Procurement policy

Department: Corporate Services

Document ID: ID 501574

Approved by: Council – 26 August 2020

Effective date: 26 August 2020

Next review: August 2021

What’s covered in this document?

Section 1 – Objectives P6

Explore the goals of CODC Procurement and the principles that support them

1 2 3 4 5 6 7

Value for Fair and Easy to do Innovation Local Sustainability Social

money open business economic outcomes
competition development

1
 Section 2 – Plan, Source, Manage P14

Plan, source, manage is the best practice approach to procurement, and includes the
relevant sub-policies highlighted at every stage.

1 2 3

Plan Source Manage

Section 3 – Governance P29

Find out more about the structures supporting CODC procurement

1 2 3 4

Governance Strategy Complaints & feedback Government

arrangements

Appendices P32 Glossary P53

2
Introduction
Central Otago District Council (CODC) spent around $49 million on goods, services and
construction in 2018-19, with spend increasing by an average $4.75 million per annum over
the past five years. Alongside this increasing procurement expenditure, CODC has committed
nearly $25 million over the next ten years for critical infrastructure.
To ensure this money is spent fairly and efficiently, and for the long-term benefit of everyone
in Central Otago, CODC officers must comply with a range of legislative and policy
requirements.

About this policy

This policy provides a consolidated view of CODC procurement objectives and the Council’s
requirements as they apply to each step of the procurement process.
The New Zealand Government Procurement Rules released by MBIE in October 2019 have
been used to guide this policy as they provide a new paradigm for sustainable and inclusive
procurement.

Additional Information Additional Information

The term ‘must’ denotes The terms ‘should’, ‘may’

mandatory rules based and ‘recommended’
on requirements indicate good practice
embedded in legislation with supporting
and Council directions documents categorised
and policies as guidance.

The flexible framework is designed to be used for a range of procurement activity from simple
and low risk to complex and high risk. It aims to drive consistent and balanced procurement
decisions that create public value.
All dollar values and thresholds are exclusive of GST and MTEV means the maximum total
estimated value that CODC will spend over the life of the contract, unless otherwise specified.

Scope
Procurement covers the end-to-end process from ‘needs identification’ to ‘contracting and
placing orders’ to managing contracts and supplier relationships during delivery, completion
or termination of an awarded contract and disposal of assets or products.

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This policy applies to the procurement of:
goods and services of any kind including refurbishment & new construction
works

goods or services supplied by non-commercial entities such as Iwi, volunteer and

other community organisations.

This policy does not apply to:

the employment of staff (excluding the engagement of contractors and

consultants to supply services)

the acquisition or lease of land or buildings (excluding their design, construction

or refurbishment)

disposals and sales of Council assets

investments, loans, guarantees, or other financial instruments

koha, gifts, donations and grants

licences and agreements regarding commercial operations of third parties

(traders) on Council property

non-contractual agreements between public sector agencies, such as

memorandums of understanding

statutory or ministerial appointments.

Who is this document for and how should it be used?

This document is for Central Otago District Council employees. It includes both policy and
procedural information as described below.
Section 1 Objectives sets out:
 the policy principles of CODC that inform procurement decisions
 how policy is applied using procurement plans and evaluation methods

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Section 2 Plan, Source, Manage sets out:
 policy requirements for each step of procurement
Section 3 Governance sets out:
 the responsibilities of the Executive Team at CODC
 the annual procurement planning process including Section 17A requirements
 relevant council documents, government legislation and guidelines
 how CODC deals with complaints and feedback
The Appendices contain a procurement flow chart with detailed notes to advise buyers of the
procedures they need to follow including approvals. CODC procurement tools to use at the
operational level are described.

Oversight by elected members of council

This policy and its principles and guidance has been approved by Councillors for three years
with an internal review of its effectiveness to be undertaken by the Audit and Risk Committee
after one year. Councillors approve budgets annually which include planned procurement
spend and council officers will inform Councillors of the outcome of their annual procurement
planning including all procurements in the high spend or significant category.

Key to icons
The following icons are used to identify different content types

Mandatory items – Recommended Applies to new Applies to goods and Additional information
you must comply items – you are construction services (non-
with these encouraged to apply procurement construction)
requirements these provisions procurement, including
ICT

Terms in italics are defined in the Glossary at the end of the policy

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Section 1 – Objectives
The following principles will guide the procurement processes of CODC. The processes can
be adapted to the changing needs of Central Otago and New Zealand society over time.
Reference to Broader Outcomes is consistent with the New Zealand Government
Procurement Rules and means the environmental, social, economic or cultural benefits of the
procurement.

Value for money

The overarching consideration for CODC procurement is ensuring best value for
money in the procurement of goods, services and construction.
The Local Government Act (2002) (the Act) requires CODC to manage its revenues,
expenses, assets, liabilities, investments, and general financial dealings prudently and in a
safe manner that promotes the current and future interests of the community. CODC will
satisfy itself that value for money is being sought and achieved and will do so via the annual
reports of the Audit and Risk Committee and the Internal Auditor. Service delivery reviews are
now a legislative requirement under Section 17A of the Act. Refer to Section 3: Strategy.
Value for money is not necessarily the lowest price, nor the highest quality good or service. It
requires a balanced assessment of a range of financial and nonfinancial factors, such as:
quality, cost, fitness for purpose, capability, capacity, risk, total cost of ownership or other
relevant factors. The following diagram from the New Zealand Government Procurement
Rules illustrates how this balance works to create public value:

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CODC’s strategic goals and objectives guide the delivery of its activities in the context of
sustainability (efforts to spend less and utilise fewer resources), efficiency (efforts to spend
well) and effectiveness (efforts to optimize the impact of spending). Best value for investment
by CODC and ratepayers is achieved by optimising the whole-of-life costs of the good and/or
service.
Calculation of whole-of-life costs should include assessment of environmental and
sustainability considerations in conjunction with:
 Initial purchase costs
 Implementation or transition requirements
 Operating costs
 Support and maintenance costs
 End-of-life/disposal.
The Value for Money principle balances quality with cost and affordability whilst:
 Considering long-term outcomes, not just short-term results;
 Delivering a fit for purpose level of service for users;
 Supporting efficient and effective work practices;
 Considering the impact on current and future customers and the environment.

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 Fair and open competition
CODC is committed to a transparent, accountable procurement process. Fair and
open competition improves outcomes for Central Otago by broadening access to
CODC procurement, particularly for Small and Medium Enterprises (SMEs) and businesses
within the district.
Transparent, competitive processes build trust in CODC procurement practices and decisions,
drive fair and ethical behaviour, safeguard probity and foster healthy working relationships
between CODC procurers and suppliers. Competition produces tangible outcomes such as
cost savings, increased quality and innovation and supports market sustainability.
Strong collaborative working relationships between CODC and suppliers are important,
however they must be able to withstand scrutiny. Application of the following probity principles
will ensure that relationships are appropriate, ethical and balanced:
 Undertake due process
 Maintain confidentiality
 Obtain relevant approvals
 Document decisions
A Probity Auditor may be utilised in instances of high value and/or high-risk projects to ensure
the procurement process is being run effectively from a probity perspective. For significant
contracts, particularly multi-year contracts of three or more years, CODC considers it essential
to involve a suitably experienced and skilled probity auditor, or specialist advisor for tender
evaluations and/or negotiations.

Easy to do business
Central Otago aims to be the district of choice to start and stay in business.
Procurement should enhance the CODC’s reputation and brand.
Making CODC procurement simpler, easier and more efficient saves time and money for
CODC and businesses. Streamlined and accessible processes lower barriers to participation
and expand opportunities to a broad supply base, particularly small and medium businesses.
A well-managed and clear procurement process with dedicated project management by
CODC will build confidence in the market.
This policy outlines considerations to guide CODC procurers to select appropriate
procurement and market engagement methods as well as contracting models. Allocating work
effectively to suppliers using a well understood process significantly enhances efficiency.
For example, using a two-stage approach when engaging with the market can be more
efficient and effective than a single stage approach. Stage 1 is a Registration of Interest (ROI)
and stage 2 is a Request for Price (RFP). Benefits of this approach are:

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  the ROI can be a simple document with limited questions saving effort and cost for
suppliers as well as CODC evaluators. It enables CODC to select a targeted short list
which is attractive to suppliers and reduces administration for CODC.
 CODC can then discuss the RFP documents with the shortlisted suppliers in more
detail. This provides greater clarity to suppliers and the CODC can ensure the RFP
documents lead to well informed bids or proposals from suppliers.
 More targeted engagement and an improved process will lead to better understanding
between CODC and suppliers and consequently, improved outcomes.
Contracting models may include:
 Early contractor involvement (ECI)
 Alliance Delivery Model (Shared risk)
 Cost reimbursable contract
 Contracts via a third-party agent
 Pre-qualified Suppliers List
 Panel of Suppliers
 All of Government contracts (AOG)
 Syndicated contracts (i.e. with other councils)
 Common Capability Contracts (CCs)

Innovation
The marketplace can be a great source of innovation, assisting CODC to work
smarter and deliver better services.
Industry engagement and flexible procurement practices will assist CODC to adopt innovative
services and solutions and support supplier innovation in CODC’s supply chains.
Innovation is encouraged at three levels of market engagement:
 at the district economic level – through effective, early, structured, and open
communication of needs to the market
 at the sourcing level – by adapting sourcing methods to facilitate innovation and
collaboration
(e.g. improve speed to market while maintaining competition by utilising modern
procurement methods such as sharing risk, Pre-qualified or panel suppliers, RFI or
introducing Competitive Dialogue or use of a prototype)
 at the contract management level – by focusing on outcomes and developing supplier
relationships that deliver value beyond the contract.
For example, innovation can lead to:
 significant reduction in emissions and the waste impacts from goods and services.
 more efficient design and delivery of better solutions

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CODC encourages active management of all contracts in a manner that fosters collaborative,
productive relationships with suppliers and contractors to maximise value for money and
support continuous innovation and improvement. CODC supports a risk management culture
in procurement that is receptive to new ideas and ways of operating. Taking calculated risks
can lead to better rewards and enhanced outcomes.

