What role does procurement play in revitalising the local economy? How do councils plan for significant capital projects? How do we maintain good governance in the ‘emergency procurement’ environment whilst still maintaining flexibility with procurement rules?
Simplify the procurement process
Procurement processes should proactively engage with business units in order to achieve improved procurement outcomes. Meeting with special project managers and sectional managers, who are the recipients of government funding, to plan efficient procurement is critically important to maximise the community recovery opportunities from major procurements. For example, discussing the supplier market environment in terms of the likelihood of suppliers bidding for construction works is crucial, especially given the recent $139m grant funding to NSW councils for road and community infrastructure. With requirements that the funding should be spent before the end of 2020, the market may be pressed to deliver business as usual and an additional large volume of work, therefore prices may not be as favourable or as competitive. Exploring alternative ways of procuring through market soundings, assessing panel suppliers or shortening procurement processes, and using online evaluation tools will prove invaluable. Smart procurement can get to the market early and expedite the process to add value.
This pandemic presents a genuine emergency and many stores and supply officers we have spoken to recently have been flat-out sourcing toilet paper, cleaning products and sanitisers. Most council stores staff are quite isolated from key decisions. Does your council have guidance on how much staff can buy? Do all staff undertaking emergency procurement have delegated authority or are they making verbal agreement with suppliers without a proper contract?
In any urgent situation, procurement can sometimes be done more quickly by using contracts that are already in place, such as an all-of-government or syndicated contract, or a panel arrangement. In a genuine emergency, a council could consider using another agency’s suppliers where they have been appointed through a competitive process.
Accountability with processes
During emergencies, councils are still accountable to their communities. This accountability needs to be balanced against avoiding delays in responding to the emergency.
Councils should plan for emergency procurement and have guidance available for staff. This guidance should include criteria for what constitutes an emergency and the procedures that should be followed.
Depending on who you talk to, procurement can be the bane of good process, source of good governance or just another department responsible for enforcing polices and rules in the local government environment.
Councils can mitigate risks by strategically and proactively planning procurement. Morrison Low can help support your planning processes, for more information contact Stephen Bunting at email@example.com or 0418124437.