introduction of the Government Procurement Charter (the Charter) and the Supplier Code of Conduct (the Code). The Charter and the Code set out Government’s expectations of agencies’ and suppliers’ conduct in procurement activities:
In terms of the Charter, as identified above the Rules will require agencies to have in place policies that incorporate the Charter and train their staff in it. Procurement practices will also need to reflect the principles of the Charter. The Charter’s companion piece, the Code, provides a minimum standard that the Government expects from all suppliers, with agencies being given the ability to remove suppliers who offend the Code. The proposed Rules also signal that agencies could include their suppliers’ commitment to the Code within their delivery contract. MBIE has also signalled an intent to pay closer attention to the relationship between a prime contractor and its supply chain, through: • new Rule 25, which will require agencies to ask that its prime contractor meet certain procurement standards in its subcontracting and should consider how to flow down expectations around Broader Outcomes to subcontractors. The standards should be consistent with good procurement practice, as outlined in the Principles, the Rules, the Government Charter, the Supplier Code of Conduct, the priority outcomes set out in Rule 16, and other procurement guidance; and • new Rule 51(2), which will require agencies to encourage their suppliers to pay their subcontractors promptly by ensuring suppliers offer subcontractors no less favourable terms as the ones they receive from agencies. MBIE has identified within Rule 51 that improving payment times and practices is a priority for the Government and, through guidance notes, provides a number of mechanisms for doing so. Theme Three: a greater focus on risk allocation and standardisation The Rules (both 3rd and 4th Editions) acknowledge that good procurement is about being “risk aware, not risk averse”. However, in the last 18-24 months and in particular following the implementation of the 3rd Edition, risk allocation has been the topic of conversation in both public and private sector