Local economic development

By building a diverse supply base, CODC can support businesses of all types to
grow and encourage economic development across the district. Procurement can
be used to support SMEs, Māori-owned businesses and local businesses.
CODC is committed to the wellbeing of its local community. CODC aims to capture, and direct
procurement impacts to contribute toward the local economy and achieve positive outcomes
for the community as a whole.
The integration of Broader Outcomes into long-term planning is currently being undertaken
and CODC intends to progress this integration as part of the 2021-31 Long-term Plan.
CODC will ensure that local suppliers are provided with a fair opportunity to compete for all
CODC business. CODC will promote the inclusion of the achievement of local value benefits
through its procurement activities and will preference suppliers that can demonstrate that all
else being equal, they have a positive economic footprint in the district; This includes
contributing to the vibrancy and sustainability of the local economy, supporting job or market
growth, as well as fostering opportunities for SMEs.
Local outcomes may be achieved through:
 Creating opportunities for local businesses to participate. However, these opportunities
will not preclude other suppliers
 Considering potential commercial and practical advantages in purchasing locally
produced products and services
 Considering local outcomes when planning major procurement activities, packaging
work for contracts, developing specifications and defining selection criteria.
 Requiring, where feasible, CODC officers to obtain at least one quote from a local
supplier for all written quotes, and closed competitive processes, when there is at least
one known local supplier who offers the good or service required.

Sustainability
This Sustainability principle outlines CODC’s intention that its procurement and
contract management practices should enhance value for money and quality

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service delivery, as well as deliver tangible benefits for the local community, economy and
environment.
Sustainable procurement focuses on spending public money efficiently, economically and
ethically to deliver value for money on a whole of life basis. It extends the assessment of value
for money beyond the sourcing process, considering benefits and risks to the organisation,
the community, the economy and impacts on the environment.
Sustainable procurement:
 is a more integrated, strategic approach to procurement. Procurement practices
account for risks, impacts and value within and beyond the organisation.
 analyses all procurement costs, including benefits for society, environment and the
economy
 provides all suppliers with full and fair opportunities to compete
 respects stakeholders’ interests, the rule of law and human rights
 seeks innovative solutions to address sustainability throughout the supply chain
 reduces waste and seeks sustainable alternatives
CODC adopted a Sustainability Strategy in 2018, which recognises that CODC influences
sustainability, both in the manner that services are provided to the community and through the
regulatory processes it applies.
CODC encourages procurement decisions that have a positive impact on the natural
environment and biodiversity, use energy and natural resources prudently, minimise waste
and hazardous substances, prevent pollution and reduce carbon impacts. Embedding
sustainability principles into CODC’s procurement framework will assist CODC to procure
goods, services and works that provide social, economic, and cultural benefits, and minimise
negative impacts to the environment. The weight given to the sustainability criterion will be
assessed on the needs of the individual project.

Social outcomes
CODC procurement can help to support economic participation, social outcomes,
create jobs and opportunities and develop skills for the people of Central Otago.
CODC’s substantial infrastructure investments can support jobs and skills development for a
range of workers, including tangata whenua. CODC procurement activity has the potential to
reinvigorate communities and drive better business outcomes.
CODC aims to strengthen its supplier networks over time, make its procurement activity more
accessible and increasingly promote social procurement and its benefits. Shared value
arrangements can capture the delivery of social benefits to communities as well as financial
benefits to CODC and its suppliers. As local spend increases, so do the positive effects felt
within the community, the economy, and small and medium enterprises within the district.
Central Otago SMEs play a critical role in the sustainability of economies and communities.

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CODC intends to use its buying power to generate social value above and beyond the value
of the goods, services or works being procured. CODC wants to maintain its reputation within
the local community as a ‘good employer’ that provides equal opportunity and considers the
needs of future generations while staying focused on developing the district.
CODC encourages procurement decisions that maximise community benefits in terms of
personal health, safety and wellbeing, social cohesion, inclusion, equal opportunity and
participation.
Social procurement can also play a key role in improving CODC staff engagement, building
brand equity, enabling businesses to honour diversity commitments, and allowing them to do
something that is socially good without compromising financial return to shareholders.

Applying policy using procurement plans

CODC requires all buyers to complete a procurement plan for purchases over $10,000.
Templates are available that increase in complexity as the maximum total estimated value of
the procurement increases.
A procurement plan analyses the need for specific goods, services or works and the outcome
CODC wants to achieve. It identifies an appropriate strategy to approach the market, based
on market research and analysis, and summarises the proposed procurement process.
Typically includes the indicative costs (budget), specification of requirements, indicative
timeline, evaluation criteria and weightings and an explanation of the Broader Outcomes
CODC will seek to achieve through the procurement.

Evaluation methods
The procurement plan will also set out the evaluation method to be used. The evaluation
method determines how each evaluation criteria or attribute will be weighted. There are five
main ways to do this:
 Lowest price – very simple procurement and price is the most important factor.
 Simple score – if all the criteria have roughly the same degree of importance.
 Weighted Attribute – if the criteria have different levels of importance.
(The two variants are standard Weighted Attributes and Price Quality Method).
 Target price – if the scope of work is hard to define, or the budget is the main constraint.
 Brook's Law or Quality Based– if quality is the most important factor and price is not a
key driver.
For more information, refer to Appendix D.

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CODC attributes
Depending on the type of procurement and evaluation method selected, attributes will be
selected from the following list and weighted in the ranges set out in Appendix D.

Attribute Description

 degree to which goods/services meet or exceed requirements

Technical merit  quality of good/services
(fit for purpose)  degree of innovation
 level of risk

 supplier’s size, structure and annual turnover

 experience and track record in delivering similar goods/services
Capability of the supplier to
 skills and resources
deliver
 understanding of requirements
 operational and financial systems

Methodology and Programme  supplier’s proposed approach and milestones

Price/value for money

 price/total costs over whole of life of contract
(based on whole-of-life cost)

Broader Outcomes
 local economic development
(secondary benefits which are
 sustainability (including environmental)
generated due to the way
 social outcomes
goods, services or works are
 cultural
produced or delivered.)

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Section 2 – Plan, Source, Manage
The three stage Plan, Source, Manage process described in this section is the best practice
approach to procurement. Key requirements and considerations in the procurement process
are set out as a practical reference for CODC procurers to be read in conjunction with the
procedures and CODC procurement flow chart in Appendix A. It is not intended as a
prescriptive process for all procurement. The importance of each stage depends on the size,
priorities, required outcomes, risk profile and type of procurement.
The Plan and Manage stages are the most critical to creating and delivering value, and
appropriate time and resources should be allocated to these activities. This policy is aligned
with New Zealand Government procurement, which is shaped by the five principles below, the
Government Procurement Charter and supported by the Government Procurement Rules
released by MBIE in October 2019. Relevant notes related to the five principles are:
 plan and manage for great results
 be fair to all suppliers
 get the right supplier
 get the best deal for everyone
 play by the rules.
The Charter sets out government’s expectations of how agencies should conduct their
procurement activity to achieve public value while supporting the delivery of better public
services throughout New Zealand. Agencies are advised to identify their key priorities and
seek to meet as many of these expectations as practical. The table below shows how the
intent of these seven government expectations are covered in section 2.

Expectation Location

Seek opportunities to include New

1
Zealand businesses.


Plan
Undertake initiatives to contribute to
a low emissions economy and
2
promote greater environmental
responsibility.


Look for new and innovative
3 Plan
solutions.

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 
Engage with businesses with good
4 Source
employment practices.

Promote inclusive economic

5 Plan Source
development within New Zealand.

6 Manage risk appropriately.

Source Manage

Encourage collaboration for

7
collective impact.

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 Plan
Good practice requires a strong understanding of the aspects of the procurement
lifecycle, and how to skilfully apply them to deliver the best results. Whilst you need to comply
with this policy, you should design your process proportionate to the value, risk and complexity
of the procurement. Applying sound commercial judgement achieves the best public value and
drives innovation and performance.

New Zealand Government Procurement Rules

Play by the rules

 Be accountable, transparent and reasonable.
 Make sure everyone involved in the process acts responsibly, lawfully and with integrity.
 Stay impartial – identify and manage conflicts of interest.
 Protect suppliers’ commercially sensitive information and intellectual property.

CODC forecast procurement activity plans

As part of annual business planning, expected procurement activity over the next one to three
years should be identified in an Annual Procurement Plan, including the:
 types of goods and services that CODC expects to procure
 value
 expected timing
 contract types and terms
As well as providing a signal to suppliers in the market, this forecasting allows CODC to plan
with sufficient time to engage the market and follow robust procurement processes.

Partnership with Ngāi Tahu iwi

In recognition of our sustainability, local economic development and social outcomes
objectives CODC intend to manage procurement in a way that protects and enhances our
culture, heritage and landscape. CODC is committed to strengthening our relationship with
Ngāi Tahu. Their values of kaitiakitanga (stewardship), manaakitanga (looking after our
people), tikanga (appropriate action) and rangatiratanga (leadership) align with CODC.

