A contract awarded without a tender to a company to handle payments for NSW parking meters has been slammed as lacking transparency and proof of value for money.
The ParknPay app, initiated by the former state coalition government, was subject to an audit that assessed whether NSW officials followed the law when directly negotiating a contract with the firm Duncan Solutions.
The app allows people to pay for parking via their mobile phones rather than on street-side machines and the company was contracted to provide back-end services.
But a report from the NSW Audit Office found the Department of Customer Service failed to establish grounds for direct negotiation without a competitive tender process and rushed a decision to trial the app in Sydney's The Rocks.
"There is no evidence that the procurement achieved value for money," it said.
"Despite being required by legislation, as well as mandatory NSW government policy, the department did not consider how it would ensure value for money, nor did it demonstrate an adequate understanding of what is meant by value for money."
Originally proposed to cost $400,000 for a one-year contract, the department entered into a three-year contract worth $1.26 million in July 2019.
The program ultimately cost $1.93 million after being extended for a second year in July 2023.
The audit found the department did not effectively manage conflicts of interest, nor did it document key decisions.
"The department lacked accountability and transparency in its interaction with the minister and the minister's office, resulting in an improper blurring of the line between executive government and the public service," the report said.
The Minns Labor government axed funding for the app in its September 2023 budget, citing the need to balance the books by cutting budget black holes and unfunded programs.
The audit office made several recommendations to improve contract procurement processes, including improved record-keeping practices and protocols for interactions between department staff and the minister's office.
Responding to the audit, outgoing department secretary Emma Hogan acknowledged the findings and accepted the recommendations.
She noted the events examined in the report had taken place three years earlier and since then the department had been subject to three external reviews of its procurement practices.
"Throughout my four years in this role, (the department) has continued to strive to improve processes and compliance," Ms Hogan said.
"As part of my handover to (incoming secretary Graeme Head) I have suggested ... it may be timely to assess how well (the department) has implemented recommendations from the earlier reviews."
