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Why have rules?

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To strengthen accountability

Government agencies must account for how they spend taxpayers’ money. The Rules, along with the Principles of Government Procurement and other good practice guidance such as the Office of the Auditor-General’s Procurement Guidance for Public Entities, provide a framework that promotes responsible spending when purchasing goods, services, and works. This framework supports proactively managing procurement process and delivery risks.

The Rules also establish processes that are consistent and predictable, making it easier for agencies and suppliers to engage with each other.

Agencies must also be aware of, and comply with relevant law, including the common law of contract, public law and commercial law obligations.

To promote our values

New Zealand is committed to open, transparent and competitive government procurement that:

  • delivers best value for money (which isn’t always the cheapest price)
  • does not discriminate against suppliers (whether domestic or international), and
  • meets agreed international standards.

The Rules reflect these values and standards.

     

    To encourage commercial practice

    Early market engagement and continued open dialogue with suppliers are essential to the results we can achieve. There are sound commercial reasons why building stronger relationships with business is important. The Rules aim to encourage better commercial practice by promoting these types of behaviours and achieving greater value for money.

     

    To support economic development

    As a small, remote trading economy, New Zealand needs to export to survive. A competitive economy trading successfully with the world is one way to build ongoing economic growth. This creates jobs and grows incomes. New Zealand suppliers need greater access to international markets to increase their export opportunities.

    The Rules incorporate New Zealand’s international treaty obligations. Access to markets is secured through Free Trade Agreements (FTAs). Under FTAs, countries offer reciprocal access to their government contracts. The Rules reflect New Zealand’s FTA commitments and align with the World Trade Organization’s Agreement on Government Procurement (GPA).

    Following the Rules is essential:

    • to provide open and fair competition that supports innovation and helps create a competitive, productive supply base in New Zealand – that supports economic growth and development
    • for New Zealand being valued as a desirable trading partner – that demonstrates professional practice and has a reputation for integrity.

To build high-performing public services

Third party suppliers deliver a large share of the government's public services. We can improve the effectiveness and efficiency of public service delivery through better procurement planning, supplier management, and more collaboration across government.


What is good procurement?

Public value

Agencies that maximise their return on spending will achieve the best possible results for New Zealanders. Good procurement means better public value.

Policy framework

Government procurement is based on Principles, Rules and good practice guidance. Collectively, these provide a broad framework that supports accountability for spending, sound business practice and better results.

Good practice isn’t just mechanically applying the Rules. It’s about developing a strong understanding of all of the aspects of the procurement lifecycle and skillfully applying these to deliver the best results. While you still need to comply with the Rules, you should design your process proportionate to the value, risk and complexity of the procurement. It’s about applying sound commercial judgement to achieve the best value for money, which isn’t always the cheapest price, and drive innovation and performance.

Understanding suppliers and the market is part of the careful planning essential to developing the right approach to market. All procurement covered by the Rules should be supported by a robust business case or procurement plan that has a level of detail reflecting the size, value and complexity of the procurement.

Procurement also covers proactively managing supplier and other key stakeholder relationships throughout the sourcing process and for the duration of the contract. This embraces continuing to develop the supplier and driving value for money through ongoing efficiency gains.

Principles

The Principles of Government Procurement apply to all government agencies and provide our overarching values. The Principles apply even if the Rules do not. Agencies can use the Principles for guidance and to help make good procurement decisions.

Other guidance

Examples of guidance on government procurement practice include:

 

Last updated 29 April 2015