Department of Justice - Procurement Policy

ContentsContents................................................................................................................................................1

1. Purpose..........................................................................................................................................4

2. Scope.............................................................................................................................................4

3. Definitions.....................................................................................................................................4

4. Principles.......................................................................................................................................5

Value for Money................................................................................................................................5

Open and Effective Competition........................................................................................................5

Enhancing Opportunity for Local Business........................................................................................6

Compliance with Ethical Standards, and Observing the Procurement Code of Conduct...................6

5. External Compliance......................................................................................................................6

Treasurer’s Instructions.....................................................................................................................6

Buy Local Policy.................................................................................................................................7

Pre-Procurement Local Impact Assessment......................................................................................7

Local Benefits Test.............................................................................................................................8

International Obligations...................................................................................................................8

Cooperative Arrangements............................................................................................................8

Free Trade Agreements.................................................................................................................9

6. Pre-Procurement Approval Requirements....................................................................................9

7. Procurement Thresholds.............................................................................................................10

Goods & Services.............................................................................................................................101

Policy Title Procurement Policy

Branch Corporate Support & Strategy – Finance Branch

Date of first Issue 03/11/2014

Version Number 1.1

Date of this version 30/3/2015

Next Review Date 29/3/2016

Department of Justice - Procurement Policy

Less than $50,000........................................................................................................................10

More than $50,000 – but less than $250,000..............................................................................10

$250,000 and over.......................................................................................................................11

Building and Construction...............................................................................................................12

Less than $50,000 (Minor Works)................................................................................................12

More than $50,000 – but less than $250,000 (Minor Works)......................................................12

$250,000 and Over (Major Works)..............................................................................................13

Prequalification............................................................................................................................14

Principal-Nominated Insurance...................................................................................................15

8. Other Procurement Requirements..............................................................................................15

Engaging a Consultant -Goods and Services....................................................................................15

Engaging a Consultant -Building and Construction..........................................................................16

Information and Communications Technology Procurement..........................................................16

Climate Change Requirements........................................................................................................17

Common Use Contracts...................................................................................................................17

Other Government Departments....................................................................................................17

Conflict of Interest...........................................................................................................................17

Probity.............................................................................................................................................18

Contracts.........................................................................................................................................18

Contract documentation.................................................................................................................18

Contract Extensions and variations.................................................................................................19

9. Treasury Approval – High Value Procurements...........................................................................19

10. External Reporting...................................................................................................................20

External Reporting of Individual Procurements...............................................................................20

$2,000,000 plus contract requirements..........................................................................................20

Quarterly Reporting.........................................................................................................................21

Annual Reporting.............................................................................................................................21

11. Internal Audit...........................................................................................................................22

12. Procurement Review Committee.............................................................................................22

13. Roles & Responsibilities...........................................................................................................23

Secretary..........................................................................................................................................23

PRC..................................................................................................................................................23

Finance Branch................................................................................................................................232

Department of Justice - Procurement Policy

Departmental Staff and Officers......................................................................................................24

14. Training and Delegations.........................................................................................................24

15. Contact Information................................................................................................................24

16. Monitoring and Review...........................................................................................................25

17. Related Resources...................................................................................................................25

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Department of Justice - Procurement Policy

1. PurposeThe purpose of this Procurement Policy (the Policy) is to:

provide information in relation to the required procurement processes applicable to the Department of Justice (the Department);

ensure that staff of the Department are aware of and familiar with external policies including the Treasurer’s Instructions and other relevant financial policies under which the Department is bound; and

provide staff with internal policy requirements established and governed by the Department.

The Policy:

establishes a framework to manage the procurement of all goods and services and building and construction so as to ensure the Department’s procurement activity is compliant with all external and internal requirements and policies; and

maximises the benefits to the Department that can be delivered through an effective and efficient procurement process.

2. ScopeThe Policy applies to:

All goods and services and building and construction procurement processes performed on behalf of the Department;

All Departmental employees and officers with a purchasing delegation.

3. Definitions1

Department: The Department of Justice.

Departmental employees and officers: All staff employed by or acting for the Department of Justice or any of the organisations that form part of it.

Goods and Services: Goods are tangible, transportable supplies. Services are intangible supplies or effort, such as consultancies (other than building and construction related consultancies).

Building & Construction: The construction and refurbishment of building and residential properties, and associated maintenance (services and residential) and professional services (eg. architects).

Consultant: A particular type of contractor (refer contractor definition) who is engaged to provide recommendations or specialist of professional advice (or more generally non-manual services) to assist or influence agency decision making.1 Definitions are taken from A Guide for Government Buyers wherever possible.

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Department of Justice - Procurement Policy

Contractor: An individual or organisation engaged under a contract (other than as an employee) to provide goods and/or services to the Department. A contractor will usually work under the supervision of a Departmental manager.

Procurement: The entire process by which all resources are obtained by an entity, including planning, design, standards determination, specification writing, selection of suppliers, financing, contract administration, disposals and other related functions.

Local SME: Australian and New Zealand businesses employing less than 200 people, consistent with the obligations under various free trade agreements and procurement arrangements by which the Tasmanian Government is bound.

