OneAdvanced & World Commerce & Contracting Report reveals need for public sector contracting reform in Australia and New Zealand. Skill gaps and tech bottlenecks constrain value delivery

 OneAdvanced and World Commerce & Contracting (WorldCC) today released the findings of their comprehensive study, Public Sector Contracting in Australia and New Zealand: 2025 Benchmark Insights.

The report, based on data extracted from the World Commerce and Contract Management Institute’s 2025 benchmark study, including insights from more than 30 public sector agencies and interviews with ten contracting leaders.

It confirms that while contracting is increasingly seen as the backbone of public value delivery, the sector is being held back by structural challenges and limited adaptability.

“The public sector in Australia and New Zealand is facing unprecedented pressure to deliver greater value at lower cost and faster, driven by a mix of market, economic, regulatory and technological factors,” said Sharon Morris, Group Regional Head, Asia Pacific at World Commerce & Contracting.

Uncertainty levels are reported at 4.6 out of 7 in both countries, which is 15% higher than the private-sector average and nearly 40% above what they consider normal.

Key Report Findings 

The research reveals that the current contracting process, historically based on rules and assumptions of control, is ill-equipped for this environment of rapid, unpredictable change:

• Low satisfaction and adaptability: Overall satisfaction with the quality of the contracting lifecycle is low, scoring just 2.8/7 in Australia and 3.5/7 in New Zealand. Adaptability scores also fall short of the international cross-industry average (4.2), measuring 3.4/7 in Australia and 3.8/7 in New Zealand.

• Regional differences: New Zealand demonstrates a higher level of adaptability and readiness to experiment, supported by more focused reform efforts and the presence of a formal Head of Procurement with national responsibility. Australia’s focus on capability uplift is more recent and less structured, leading to wide variations in performance.

• Structural barriers dominate: While improving processes is the dominant strategic priority, structural challenges, including operational overload, unclear organisational ownership, weak data flows and late involvement in the process, are the primary constraints on value delivery. Data immaturity, which limits the ability to generate or consolidate data, is a core limitation.

Technology investment remains a critical gap, contributing to the sector’s struggle for resilience and adaptability.

Most respondents (57 per cent) report no dedicated budget for contract management systems. 62 per cent have no plans to implement any form of contract management technology or replace existing systems within the next 12 months.

This cautious, budget-driven approach creates a technology adoption bottleneck, limiting basic implementation and the use of advanced tools like AI. Addressing the skills gap is equally important, as the public sector shifts toward insight-driven delivery.

• Adaptability is key: 77% of practitioners recognise the ability to be adaptable and encourage adaptability as the most important development over the next five years.

• Complementary skills: Technological proficiency and communication skills follow closely, each recognised by 69% of respondents as essential needs.

The report confirms that procurement and contract management teams are struggling to keep pace while simultaneously addressing unprecedented market disruption.

Contracting is identified as a constraint and a barrier to meaningful reform, requiring urgent attention. A transition is necessary away from a control-based model focused primarily on compliance and risk transfer.

The data shows a shift emerging toward improving productivity and supporting organisational transformation.

The integration of ESG (Environmental, Social and Governance) is transitioning from policy aspiration to accountability.

“The focus is now on establishing consistent measurement practices and monitoring environmental and social impacts said,” Hadi Rezaei Vandchali, ESG and Procurement Services Consultant, Local Government Procurement.

“Very often, though, ESG capabilities and reporting will not be embedded in the contract management process,” 

“Senior leaders emphasise that adaptability and value depend on moving from a gatekeeping role to one of strategic enablement, focused on delivering outcomes,”

“World-class public contracting demands a balance between stability and agility, compliance and collaboration, and people and technology. Hadi said.

“The future lies in transforming procurement and contracting from a process that controls to a system that enables, anchored in trust, guided by data and powered by people who understand where that true public value comes from,” said Adam Bowles, Country Director for Australia and New Zealand at OneAdvanced.

With more than 19,000 customers worldwide and a growing footprint across ANZ, OneAdvanced helps organisations modernise contracting, manage supplier risk, uplift workforce capability and drive performance.

Its approach combines global expertise with local understanding, ensuring its solutions align with the realities of sector-specific delivery, regulatory expectations and community accountability.