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Problem gambling appeal decision

22 December 2016

In July 2015, the High Court delivered a judgment relating to the procurement of gambling services by the Ministry of Health. The Crown subsequently appealed the judgment to the Court of Appeal.

The Court of Appeal has recently delivered its appeal decision and has found in favour of the Crown on all appeal points. The earlier High Court judgment has been set aside.

After the original judgment was delivered, we published some observations relevant to government procurement and the Government Rules of Sourcing. Although the Crown’s appeal has been successful, these observations remain relevant and we re-publish them below as a reminder for government agencies to ensure they undertake their procurement activities to a high standard and in a way that is consistent with the Government Rules of Sourcing.

These observations are not a substitute for legal and procurement advice. It is each government agency’s responsibility to ensure its procurement activity meets its needs while complying with applicable laws, policies, standards and processes.

  1. Good planning – Procurement activity should be well planned, with all stages of the evaluation process determined in advance. Evaluation criteria used to assess supplier responses must be included in each RFx document [see Rule 35 and the definition of “evaluation criteria”].
  2. Document the process – The procurement process (including evaluations, meetings, issues and resolutions, recommendations and decisions) must be thoroughly documented and maintained as records [see Rules 49 and 50].
  3. Evaluation and assessment – A clear evaluation methodology should be used. Evaluation panel members should understand what is being asked of them and should be instructed on what they can and cannot consider as part of evaluation. Following evaluation, but before making a contract award decision, a holistic assessment of suppliers (including due diligence) should be undertaken [see Rule 41]. The RFx document should signal this intention, either expressly or through reserved rights [see, for example, Section 3 of the Government Model RFP template].
  4. Conflicts of interest – Government agencies must have in place policies for staff involved in procurement to identify, notify and manage conflicts of interest [see Rule 2 and the definition of “conflict of interest”]. All conflicts of interest arising in connection with a procurement activity must be well managed. The conflicts management process should make clear that the purpose is to manage (not eliminate) conflicts and that the process does not seek to set a legal standard for determining the existence of conflicts.
  5. Follow the process – A government agency should do what it says it will do in its RFx document. If there is a need to change the process or any requirement (including evaluation criteria) set out in its RFx document, the government agency must notify the supply market of this and give suppliers a fair opportunity to respond to the change [see Rule 39].
  6. Review internal policies and procedures – Each government agency should regularly review its internal documentation to ensure any requirements or processes relating to its procurement activity are or remain appropriate.
     

Detailed information on government procurement policy and practice can be found on our section For Agencies.

If you have any queries, please direct them to procurement@mbie.govt.nz

 

Last updated 22 December 2016