Government’s buying power to boost wider goals

Changes to Government purchasing rules will help boost New Zealand’s construction sector and reduce carbon emissions from the public sector vehicle fleet.

 Those are two areas where the Government will expect more in future from public spending on goods and services, Economic Development Minister David Parker said.

 “Every year, the Government spends about $41 billion on buying goods and services from third-party suppliers and providers, and this represents around 18 per cent of GDP.

 “It is important to leverage the collective spend in a more sophisticated way. We should do this in areas where we can make a real difference.”

 The Government has changed and updated the Government Rules of Sourcing, now renamed the Government Procurement Rules.

 “We’ve made it really specific, in order to create accountability for the outcomes we want.

 “We are looking beyond just the price of what we purchase, to ensure procurement is contributing to the transition to a low carbon economy, inclusive growth, and prosperity.

 “Implementation has started. In April we established a dashboard to monitor average CO2 emissions from the government light vehicle fleet, so agencies can drive down emissions.”

 Changes focus on four priority outcome areas:

  • Transitioning to a net-zero emissions economy and designing waste out of the system (including light vehicles, All-of-Government office supplies and industrial heating).
  • Construction skills and training (for contracts worth more than $9 million)
  • Improving employment standards for cleaning, security and forestry contract workers and health and safety in high risk areas.
  • Increasing access for small to medium businesses (e.g. in software contracts).

David Parker said these are initial priorities and there is flexibility to add more.

 The new Rules will come into effect for all new procurement processes that start on or after 1 October. They can be found at https://www.procurement.govt.nz/