Improving public procurement capability will deliver value for NZ Inc.

Recent surveys have found strong support for improved procurement capability in New Zealand at both supplier and client levels.

27 February 2018

Feedback from companies bidding for major contracts in New Zealand identified a number of shortfalls in current procurement practice. These include unreasonable deadlines, too much emphasis on price, misaligned questions, incorrect information in Request for Tender documents, and multiple changes to information provided to bidders – sometimes just days before submission deadlines.

“Inefficient procurement processes add extra time and cost to public projects,” says Caroline Boot, Director of procurement specialist Clever Buying. “With the estimated value of goods and services tendered by central and local government in the tens of billions each year, there’s a signficant opportunity to improve value for all New Zealanders. If those who running procurement processes are obliged to be trained and qualified to spend it wisely, then millions or even billions of dollars of public money could be saved.”

The survey findings are consistent with a poll conducted in mid-2017 by Infrastructure New Zealand.

“A staggering 96 per cent of procurement experts responding to our survey believed we cannot continue to procure infrastructure the way we are,” says Infrastructure New Zealand’s Chief Executive Stephen Selwood.

"An independent procurement agency and committed project pipeline are essential to lifting capability. A dedicated, specialist procurement body will provide a career pathway for procurement expertise in the public sector. A clear project pipeline will encourage private sector companies to invest in skills and labour.

“The NZ Transport Agency is held in high regard by the industry, but other central and local government agencies have significant room for improvement. Raising national procurement capability would deliver a strong net benefit for our economy and better services for users,” Selwood notes.

Since the early 1990s, the NZ Transport Agency has required significant procurement projects to involve an NZQA-qualified tender evaluator.

Market feedback supports wider application of a procurement qualification that’s designed specifically for New Zealand. An overwhelming 98% of survey respondents across both supplier and clients agreed that there should be a generic NZQA procurement qualification that demonstrates capability relevant to all government procurement practitioners.

Boot adds, “If a generic NZQA-accredited procurement qualification were required for procurement practitioners of significant projects (like it is for the NZ Transport Agency), then the savings – both in procurement process efficiency and in delivering services and projects to our communities – would be immense.”

The call for better procurement practice was further echoed with 99% of survey respondents agreeing that the Government should make it mandatory for at least one tender evaluator for all significant public procurements to be NZQA qualified.

“With robust procurement procedures that are run by trained and qualified professionals, it’s no wonder that there’s more confidence in the Transport Agency’s procurement processes than any other public entity,” according to Boot.

Clever Buying is leading the development of a proposal to Government to broaden the application of the NZQA procurement qualification to all major public procurements. Those with interest in providing submissions are invited to contact Caroline Boot at Clever Buying (caroline.boot@cleverbuying.com).

Media Contacts:

Caroline Boot – Director, Clever Buying   |   021 722 005|   caroline.boot@cleverbuying.com

Stephen Selwood – Chief Executive, Infrastructure New Zealand   |   021 791 209