Foreword

I am pleased to release the Commonwealth Procurement Rules to reflect the Australian Government’s policies and expectations of procuring officials. 

The Australian Government is committed to building a stronger, more prosperous and resilient economy where Australian businesses can be competitive on a domestic and international level. With this in mind, we are focussed on reducing the cost of doing business with the Commonwealth by cutting red tape and enhancing government engagement with business, including small and medium business. 

I have made these Commonwealth Procurement Rules under section 105B(1) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act). The previous Commonwealth Procurement Rules - 20 April 2019 (F2019L00536) are repealed when this instrument commences on 14 December 2020.

The Commonwealth Procurement Rules are the keystone of the Government’s procurement policy framework. They are supported by a range of tools including the AusTender system, guidance material and templates developed and maintained by the Department of Finance to ensure accountability and transparency, and reduce the costs and complexity of conducting business with the Australian Government.

Achieving value for money is the core rule of the Commonwealth Procurement Rules as it is critical to ensuring that public resources are used in the most efficient, effective, ethical and economic manner. However, it is important to remember that price is not the only factor when assessing value for money, and officials are required to consider all relevant financial and non-financial costs and benefits, including environmental sustainability, associated with a procurement.

The Australian Government considers it is important to understand the economic implications of major contracts and therefore requires agencies to examine the value offered by different suppliers. Suppliers are encouraged to demonstrate the economic benefits of their proposals in procurements valued above $4 million (or $7.5 million for construction services).

There is sufficient flexibility in these rules to provide opportunities for innovation and for officials to design processes that appropriately reflect the size, scope and risk of the procurement. The framework reflects officials’ responsibilities, including under the PGPA Act and Australia’s international obligations, and factors that must be considered in meeting the core rule of achieving value for money.

 

Simon Birmingham

Minister for Finance


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