Treasurer’s Instructions (TIs): The TIs are issued in accordance with the Financial Management and Audit Act 1990 (the Act). Under the Act, the Treasurer can issue instructions with respect to the principles, practices and procedures to be observed in the financial management of all Agencies. It is the duty of each Head of Agency to comply with any requirement of the Treasurer's Instructions.

Free Trade Agreement: A Free Trade Agreement is a negotiated agreement between two or more countries to form a free trade area. The free trade area increases trade between the signatories through the removal of tariffs, quotas, ‘buy local’ penalties and other trade barriers.

Australia New Zealand Government Procurement Agreement (ANZGPA): The ANZGPA is a cooperative agreement between Australia and New Zealand which applies to all procurements undertaken by agencies regardless of value.

Principal-nominated insurance: Principal-nominated insurance is an insurance policy that has been arranged by Treasury which a contractor is required to use when undertaking contract works on behalf of the Tasmanian Government. The policy covers both contract works and public liability.

4. Principles The policy is subject to the following key principles. These are governed primarily by Treasurers Instructions 1101 and 1201. Departmental procurement must be undertaken in a manner that is consistent with the following four principles:

Value for Money

Value for money means achieving the desired outcome at the best possible price, this means weighing up the qualitative benefits of the purchase (including fitness for purpose, contribution to government policy objectives, risks etc) against the cost of the purchase. It does not mean only accepting the lowest price.

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Open and Effective Competition

Being open and effective means using transparent, open purchasing processes, adequately testing the market (by quotation or tender), avoiding biased specifications and treating all suppliers consistently and equitably, so that potential contractors and the public can have confidence in the outcomes.

Enhancing Opportunity for Local Business

The Department must ensure that local businesses that wish to do business with Government are given the opportunity to do so and that the Government’s Buy Local Policy requirements detailed in the publication Buy Local Policy and in TI 1119 are adopted as required.

Compliance with Ethical Standards, and Observing the Procurement Code of Conduct

The Department, and staff who are purchasing on behalf of the Department, must ensure that all purchasing is undertaken in a fair and unbiased way and that they comply with the Procurement Ethical Standards (Appendix A) and Procurement Code of Conduct (Appendix B). This also applies to ensuring that suppliers act ethically and in accordance with appropriate legislation.

The Department has developed a Conflict of Interest Policy. It is important that all Departmental Officers engaged in procurement activities are familiar with and adhere to the policy.

5. External ComplianceThe policy is governed by compliance with external policies and procedures developed and maintained by the Department of Treasury and Finance (Treasury). These purchasing policies and procedures apply to all Departments which are required to comply with the Financial Management and Audit Act 1990, as well as any consultants and contractors who have been contracted to undertake purchasing on their behalf.

Treasurer’s Instructions

The TIs establish the procurement principles, Government policy and mandatory procedures for procurement and contracting. They divide procurement into the following categories:

1100 series - Goods and Services;

1200 series - Building and Construction/Roads and Bridges;

1300 series – Disposals; and

1400 series –Confidentiality Policy and Claims Management.

Tasmanian Government purchasing processes must be conducted by encouraging fair and open competition between suppliers, with the objective of achieving value for money.

Buyers must behave ethically, and comply with the State Service Principles and Code of Conduct

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Department of Justice - Procurement Policy

Where possible, purchasing processes must enhance opportunities for local businesses (see Buy Local Policy).

The Department must conduct its purchasing activities with probity and accountability. To be able to withstand public scrutiny, it is vital that actions, like quotations, tenders and

evaluations, be carried out and documented meticulously. Staff engaging in procurement must be mindful of any conflict of interest, and where an

actual or perceived conflict of interest may exist, it must be disclosed and noted in the procurement evaluation documentation.

Information provided to the Department should be treated as confidential, and restricted to persons concerned with the specific purchase or contract.

A full list of the TIs can be found at the Treasury website. The Purchasing Website also has detailed information and template documents in relation to all procurement processes www.purchasing.tas.gov.au.

Buy Local Policy

The Buy Local Policy applies to Departments and Entities that are subject to the Financial Management and Audit Act 1990. The specific requirements of this policy are contained in the TI 1119 – Buy Local Policy: goods and services and TI 1225 - Buy Local Policy: building and construction/roads and bridges.

The policy embodies the essence of enhancing opportunities for local businesses to compete for Government business by:

Requiring Government entities to take into account the wider community and social benefits of purchasing decisions: and

Promoting within the Government, the advantages of buying locally; Reducing the administrative burden on businesses providing services by simplifying

procurement documentation; Providing businesses (and Government entities) with key information, tips, tools and training

to effectively increase their future competitiveness to win government business; and Increasing transparency in relation to Government procurement activities.

Additional requirements of the Buy Local Policy is the completion of a Pre-Procurement Local Impact Assessment to be completed as part of the procurement planning stage and for the tenderer to complete a Local SME Impact Statement as part of their submission.

Pre-Procurement Local Impact Assessment

The Buy Local Policy states the mandatory procurement planning requirement of undertaking an assessment of the impact of the procurement on local suppliers prior to any approach to the market. This is to ensure that local suppliers are given every opportunity to participate and be successful in relation to government procurement. The requirements are:

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Department of Justice - Procurement Policy

Purchases of $50,000 or less – an assessment of the impact on local suppliers is to be undertaken;

Purchases of more than $50,000 but less than $250,000 – a pre-procurement local impact assessment must be completed and approved by the Head of Agency or duly authorised delegate.

