Over $1m

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Over $1m

If you have come to this page directly, please go to the page “What is BuyRight?".

This contains conditions that you need to first consider when conducting your procurement.

This page will highlight the issues that require consideration for procurements over $1 million.

  • + provides additional detail under each step of the process
  • ► denotes an action step
  • Notes and text in the blue boxes provide additional information and tips
  • Click the orange “Why?” box to see the relevant section/s of the policy

Review the steps below to inform your actions

 

1. Considerations when purchasing over $1 million
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There are additional policy requirements that you need to consider when contracting for large values.

● You must assess the economic benefit to the Australian economy for all contracts over $4 million (see CPR 10.31-10.32).

● Mandatory minimum requirements of the Indigenous Procurement Policy apply when contracts delivered in Australia are valued at $7.5 million or more, where the majority of goods or services are in a specified industry.

► Check the Department of Prime Minister and Cabinet website to see if these requirements apply to your procurement. If your procurement is affected by these requirements, it will need to comply with the mandatory minimum requirements for indigenous employment within the contract and the supplier’s organisation.

»  The procurement threshold for construction services is $7.5 million. You only need to go to open tender for these services if they are at or above this threshold (CPRs 9.7).

»  The Code for Tendering and Performance of Building Work 2016 (the Building Code 2016) issued under section 34 of the Building and Construction Industry (Improving Productivity) Act 2016 applies to ‘building work’ that is directly or indirectly funded by the Commonwealth.

● There are a range of requirements that apply during the procurement of Commonwealth funded building work and during the actual conduct of the works. The Australian Building and Construction Commission (ABCC) has issued a range of guidance material, including model clauses for use in approach to market and contract documentation. This material is available on the ABCC’s website.

Australian Industry Participation Policy is linked to the Commonwealth Procurement Framework via a procurement-connected policy. Some requirements exist for procurements over $20 million (see the Department of Industry, Innovation and Science website).

Information and communication technology (ICT) contracts must not exceed $100 million (ex GST whole-of-life cost) per contract or a three-year initial term. You may include extension options but these may only be exercised following a review of the contractor’s performance and/or deliverables and an assessment of value for money (see the Digital Transformation Agency website).

Why?

2. Conduct of the procurement
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Large procurements may be complex or highly strategic or may just be the result of large volumes or longer timeframes for routine goods or services. 

You need to determine the complexity of your procurement:

  • if it is for routine goods or services and is just a large volume then you may wish to apply the BuyRight process for procurements valued at $200-$1m
  • if it is complex or has strategic implications it may be appropriate to seek professional procurement assistance.