The recent tender round for a Christchurch cornerstone project highlighted the need for clarity around what information is required to allow the procurement decision makers to comply with the new Government Rules of Sourcing whose 3rd Edition came into force on the 1st July 2015.
On 1st February 2015 an additional 103 crown entities joined the 29 government agencies already mandated to apply the Rules, making this “required to comply group” a very significant share of the public sector procurement.
On 1st February 2015 an additional 103 crown entities joined the 29 government agencies already mandated to apply the Rules, making this “required to comply group” a very significant share of the public sector procurement.
The Rules require consideration of the 5 Principles of Government Procurement which puts a complex challenge out to the procurement decision-makers requiring, e.g. consideration of whole-of-life costing or to make balanced decisions which take account of the social, environmental and economic effects of the deal.
HERA had been involved in advising on the Government’s Procurement Reform and particularly researched the aspect of meeting the 5 Principles of Government Procurement and in particular Principle 4 given here in full:
4. Get the best deal for everyone
- Get best value for money – Account for all costs and benefits over the lifetime of the goods or services.
- Make balanced decisions – Consider the social, environmental and economic effects of the deal.
- Encourage and be receptive to new ideas and ways of doing things – Don’t be too prescriptive.
- Take calculated risks and reward new ideas.
- Have clear performance measures – Monitor and manage to make sure you get great results.
- Work together with suppliers to make ongoing savings and improvements.
- It’s more than just agreeing the deal – Be accountable for the results.
Following an industry request to assist providing relevant information in steel construction industry related tenders; HERA developed a template covering information responding particularly to the 4th Principle. This template has been used in the above-mentioned Christchurch cornerstone project and demonstrated the very significant economic, social and environmental contribution of the local fabrication.
The local tenderer felt that if the 5 Principles were applied by all submitted tenders including those from overseas, the local contribution must no doubt be rated highly as meeting the “Get Best Value for Money” requirement.
Update shared by Director Dr Wolfgang Scholz