Purchases of more than $250,000 – a pre-procurement local impact assessment must be completed and approved by the Head of Agency.

Local Benefits Test

The Government has implemented a local benefits test for all procurements with a value of more than $50,000. The test requires:

Suppliers to provide, as part of their response to procurements, information on the impact on local SME industry should they be awarded the contract; and

Government entities to take that into account in the evaluation process.

For procurements valued at more than $50,000 suppliers should provide the information in the form of a Local SME Industry Impact Statement.

For procurements valued at more than $5 million, suppliers should provide the information in the form of a Tasmanian Industry Participation Plan.

The evaluation criteria for all procurements with a value of $50,000 must include a criterion linked to the content of the local SME Industry Impact Statement. The weighting to be attributed to this criterion must be a minimum of 10 per cent of the total of the non-price criteria.

For the complete Policy and Guide and template Tasmanian Industry Participation Plan please see the Local SME Impact & Participation page.

The Department’s responsibility and how these policies affect our procurement activity is outlined in the Internal Compliance section below.

International Obligations

Cooperative Arrangements

The Tasmanian Government, together with the Australian Government and all other state and Territory Governments, is bound by the Australia and New Zealand Government Procurement Agreement (ANZGPA).

In accordance with ANZGPA, agencies must not give preference to Tasmanian suppliers over those from another Australian jurisdiction or New Zealand. Australian and New Zealand suppliers must be given equal consideration and opportunities to contract for the supply of goods and services (including construction related services) to the State Government in relation to all procurements.

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Department of Justice - Procurement Policy

The ANZGPA is a cooperative agreement which applies to all procurements undertaken by agencies regardless of value.

Free Trade Agreements

The Tasmanian Government, together with all other State and Territory Governments, is bound by a number of free trade agreements. Those agreements which include specific Government procurement commitments include:

The Australia – United States Free Trade Agreement (AUSTFA); The Australia - Chile Free Trade Agreement (ACFTA); Korea – Australia Free Trade Agreement (KAFTA); and Japan – Australian Economic Partnership Agreement (JAEPA).

The provisions of relevant free trade agreements apply to all goods and services procurements and building and construction procurements where the procurement has an estimated dollar value equal to, or in excess of:

$551,000 (inclusive of GST) for Goods and Services; or $7.769 million (inclusive of GST) for Building and Construction.

In accordance with the terms of the free trade agreements, in any procurement governed by the agreements:

Agencies must treat the goods and services (where services include construction services as defined in the terms of the free trade agreements) of a party to a free trade agreement and the suppliers of goods and services (including construction) of a party to a free trade agreement on a basis which is no less favourable than the most favourable treatment provided by the agency to goods and services or suppliers of goods and services (including construction) from Tasmania, Australia or New Zealand; and

An agency must not treat a locally established supplier less favourably than other locally established suppliers on the basis of degree of affiliation or ownership with, or by, a party to a free trade agreement nor discriminate against a local established supplier on the basis that the goods or services (including construction) offered by that supplier for a particular procurement are goods and services of a party to a free trade agreement.

If it is determined that procurement falls within the scope of a free trade agreement by which the Tasmanian Government is bound, then, in addition to the requirements under the TI’s, relevant requirements in the Free Trade Agreement Guidelines must also be followed.

6. Pre-Procurement Approval RequirementsThe Department requires any Output or Departmental officer wanting to undertake any procurement process over the $50,000 threshold to prepare the following documentation for review and advice prior to any approach to the market:

Endorsed Procurement Plan (by a manager with an appropriate financial delegation);

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Department of Justice - Procurement Policy

Pre-Procurement Local Impact Assessment; and Contract (RFQ or RFT) and associated documentation.

This documentation is to be submitted to the Senior Finance and Facilities Officer for consideration and approval prior to any documentation being released to the market.

7. Procurement ThresholdsThe Department’s procurement activity is governed by a number of government policy documents and the TI’s, however within these governed policies and procedures the Department provides further direction to ensure compliance and accountability.

Goods & Services

Less than $50,000

The Department requirement for purchases of less than $50,000 includes weighing up the value of the purchase and the cost of seeking quotations against the need to ensure that value for money is achieved, while also enhancing opportunities for local business.

The Department requires all those officers purchasing on behalf of the Department to keep internal records of any procurement on the Record of Purchase template, for all procurements greater than $25,000 and less than $50,000.

It is recommended that for all procurements over $25,000 ICNTas be engaged to assist with sourcing suppliers for the procurement. ICNTas are able to provide a list of potential suppliers for all types of procurement.

The Record of Purchase is to also include details on sourcing the goods or services from local suppliers as part of the pre-procurement local impact assessment. Records must be maintained and kept appropriately, with the expectation that an internal audit on procurement activities may be conducted.

Officers can only approve Records of Purchase up to their financial delegation limit.

More than $50,000 – but less than $250,000

The Department requires a Pre-procurement Local Impact Assessment be completed for all purchases of more than $50,000 but less than $250,000 prior to any approach to the market.