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A partnership with Ngāi Tahu will allow each party to show the values of whanaungatanga
(connection). CODC will promote close engagement and consultation with Ngāi Tahu when
planning procurement into the future. This will enable Ngāi Tahu to be well prepared to
demonstrate their tohungatanga (skills and expertise) and bid for a particular contract
opportunity as well as join competitive processes to become a pre-qualified or panel supplier
for relevant procurement.
For procurement that Ngāi Tahu has an interest in (e.g. due to its cultural significance or
ownership), consideration will be given to how knowledge of the practices of the iwi can be
included in the evaluation criteria used to evaluate supplier responses.

Risk
Procurement risk management requires you to balance the risks against the expected benefits
and:
 identify risks in or around your procurement process (including reputational risk)
 assess the probability and severity of each risk
 plan how to mitigate or manage risks

Government Procurement Charter

Manage risk appropriately

Responsibility for managing risks should be with the party – either the agency or the supplier –
that is best placed to manage the risk. Agencies and suppliers should work together on risk
mitigation strategies.

When completing a contract, carefully consider whether CODC or the supplier is the party that
is best placed to manage particular risks and work together with suppliers to plan risk
mitigation.
For more information, refer to CODC’s Risk Management Policy.

Conflicts of interest
CODC’s procurement decision-making processes need to withstand challenge on the basis of
actual or perceived bias or conflicts of interest.
At all key decision points in the process, staff must comply with CODC’s Staff Interests Policy
and complete a conflict of interest declaration form which will be stored in the central register.
Any perceived, potential or real conflicts must be managed.

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Commercially sensitive information and Intellectual
Property
The confidentiality of suppliers’ information must be protected throughout the procurement
process. Confidentiality obligations remain after contracts are terminated or expired.
Legal advice may be required in instances where CODC needs to balance confidentiality
requirements with statutory requirements for disclosure and consultation under the Local
Government Official Information and Meetings Act 1987.

Governance and Approvals

CODC has a Register of Delegations to regulate decision making and financial authority.
Early governance and approval allow the decision maker to review the direction and approach
for the procurement before engaging with suppliers in the market. This means relevant
changes can be made and discussed. Procurement plans and strategies should be presented
in enough detail for approval to proceed. Depending on the complexity or risk of a
procurement, the decision maker should stay involved as the procurement plan is developed.

Additional Information

At this time in the process, the decision to use a Probity Auditor or specialist advisor should be
made so they can be involved in the rest of the process.

If a procurement is not allowed for in the existing annual budget, then a business case will
need to be written to justify the expenditure. The level of detail will vary depending on the level
of risk or value of the procurement. Refer to the table in Appendix B and the Register of
Delegations to find the suitable level of governance and approval including circumstances
where there is an exemption from open advertising.

Procurement Plans
Before approaching the market or provider community, a procurement plan must be produced
describing what is being procured and why. CODC procurement objectives should be built
into the plan. The extent of planning should be based on the size, risk and complexity of each
procurement.

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 Additional Information

CODC procurement plan templates for different value and category of goods and services can be
found in the Procurement Tools Library on the intranet.

New Zealand Government Procurement Rules

Plan and manage for great results

 Identify what you need, including what Broader Outcomes should be achieved, then plan
how to get it.
 Set up a team with the right mix of skills and experience.

Procurement plan

A procurement plan sets out what you intend to procure, how and why you intend to approach the
market and why, how you will evaluate bids and how you intend to contract. This information could
also be covered in another document, e.g. a business case. A typical procurement plan should
include:
 a clear business objective and benefits
 a scoping statement
 how you will engage with the market, and supply market analysis
 risk assessment
 demand analysis
 stakeholder engagement
 sourcing approach to market
 sufficient timelines
 evaluation methodology and criteria
 contractual arrangements, including management of the contract
 relevant funding and other approvals.

It is important that you consider the longer-term impacts of your procurement decisions and not
just the immediate results (e.g. will the decision substantially reduce competition or create a
monopoly in the future marketplace?).

Additional Information

Identifying key stakeholders at this stage is important so they can be involved in developing the
procurement objectives, scope, market approach, evaluation criteria and relative weightings and
later the contract requirements, including key performance indicators.

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 Additional Information

NZ government agencies that provide funding to CODC, sometimes have specific procurement
requirements or policies that CODC need to comply with.
CODC procurement plans must follow the requirements of CODC policy first, then apply any
additional requirements that the funder (e.g. NZTA) has specified. Written confirmation approving
the procurement plan must be received from the relevant agency prior to proceeding.

Selecting the best procurement method and engaging the

market
Early market engagement and continued open dialogue with suppliers is essential to achieving
good results. There are sound commercial reasons why building stronger relationships with
business is important such as finding new and innovative solutions. CODC values these
relationships with suppliers.
Understanding both suppliers and the market is part of the careful planning essential to
developing the right approach to market. Selecting the most appropriate procurement process
that is proportionate to the value, risk and complexity of the procurement will also help to
achieve public value. Good procurement is about being risk aware, not risk averse.

New Zealand Government Procurement Rules

Plan and manage for great results

 Involve suppliers early – let them know what you want and keep talking.
 Take the time to understand the market and your effect on it. Be open to new ideas and
solutions.
 Choose the right process – proportional to the size, complexity and any risks involved.
 Encourage e-business (for example, tenders sent by email).

Be fair to all suppliers

 Create competition and encourage capable suppliers to respond.
 Treat all suppliers equally – we don’t discriminate (this is part of our international
obligations).
 Seek opportunities to involve New Zealand businesses, including Māori, Pasifika
businesses and social enterprises.
 Make it easy for all suppliers (small and large) to do business with government.
 Be open to subcontracting opportunities in big projects.
 Clearly explain how you will assess proposals – so suppliers know what to focus on.
 Talk to unsuccessful suppliers so they can learn and know how to improve next time.

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 Source

New Zealand Government Procurement Rules

Get the right supplier

 Be clear about what you need, and fair in how you assess suppliers – don’t string
suppliers along.
 Choose the right supplier who can deliver what you need, at a fair price and on time.
 Choose suppliers that comply with the Government’s Supplier Code of Conduct.
 Build demanding, but fair and productive, relationships with suppliers.
 Make it worthwhile for suppliers – encourage and reward them to deliver great results.
 Identify relevant risks and get the right person to manage them.

Extension of existing contracts

An extended contract approach can be used to reduce tendering, contract, administration and
establishment costs for both CODC and suppliers.
CODC may request that current suppliers provide pricing for additional work as variations to
existing contracts under the following conditions:
 the supplier has a track record of providing goods and services to a high quality and on
time
 the existing contract was won through a competitive market tender process less than
three years ago and the additional goods or services are of a similar nature to the work
already contained within the contract
 the MTEV of the new work is less than $100k and is a lower value than the existing
contract
 market analysis shows that pricing for the goods and services provided is stable
 Pending regulatory change or significant change to a market structure

Government Procurement Charter

If CODC cannot agree a reasonable price with the supplier during negotiation, then a market
tender must be pursued. The Supplier’s final pricing will then compete with the market pricing
received.

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Market approaches
Government Procurement Charter

Promote inclusive economic development within NZ

Engage with Māori and Pasifika businesses and social enterprises in order to actively contribute to
our local economy. Openly working to include and support these businesses and social
enterprises through procurement will promote both skills development and a diverse and inclusive
workforce.

Market tender
CODC will generally conduct competitive tendering using either a single stage or two stage
procurement process.
Two-stage procurement process begins with a Registration of Interest (ROI) to shortlist
potential suppliers before seeking detailed bids from the shortlisted suppliers. An ROI is
generally used when the information required from suppliers is specific but CODC is unsure
of the capability of suppliers to provide the required goods and services.
A Request for Proposal (RFP) may be used for a single or a two-staged process and is used
when the project or requirement has been defined, but where an innovative or flexible solution
is sought.

All of Government
The Ministry of Business, Innovation and Employment (MBIE) coordinates New Zealand
Government procurement for public sector agencies. There are three types of contracts
available:
 All of Government contracts (AoG)
 Syndicated contracts
 Common Capability contracts (CC)
These contracts allow eligible agencies (including councils) to purchase goods and services
collectively.

Pre-qualified or panel suppliers

Aligning with the Easy to do business objective, CODC intends to utilise pre-qualified or panel
suppliers in future procurement activity as soon as practically can be achieved.

22
 New Zealand Government Procurement Rules

Definitions

Panel of Suppliers: A list of suppliers an agency has pre-approved to supply particular goods or
services and who have agreed to the agency’s terms and conditions for supply.

Pre-qualified Suppliers List: A list of suppliers an agency has pre-approved as having the
capability and capacity to deliver specific goods or services.

Pre-conditions: A condition that a supplier must meet to be considered for a particular contract
opportunity.

Panel Contract: A type of framework agreement that governs the relationship between the agency
and each Panel Supplier. It sets out the terms and conditions that the parties agree to contract on
in the event that the Panel Supplier is allocated a contract to provide specific goods, services or
works.

Competitive secondary procurement processes will be developed and conducted in

accordance with the New Zealand Government Procurement Rules and this policy. Broader
Outcomes will be considered when preparing pre-conditions and/or evaluation criteria for the
competitive processes. Further evaluation criteria and pre-conditions may be used later during
allocation of work to panel members or pre-qualified suppliers depending on the specific goods
or services required.
To establish a panel of suppliers and a pre-qualified suppliers list, CODC will conduct
competitive processes and maintain records for audit and accountability purposes.
Suppliers will need to submit an Application to Qualify to be included on CODC’s Pre-qualified
Suppliers List. A supplier must prove it has the capability and capacity to deliver specific types
of goods, services or works to be included in the list. They may also have to satisfy pre-
conditions such as Health & Safety requirements and prove their financial viability.
CODC will clearly communicate:
 when the panel is open or closed to new suppliers
 how many suppliers are expected to be on the panel at a given time
 how suppliers are added or removed from the panel or list
 how work will be allocated to panel members (allocation must be fair and defendable.)
 the expected terms and conditions/contract requirements.

