NSW Govt prioritise SMEs in new procurement policy

NSW Govt prioritise SMEs in new procurement policy

For contracts of up to $250,000

The NSW Government is compelling agencies to prioritise small, medium and regional enterprises when directly buying goods and services of up to $250,000.

In the latest shake-up to its SME and Regional Procurement Policy, the Government will compel agencies to use an SME and Sustainability Criteria when procuring new contracts valued at more than $3 million.

As such, agencies will be required to provide a minimum 15 per cent of the non-price evaluation criteria that considers how potential suppliers will support the Government’s economic, ethical, environmental or social priorities.

Effective from 1 February, at least 10 per cent of this must be allocated to SME participation, according to the policy outline.  

In cases when the contract is valued at less than $3 million, when an agency seeks more than one quote, agencies will be encouraged to include a non-price evaluation criteria addressing the Government’s priority list.

In an effort to encourage start-up participation, the Government will also continue its 2016 innovation policy allowing agencies to directly engage an SME on short-term contracts for proof-of-concept testing or outcome-based trials valued up to $1 million.

Under revisions to its small business exemptions, agencies can now purchase goods or services valued up to $50,000 from an SME even where goods or services are available on a whole-of-government arrangement.

A general procurement exemption will also allow agencies to purchase up to a maximum of $10,000 from any supplier.

Previously exemptions only applied to goods and services of maximum $5,000 and only applied to non-urban agencies.

By 2021, the Government aims to have awarded more contracts to and increased its procurement expenditure with SMEs.

Since its last policy update in 2015, the Government claimed it increased procurement spend with SMEs by 20 per cent, compared to a 14 per cent increase in spend overall.

It also said its introduction of a 30-days-to-pay policy had seen 96 per cent of payments to registered small businesses made on time.

“We have consulted with small businesses and across Government to deliver a policy that includes a sustainable development focus and encourages a diverse supplier base,” said Martin Hoffman, secretary of the Department of Finance, Services and Innovation.

Last year, the NSW Government announced it would increase its support for start-ups and SMEs in its cyber security roadmap.

Meanwhile, the Federal Government has been on an ongoing mission to increase SME procurement participation.

Most recently, the Digital Transformation Agency announced that it had awarded SMEs $240 million in Government deals through the Digital Marketplace since its inception in 2016.

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