SENATE

Monday, 27 February 2017 Senate Page 23
licensee to provide a business plan to the licensor.' Here you are in direct competition with Aussies and you are
requiring the provision of his business plan to you. That would be exceedingly helpful if you were in direct
competition. Are you providing your business plan to Aussies, how you are going to try to undercut him and get
more of this business?
Mr Stefanic: The suggestion that we are trying to undercut Aussies is not correct. The operation—
Senator ABETZ: All right. Are you in competition with Aussies?
Mr Stefanic: Not directly, Senator. We run a number of operations. We run an events business. We run the
staff dining room. We run a coffee cart. We run the Queen's Terrace Cafe.
Senator ABETZ: Takeaway coffees, snacks, food, beverages?
Mr Stefanic: That is right. The net value of that operation is far higher. To suggest that we would be running
down Aussies to enhance our own operation is not—
Senator ABETZ: Are you in direct competition with that which Aussies provides? We know that Aussies
does not provide catering in the Great Hall, but for that which Aussies does provide, especially coffee and food
sales, you are in direct competition.
Mr Stefanic: The majority of DPS's revenue from catering is generated through the events business, Senator.
Senator ABETZ: Yes, but that avoids the question I am asking. Are you in direct competition with Aussies in
the area of coffee and food sales and other beverages, the first three items on your list which says he must provide
information on a monthly basis?
Mr Stefanic: We are in competition with respect to sales of coffee and wherever else there is a similar
product.
Senator ABETZ: Thank you—and food and beverages.
Mr Stefanic: What I will say, though, is that the Presiding Officers are the sign-off on the licence itself, so
there are checks and balances along the way. It is not DPS that is solely making these decisions. We seek
independent advice. We expect that Mr Calabria would seek independent advice as well and come back to us and
discuss any areas of concern he has in the agreement.
Senator ABETZ: So what is your need to know his business plan?
Ms Croke: Senator, can I just add to that. DPS has a responsibility, in managing all of the licence
arrangements we manage, to make sure we are putting services into the parliament that meet the needs of the
senators and members and the occupants of parliament. So we were asked—and it was through an ANAO report,
as well—to do a full retail strategy of what services were needed. Part of that is, when we do put in place a
licence agreement, we need to have some indication of the services that have been provided and whether they are
effective in meeting the needs of the people in the building. Prior to DPS undertaking the catering and event
service and the provision of food that we are currently doing in the areas that the secretary mentioned, that was
managed by an outsourced contractor. Those services have been in place for years, in a coffee cart, in the staff
dining room; that competition has been there for years. The only thing that has changed is that, because of
concerns about the level of that service and the quality of the food that was provided, DPS was asked to take over
the running of those arrangements.
Senator ABETZ: And of course that is where you are hopelessly conflicted. Hopelessly conflicted in relation
to this matter with Aussies. Can I take you back to the evidence provided previously about the current owner's
father. When did the current owner's father have the business?
Ms Croke: He had the business prior to the current Mr Calabria. I am not sure how far back it goes.
Senator ABETZ: 2001 was when the son took over—16 years ago. So launching back into ancient history as
to what the agreement may have been, I think in 1996, when the current owner's father took it is, I must say, not
very helpful in our discussions today and especially in the circumstances where all we are talking about is a
renewal of, I think, an enterprise about which I would suspect the most left-wing and the most right-wing of
parliamentarians, public servants et cetera would be of the view provides a pretty good and efficient service. So I
am just wondering why all these new factors have been included. You reach back to 1996 when it first started,
and here we are in 2017.
Mr Stefanic: I think where it is relevant is that the licence held by Aussies has not been subject to market
testing in 25 years. My department has been criticised by the ANAO for not seeking to maximise a return to the
Commonwealth—hence its recommendations to undertake a retail strategy. I do not know where to go, then. Do
we just leave the existing licence in place forever?
FINANCE AND PUBLIC ADMINISTRATION LEGISLATION COMMITTEE