This assessment needs to be completed and forwarded to the Finance Branch for review and approval by the Assistant Director Finance before any quotation or tender documentation can be released to the market.

Any purchase of goods or services valued at more than $50,000 but less than $250,000 requires the Department to seek at least three written Requests for Quotation (RFQ). Appropriate records should

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Department of Justice - Procurement Policy

be kept of all suppliers approached and their responses including documented advice from suppliers who have declined to submit a quote.

It is recommended that ICNTas be engaged to assist with sourcing suppliers for the procurement for all RFQs.

The RFQ documentation must have the Local SME Industry Impact Statement included as an attachment and suppliers should be encouraged to complete this document as part of their submission. This must form part of the evaluation criteria and be weighted at a minimum of 10% of the non-price criteria.

Any purchases over $50,000 are required to be submitted to the Procurement Review Committee for approval prior to the purchase being finalised or any contracts signed.

$250,000 and over

The Department requires a Pre-procurement Local Impact Assessment to be completed for purchases of $250,000 and over prior to any approach to the market. This assessment needs to be completed and forwarded to the Finance Branch for endorsement by the PRC and approval by the Secretary before any tender documentation can be released to the market.

For any purchases of goods and services, leases or rentals of equipment valued at $250,000 or more, a full Request for Tender (RFT) process must be undertaken. Appropriate records should be kept as part of this process to ensure compliance with the requirements of the tender process.

It is recommended that ICNTas be advised of all upcoming RFTs, to ensure that the relevant industries are aware of and able to provide submissions for all RFTs.

The RFT documentation must have the Local SME Industry Impact Statement included as an attachment and suppliers should be encouraged to complete this document as part of their submission. This must form part of the evaluation criteria and be weighted at a minimum of 10% of the non-price criteria.

All RFT procurement processes must be advertised for a minimum of 18 days. For those RFTs over the free trade agreement thresholds potential suppliers must be allowed a minimum of 25 days from the date of advertisement to lodge their submissions. Tender periods must not close earlier than 2.00 pm, must not close on a Monday or a day immediately following a public holiday and must close at least one week after the recognised industry Christmas close-down.

Any purchases over $50,000 are required to be submitted to the Procurement Review Committee for approval prior to the purchase being finalised or any contracts signed.

For any Goods and Services procurements valued at $5,000,000 and over the Department is required to provide a pre-procurement industry consultation report to the Secretary of the Department of Treasury and Finance for review and approval. This report is to summarise the outcomes of consultation undertaken with industry and local business representatives in the planning stages of the intended procurement. Where Treasury considers the Department’s research and consultation

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Department of Justice - Procurement Policy

appropriate, the procurement will be allowed to proceed. If the Department has not conducted thorough industry consultation and/or there is a particular industry group Treasury believes need to be consulted, Treasury will request the agency undertake further consultation and nominate relevant industry groups and/or contacts. Procurement processes valued at $5,000,000 and over cannot proceed until approval has been provided by the Secretary of Treasury.

Building and Construction

Less than $50,000 (Minor Works)

The Department requirement for building and construction purchases of less than $50,000 includes weighing up the value of the purchase and the cost of seeking quotations against the need to ensure that value for money is obtained, while also enhancing opportunities for local business.

The Department requires all those officers purchasing on behalf of the Department to keep internal records of any procurement on the Record of Purchase template: Record of Purchase pro-forma, for all procurements greater than $25,000 and less than $50,000.

It is recommended that for all procurements over $25,000 ICNTas be engaged to assist with sourcing suppliers for the procurement.

The Record of Purchase is to also include details on sourcing the goods or services from local suppliers as part of the pre-procurement local impact assessment. Records must be maintained and kept appropriately, with the expectation that an internal audit on procurement activities may be conducted.

Officers can only approve Records of Purchase up to their financial delegation limit.

For all minor works construction contracts valued at less than $50,000, it is recommended that AS 4905-2002, Minor Works Contract Conditions be used as part of the contract documentation.

More than $50,000 – but less than $250,000 (Minor Works)

The Department requires a Pre-procurement Local Impact Assessment be completed for Minor Works of more than $50,000 but less than $250,000 prior to any approach to the market.

This assessment needs to be completed and forwarded to the Finance Branch for review and approval by the Assistant Director Finance before any quotation or tender documentation can be released to the market.

Any Minor Works valued at more than $50,000 but less than $250,000 requires the Department to seek at least three written RFQs. Appropriate records should be kept of all contractors approached and their responses including documented advice from contractors who have declined to submit a quote. All contractors approached should be pre-qualified contractors, where an appropriate prequalification category exists.

It is recommended that ICNTas be engaged to assist with sourcing suppliers for the procurement for all RFQs.

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Department of Justice - Procurement Policy

The RFQ documentation must have the Local SME Industry Impact Statement included as an attachment and suppliers should be encouraged to complete this document as part of their submission. This must form part of the evaluation criteria and be weighted at a minimum of 10% of the non-price criteria.

Any Minor Works over $50,000 are required to be submitted to the Procurement Review Committee for approval prior to the RFQ being awarded or any contracts signed.