Direct source
Direct engagement of a supplier in the absence of competition should only be used in certain
circumstances when:
 only a single supplier has the required goods or services available in the time required

23
  compatibility with existing equipment or services or standardisation is essential, and
can only be achieved through one supplier
 continuity of professional advice is required
 there is a legislative requirement to use one supplier
 the cost associated with any other form of procurement would be out of proportion to
the value or the expected benefits of the procurement

Emergency procurement
An ‘emergency’ is a sudden unforeseen event which may result in injury, loss of life or critical
damage to property or infrastructure. In the event of a genuine emergency, flexibility is
required by CODC to procure goods and services which may be required to manage the
emergency response. A balance is required between the need to act without delay, against
obligations to achieve value for money.
Appropriate authorisation should be gained from the relevant delegated authority before any
emergency procurement is made.
During an emergency, all practical efforts should be made to document and account for all
emergency procurement so as to mitigate potential wrongdoing occurrences and remain
transparent.

Selection
Once the procurement has been evaluated, CODC will select a preferred respondent in
accordance with the RFP.

New Zealand Government Procurement Rules

Get the best deal for everyone

 Get best public value – account for all costs and benefits over the lifetime of the goods or
services.
 Make balanced decisions – consider the possible social, environmental, economic and
cultural outcomes that should be achieved.
 Encourage and be receptive to new ideas and ways of doing things – don’t be too
prescriptive.
 Take calculated risks and reward new ideas.
 Have clear performance measures – monitor and manage to make sure you get great
results.
 Work together with suppliers to make ongoing savings and improvements.
 It’s more than just agreeing the deal – be accountable for the results.

24
 Government Procurement Charter

Engage with businesses with good employment practices

Ensure that the businesses you contract with operate with integrity, transparency and
accountability, and respect international standards relating to human and labour rights. For
businesses operating within New Zealand, ensure that they comply with all New Zealand
employment standards and health and safety requirements.

Negotiation
CODC can then confirm to the supplier that they are the preferred respondent and enter into
detailed negotiations to agree the terms of the contract, including:
 scope including technical specifications and equipment
 roles and responsibilities
 methodology
 final pricing
 health and safety requirements
 key performance indicators
If terms cannot be agreed on, then CODC reserves the right to enter into discussions with the
next best supplier or abandon the process altogether.

Award
When the outcome of the process is submitted for approval to enter into a commitment with
the supplier, the approver should check that the procurement process has been run robustly
and in line with the approved procurement plan. After reviewing the process and final
documentation, the approver may either approve, seek further information or clarity, or decline
approval.

Additional Information

Executive Team members may be required to use their judgement as to whether a procurement
decision needs to go to the CEO or Council for approval or discussion.
For example, a low value procurement may be considered high risk due to the public interest in
the outcome.

If approval is declined, then the procurement process is likely to be terminated. The approver
cannot override the recommendation and choose an alternative supplier. If the process ends
this way, the decline must be documented with reasons.

25
Complete contract
Once the appropriate approvals are gained to enter a commitment, the contract documents
can be finalised with the assistance of legal if required. Sign off will be in accordance with the
Register of Delegations.
To assist contract management and review, it is useful to have a clear scope and
specifications in the contract at the beginning, combined with an agreed performance regime
such as key performance indicators for service contracts.

26
Manage
Additional Information

CODC must keep adequate records of all procurement decisions for audit and accountability
purposes. The Public Records Act 2005 requires public entities to maintain full and accurate
records in keeping with normal, prudent business practice.

The value, complexity and risk of the procurement will determine the nature and amount of
documentation that is required. Records should clearly demonstrate due process was followed
in compliance with this policy and contain information such as:
 identification and appropriate management of potential conflicts of interest issues
 tender documents that were published or sent to suppliers
 supplier responses
 evaluation outcomes
 governance decisions
 contract documents

Contracts register
The Contract Manager must ensure that all contracts are recorded on CODC’s Contracts
Register. The Contracts Register can be found in the Procurement Tools Library on the
intranet.

Health and Safety

CODC has a primary duty of care to ensure, so far as reasonably practicable, the health and
safety of workers for CODC while they are at work. Workers include CODC staff and the staff
of suppliers.
Contractual arrangements often have a number of parties involved. The Health and Safety at
Work Act 2015 refers to these parties as Persons Conducting a Business or Undertaking
(PCBU). If more than one PCBU has a duty in relation to the same matter, each PCBU with
the duty must, so far as reasonably practicable, consult, cooperate and coordinate activities.
CODC contract managers must ensure that where possible, health and safety legislation and
practice is being adhered to by all persons / contractors undertaking the work or present at
the site. Refer to the CODC Health and Safety page on the staff intranet for further guidance.

27
Contract Management and Review
Contract management ensures that the supplier delivers per the contract on time, with the
appropriate quality and for the agreed price. It requires active monitoring of delivery and costs,
managing risks and managing the supplier relationship throughout the contract.
Regular contract reviews and/or meetings with suppliers can be used to assess how well the
objectives have been met and where any improvements can be made in future.

28
Section 3 – Governance
Governance

The Executive Team are responsible for developing and implementing this policy and ensuring
minimum standards are met in managing procurement activities. They are accountable for:
 effectively managing risk
 promoting the delivery of outcomes towards strategic objectives and priorities
 driving continuous improvement and capability development across CODC
 ensuring best value for money in the procurement of goods and services by and for
CODC
 improving competition and facilitating access to CODC procurement business by the
private sector, especially by small and medium enterprises within the district
 reducing administrative costs for CODC associated with procurement
 simplifying procurement processes while ensuring probity and fairness
 monitoring compliance with this policy
 investigating and dealing with complaints about CODC procurement activity

Strategy

Annual Procurement Planning

The Executive Team will meet annually to agree the rolling Annual Procurement Plan which
will cover at least the next 12 months of planned procurement. Progress against this plan can
be reviewed quarterly and updated if necessary.

Section 17A
The Executive Team will meet and approve service delivery reviews required as part of their
quarterly review.
Service delivery reviews are now a legislative requirement under Section 17A of the Local
Government Act (2002) (the Act).
This states:

29
“A local authority must review the cost-effectiveness of current arrangements for meeting the
needs of communities within its district or region for good-quality local infrastructure, local
public services and performance of regulatory functions.”
The Act goes on to specify that a review must be undertaken in the following circumstances:
 When a significant change to the level of service is proposed
 Within two years of a contract or binding agreement expiring
 At any other time, but no less than six years following the last review
Where a review is required to be undertaken, as a minimum, the review must consider the
following:
 Governance and funding by:
o Council alone; or
o In a shared governance arrangement with one or more councils.
 Service delivery by:
o Council (i.e. in-house);
o A Council Controlled Organisation owned by Council or jointly owned with another
shareholder (e.g. another council or private party);
o Another council (e.g. through a shared service arrangement); or
o Another person or agency (e.g. out-sourced contract or by opting out).

Council documents
Relevant CODC documents and policies include:
 Register of Delegations
 Risk Management Policy
 Staff Interests Policy
 Significance and Engagement Policy
 Sustainability Strategy

Complaints and feedback

Complaints handling
An effective complaints management process is integral to the principles of probity and
fairness. It demonstrates that CODC places a high level of importance on conducting
procurement in an honest, fair, accountable and transparent manner. Complaints processes
can also assist in diagnosing shortcomings in Council procurement and provide a means for
continuous improvement of procurement systems and standards of service.

30
 Government arrangements

Relevant legislation
Relevant legislation includes but is not limited to:
 Building Act 2004
 Construction Contracts Amendment Act 2015
 Consumer Guarantees Act 1993
 Commerce Act 1986
 Fair Trading Act 1986
 Contract and Commercial Law Act 2017
 Health and Safety at Work Act 2015
 Human Rights ACT 1993
 Public Finance Act 1989
 Financial Reporting Act 2013
 Privacy Act 1993
 Official Information Act 1982
 Land Transport Management Act 2005
 Local Government Act 2002
 Local Government Official Information and Meetings Act 1987
 Resource Management Act 1991
 Public Audit Act 2001
 Public Records Act 2005

Central Government guidelines

Central Government guidelines, include but are not limited to:
 Ministry of Business, Innovation and Employment, Government Procurement Rules, 4th
edition, June 2019
 Ministry of Economic Development, Guide 4 to Sustainable Procurement, July 2010
 Ministry of Economic Development, Mastering Procurement, March 2011
 Office of the Auditor General, June 2007, Managing Conflicts of Interest: Guidance for
Public Entities
 Office of the Auditor General, June 2008, Procurement guidance for public entities
 Office of the Auditor General, October 2010, Guidance for members of local authorities
about the local authorities (Members' Interests) Act 1968

31
Appendix A – Plan, source, manage procedures
CODC procurement flow chart

32
 Plan

Note 1. Estimate monetary value of the procurement

You must estimate the total monetary value of a procurement to determine whether it meets
or exceeds a relevant value threshold (see Note 6 & Note 11). You must act in good faith and
use good judgement to estimate the monetary value of a procurement. You must include the
estimated monetary value in your procurement plan. This estimate is referred to as the
maximum total estimated value (MTEV).
 You must consider the total value over the whole-of-life of the contract/s when
estimating the procurement’s MTEV - including any costs associated with the disposal
of goods. The estimate must include the value of all of the contracts that may result
from the procurement.
 The value is the total amount excluding GST.
 When calculating the MTEV, you must include everything required for the full delivery
of the goods, services or works including the value of:
o options to purchase additional goods, services or works
o options to extend the term of the contract
o paying any premiums, fees or commissions to the supplier or a broker
o any related revenue streams a supplier receives
o any other form of remuneration or payment due to the supplier or to a third party or
any interest payable.

