Digital Seller Underperformance Policy

Why this Policy matters to sellers

We have designed the DSUP to recognise that performance challenges on digital contracts can arise from many factors.

This Policy is not about penalising sellers. It's about:

• Creating a fair and consistent approach to managing serious underperformance.
• Encouraging collaboration between buyers and sellers to improve delivery outcomes.
• Providing transparency in how performance history may be considered in future procurements.

The DSUP will apply to Strategic Digital Contracts, valued at $4 million or more, or other contracts determined to be strategically significant by the DTA.

What's being proposed

The DSUP outlines a process for:

• Reporting and assessing serious underperformance.
• Providing sellers with a right of reply to the reporting of 'serious underperformance'.
• Recording confirmed serious underperformance on a secure register (CSU Register).
• Sharing relevant information with Australian Government buyers during tender evaluations.

The CSU Register will be accessible only to authorised Australian Government buyers and will not prevent sellers from being awarded future contracts — but it will help buyers make informed decisions.

Why your feedback is important

Your insights will help ensure the Policy is:

• fair and proportionate;
• sensitive to the realities of digital delivery; and
• supportive of sellers of all sizes and specialties.

We want to hear from you — whether you're a sole trader, small to medium enterprise, or large seller — to help shape a Policy that works for the whole market.

How to participate

• Read the draft Policy
• Submit your feedback in the 'Have your say' section of digital.gov.au
• Consultation closes on 21 December 2025 at 4 PM (AEDT).

Matters we'd like your feedback on

• Are the criteria for "serious underperformance" clear and reasonable?
• If you're a seller, is the right of reply for sellers sufficient to ensure you are able to respond to and that your perspective is taken into account by the decision maker?
• Do you understand how your contracts may be affected by this Policy?
• Does the Policy provide enough opportunity for sellers to improve and demonstrate remediation?
• Do you have any views on the Policy's fairness and impartiality?
• How would you prefer to receive updates or guidance once the Policy is finalised?
• Is the scope of the policy clear, including which contracts will be covered and how the threshold will be applied?

Applying the policy more broadly

We are also interested in seller and stakeholder views on whether the seller underperformance policy should be applied more broadly to a wider range of contracts. We are interested in feedback on:

• Which other contract types should be prioritised in extending the seller underperformance policy beyond digital contracts? This includes any you consider are high-risk or would especially benefit from the policy.
• Do you see any barriers or issues associated with widening application of the policy to other types of contracts in future and, if so, do you have any suggestions to address these?
• Noting the draft policy applies to all sellers, are there sellers you think should be exempt? Why?

What happens next

After the consultation period closes:

1. The DTA will review all submissions: feedback from sellers and other industry stakeholders will be carefully considered for DTA's finalisation of the policy.
2. We will publish a summary of feedback: a consultation summary will be made available outlining key themes and how they will shape the final policy.

What the policy does

• Applies to Australian Government digital contracts valued at $4 million or more; or other strategic digital contracts as determined by the DTA.
• Improves transparency of digital seller performance across the Australian Government.
• Provides incentives for buyers and sellers to work together to resolve delivery challenges and achieve successful outcomes.
• Offers a simple, fair process for reporting potential cases of serious underperformance.
• Ensures sellers have the right to respond and that all reports are assessed consistently, fairly, and ethically by DTA personnel with the requisite authority to make decisions. The final decision to record a seller as having 'confirmed serious misconduct' will be made by the Deputy CEO of the DTA.
• Maintains a register of serious underperformance to inform agency decision-making during tender evaluation activities for digital contracts.
• Protects seller and supplier privacy, with information only accessible under strict confidentiality arrangements including a 'need to know basis' only.

What the policy does not do

• It is not designed for minor issues, it only applies to serious underperformance (see Policy for definition).
• It is not a procurement ban or debarment regime. Buyers make their own decisions about a seller's suitability on a case by case basis for procurements where the digital contract is valued at $4 million or more or the contract is a Strategic Digital Contract, as determined by the DTA.
• It is not a 'blacklist'. The register is not public and does not prevent agencies from considering listed sellers for future work.
• It is not the sole source of assessment. Buyers must still undertake their own due diligence and performance checks during evaluation.
• It is not a dispute resolution or mediation service. Buyers remain responsible for managing contracts and engaging with sellers to resolve issues before escalating to the DTA.

What does the DTA do?

The DTA is the Australian Government's trusted adviser on digital transformation. This includes supporting and monitoring digital sourcing initiatives across the Australian Government, such as the Digital Marketplace Panel 2.0.

Australian Government agencies have spent approximately $16.9 billion on digital products and services contracts across DTA marketplaces as at 31 July 2025.

The DTA has whole-of-Government responsibility for managing strategic coordination and oversight functions for digital projects. This policy initiative is part of DTA's role...

The DTA also has oversight of and reports on whole-of-Government digital project performance. The Major Digital Projects Report provides an annual update on the status of major digital projects and sets out how the DTA is working to create the conditions for success through ongoing reforms and improvements.