For all minor works construction contracts valued at $50,000 and over, it is mandatory to use AS 4905-2002, Minor Works Contract Conditions as part of the contract documentation.

Principal-nominated insurance is required for all minor works projects over $50,000, unless a risk assessment is undertaken indicating that a Principal-nominated insurance policy is not required is approved by the PRC.

$250,000 and Over (Major Works)

The Department requires a Pre-procurement Local Impact Assessment to be completed for Major Works of $250,000 and over prior to any approach to the market. This assessment needs to be completed and forwarded to the Finance Branch for endorsement by the PRC and approval by the Secretary before any tender documentation can be released to the market.

For any Building and Construction procurements valued at $250,000 or more, a full RFT must be undertaken. Appropriate records should be kept as part of this process to ensure compliance with the requirements of the tender process. A condition of tender must ensure that major works contracts are awarded only to appropriately prequalified contractors, where an appropriate prequalification category exists.

It is recommended that ICNTas be advised of all upcoming RFTs, to ensure that the relevant industries are aware of and able to provide submissions for all RFTs.

The RFT documentation must have the Local SME Industry Impact Statement included as an attachment and suppliers should be encouraged to complete this document as part of their submission. This must form part of the evaluation criteria and be weighted at a minimum of 10% of the non-price criteria.

All Major Works relating to new buildings and refurbishment projects (but not building maintenance works) valued at $250,000 or over must comply with the Tasmanian Government Art Site Scheme. The Scheme requires the purchase and commissioning of artwork, to the value of two per cent of the project capital works estimate, to a maximum of $80,000. The Artists Brief is to be approved by the Minister for the Arts and the relevant portfolio Minister. Arts Tasmania is to be consulted as part of the development of the building works specifications phase of the procurement.

All Major Works procurement processes must be advertised for a minimum of 18 days. For those RFTs over the free trade agreement thresholds potential suppliers must be allowed a minimum of 25 days from the date of advertisement to lodge their submissions. Tender periods must not close

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Department of Justice - Procurement Policy

earlier than 2.00 pm, must not close on a Monday or a day immediately following a public holiday and must close at least one week after the recognised industry Christmas close-down.

Any Major Works over $250,000 are required to be submitted to the Procurement Review Committee for endorsement and forwarded to the Secretary for approval prior to the Tender being awarded or any contracts signed.

For all Major Works construction contracts valued at $250,000 and over, it is mandatory to use AS 2124-1992 General Conditions of Contract and Request For Tender (Building and Construction version) document approved by Crown Law as part of the contract documentation.

Principal-nominated insurance is required for all major works projects.

For any Major Works procurements valued at $10,000,000 and over, the Department is required to provide a pre-procurement industry consultation report to the Secretary of the Department of Treasury and Finance for review and approval. This report is to summarise the outcomes of consultation undertaken with industry and local business representatives in the planning stages of the intended procurement. Where Treasury considers the Department’s research and consultation appropriate, the procurement will be allowed to proceed. If the Department has not conducted thorough industry consultation and/or there is a particular industry group Treasury believes need to be consulted, Treasury will request the agency undertake further consultation and nominate relevant industry groups and/or contacts. Major Works procurement processes valued at $10,000,000 and over cannot proceed until approval has been provided by the Secretary of Treasury.

Prequalification

The requirement to be pre-qualified is applicable to any contract with a State Government agency for building construction that exceeds a cost of $250,000.

Treasury maintains a register of pre-qualified contractors. The register provides a record of contractors’ expertise, experience, capacity to perform and a history of their performance on Government projects. The pre-qualification categories are as follows:

Building Works - Institutional;

Building Works - Residential;

Electrical Services;

Mechanical Services;

Fire Services;

Building Systems - Monitoring and Control; and

Facilities Management and Maintenance.

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The registration limit for construction works is defined as the estimated maximum project cost for contractors and the estimated maximum component cost for subcontractors.

All sub-contractors engaged by a contract must, where an appropriate category exists be pre-qualified to the appropriate level of the contract.

Principal-Nominated Insurance

Principal-nominated insurance is an insurance policy that has been arranged by Treasury which a contractor is required to use when undertaking contract works on behalf of the Tasmanian Government. The policy covers both contract works and public liability.

Use of the Principal-nominated insurance is required for all Government building and construction works contracts valued at $250,000 or over. Use of the insurance is also required for all Government building and construction works contracts valued between $50,000 and $250,000 unless a risk assessment undertaken by the Department indicates that the use of the policy is not warranted.

It is the Department’s responsibility to contact the Government’s insurance broker, Marsh Pty Ltd, to arrange the insurance. Marsh Pty Ltd is the insurance provider until 30 June 2015. Effective 1 July 2015 the new provider will be Jardine Lloyd Thompson Pty Ltd. The contractor is then required to pay the premium. Work should not commence until the insurance is in place.

8. Other Procurement RequirementsEngaging a Consultant -Goods and Services

The use of any consultants must be pre-approved by the Secretary or a Deputy Secretary (or equivalent) prior to the appropriate procurement process being undertaken to engage the consultant. The Approval to Engage a Consultant form needs to be completed and forwarded to the Senior Finance & Facilities Officer prior to seeking approval from a Deputy Secretary or Equivalent.

