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Emergency procurement

Emergencies are sudden, unforeseen events. They can cause injury, loss of life, or critical damage to property or infrastructure. Consult this page to see what options are available to agencies in an emergency situation.

An emergency situation can include:

  • natural or manmade disasters, such as earthquakes, cyclones, tsunamis, volcanic eruptions, flooding, fires or contamination
  • failures of critical infrastructure or equipment, such as prison security systems or hospital infrastructure
  • critical health or environmental emergencies, such as a pandemic or food safety incident
  • political emergencies such as a war, coup, or a civil insurrection in New Zealand or in countries where the New Zealand government offers support
  • critical security emergencies such as a terrorist attack, serious crime or major cyber security emergency
  • unanticipated events that make it impossible for an agency to perform a statutory or critical function in the necessary timeframe; for example, the destruction of critical election supplies immediately prior to an election would be an emergency for the Electoral Commission.

In deciding if an event constitutes an emergency consider whether the event falls into one of the categories listed or something similar, as well as the nature and extent of harm if relief is delayed. Urgent situations that are created by an agency through a lack of planning or risk mitigation don’t constitute an emergency. If these occur as part of a wider emergency situation, they can’t be included as a sole justification for changing processes.

Your agency should plan ahead to allow for the provision of goods and services during an emergency or supply shortage. The level of planning should reflect the strategic importance of the good or service, the risk of an emergency and the cost of any contingency measures. Any contingency planning should be balanced, practical and fiscally responsible. You should consider making this process part of your risk management strategy.

Flexibility to respond

In an emergency, agencies need to be flexible in how they procure goods and services. Your agency is permitted to forgo routine procurement procedures in these circumstances. While adopting a more flexible procurement process, you should consider what is reasonable and justifiable.

During an emergency, you’re allowed to purchase directly from a supplier if the delay involved in conducting a routine procurement – which involves advertising and competitive tendering – prevents you delivering goods or services in time to bring effective relief.

Your agency needs to balance acting without delay (for example, to save or preserve life, or safeguard buildings or repair critical infrastructure) against meeting their obligations to act lawfully, reasonably and with integrity.

Deciding your response

Consider the following when deciding how your agency will respond in an emergency:

  • clarify that the situation meets the criteria for an emergency, and that a flexible approach to procurement can be justified
  • identify, specify and prioritise the immediate procurement activities that will bring relief
  • consider the operating environment and conditions on the ground
  • find out what other government agencies and NGOs are doing and collaborate where possible
  • consider your duty of care to suppliers, taking appropriate measures to keep them safe.

Maintaining accountability

Once there is no immediate risk to human life, the environment or critical infrastructure, you can consider an emergency situation to be stabilised. At this point, consider establishing a governance and management structure to coordinate and authorise necessary procurement activities.

During emergencies there is a greater risk of inflated prices, fraud, bribery and corruption. Be aware of this possibility, and take action to guard against it. Also consider the possibility of conflicts of interest and how to manage them.

Document your emergency procurements during the event, or as soon as possible afterwards. Clearly state in your records that purchases were emergency procurements, and record the facts and circumstances justifying this approach. Documents need to be filed in accordance with the Public Records Act 2005.

Any procurement process, even in an emergency, is still subject to audit.

For agencies subject to the Government Rules of Sourcing, an exemption for emergencies is available under Rule 15. The award of any contract over the appropriate value threshold should be published later on the Government Electronic Tenders Service, including a clear statement that it was an emergency procurement.

Procurement Rule 15: Planning

Types of emergencies

Emergency responsiveness can be viewed at three different levels based on the immediacy of the threat or danger, and the degree of harm if relief is delayed.

  1. Immediate response, reactive procurement
  2. Disaster relief, emergency procurement
  3. Post-disaster reconstruction, accelerated procurement

In some emergencies, agencies will need to respond at different levels over time. Sometimes only one level of response will be required. When choosing the appropriate level of response, your agency should always apply the best procurement practice possible given the circumstances and the immediacy of the need to respond. Consider the harm a delay would cause, and ensure you can justify any procurement decisions.

Level 1: Immediate response

During a major catastrophe, it’s critical to react instantly to conditions on the ground. This may involve getting medical equipment for the injured, and securing water, food and shelter for victims. It could also involve mobilising staff, equipment or machinery, or relocating service centres for major infrastructure provision to new sites, such as power, gas, water and telecommunication.

