COOPERATIVE AGENCY PROCUREMENT

Principles

1. Cooperative Procurement is where more than one entity approaches the market together (i.e. ‘clustering’) or where an entity accesses another entity’s  established contract or standing offer arrangement (i.e.‘piggybacking’).  It enables entities to reduce expenditure by sharing administration costs and utilising their combined economies of scale.

2. Cooperative Procurement may also be referred to as collaborative procurement or multi agency access (MAA) in planned procurements, approaches to market (ATMs), multi-use lists (MULs) and standing offer notices (SONs) published on AusTender.

3. Value for money is the key consideration in cooperative arrangements. Entities should assess cooperative procurement against other procurement options to determine the process that will achieve the best value for money.

4. Entities should consider cooperative procurement options as part of their procurement planning.  This includes:

  • determining if another entity’s existing arrangement would provide a better value for money outcome than a new approach to the market (particularly in maximising market benefits by aggregating the purchase of goods and services in common use, and delivering savings including reduced costs of tendering);
  • considering, if an existing arrangement is found to be not suitable, whether there are opportunities to approach the market cooperatively with one or more other entities through a new procurement process; and
  • incorporating suitable clauses in the request documentation to enable other entities to access the contract or standing offer arrangements in future.

5. Specific issues that must be addressed to ensure that cooperative procurement is consistent with the Commonwealth Procurement Rules (CPRs), are:

  • value for money is achieved;
  • the approach to market for a cooperative arrangement must specify that it will be accessed by other entities (preferably naming the entities involved where known) ; and
  • entities subsequently joining a cooperative arrangement must do so within the scope of the existing arrangement.

6. Unless there is a legitimate reason to not allow other entities to leverage from a contract, appropriate clauses that enable multi agency access should be included in the request documentation, and notified to the market.

7. Cooperative procurement complements the Australian Government’s coordinated procurement arrangements (whole-of-government contracts).  The key differences between cooperative and coordinated procurements are below.

 

COOPERATIVE

COORDINATED

Scoping Study

Maybe

Yes

Government agreed

No

Yes

Entity participation

Voluntary

Mandatory, however, opt out provisions apply where special need for alternative supply is demonstrated and approved

Lead entity

Generally initiated by entities.  May be initiated by Finance at the request of several entities or government based on advice from key stakeholders. 

Finance or nominated lead entity

Savings

Retained by entities

Allocated between entities and budget

Size

May vary from a small arrangement between two entities, to a larger arrangement involving many entities.
External entities may participate but must comply with CPRs.

FMA Act entities

Procurement process and contract management

Tailored to meet the needs of entities involved.

Centrally managed by Finance or lead entity

Administrative charge

If agreed by entities

Yes

Types of goods and services

Relevant to the entities involved and may have a narrower scope

In common use by all or most entities

Last updated: 03 January 2019