A list of all Departmental officers with the authority to approve the engagement of consultants can be found on the Delegations intranet page under Officers able to Engage Consultants.

Once approval to engage a consultant has been obtained, the normal goods and services procurement requirements apply to the procurement process (including the Pre-procurement Local Impact Assessment ) . A copy of the approved form to engage a consultant must be forwarded to Assistant Director Finance once approval has been obtained.

Engaging a Consultant -Building and Construction

Building and Construction specifications will usually be completed in consultation with a consultant due to the skills required to prepare the specifications and project manage the project not being available within the Department.

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A consultant is normally expected to work without direct supervision, to exercise his or her own judgement, conduct complex research or investigations and provide advice or recommendations that form the basis for agency decision making or the taking of a certain course of action. A consultant is usually engaged by way of a short term or temporary contract.

Treasury maintains a register of pre-qualified consultants. The register provides a record of consultants’ expertise, experience, capacity to perform and a history of their performance on Government projects. The pre-qualification categories are as follows:

Strategic Serviceso Strategic Asset Managemento Project Managemento Management of Maintenanceo Heritage Conservation Planning

Project Design Serviceso Architectureo Site and Civil Engineeringo Electrical Engineeringo Mechanical Engineering

The Department must ensure that, where there is an appropriate category, only pre-qualified consultants are engaged. All pre-qualified consultants must be engaged in accordance with the requirements contained in the Procurement Practice Manual – Best Practice for the Engagement of Consultants.

Pre-qualified building and construction related consultants can be directly engaged without the prior approval of the Secretary or Deputy Secretary (or equivalent). Procurements of over $50,000 require a Pre-procurement Local Impact Assessment be completed prior to any approach to the market. This assessment needs to be completed and forwarded to the Finance Branch for review and approval by the Assistant Director Finance before any quotation or tender documentation can be released to the market.

Once the Pre-procurement Local Impact Assessment has been approved , the normal goods and services procurement requirements apply to the procurement process. All Building and Construction consultant procurements over $100,000 are to be approved by the Secretary (TI 1211).

Information and Communications Technology Procurement

The Agency’s Information Communications and Technology Branch (ICTB) must be consulted before commencing any procurement of Information and Communications Technology Goods and Services. For more complex procurements the ICTB should be used to assist with the development of the specifications and assist with the evaluation of any submissions received.

Agreements or contracts for the supply of Information Technology (IT) goods and services must use the Government Information Technology Conditions (GITC). The ICTB has expertise in procurement

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under GITC and will coordinate with the Crown Solicitor the establishment of Head Agreements under GITC and the issuing of Official Orders (Contracts) under GITC Head Agreements.

Where appropriate, existing whole of government common use contracts must be utilised (see below).

Climate Change Requirements

The Department should ensure that, where relevant, climate change factors are taken into consideration in the purchase of goods and services. Considerations could involve looking for opportunities to reduce energy and fuel consumption, and consideration of transport and waste disposal implications.

Criteria could include the supplier’s level of commitment and capacity to deliver positive climate change outcomes, or consideration of the carbon emissions in the productions and/or utilisation of a product or in the delivery of a service. Where relevant, climate change impacts should be considered over the full life cycle of the product, from production, delivery, use and disposal.

Common Use Contracts

When purchasing relevant goods and/or services, agencies must use the whole-of-Government common use contracts established by Treasury.

These contracts have been established where a common requirement for goods and/or services across all general Government sector agencies has been identified. They increase:

Government purchasing power through combining the procurement volume of individual agencies, affording better value for money; and

The efficiency of the procurement process through centralising supplier selection and contract management, on behalf of all general Government sector agencies.

A full list of common-use-contracts, their purpose and supplier information is available on the purchasing website.

Other Government Departments

Goods and services may be procured directly from Tasmanian inner-budget agencies without undertaking the prescribed procurement processes.

Conflict of Interest

The Department’s expectation is that all Officers are required to ensure that procurement activities are conducted in the best interests of the State and that staff behave honestly and with integrity while carrying out duties. Should any participant in the procurement process have any interest in the outcome of the decision, no matter how remote, it must immediately be declared prior to the evaluation of a submission.

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All participants in any procurement process, including staff, project consultants, probity advisors or any other person who may be involved, must complete a Conflict of Interest Declaration and Confidentiality Agreement prior to the evaluation process. Copies of the declaration forms are to be retained on file with all other related procurement documentation.

There are separate forms for State Service Employees and Non-State Service Employees.

Further details are contained within the Department’s Conflicts of Interest Policy.

In addition to the completion Conflict of Interest Declaration and Confidentiality Agreement, all participants must also record any associations in an Associations Register.

Probity

A probity advisor is an external consultant appointed to assist in the procurement process. A probity advisor will:

provide scrutiny (by way of observing and reviewing) of the procurement process, to ensure that prescribed processes have been adhered to;

provide advice on probity issues which may arise before and during the procurement process; and

ensure that the process is equitable and conducted with integrity.

A probity advisor should be used as the exception rather than the rule. Circumstances where they would be beneficial include:

the procurement is of a high value

the matter is highly complex, unusual or contentious; or

the matter is politically sensitive.

Treasury maintains a directory of pre-qualified probity advisers for inner budget government agencies to select from.

