Among the reported confidential contracts were $5.2 billion in spending by Home Affairs, carried over from the former immigration department, as well as $50.4 million from the AEC, $42.4 million from Infrastructure and $9.4 million from the Reef Park Authority.

This month another audit report found Home Affairs had ended a two-year $17.6 million project with consultants Accenture a year early because it "had not been satisfied with the performance" of the firm.

The proportion of Commonwealth contracts valued at $100,000 or more reported to contain confidentiality provisions has decreased in the past decade, down from about 9.7 per cent in 2009 to about 4.1 per cent in 2017.

Guidelines from the Finance Department allow government contract information to be kept confidential if it meets four criteria: it must be commercially sensitive, it must be specifically identified, disclosure would cause "unreasonable detriment" to the owner or other parties and the information was provided through an understanding it would be kept confidential.

The use of confidentiality provisions has decreased to about 4.1 per cent of contracts in 2017. Louie Douvis

Of the 43 contracts examined against the test, confidentiality provisions were appropriately used and reported for only six of the contracts, or 14 per cent.

Internal costings and profit information was the most used category for confidentiality provisions, ahead of trade secrets, privacy and public interest reasons.

The report said government departments could not consistently demonstrate why suppliers needed confidentiality or their reasons for agreeing to keep information secret. The most frequent errors in following the rules were a failure to explain the subject matter of contracts and not specifying reasons for confidentiality.


Mr Hehir recommended all government entities document their consideration of supplier confidentiality requests against the confidentiality test to provide a record of the reasons for agreeing to any confidentiality provisions and the basis for future decisions.

"Going forward, there would be merit in the Department of Finance monitoring how entities are applying the department's guidance to support government entities to be more accountable and transparent in their purchasing arrangements," the report said.

"Entities should also engage directly with Finance to discuss the complexities associated with their contracting environment," Mr Hehir said.

Home Affairs said it would review and amend guidance materials to assist staff to better "understand, implement, and report on confidentiality provisions in contracts".

The confidentiality report comes amid increased scrutiny of government outsourcing, including to consulting firms and labour hire companies, part of an inquiry launched by Parliament's Joint Committee of Public Accounts and Audit.

The committee is considering a report from December which examined more than of 64,000 contract notices published on the government's AusTender, worth $47.4 billion.