Additional Information

It’s better to be cautious. If your MTEV is getting close to a value threshold (e.g. services valued at
$48,000), always consider using an open competitive process. After all, your calculation is only an
estimate.

33
Other inclusions to consider when calculating MTEV are noted in the table below:

Goods or services or refurbishment

New construction works
works

design, architecture, engineering, quantity

Related services installation, training, servicing, and
surveying, and management consultancy
examples management consultancy services
services

Types of goods construction material, health and safety

operating consumables
examples equipment

Subcontracting subcontracted goods, services or works subcontracted goods, services or works

phases of the construction through to

Other annual licence/subscription fees
completion

Additional Information

When planning new construction works, you may decide to ‘structure work into subcategories and
award these to separate suppliers. Openly advertising smaller contracts can be helpful for SMEs
that do not have the capacity to supply all the components of a large project.

If you decide to structure work into subcategories, each of the packages of work will count towards
the MTEV of your procurement.
You must not split orders to avoid procurement value thresholds and their governance
requirements.

Note 2. Does CODC already have an existing contract that covers

this need?
Check CODC’s contract register to ensure CODC doesn’t already have an existing obligation
to a supplier for the goods or services you require.

Note 3. Is it an emergency situation?

Emergency situations can include:

34
  Natural or manmade disasters
 Failure of critical infrastructure or service Additional Information
 Critical health or environmental emergencies
 Political or civil emergencies
 Critical security emergencies
See note 16
 Unanticipated events which impact upon CODC’s ability to
fulfil
statutory or critical obligations within the necessary
timeframes.

Note 4. Is Section 17A review required?

Service delivery reviews are now a legislative requirement under Section 17A of the Act. Refer
to Strategy in Section 3 for more information on when a Section 17A review is required.

Note 5. Seek budget variation approval

Additional Information

Executive Team members may be required to use their judgement as to whether a procurement
decision needs to go to the CEO or Council for approval or discussion.
For example, a low value procurement may be considered high risk due to the public interest in
the outcome.

If the procurement you need to do is not allowed for in the existing annual budget, then you
will need to write a business case to justify the expenditure. The level of detail will vary
depending on the level of risk or value of the procurement. Refer to the Register of
Delegations for authority to sign off.

Note 6. Apply governance rules

CODC has a Register of Delegations to regulate decision making and financial authority. Refer
to the Governance and Approvals in Section 2 for further information.

Additional Information

At this time in the process, the decision to use a Probity Auditor or specialist advisor should be
made so they can be involved in the rest of the process.

35
Using the procurement’s MTEV that you have calculated, refer to the table in Appendix B and
the Register of Delegations to find the suitable level of governance and approval including
circumstances where there is an exemption from open advertising.

Note 7. Start contract development considering CODC objectives

and Broader Outcomes
Planning is crucial for your procurement. Before you can approach the market or provider
community, you will need to plan your procurement. Begin writing a procurement plan
describing what you are trying to achieve and why. Think about the overarching CODC
procurement objectives and how you can build these into your plan. The extent of your
planning should be based on the size, risk and complexity of each procurement.

Additional Information

CODC procurement plan templates for different value and category of goods
and services can be found in the Procurement Tools Library on the intranet.

Public value means getting the best possible result from your procurement, using resources
effectively, economically and without waste, taking into account:
 the total costs and benefits of a procurement (total cost of ownership); and
 its contribution to the results you are trying to achieve.
For each procurement consider:
 how to achieve the CODC Objectives of value for money, fair and open competition,
easy to do business and innovation and New Zealand Government priority outcomes;
 how other Broader Outcomes (social, environmental, cultural or economic) could be
leveraged through the procurement;
 whether an existing All-of-Government, Syndicated or Common Capability contract
could cover the need; and
 if you can engage with other councils to seek opportunities to collaborate.

36
Note 8. Analyse and engage market and select the best value
procurement method
Early market engagement and continued open dialogue with suppliers is essential to achieving
good results.
Selecting the most appropriate procurement process that is proportionate to the value, risk
and complexity of the procurement will also help to achieve public value.
Communications with suppliers should include:
 confirming the outcomes CODC is seeking
 providing a contact person for suppliers to talk to during the procurement process
 getting supplier input during development of RFP documents
 answering questions in a timely and clear manner
 allowing supplier feedback after each procurement process.

Source

New Zealand Government Procurement Rules

Get the right supplier

 Be clear about what you need, and fair in how you assess suppliers – don’t string
suppliers along.
 Choose the right supplier who can deliver what you need, at a fair price and on time.
 Choose suppliers that comply with the Government’s Supplier Code of Conduct.
 Build demanding, but fair and productive, relationships with suppliers.
 Make it worthwhile for suppliers – encourage and reward them to deliver great results.
 Identify relevant risks and get the right person to manage them.

Note 9. Is it appropriate to extend an existing contract <$100k?

An extended contract approach can be used to reduce tendering, contract, administration and
establishment costs for both CODC and suppliers.
CODC may request that current suppliers provide pricing for additional work as variations to
existing contracts under the conditions, as seen in Note 10 below.

37
Note 10. Follow extension rules
You may extend an existing contract under the following conditions:
 the supplier has a track record of providing goods and services to a high quality and on
time
 the existing contract was won through a competitive market tender process less than
three years ago and the additional goods or services are of a similar nature to the work
already contained within the contract
 the MTEV of the new work is less than $100k and is a lower value than the existing
contract
 market analysis shows that pricing for the goods and services provided is stable
 Pending regulatory change or significant change to a market structure

Additional Information

If CODC cannot agree a reasonable price with the supplier during negotiation, then a market
tender must be pursued. The Supplier’s final pricing will then compete with the market pricing
received.

Note 11. Ensure price is a reasonable

There are several techniques to check whether a price is reasonable:
 obtain quotes from various suppliers for the same goods or services
 compare the price with previous purchases or work completed
 check published or advertised market rates
 consult other councils or organisations who have undertaken similar work
 get benchmarking of market rates using independent professional advice (from an
industry consultant, quantity surveyor, accountant or other appropriate professional)
 use a pre-qualified or panel supplier. See Note 13

Additional Information

Using the procurement’s MTEV that you have calculated, refer to the table in Appendix C for
recommended actions to ensure a price is reasonable at different values.

38
Note 12. Market tender
CODC will generally conduct competitive tendering using either a single stage or two stage
procurement process. For further information about the benefits of a two-stage process, refer
to the Easy to do Business explanation in Section 1 of this policy.
Two-stage procurement process begins with a Registration of Interest (ROI) to shortlist
potential suppliers before seeking detailed bids from the shortlisted suppliers. An ROI is
generally used when the information required from suppliers is specific but CODC is unsure
of the capability of suppliers to provide the required goods and services.
A Request for Proposal (RFP) may be used for a single or a two-staged process and is used
when the project or requirement has been defined, but where an innovative or flexible solution
is sought.

Note 13. All of Government

The Ministry of Business, Innovation and Employment (MBIE) coordinates New Zealand
Government procurement for public sector agencies. There are three types of contracts
available:
 All of Government contracts (AoG)
 Syndicated contracts
 Common Capability contracts (CC)
These contracts allow eligible agencies (including councils) to purchase goods and services
collectively. Each contract has a lead agency responsible for the procurement process and
the resulting contract. You will need to evaluate the goods or services offered to ensure it is
the best value for CODC.
A register of existing contracts is available on the New Zealand Government Procurement
website listing current contracts by category.
https://www.procurement.govt.nz/contracts/types-of-contracts/

Note 14. Pre-qualified or panel suppliers

Set out any Pre-conditions that a supplier must meet to be considered for a particular contract
opportunity.
Select Suppliers from CODC’s Panel of Suppliers or Pre-qualified Suppliers List.
Approvals will be in accordance with Note 5.

39
Note 15. Direct source
Direct engagement of a supplier in the absence of competition should only be used in certain
circumstances when:
 only a single supplier has the required goods or services available in the time required
 compatibility with existing equipment or services or standardisation is essential, and
can only be achieved through one supplier
 continuity of professional advice is required
 there is a legislative requirement to use one supplier
 the cost associated with any other form of procurement would be out of proportion to
the value or the expected benefits of the procurement
The final procurement plan should explain the reason for direct engagement prior to approval
by the relevant authoriser. Repeated use of the same supplier for small amounts using this
method should be carefully reviewed.

Note 16. Emergency procurement

An ‘emergency’ is a sudden unforeseen event which may result in injury, loss of life or critical
damage to property or infrastructure. Further information regarding emergency procurement
may be found in this pdf on the New Zealand Government’s procurement website:
https://www.procurement.govt.nz/assets/procurement-property/documents/guide-
emergency-procurement.pdf

Note 17. Finalise procurement plan with reasons. Obtain approval

from relevant authoriser
Complete procurement plan before approach to market and obtain relevant approval. See
Notes 5 and 6.
If the response from the market is higher than the MTEV that was previously approved then
you will need to go back to Note 4 Seek budget variation approval.