Contracts

The Department requirement is that all signed contracts, regardless of value, be forwarded to the Finance Branch for filing and record keeping.

Contract documentation

All non-Crown Law or Crown Law contracts that have been significantly altered must be referred to Crown Law for review before finalisation and signing of the contract (including building leases). Any legal advice received from Crown Law related to the contract must be retained with the rest of the procurement documentation and available for audit purposes.

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Department of Justice - Procurement Policy

Copies of all signed contracts are to be forwarded to the Senior Finance & Facilities Officer in the Finance Branch for recording on the schedule of contracts.

Contract Extensions and variations

All requests for contract extensions must be submitted to the Senior Finance & Facilities Officer in the Finance Branch who will submit the request to the PRC. The request must be undertaken prior to the completion date of the current contract and meet the conditions required in TIs. Retrospective contract extensions will not be approved.

Any contract variations that result in an increased price of more than 10% of the original contract value, must first be submitted to the Assistant Director Finance for advice prior to acting on the contract variation. The Assistant Director Finance will seek further approval from the PRC and/or Secretary as considered necessary.

In regard to these matters above, a business case needs to be submitted to the relevant officer to support the contract extension or variation.

9. Treasury Approval – High Value Procurements The Department is required to provide a pre-procurement industry consultation report which is to summarise the outcomes of consultation undertaken with industry and local business representatives in the planning stages of the intended procurement. (as per the thresholds outlined below) to the Secretary of the Department of Treasury and Finance for review and approval. Where Treasury considers the Department’s research and consultation appropriate, the procurement will be allowed to proceed. If the Department has not conducted thorough industry consultation and/or there is a particular industry group Treasury believes need to be consulted, Treasury will request the agency undertake further consultation and nominate relevant industry groups and/or contacts.

Details of industry consultation on procurements above the following thresholds will be required to be sent to the Secretary of Treasury prior to advertising:

Procurement type Threshold

Goods and services More than $5 million

Building and construction/roads and bridges consultancies More than $5 million

Building and construction excluding consultancies More than $10 million

Roads and bridges excluding consultancies More than $15 million

If you have any procurements that meet these thresholds, please contact the Assistant Director Finance or Senior Finance and Facilities Officer for the additional documentation requirements.

10. External ReportingExternal Reporting of Individual Procurements

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Department of Justice - Procurement Policy

The Department is required to record the following procurement information on the Treasury Tenders Website;

All open procurements with a value of $250,000 or more; and

All new contracts and contract extensions awarded with a value of $50,000 or more (excluding GST).

All open procurements with a value of $250,000 or more are required to be advertised on the Tenders Website. Details associated with all new contracts and contract extensions awarded with a value of $50,000 or more are required to be made available on the Tenders Website within 10 working days of all parties signing the contract documentation.

All Departmental officers who are responsible for any procurement process within the thresholds above are required to forward appropriate documentation to the Finance branch to enable the information to be loaded to the Tenders Website. Finance also keep a copy of all contracts awarded.

Reporting Requirements for Contracts in Excess of $2,000,000

All contracts arising from a procurement process where the value of the contract is over $2 million are to be made publicly available on the Contracts Awarded section of the Tenders Website. The value of a contract is to take into consideration all potential extensions. The contracts can be either loaded onto the Tenders Website or contact details of an officer be made available to provide access to the relevant documents on request.

Quarterly Reporting

The Department is required to report the following information to Treasury within one month of the end of each quarter:

all procurements for which an exemption from the requirement to disaggregate has been approved; and

contracts with a value of $50,000 or over not awarded to Tasmanian businesses.

All reported data, plus information on the agency’s failure to report, is to be provided to the Government quarterly. Finance is responsible for reporting this information to Treasury.

Annual Reporting

The Department is required to report the following information as part of its annual report:

a statement of support for local business;

a statement of compliance with the TI’s including a summary of major issues;

a table summarising the level of participation by local business for procurements valued at $50,000 or more, including;

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Department of Justice - Procurement Policy

o total number of contracts awarded;o total number of contracts awarded to Tasmanian businesses;o value of contracts awarded;o value of contracts awarded to Tasmanian businesses;o total number of tenders called and written quotation processes run;o total number of bids and/or written quotations received; ando total number of bids and/or written quotations received from Tasmanian businesses.

details of each contract valued at $50,000 and over, listing consultancy contracts and all other contracts separately, including:

o the name of the contractor/consultant;o the location of the contractor/consultant (eg town/state - include country if the contract

was awarded internationally);o a description of the contract;o the period of the contract; ando the total value of the contract for the period of the contract.

identify any contracts awarded to businesses that provide employment to persons with disabilities;

details of each contract and contract extensions, regardless of value, entered into as a result of an approval by their Head of Agency pursuant to TI’s 1114, 1217 or 1115; and

details of all contracts where an exemption for the requirement to disaggregate has been approved.

The Procurement Annual Reporting Guide has been developed by the Department of Treasury and Finance to assist agencies with reporting the required procurement activities. Finance is responsible for providing this information for inclusion within the Annual Report.

