Mandatory for NCE procurements valued over $4 million (including GST) including panels. CCEs and Commonwealth companies are encouraged to apply the policy.
Black Economy Procurement Connected Policy http://treasury.gov.au/policy-topics/economy/black-economy/procurement-connected-policy
Statement of Tax Record https://www.ato.gov.au/Business/Bus/Statement-of-tax-record/
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Commonwealth Government Procurement Connected Policies information available at: https://www.finance.gov.au/government/procurement/commonwealth-procurement-rules/procurement-framework
As part of the 2018-19 Budget and in response to the Black Economy Taskforce’s Final Report, the Government announced a range of measures including the Black Economy Procurement Connected Policy - Increasing the Integrity of Government Procurement.
This Policy outlines the key components of the Commonwealth Government’s policy to increase the integrity of government procurement.
From 1 July 2019, new approaches to market over $4 million (including GST) will require businesses (including new and foreign businesses) wishing to tender for Australian Government procurement contracts to provide a statement from the Australian Taxation Office showing they have a satisfactory tax record (STR). Similarly, any first-tier subcontractors with a subcontract for over $4 million (including GST) are also required to hold an STR. Special rules apply for tenders that are partnerships, trusts, joint ventures and tax consolidated groups.
All non-corporate Commonwealth entities must comply with the policy when approaching the market to establish new contracts, and to create Standing Offer (panel) arrangements over $4 million (including GST) as well as ensuring STRs remain valid and satisfactory during the contracting and contract management phases of the procurement.
Procurement entities subject to the policy must not contract with any Supplier who does not hold a valid STR.
The Black Economy Model Clauses are available at https://treasury.gov.au/sites/default/files/2019-06/190605-Final-Black_economy_model_cl.docx
Standardisation of contractual text results in efficiencies for both Parties to a contract. Before deciding whether a particular clause is appropriate, procurement officials should carefully consider the context of their procurement.
Clause wording would generally need to be changed where Commonwealth entities need to adapt the clauses to fit into their contracting templates, but the clause wording must comply with this PCP.
Some terminology may need to be changed to align with other Contract terminology.
Commonwealth entities subject to the policy may be approached by the Department of the Treasury for information to help evaluate the performance of the policy.
If an NCE included a clause that required tenderers to maintain a satisfactory STR over the term of the contract, after contract signature, contract managers are required to review the status of tenderers STRs. Contract managers may choose to check STRs for first tier sub-contractors held by the head contractor during the course of the contract.