A contract awarded to a company to handle payments from council parking meters and national parks in NSW wasn't put to tender and came directly from the government, a committee has heard.
NSW Customer Service Minister Victor Dominello on Monday defended the implementation of smart parking meters around Sydney and the dominance of Duncan Solutions in the market.
Councils can choose different companies to put in the meters but at present, the money is funnelled through Duncan Solutions via its payment gateway.
The company was awarded a development contract to provide an app interface and take payments on behalf of the councils through a direct deal with the government.
A pilot of the Park'n Pay program began in The Rocks in the Sydney CBD, where Duncan Solutions already had installed smart parking meters, Mr Dominello told the parliamentary budget estimates hearing.
"We had to start somewhere," he told MPs.
The committee also heard there was "some tiering based on the number of meters adopted", which meant the contract became more lucrative as more meters were installed and more payments were made through the app.
The Park'n Pay app is open source and "technically agnostic", Digital NSW deputy secretary Greg Wells told the committee.
He acknowledged the initial contract with Duncan Solutions was the result of direct dealing and not a tender.
The government is not supposed to routinely use direct dealing but can where a competitive tender is not possible or appropriate.
The committee heard the contract will be up for renewal and a new competitive tender process will begin soon.
Mr Dominello said people are adopting the Park'n Pay app and feedback had been positive, which was proof the app provided value for customers.
The app was intended to cut congestion by helping people find open parking spots and pay for them through one app, rather than using multiple apps for different council areas.