11. Internal Audit The Department has internal audit requirements that are outlined in TI 1128 and 1214. The Department is required to ensure that a percentage of;

all major works (building and construction);

all direct/limited submission sourcing procurement pursuant to TI 1114 and 1217; and

contract extensions approved pursuant to Instruction 1115(4)

during a financial year are subject to a compliance audit either as part of the agency’s internal audit program or through the engagement of an independent auditor.

The results of the compliance audit must be reported to the Department’s Internal Audit and Risk Management Committee and a copy of an extract from the audit report must be forwarded to the Department of Treasury and Finance within two months of the final report being completed.

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Department of Justice - Procurement Policy

12. Procurement Review Committee The Department has established a Procurement Review Committee (PRC) to review all Departmental evaluations for procurements valued at $50,000 or more (excluding GST) prior to the contract being awarded. This includes open tenders, selective tenders and requests for quotation. All requests for contract extensions and exemption from the Treasurer’s Instructions must also be submitted to the PRC for endorsement before being presented the Secretary for approval.

The PRC is responsible for ensuring that a fair and equitable process has been followed and that the principles and mandatory processes outlined in the procurement TI’s and the Free Trade Agreement Guidelines (where applicable) have been adhered to.

The Department’s PRC has four permanent members and one alternate member:

Chairman – Deputy Secretary;

Member – Director of Finance;

Member – Assistant Director Finance

Member/Secretary – Senior Finance and Facilities Officer.

Alternate Member – Senior Project Manager

Where a standing member of the PRC has been involved in the procurement process, has conflict of interest, or is unavailable, then that standing member is to be replaced by another Departmental officer with sufficient procurement knowledge and independence to be able to review the procurement process. In the first instance if a standing member, other than the chairman, is to be replaced then the alternate member will fill the role unless they too are conflicted.

A minimum of three members are required to form a quorum.

13. Roles & ResponsibilitiesSecretary

Subject to endorsement of the procurements by the PRC, the Secretary has responsibility for approval of:

Goods and Services pre-procurement local impact assessment $250,000 and over;

Building and Construction Major Works $250,000 and over;

Requests for exemption from this Procurement Policy or the Treasurer’s Instructions; and

Approval of Consultancies (Building and Construction/Roads and bridges non-works procurements) valued at $100,000 or more.

Any procurement that is valued at over $2 million needs to be approved by the Minister.

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Department of Justice - Procurement Policy

PRC

The PRC is responsible for: Ensuring that procurement processes have been followed in line with relevant internal and

external policy;

Reviewing and approving all procurement process valued at $50,000 and over prior to the finalisation of any process and awarding of contracts not required to be approved by the Secretary (see above); and

Endorsing any procurement processes required to be approved by the Secretary.

Finance Branch

The Finance Branch, Corporate Support and Strategy is responsible for:

providing advice and assistance on procurement matters to Departmental staff as required;

providing secretarial support to the PRC;

approval of pre-procurement local impact assessments more than $50,000 but less than $250,000 (PRC Members only);

loading of tender and contract awarded information on the Tenders Website;

maintaining a schedule of procurement activity and contract documentation; and

maintaining the schedule of financial delegations and procurement training.

Departmental Staff and Officers

All Departmental staff and officers involved in purchasing are responsible for ensuring that they adhere to the requirements of the TI’s and departmental policy and guidelines in relation to procurement.

14. Training and DelegationsThe Department has a Financial Delegations Policy which provides details of financial and corporate card delegations. Financial Delegations are approved by the Secretary and are applied to specific Departmental positions, not individual officers.

All Departmental staff and officers with purchasing delegations (Including Tasmanian Government Cards) are required to attend appropriate procurement training, so as to be able to appropriately exercise their delegations.

All Statutory Officers, Magistrates and Judges are also encouraged to attend appropriate procurement training.

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Department of Justice - Procurement Policy

Only officers who have attended procurement training and have an approved financial delegation are permitted to undertake procurement activities in accordance with their approved delegation.

Completion of training will be recorded on the delegation register, which is held electronically in the Finance Branch.

A full list of financial delegations is available on the intranet http://intra.justice.tas.gov.au/finance/delegations .

15. Contact InformationAny queries on this policy or procurement matters can be directed to the Assistant Director - Finance or Senior Finance & Facilities Officer.

For principal-nominated insurance Marsh Pty Ltd can be contacted on (03) 6281 3100 (provider until 30 June 2015) from the 1 July 2015, the new insurance provider is Jardine Lloyd Thompson Pty Ltd.

16. Monitoring and ReviewChanges to Government procurement policies and the Treasurer’s Instructions will be monitored and incorporated into the Policy as necessary. This Policy should be reviewed at least annually.

17. Related ResourcesFurther detailed information is available on the Departmental intranet under the procurement section http://intra.justice.tas.gov.au/finance/procurement.

External Resources Internal Resources

Treasurer’s Instructions Treasurer's Instructions

http://intra.justice.tas.gov.au/finance/procurement

Buy Local Policy Buy Local Policy - A Guide for Government Agencies

Financial Delegations Policy

Tasmanian Industry Impact and Participation Policy and Guides Tasmanian Industry Impact and Participation Policy and Guides

Tasmanian Government Card Policy

All the others mentioned in this document and other of interest,

Conflict of Interest Policy

Travel Policy

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