
transportation services

Charter flights


Passport / Visa applications

Travellers requiring assistance
Specialised travel booking services
(transport of dangerous goods, transport of
prisoners, witnesses and/or asylum seekers,
secure hand delivery, freight, unaccompanied
baggage, disabled support services)
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Attachment B – High level functions and travel management service requirements.
Function
Services

store traveller information to facilitate travel bookings

store agency profile information to facilitate agency travel policy and expense reconciliation (e.g.
booking references, cost centre structure)
Profile
Management
Online Travel
Management
Customer
Support and
Training

central or travel booker self registration (online and offline)

agency creation and maintenance of traveller profiles (online)

TSP creation and maintenance of traveller profiles (offline)

password set up and maintenance

real time or passive data-feeds from HR, financial or card management systems

air, hotel and car rental inventory research (domestic and international)

air, hotel and car rental (delegate) approval

air, hotel and car rental bookings (including the use of supplier credits)

ability to book special requirements (eg group travel and bulk booking)

air, hotel and car rental booking amendments and cancellations

ability to prioritise presentation of air fares, hotel and car rental rates

ability to book ancillary services such as rail and ferry

ability to manage additional baggage/freight

24/7 access through various mediums including smart phones and tablets

provision of comprehensive itinerary that consolidates all aspects of travel (air, hotel, car)

air, hotel and car rental inventory research (in tool) help and support

air, hotel and car rental booking (in tool) help and support

offline air, hotel and car rental amendments and cancellations

24/7 offline traveller support including travel booking for VIP and emergency bookings or due to
deficiency or unavailability of online travel management tool

feedback/complaints (in tool)

connectivity to Commonwealth contracted air, hotel and car rental providers
Inventory
Management

ticket fulfilment (where applicable)

air, hotel and car rental booking confirmation
Payment

based on the whole of government travel card arrangement for travel expenses, where payment
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Function
Services
occurs automatically in the background (virtual card and card in hand)
Systems
Integration

manage air, hotel and car rental refunds due to agencies

assist agency travel expense reconciliation with provision of enhanced data feed

integration with Government agencies’ system including, Financial, HR or Card Management
systems

integration with /connectivity to Commonwealth contracted air, travel card, hotel and car rental
providers’ systems
Information
Management

provision of timely, accurate and complete transactional data

data to include specific information and in format that aligns with Commonwealth’s reporting
requirements

travel data (and traveller profile information) owned by the Commonwealth

travel data (and traveller profile information) stored and handled in a secure environment in
Australia.
Contractual
Relationship

strategic partnership with Finance as the contract manager

Government agencies are recipient of travel services

acting reasonably to ensure success of service delivery

representing the Commonwealth’s interests

open communication with Finance and with Government agencies
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Attachment C –Overview of the current travel management service processes.
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Attachment D - Proposed travel management service model
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