40
Note 18. Select, negotiate and award contract
New Zealand Government Procurement Rules

Get the best deal for everyone

 Get best public value – account for all costs and benefits over the lifetime of the goods or
services.
 Make balanced decisions – consider the possible social, environmental, economic and
cultural outcomes that should be achieved.
 Encourage and be receptive to new ideas and ways of doing things – don’t be too
prescriptive.
 Take calculated risks and reward new ideas.
 Have clear performance measures – monitor and manage to make sure you get great
results.
 Work together with suppliers to make ongoing savings and improvements.
 It’s more than just agreeing the deal – be accountable for the results.

Select
Once the procurement has been evaluated, CODC will select a preferred respondent in
accordance with the RFP.

Government Procurement Charter

Engage with businesses with good employment practices

Ensure that the businesses you contract with operate with integrity, transparency and
accountability, and respect international standards relating to human and labour rights. For
businesses operating within New Zealand, ensure that they comply with all New Zealand
employment standards and health and safety requirements.

Negotiate
CODC can then confirm to the supplier that they are the preferred respondent and enter into
detailed negotiations to agree the terms of the contract, including:
 scope including technical specifications and equipment
 roles and responsibilities
 methodology
 final pricing
 health and safety requirements
 key performance indicators

41
If terms cannot be agreed on, then CODC reserves the right to enter into discussions with the
next best supplier or abandon the process altogether.
When completing the contract, carefully consider whether CODC or the supplier is the party
that is best placed to manage particular risks and work together with suppliers to plan risk
mitigation.

Award
When the outcome of the process is submitted for approval to enter into a commitment with
the supplier, the approver should check that the procurement process has been run robustly
and in line with the approved procurement plan. After reviewing the process and final
documentation, the approver may either approve, seek further information or clarity, or decline
approval.

Additional Information

Executive Team members may be required to use their judgement as to whether a procurement
decision needs to go to the CEO or Council for approval or discussion.

If approval is declined, then the procurement process is likely to be terminated. The approver
cannot override the recommendation and choose an alternative supplier. If the process ends
this way, the decline must be documented with reasons.

Additional Information

At the end of a procurement process, it is good practice to offer unsuccessful suppliers a supplier
debrief to allow them an opportunity to learn and make improvements to their next bid. The
procurement plan should set out how and when this will likely be conducted.

Complete contract
Once you have gained the appropriate approvals to enter a commitment. Finalise the contract
documents with the assistance of legal if required. To assist contract management and review.
it is useful to have a clear scope and specifications in the contract at the beginning, combined
with an agreed performance regime such as key performance indicators for service contracts.

42
Note 19. Raise purchase order
Additional Information

Once approved by an authorised delegate, purchase orders must be raised for the full amount of
all procurement and the purchase order number should be quoted on the supplier’s invoice for it to
be paid. Purchase orders must never be used to make private purchases.

Manage

The value, complexity and risk of the procurement will determine the nature and amount of
documentation that is required. Records should clearly demonstrate due process was followed
in compliance with this policy and contain information such as:
 identification and appropriate management of potential conflicts of interest issues
 tender documents that were published or sent to suppliers
 supplier responses
 evaluation outcomes
 governance decisions
 contract documents

Contracts register
All contracts must be recorded on CODC’s Contracts Register. The Contracts Register can
be found in the Procurement Tools Library (linked to be inserted).

Note 20. Implementation

Depending on the size and complexity of the procurement, it is useful to have an initiation
meeting with new suppliers to confirm expectations and timelines.

Note 21. Manage contract & relationship

Procurement also covers proactively managing supplier and other key stakeholder
relationships throughout the sourcing process and for the duration of the contract. This

43
continues to develop the supplier and drives public value through ongoing efficiency and
effectiveness gains.

Contract management and review

Contract management ensures that the supplier delivers per the contract on time, with the
appropriate quality for the agreed price. It requires active monitoring of delivery and costs,
managing risks and managing the supplier relationship throughout the contract.
Regular contract reviews and/or meetings with suppliers can be used to assess how well the
objectives have been met and where any improvements can be made in future.

Note 22. File docs and review

Additional Information

All procurement records must be filed appropriately in electronic format.

Periodic review of the procurement process both internally and with suppliers is required.

CODC must keep adequate records of all procurement decisions for audit and accountability
purposes. The Public Records Act 2005 requires public entities to maintain full and accurate
records in keeping with normal, prudent business practice.

44
Appendix B – Governance and approvals
The table below sets out the delegated authority for each procurement value threshold in
accordance with the delegated authority in the Register of Delegations:

Spend Value threshold Governance and Suggested procurement type

category approval
 Petty cash can be used for
Minor Team Leader or incidental purchases
Manager in  Written quotes
(see also table Less than $50,000
accordance with their  Use AoG, Pre-qualified
below) financial delegation supplier or panel or Direct
source as appropriate
 Market Tender
Executive Manager per  Use AoG, Pre-qualified
Moderate $50,000 - $199,999
approved budgets supplier or panel or Direct
source as appropriate
 Market Tender
Executive Manager per
High $200k - $500k  Closed competitive process in
approved budgets
certain circumstances
 Market Tender
$500k - $1m CEO  Closed competitive process in
certain circumstances
 Market Tender
$1m + Council  Closed competitive process in
certain circumstances
 Closed competitive process or
Emergency alternative methods
$1m CEO
procurement  Direct source in certain
circumstances

Minor expenditure – less than $50,000

You may use a minimum of 1 written quote or estimate when MTEV is less than $10,000. You
may purchase directly from a supplier for minor expenditure when the cost of seeking quotes
or conducting a tender would be impractical, or disproportionate to the benefits obtained.
At least three written quotes or estimates must be obtained for MTEVs greater than $10,000
but below $50,000. The quotes will be sourced with identical specifications and work scope.
AoG, pre-qualified supplier or panel or direct source may also be appropriate.

45
Moderate expenditure - $50,000 - $199,999
Use either a Market Tender, AoG, pre-qualified supplier or panel or direct source method as
appropriate. Selection must be justified in a procurement plan and approved by an Executive
Manager before proceeding.

High expenditure – $200k or above or deemed ‘significant’ or ‘high

risk’
This category relates to procurements with either an MTEV greater than $200k, or where the
procurement of goods, service or works is deemed ‘significant’ under CODC’s Significance
and Engagement Policy or ‘high risk’ in accordance with CODC’s Risk Management Policy
(linked to be inserted).
A market tender will be issued (unless the exceptions set out in this policy apply), which
contains all of the information that suppliers need to prepare and submit a tender.
A detailed description of the goods or services being procured, key timeframes, required
service levels, the procurement method and evaluation process will be available. If evaluation
criteria are being used, an indication of the relative importance of each criterion will also be
provided.

Exemption from open advertising

In some circumstances the conditions in this policy may not be able to be met. Subject to
approval, alternative procurement methods may be used for all levels of expenditure including
in situations when:
 The services required are specialist technical or professional services;
 Council is part of a joint procurement process;
 No acceptable responses were received through open competition for the same core
requirements, carried out within the last 12 months;
 The products, services or works are an addition to, and necessary for the complete
delivery of an existing supply arrangement, provided that the original supply
arrangement was openly advertised, and a change of supplier cannot be made for
economic, technical or practical reasons;
 The overall rates offered are the same or lower than that received through open
competition for the same core requirements, carried out within the last 12 months.
 Additional circumstances for moderate expenditure:
 The required goods or services are available from only one supplier;
 Standardisation or compatibility with existing equipment or services is necessary or
desirable.

46
 Additional circumstances for high expenditure:
 The goods or services are only available from a few suppliers;
 It is not practical or cost-effective to conduct an open tender or proposal;
 There is limited time for the procurement process.

Additional Information

All situations when exemption from open advertising is recommended must be approved by one
level of delegated authority higher than usual for the value thresholds in the table above.

47
Appendix C – Ensuring a price is reasonable
The following table sets out necessary actions to ensure a price is reasonable at different
values:

Spend
Value threshold CODC Actions
category

Use petty cash for purchases under $50.

Less than $500 Use a purchase order number. No recording is required as the
invoice will be listed with the purchase order.

>$500 & <$10,000 Prior to approval, obtain a minimum of one written quote.
Minor
Prior to approval, written evidence is available to demonstrate to the
approving delegated authority that the price is reasonable and due
diligence has been completed.
>$10,000 to $50,000
Obtain a minimum of 3 written quotes if possible.

Procurement plan showing reasons for spend is signed off.

48
Appendix D
Evaluation methods

1. Lowest price - very simple procurement and price is the most important factor

Method Situation

1. Determine which offers meet the Procuring goods rather than services
requirements.
2. Look at the total price for each eligible offer. The strongest emphasis is on price and all of the
3. The lowest priced eligible offer is ranked first. criteria have the same importance.

This method is not recommended for complex procurements as it doesn't consider the relative
importance of the criteria or judge value for money.
2. Simple score – if all the criteria have roughly the same degree of importance

Method Situation

The procurement is relatively simple

1. Score each offer against the criteria according
to your rating scale All of the criteria have roughly the same degree of
2. Add the total scores for each offer. importance
3. The highest scored offer is ranked first on the
When evaluating Registrations of Interest to select a
merits
shortlist as the first stage of a multi-stage process.

3. Weighted-attribute – if the criteria have different levels of importance

This is the most common methodology used in public sector procurement. Price can be a
weighted criterion, or you can evaluate price separately.

