Examples include structuring procurement into separate parts and publishing as a tender with separate subcategories, allowing smaller New Zealand firms to compete. Where such division is not possible, agencies are encouraged to engage with contracted parties to consider how New Zealand businesses could be included in the supply chain. This requirement must be read against rule 3, which requires agencies to “treat suppliers from another country no less favourably than New Zealand suppliers”, which in turn reflects obligations in many FTAs. Construction skills and training, improving conditions for workers (rules 18 and 19) Agencies must include questions about the skills development and training practices of the supplier and their subcontractors when procuring construction works over $9 million. This reflects the Government’s stated priority of growing the capability and capacity of the construction workforce. The Rules also require that all designated contracts set out expectations as to supplier compliance with safety standards and associated MBIE guidance. Agencies cannot simply assume that contractors will comply and are required to monitor them. Move towards zero emissions and designing waste out of the system (rule 20) Agencies entering into designated contracts are required to support procurement of low-emissions and low-waste goods, services and works, and encourage innovation to significantly reduce emission and waste impacts from goods and services. All agencies are encouraged to support these goals, although it is not mandatory. The rules specifically note the All of Government motor vehicle contract (a designated contract) and the guidance that MBIE has produced relating to low-emissions fleet options. Construction procurement (rules 18, 64, The Rules will apply to a greater number of new
construction works, with the relevant value threshold lowered from $10 million to $9 million (with provision for an annual review). A rule referring to Private Public Partnerships procurement and the requirement to consult with the Treasury PPP team has been removed. There is a new requirement that all procurements of infrastructure with a total ownership cost of $50 million must consult with Treasury’s Interim Infrastructure Transactions Unit, established in November 2018 and soon to shift to the new NZ Infrastructure Commission/Te Waihanga. “Where appropriate”, agencies are required to apply the good practices set out in the Construction Procurement guides when procuring construction works. There are four Guides published by MBIE website, including “matching capability to complexity” and “risk and value management”. Where the guides are not used, agencies must be able to produce documented evidence of the rationale for doing so. Exceptions Cases for exceptions can be made. In the same week as the Rules came out, the Minister of Defence announced a decision to spend over $1bn on SuperHercules aircraft to be acquired through a non-competitive process; and gave credible reasons why that was done.