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Application of the Rules

Agencies need to know when and how to apply the Rules, as well as what activities are defined as procurement.

New Zealand's central government is made up of agencies in the public service, state services and state sector. A full list of these agencies is available on the Te Kawa Mataaho Public Services Commission website. Local government agencies are part of the public sector. For convenience, the Rules refer to all central and local government agencies as 'agencies'.

Central government organisations – Te Kawa Mataaho Public Service Commission

Agencies required to apply the Rules

The following agencies are required to apply the Rules:

  • All Public Service departments
  • New Zealand Police
  • New Zealand Defence Force
  • Crown agents, Autonomous Crown Entities, Independent Crown Entities, Crown Entity Companies – other companies, Public Finance Act 1989 Schedule 4A companies
  • Crown Research Institutes must have regard to the Rules
  • Certain agencies are bound to meet the requirements of the World Trade Organisation (WTO) agreement on government procurement or other free trade agreements. For these agencies, only those Rules relevant to the commitments made, and procurement covered by, those agreements will apply.

Agencies expected or encouraged to apply the Rules

The following agencies are expected or encouraged to apply the Rules:

  • School Boards of Trustees, Public Finance Act Schedule 4 organisations, and the Reserve Bank of New Zealand are expected to have regard to the Rules as good practice guidance.
  • Wider state sector and public sector agencies are encouraged to have regard to the Rules as good practice guidance.

Whole of Government Direction

The Whole of Government Direction on Procurement Functional Leadership, dated 22 April 2014, was made under section 107 of the Crown Entities Act 2004 by the Ministers of Finance and State Services. More information about this, and related directions about ICT and property services, is available on the Te Kawa Mataaho Public Services Commission website.

Te Kawa Mataaho Public Services Commission(external link)

Value thresholds

The Rules apply to the procurement of goods, services and refurbishment works or any combination thereof where the whole of life cost meets or exceeds $100,000.

The Rules apply to the procurement of new construction works where the whole of life cost meets or exceeds $9 million.

Types of contracts

The Rules apply to all contract types, including:

  • when purchasing outright
  • purchasing through hire-purchase
  • when renting or leasing
  • where there is an option to buy
  • Public Private Partnerships
  • contracts accessed through a third-party commercial supplier or broker
  • social sector commissioning and social investment outcome contracts.

Non-procurement activities

For the purposes of the Rules, the following activities are deemed not to be procurement activities:

  • employing staff (excluding the engagement of contractors and consultants)
  • investments, loans and guarantees
  • gifts, donations and any form of unconditional grants
  • statutory appointments
  • Ministerial appointments
  • Core Crown legal matters
  • public prosecutions as defined in section 5 of the Criminal Procedure Act 2011
  • goods, services or refurbishment works that are purchased for commercial resale
  • disposals at the end of the useful life of an asset, including sale by tender.
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