49
 Price is a weighted criterion Price is not a weighted criterion

 Two variants are Standard Weighted Attributes  price information is usually kept from the
or Price Quality Method evaluation panel until after the evaluation on the
 Price should be in a second envelope and not merits and scoring is finalised.
disclosed until the non-priced evaluation is  Price is often not included as a weighted
completed. criterion in the procurement of social services.
 Carry out some level of sensitivity analysis to
ensure that the level of weighting is appropriate.
 Consider the risk of unreasonable and
unrealistically low-priced offers achieving the
highest overall weighted score where it is clear
that the goods/services cannot be delivered
within the quoted price.

Method Situation

1. Start by ranking the criteria in order of

importance.
2. Decide a weighting for each — this is usually a
percentage, with the total weightings for all
criteria adding to 100%.
3. Score each offer against the criteria and rating
scale to obtain raw scores.
4. Apply the weightings to the raw scores to
obtain the weighted scores.
5. Add the total weighted scores for each offer.
For the Price Quality Method the total weighted scores Criteria have different levels of importance.
are converted into a Price Quality Premium. Procuring goods or services.
6. The price envelope is opened.
7. For the Standard Weighted Attribute the Price
is converted into a Price score attribute. This
is added to the total non-price attribute score
and the highest overall score is the
recommended tenderer
For the Price Quality Method the Price Quality Premium
is subtracted from the Price and the lowest price is the
recommended tenderer

4. Target price – if the scope of work is hard to define, or the budget is the main
constraint

50
 Method Situation

1. Include the available budget (the ‘target price’)

in the RFP as a guide for defining the scope of It is genuinely difficult to define the scope of the
the services, and then invite suppliers to requirements, and there is a fixed budget.
specify what they can do for that price.

2. Focus the evaluation on the quality, quantity CODC is likely to receive a range of offers with prices
and outcomes of the services to be provided that are hard to compare and might exceed the
rather than price. available budget.

5. Brook’s Law or Quality Based – if quality is the most important factor and price is not
a key driver.

Method

1 Offers are evaluated on the merits without price being disclosed to the panel.

2 Only those suppliers who are clearly able to fully deliver against the requirements are shortlisted.

The highest-ranked supplier is invited to negotiate. At this point the price for this supplier is disclosed. All
3
other prices remain unopened.

4 If the negotiation is successful, the supplier is awarded the contract.

If no agreement is reached, the second ranked supplier is invited to negotiate. At this point the price for that
5 supplier is disclosed. All other prices remain unopened. The process continues until a satisfactory
agreement is negotiated.

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Evaluation method attribute guidelines
The following table compares the evaluation methods and indicates how attributes should be
allocated. The total score should add to 100%.

Price /
Technical Capability Value for
Evaluation Typical
merit of the Methodology money Broader
value Price
method (fit for supplier and Programme (based on Outcomes
threshold
purpose) to deliver whole-of-
life cost)

Lowest Minor
price n/a n/a n/a
Moderate 100%
(goods)
Emergency

Simple Minor
n/a 20% 20% 20% 20% 20%
score
Moderate

Price is a
Moderate
weighted 25 -35% 15-20% 15-20% 15-40% 5-10%
High
criterion

Weighted
attribute
Price is
not a
Moderate 30-35% 20-25% 25-30% n/a 5-10%
weighted
criterion

Moderate
Target
High Specified 30-35% 25-30% 25-30% n/a 5-10%
price
Emergency

Brook's
Law or Moderate Separate 30-35% 25-30% 25-30% n/a 5-10%
Quality negotiation
Based High

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Glossary
The definitions in this glossary are generally consistent with those used in the New Zealand
Government Procurement Rules.

Word or phrase Reference Definition

A generic term used in the New Zealand Government

Agency All Notes Procurement Rules to refer to New Zealand government entities
across the Public Sector.

The alliance delivery model is a relationship-style contract

arrangement, that brings together the client and one or more
parties to work together to deliver the project, sharing project
Alliance delivery model Section 1 risks and rewards. Collaborative procurement methods are
usually used for highly complex or large infrastructure projects
(shared risk) Easy to do business that would be difficult to effectively scope, price and deliver
under a more traditional delivery model. For more information
see the Guide to Alliance delivery model at:
www.procurement.govt.nz.

Section 1 Easy to
do Business A type of collaborative contract. AoGs are usually Panel
All-of-Government Contracts established by MBIE or other agencies that are
Contracts (AoG) Note 12 approved Centres of Expertise for common goods or services
(e.g. vehicles, laptops, and recruitment services).
Appendix B

An application by a supplier to be included in CODC’s Pre-

Application to Qualify qualified Suppliers List. A supplier must prove it has the
Note 13
(ATQ) capability and capacity to deliver specific types of goods,
services or works to be included in the list.

The formal process of giving notice of a contract opportunity to

Note 6 potential suppliers and inviting them to respond. An example of
Approach to market
Note 7 an approach to the market is a Request for Tender published on
Government Electronic Tenders Service (GETS).

Section 1 Broader Outcomes are the secondary benefits which are

generated due to the way goods, services or works are
Broader Outcomes Note 6
produced or delivered. They include economic, environmental,
Note 13 social, and cultural outcomes.

Brook's Law or Quality Procurement evaluation method used when quality is the most
Based important factor and price is not a key driver.

A management tool that supports decision-making for an

Note 4 investment. It sets out the reasons for a specific project,
Business case
Note 6 considers alternative solutions and identifies assumptions,
constraints, benefits, costs, and risks.

53
 Word or phrase Reference Definition

Section 1 Local
economic A tender process where CODC asks a limited number of known
Closed competitive
development suppliers to tender for a contract opportunity. The contract
process
opportunity is not openly advertised.
Appendix B

Information that, if disclosed, could prejudice a supplier’s

Commercially sensitive
Plan commercial interests (e.g. trade secret, profit margin or new
information
ideas).

A type of collaborative contract. CCs establish various supply

Section 1 Easy to agreements (e.g. for ICT goods or services purchased across
do Business government with approved suppliers). CCs differ from All-of-
Common Capability Government and Syndicated Contracts because, in a CC: in
Contracts (CCs) Note 6 some instances, a private sector supplier may be authorised to
purchase from a CC when it is acting on behalf of an agency
Note 12 (authorised agent) and in some CCs, the lead agency may
charge a participating agency an admin fee or levy.

Rivalry between suppliers for sales, profits and market share.

Competition Competitive tension in the market and can produce innovation,
better-quality goods or services, better value and better pricing.

A type of open procurement process often used where there is

no known solution in the marketplace. It involves a structured
dialogue phase with each shortlisted supplier, who invents a
possible solution to meet the CODC’s needs. Shortlisted
Competitive Dialogue Innovation suppliers are often paid for their participation in the dialogue
phase. All shortlisted suppliers are invited to respond to a
Request for Proposal or Request for Tender.
For more information see the Guide to competitive dialogue at:
www.procurement.govt.nz

A conflict of interest is where someone’s personal interests or

obligations conflict, or have the potential to conflict, with the
responsibilities of their job or position or with their commercial
Conflict of interest Plan interests. It means that their independence, objectivity or
impartiality can be called into question.
For more information see www.procurement.govt.nz

An opportunity for suppliers to bid for a contract for goods,

Contract opportunity
services or works.

54
 Word or phrase Reference Definition

Under a cost reimbursable contract, the contractor is paid its

actual costs for the work completed. This places significant
financial risk on the client and so these approaches tend to be
used where the nature or scope of the work can’t be adequately
defined, either due to time constraints or the fact that the work is
Cost reimbursable Section 1 Easy to
of an urgent nature, e.g. where there is a need to carry out
contract do Business
critical emergency or repair work. The final cost of the project
won’t be known during award of contract and therefore this
approach has a high degree of financial risk for the client. For
more information see the Guide to Cost reimbursable contract
at: www.procurement.govt.nz

A tender process where the agency asks a single supplier to

Direct source Appendix B tender for a contract opportunity, and the contract opportunity is
not openly advertised.

Early contractor involvement (ECI) is an approach to contracting

that can be used to gain early advice and involvement from a
contractor into the buildability and optimisation of designs. It’s
Early contractor Section 1 Easy to suited to large, complex or high-risk projects because it affords
involvement (ECI) do Business an integrated team time to gain an early understanding of
requirements, enabling robust risk management, innovation and
public value. For more information see the Guide to ECI at:
www.procurement.govt.nz

The criteria that are used to evaluate responses. These include

measures to assess the extent to which competing responses
Evaluation criteria meet requirements and expectations (e.g. criteria to shortlist
suppliers following a Registration of Interest or criteria to rank
responses in awarding the contract).

The recognised circumstances (e.g. a procurement in response

Exemption from open
to an emergency) where CODC does not need to openly
advertising
advertise the contract opportunity.

Usually used in relation to Panel Contracts. It is the umbrella

agreement that governs the relationship between the agency
and the supplier(s). It sets out the terms and conditions
(including pricing) that the parties agree to contract on in the
Framework agreement event that the supplier is allocated a contract for supplying the
covered goods, services or works. When CODC wants to buy
something under the framework agreement, the parties then
enter into a separate contract that refers to the terms and
conditions contained in the framework agreement.

An acronym for Government Electronic Tenders Service. GETS

is a website managed by New Zealand Government
Procurement. It is a free service that advertises New Zealand
GETS
Government contract opportunities and is open to both domestic
and international suppliers. All tender information and
documents are made freely available through GETS.

55
 Word or phrase Reference Definition

Items which are capable of being owned. This includes physical

Goods Throughout goods and personal property as well as intangible property such
as Intellectual Property (e.g. a software product).

The Charter sets out Government’s expectations of how

Government
agencies should conduct their procurement activity to achieve
Procurement Charter
public value.

