Economic Growth Minister Nicola Willis announced on 12 March 2025 proposed changes to Government Procurement Rules (Rules), with public consultation on the draft Rules open until 8 April 2025. The Rules provide government agencies with the Government’s standards of good practice for government procurement.
Proposed 'economic benefit' test
Changes proposed under the draft Rules include a new Rule 8, which provides that, for contracts above the value thresholds ($100,000 for goods, services and refurbishment works and $9m for construction works), agencies must require that suppliers demonstrate in their tender proposals how they will deliver economic benefits to New Zealand. Agencies would be required to include a minimum weighting of 10 percent for evaluation of the economic benefits of a proposal.
For contracts below the thresholds above, agencies are expected to award contracts to New Zealand businesses that are capable and have capacity to deliver the contract.
Other changes
There is an overall reduction in the number of rules, including the removal of the requirements on agencies to consider specific 'Broader Outcomes'. There are currently four secondary outcomes that agencies must consider in their procurement processes, including improving conditions for workers and supporting the transition to a net zero emissions economy. This concept has effectively been replaced by the 'economic benefit' rule, which includes consideration of benefits such as environmental benefits and providing skills and training that benefit New Zealand communities.
The draft Rules also incorporate changes to the establishment and running of supplier panels, and secondary procurements.
What's next?
Feedback from public consultation will be used to inform the final version before it is submitted to Cabinet for approval. If you have a view on the proposed Rules, make sure you get your feedback in before 8 April 2025.
If you would like more information on the proposed Rules please contact one of Government procurement experts.
