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Using functional leadership to improve government procurement

As you may be aware, in December 2019 the Office of the Auditor General (OAG) tabled a report in Parliament into how we use functional leadership to improve government procurement.

Using “functional leadership” to improve government procurement - Auditor-General's overview - Office of the Auditor-General New Zealand

This report follows a review of MBIE’s leadership role for public sector procurement that is part of the OAG’s three-year work programme looking at procurement across government. We are very supportive of the OAG’s focus on government procurement and having now taken some time to review the report’s findings, we wanted to give you an update.

While the report acknowledges that the foundations for effective procurement functional leadership have been successfully laid, it has also highlighted some important areas for us to focus further on.

The report’s recommendations broadly cover four areas:

  1. We need to more clearly define our leadership role and responsibilities for improving government procurement and identify and revise our approach to stakeholder engagement to work more collaboratively;
  2. The State Services Commission needs to clarify its oversight role for procurement functional leadership in the public sector;
  3. The State Services Commission, as appropriate, also needs to clarify its oversight role for other functional leaders in the public sector; and
  4. We need to put in place a national procurement strategy to give direction on priorities, develop a monitoring and reporting framework, and publish a regular report on government procurement.

We have already been working to address many of these issues and recommendations over the last year, including:

  • increasing engagement with agency Chief Executives;
  • increasing transparency through the release of contract award notices;
  • development of an annual report (to be published shortly);
  • supported commercial capability across the sector through the Construction Procurement Guidelines; and
  • launching Hīkina, our online training and skills development system for government procurement and property professionals.

Having said that however, we still have more to do including looking at how the report can support our work and shape the direction we take.

One of our priorities over the coming months is to focus on our leadership of the government procurement system, as we develop the New Zealand government procurement strategy, and work with the State Services Commission to more clearly define functional leadership roles and responsibilities.

We are also taking this opportunity to look at how we engage across all levels of the public service in order to build a shared purpose and understanding, and to increase our transparency and accountability to our stakeholders.

We are committed to continuous improvement and welcome feedback from you in relation to the findings of the report. Please reach out to your account manager, or any other member of the team, if you have questions or concerns.