A generic name for a range of New Zealand Government good

Guidance procurement practice guides, tools and templates. These can be
found at: www.procurement.govt.nz

Procurement evaluation method used for very simple

Lowest price procurement (typically goods) where price is the most important
factor

Market engagement is a process that allows you, at all stages of

procurement, to:
 communicate your needs or requirements to suppliers
Market engagement  openly and transparently discuss possible solutions
 stimulate innovation in the design and delivery of the
solution
 understand market capacity, capability and trends.

A genuine estimate of the total cost that CODC will pay over the
Maximum total whole-of-life of the contract. It covers the full contract cost of
estimated value Note 1 goods or services, and any other expenses such as
(MTEV) maintenance and repairs, and the cost of disposing of the goods
at the end of the contract.

56
  This term relates to goods and services associated with
developing new civil or building construction works
including buildings, roads, rails, bridges and dams. It
covers new builds and replacement of an existing
construction. This also includes related services such as
design, architecture, engineering, quantity surveying,
and management consultancy services.
 It includes various stages in the project such as:
 demolition of previous structure
 pre-erection works at construction sites, including site
investigation work
 construction work for buildings, residential and non-
residential
 construction work for civil engineering
 assembly and erection of prefabricated constructions,
i.e. installation on site of complete prefabricated
buildings or other constructions, i.e. installation on site
of complete prefabricated buildings or other
constructions, or the assembly and erection on site of
prefabricated sections of buildings or other
constructions
 special trade construction work such as foundation
work, including pile driving, water well drilling, roofing
and water proofing, concrete work, steel bending and
erection, erection work from purchased or self-
New construction works manufactured structural steel components for buildings
or other structures such as bridges, overhead cranes or
electricity transmission towers, steel reinforcing work
and welding work
 masonry work
 installation work such as heating, ventilation and air-
conditioning work, water plumbing and drain-laying
work, gas-fitting construction work, electrical work,
insulation work (e.g. electrical wiring, water, heat,
sound), fencing and railing construction work, other
installation work (e.g. installation of lifts and escalators
and moving sidewalk), fire escape equipment and
construction work (e.g. staircases)
 building completion and finishing such as glazing work
and window-glass installation work, plastering work,
painting work, floor and wall-tiling work, floor-laying,
wall-covering and wall papering work, wood and metal
joinery and carpentry work, interior fitting decoration
work, ornamentation fitting work, other building
completion and finishing work (e.g. special trade
building acoustical work involving the application of
acoustical panels, tiles and other material to interior
walls and ceilings), and steam or sand cleaning work of
building exteriors
 renting services related to equipment for construction or
demolition of buildings or civil engineering works.

57
 Word or phrase Reference Definition

A business that originated in New Zealand (not being a New

Zealand subsidiary of an offshore business), is majority owned
New Zealand business
or controlled by New Zealanders, and has its principal place of
business in New Zealand.

Publishing a contract opportunity on GETS and inviting all

Open advertising interested domestic and international suppliers to participate in
the procurement.

A type of framework agreement that governs the relationship

between CODC and each Panel Supplier. It sets out the terms
Panel Contract and conditions that the parties agree to contract on in the event
that the Panel Supplier is allocated a contract to provide specific
goods, services or works.

A list of suppliers CODC has pre-approved to supply particular

Panel of Suppliers goods or services and who have agreed to CODC’s terms and
conditions for supply.

Panel Supplier A supplier included in a Panel of Suppliers.

A condition that a supplier must meet to be considered for a

Pre-conditions
particular contract opportunity.

Pre-qualified supplier A supplier included in a Pre-qualified Suppliers List.

Pre-qualified Suppliers A list of suppliers CODC has pre-approved as having the

List capability and capacity to deliver specific goods or services.

The following four priority outcomes have been identified by

Cabinet to be leveraged by government procurement:
 Increase New Zealand businesses’ access to
government procurement
 Increase the size and skill of the domestic construction
sector workforce
Priority outcomes Note 6
 Improve conditions for workers and future-proof the
ability of New Zealand business to trade, and
 Support the transition to a net zero emissions economy
and design waste out of the system.
Each priority outcome is targeted at specific focus areas. You
can find these focus areas at: www.procurement.govt.nz

All aspects of acquiring and delivering goods, services and

works. It starts with identifying the need and finishes with either
Procurement Throughout
the end of a service contract or the end of the useful life and
disposal of an asset.

58
 Word or phrase Reference Definition

A plan to analyse the need for specific goods, services or works

and the outcome CODC wants to achieve. It identifies an
appropriate strategy to approach the market, based on market
research and analysis, and summarises the proposed
Procurement plan Throughout procurement process. It usually includes the indicative costs
(budget), specification of requirements, indicative timeline,
evaluation criteria and weightings and an explanation of the
Broader Outcomes CODC will seek to achieve through the
procurement.

An early sample, model or pilot study used to test a concept or

Prototype Innovation
process.

This includes agencies in:

 the Public Service (departments and ministries)
 the wider State Services (e.g. Crown Entities, Crown
Research Institutes, entities listed in Schedules 4 and
4A of the Public Finance Act 1989, and School Boards
of Trustees) and
Public Sector
 the wider State Sector (e.g. Offices of Parliament,
Tertiary Education Institutes and State Owned
Enterprises) and
 Regional Councils and Territorial Authorities (as defined
in s5 of the Local Government Act 2002).

A list of these agencies is available at: www.ssc.govt.nz

This term relates to goods or services or works associated with

delivery of refurbishment works in relation to an existing
construction. Construction means buildings, roads, bridges and
Refurbishment works dams. Refurbishment works cover renovating, repairing or
extending an existing construction.
Refurbishment works does not include replacing a construction.
That is deemed to be new construction works.

Also known as an Expression of Interest. A formal request from

CODC asking potential suppliers to:
 register their interest in an opportunity to supply specific
Registration of Interest goods, services or works
(ROI)
 provide information that supports their capability and
capacity to deliver the goods, services or works.
It’s usually the first formal stage of a two-step tender process.

A market research tool. A formal request from CODC to the

market, for information that helps identify the number and type
Request for Information of suppliers and the range of solutions, technologies and
Innovation products or services they can provide.
(RFI)
It is not a type of Notice of Procurement. It must not be used to
select or shortlist suppliers.

59
 Word or phrase Reference Definition

A formal request from CODC asking suppliers to propose how

their goods or services or works can achieve a specific
Request for Proposal outcome, and their prices.
(RFP)
CODC may be open to innovative ways of achieving the
outcome.

A formal request from CODC asking potential suppliers to quote

Request for Quote
prices for ‘stock standard’ or ‘off-the-shelf’ goods or services or
(RFQ)
works, where price is the most important factor.

A formal request from CODC asking for offers from potential

Request for tender suppliers to supply clearly defined goods or services or works.
(RFT) Often there are highly technical requirements and a prescriptive
solution.

A supplier’s reply to a Notice of Procurement. Examples include:

 registering of interest in an opportunity
Response  submitting a proposal
 submitting a tender
 applying to qualify as a pre-qualified supplier.

Where CODC purchases goods, services or works from a Panel

Secondary
of Suppliers, an All-of-Government Contract, Common
procurement
Capabilities Contract or Syndicated Contract.

Acts or work performed for another party, e.g. accounting, legal

services, cleaning, consultancy, training, medical treatment, or
transportation.
Sometimes services are difficult to identify because they are
Services closely associated with a good. No transfer of possession or
ownership takes place when services are sold, and they:
 cannot be stored or transported
 are instantly perishable
 only exist at the time they are provided.

Procurement evaluation method used if all the criteria have

Simple score
roughly the same degree of importance

A person, business, company or organisation that supplies or

Supplier Throughout
can supply goods or services or works to CODC.

Information CODC provides to a supplier who has been

unsuccessful in a particular contract opportunity, that explains:
 the strengths and weaknesses of the supplier’s proposal
Supplier debrief against the tender evaluation criteria and any pre-
conditions
 the reasons the successful proposal won the contract
 anything else the supplier has questioned.

60
 Word or phrase Reference Definition

A type of collaborative contract that typically involves a group of

agencies aggregating their needs and collectively going to
Syndicated Contracts market for common goods, services or works.
If the contract is limited to a group of named agencies, it is a
Closed Syndicated Contract.

Procurement evaluation method used if the scope of work is

Target price
hard to define, or the budget is the main constraint

A tendering requirement that either:

 lays down the characteristics of goods, services or
works to be procured, including quality, performance,
Technical specifications safety and dimensions, or the processes & methods for
their production or provision, or
 addresses terminology, symbols, packaging, marking or
labelling requirements, as they apply to a goods, service
or works.

A party who is contracted to manage a procurement process on

behalf of CODC. CODC agency remains responsible and
Third party agent
accountable for ensuring that the procurement complies with
this policy.

An estimate of the total cost of the goods, services or works

over the whole of their life. It is the combination of the purchase
price and all other expenses and benefits that the agency will
Total cost of ownership Section 1 Value for incur (e.g. installation and training, operating and maintenance
(TCO) money and Note 6 costs, repairs, decommissioning, cost associated with disposal
and residual value on disposal). It is a tool often used to assess
the costs, benefits and risks associated with the investment at
the business case stage of a procurement.

The minimum New Zealand Dollar value at which the

Note 1 and
Value threshold governance and approval levels change for CODC. It excludes
Appendix B
GST.

Procurement evaluation method used if the criteria have

different levels of importance.
Weighted Attribute
The two variants are standard Weighted Attributes and Price
Quality Method

61