Keep a common sense approach to procurement in these scenarios. Your staff will be under significant pressure to respond immediately, and must be able to do what’s necessary and within their power to help. Agencies are not required to follow routine procurement procedure in a level one situation. They need to demonstrate sound reasoning and good judgement when acquiring goods or services. A file note about the approach taken should be made after the situation has stabilised.

Further guidance

  • Obtain necessary goods or services direct from suppliers.
  • No written contract is required.
  • Ask suppliers to invoice after the situation has stabilised.
  • Keep a note of what has been purchased.
  • Act within existing delegated authority, where possible.
  • If there is no existing delegated authority, and no time to obtain an approval, exercise good judgement and be prepared to provide a rationale for procurements.
  • If a procurement involves a major expense, verbal approval, at the very least, from an officer with sufficient delegated financial authority – followed up in writing – should be obtained before making a commitment.

When to respond

This is the most reactive level of emergency response and should be applied where:

  • there is a threat to human life
  • there is a critical or catastrophic threat to the natural environment or infrastructure (for example an oil spill), or
  • where delayed response would likely deteriorate conditions on the ground, or cause grievous harm to individuals, the environment or the wider community.

It will often be applicable when a state of local or national emergency is declared.

Level 2: Disaster relief

Moving to this less reactive and more responsive level usually occurs when there is no further threat to loss of life or damage to major infrastructure, or when a state of emergency is lifted. Agencies can forgo routine procurement procedures on the grounds that usual procedures would prevent them delivering goods or services in time to bring effective relief.

Further guidance

  • Identify, specify and prioritise the immediate procurement required to bring effective relief.
  • Consider the operating environment and conditions on the ground.
  • If possible, find out what other government agencies and Non-Government Organisations are doing and collaborate.
  • Purchase direct from the most convenient suppliers; price will be a factor in deciding the selection of suppliers, but the overriding consideration must be immediate provision of relief.
  • Always obtain financial approval to proceed prior to the purchase; where appropriate, agencies could make blanket approvals to cover this stage of the emergency response.
  • Consider options for sourcing, including what contracts may already be in place (All-of-Government supplier, panel contractor or syndicated contract); consider using another agency’s suppliers where appointed through a competitive process, if that supports immediate delivery.
  • Where there are no existing contracts, identify what quotes can be organised quickly and what suppliers are able to deliver immediately; verbal or e-mail quotes are sufficient, provided you make a note of any conversations.
  • Check that suppliers can deliver to the right level of quality, in the right quantities, to the correct location, for a good price, and immediately.
  • Advise suppliers the purchase is being made as an emergency procurement to provide immediate relief, and a more competitive process will be used for any medium to long term solutions.
  • Consider alternative contract solutions, for example short term lease of equipment rather than purchasing; this may allow time to source a permanent solution through a more competitive process.

Confirm your agreement with suppliers in writing. If you can, use the simple Government Model Contract available on procurement.govt.nz. If there isn’t time, confirmation by email is sufficient. You need include only the basics: what’s being delivered, to what specification, when, where, by whom, the price, and any other charges, such as freight and insurance.

When to respond

This level of emergency response may be appropriate where:

  • there is no immediate threat of loss of life
  • there is no immediate threat of damage to infrastructure
  • a state of emergency has been lifted
  • there is still an urgent need to respond
  • a normal procurement process wouldn’t allow for the delivery of effective relief.

Level 3: Post-disaster reconstruction

Once an emergency situation has stabilised, and the response effort is directed towards post-disaster reconstruction and remediation, most procurement procedures should return to normal. For certain types of procurement – for example, provision of critical infrastructure such as water, sewage treatment facilities and reconstruction of housing or land remediation – agencies may choose to follow an accelerated process.

At this level, agencies develop a process to fit the specific category of procurement and immediate needs. Often this will involve waiving the minimum period for a Request for Proposal (RFP) while continuing to follow the rest of the RFP process.

For example, during the COVID-19 pandemic MBIE ran a 48-hour procurement process for freight services due to the urgency of the situation and the critical nature of those services.

This provides more flexibility and greater responsiveness, while allowing for some level of competition, and maintaining governance and accountability for the spend. If you use an accelerated procurement procedure you will need to justify any departures from routine procurement process.

When to respond

  • Once the situation has stabilised.
  • If the procurement is of a critical nature.
  • If departing from normal processes can be justified.