SMEs focus of new government procurement policy

NSW procurement policy is designed to increase SME participation in supplying to government.

The NSW government has launched a new procurement policy, designed to increase small and medium enterprise (SME) participation in supplying to government.

The new small and medium enterprise and regional procurement policy took effect from 1 February, replacing the previous NSW Government SME Policy Framework.

Martin Hoffman, secretary of the Department of Finance, Services and Innovation, said the new policy will ensure the procurement process is easier for small and medium businesses to navigate.

“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,” Hoffman said.

The policy encourages government agencies to prioritise small and medium businesses when considering suppliers and setting a standard for contracts to consider economic, ethical, environmental and social priorities. Where an agency can purchase directly from a supplier, agencies must first consider engaging SMEs for contracts of up to $250,000.

For larger contracts worth more than $3 million, a new SME and sustainability criteria will apply. This requires agencies to include 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. Of this, at least 10 per cent must be allocated to SME participation.

A Department of Finance, Services and Innovation (DFSI) spokesperson told INCLEAN the policy is designed to increase SME participation in supplying to government.

“It has been designed to support SMEs, primary industries and start-ups and to build-up SME capability to supply to government by making it easier for them to do so, as well as gathering feedback from SMEs and measuring their participation,” the spokesperson said.

“All SMEs, including cleaning companies, will receive many benefits from the new policy, including tender pre-briefings and debriefings; an increase in the small business exemption threshold to $50,000 and a new SME feedback tool, which gives all SMEs an opportunity to provide anonymous feedback on their experience with NSW Government procurement processes.”

Advice and support is also available to SMEs through various channels including the NSW Buy Service Centre, Department of Industry advisory service and the Office of Small Business Commissioner dispute services.

The spokesperson said the new procurement policy will also drive increased focus on SME participation in government procurement, both through direct engagement of SMEs or subcontracting of SMEs.

“This will be achieved through new tender evaluation criteria requiring agencies to include SME participation in any contracts valued over $3 million, as well as supplier reporting requirements to provide greater transparency of SME participation in large contracts.

“The new policy also includes new feedback mechanisms for SMEs and additional tools, templates, support and guidance to help them increase their business with the NSW Government.”

The policy includes a continuation of the Procurement Innovation Stream. This allows agencies to directly engage an SME for proof-of-concept testing or outcome-based trials for values up to $1 million.

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