Government procurement reform
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Government Procurement Reform IT Sector Briefing 1 Agenda Background Machinery of government Procurement reform Business participation All of Government contracts Sector specific data Conclusion 2 Background 3 Why reform procurement? 30 – 70% of operating costs Business feedback

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Presentation Transcript
Government procurement reform l.jpg

Government ProcurementReform

IT Sector Briefing

1


Agenda l.jpg
Agenda

  • Background

  • Machinery of government

  • Procurement reform

  • Business participation

  • All of Government contracts

  • Sector specific data

  • Conclusion

2



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Why reform procurement?

  • 30 – 70% of operating costs

  • Business feedback

  • Economic downturn

  • Unacceptable risk profile

  • Lost efficiency opportunities

  • Build strategic capacity

4


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Ministerial Support & Scrutiny

  • Hon Bill English (Chair)

  • Hon John Key

  • Hon Gerry Brownlee

  • Hon Simon Power

  • Hon Tony Ryall

  • Hon Stephen Joyce

  • Hon Rodney Hide

5


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Governance

  • Expenditure Control Committee

  • Chief Executive VfM Group

    • Government Procurement Reform (MED)

    • Administrative Services Review (The Treasury)

    • Cross cutting Value for Money initiatives

6



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Government Structure

PUBLIC SECTOR

STATE SECTOR

STATE SERVICE

PUBLIC SERVICE

e.g. Ministries

e.g. NZDF, Police, DHBs

e.g. NZ Post, Meridian

e.g. Local Government

8


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Reporting and barrier removal

  • Quarterly reports to Cabinet

  • Minister briefings

  • Intervention reports to ECC as needed

  • Ministers notified:

    • Good practice

    • Undermining behaviour

    • Ministerial intervention needed

9



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Procurement Reform

  • Cost Savings

  • Capability and Capacity Building

  • Enhanced Business Participation

  • Governance, Oversight and Accountability

11


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Key Reform aspects

  • 4 Year programme

  • Supports other VFM initiatives

  • Transform procurement thinking

  • Strategic procurement capability

12


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Enhanced Business Participation

  • Cutting red tape

  • Improving transparency

  • Increasing opportunities

  • Sustainable markets

13


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Business feedback

  • Procurement capability

  • Conditions of contract

  • Standard documentation

  • Evaluation method

  • Futile bidding enquiries

  • IP risk

  • Engagement

14


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All-of-GovernmentContracts

15


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Target Areas

Secure Supply

Strategic Critical

Risk

Streamline

Tactical Sourcing

Value

16


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All-of-Government Contracts

  • National/international market dominated

  • Common needs

  • Lower supply risk

  • Reflect other jurisdictional experience

  • Not syndicated contracts

17


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Key Drivers

  • Need for change

  • Strong performance management

  • Reduce overhead

  • Total cost evaluation

  • Meet diverse customer needs

  • Maintain/enhance competition

18


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Transition

  • Managed transition

  • Soon as practical

  • Aim for 100% by 30 June 2012

  • Current contracts:

    • Extend till transition period

    • Re-tender

19


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Centres of Expertise (CoE)

  • Additional resources

  • Dedicated category managers

  • Strong market knowledge

  • Relationship management

  • Key performance measures

  • Supplier incentives

20


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Centres of Expertise (CoE)

  • Desktops/Laptops - DIA

  • MFD’s - DIA

  • Vehicles - MED

  • Stationery - MED

21


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Key Data

Craig Doherty

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Data Collection

  • State Sector data

  • 163 of 198 agencies responded so far

  • Analysis based on information submitted

  • Further validation to be undertaken

  • Firm up demand during budget setting

23


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Spend & Units by Sector – IT Hardware

Note: Number are rounded to $1M

24


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12.0

80% of total spend

10.0

8.0

6.0

4.0

2.0

$M

Pareto – Significant Procurers MFDs

25



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Timelines

  • Establish CoE team now

  • Market engagement

  • Firm up demand by Christmas

  • Out to Market quarter 3

  • Contract award by June

  • Mobilisation from July

27


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Challenges

  • Minister expectations

  • Diverse client base

  • Change management

  • Undermining activities

  • Sabotaging behaviour

28


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Summary

  • Change management project

  • Strong agency support

  • Ministers will remove barriers to progress

  • Dedicated category management

  • Supplier incentives

  • Transition as soon as practical

29



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Conclusion

  • Open dialogue

  • Centre of Expertise

  • Improve efficiency

  • Market sustainability

  • Better value for tax-payers

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Contacts:CoE Manager:Craig Doherty – 04 495 [email protected] Project Manager:Christopher Browne – 04 470 [email protected]

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