NSW GOVERNMENT
PROCUREMENT SYSTEM
FOR CONSTRUCTION
The NSW Government Procurement System for Construction
(the System) provides tools, procedures, and guidance to assist
government agencies to manage their construction procurement
processes effectively.
The System supports preparation for early project planning,
procurement strategy selection, use of contract templates
and guides, tendering and preparation of tender documents,
selection of prequalified contractors and consultants, use of
standard contracts, contract administration, use of standardised
performance reporting templates, conduct of project workshops
and meetings, performance monitoring and management.
The System is maintained by NSW Procurement, a division
of the NSW Department of Finance and Services, which also
provides independent probity and procurement expertise to
support the Agency Client/Service Provider relationship. The
System applies to all construction projects of $1 million and
above and is often used for projects below this threshold.
OBJECTIVES
The objectives of the NSW Government
Procurement Policy are to assist agencies
to make appropriate and informed decisions
that ensure best value for money, and
support the efficient and effective delivery
of government services without diminishing
their accountability for outcomes.
Under the Agency Accreditation Scheme
for Construction, specific agencies are
accredited by the Department of Finance
and Services to carry out, unassisted,
planning and/or delivery activities
associated with the procurement of
built assets. Those agencies without
accreditation are required to obtain
assistance from relevant external experts
available from the private sector or from an
accredited agency.
In support of the Agency Accreditation
Scheme for Construction, NSW
Procurement provides the NSW
Government Procurement System for
Construction. The System is designed for
the use by non-accredited agencies and
provides guidance and support to assist
in minimising risks and cost overruns.
The Agency Accreditation Scheme for
Construction requires external experts
engaged by non-accredited agencies
to use the System. The System is also
available for use by accredited agencies
and State Owned Corporations as a means
of avoiding the duplication of effort and
expense associated with the development,
maintenance and operation of an in-house
construction procurement system.
BENEFITS OF THE SYSTEM
●● Free documentation, guidance and practice
advice to government agencies, assisting
them to adopt the most efficient and effective
construction practices from the initial planning
stages through to engaging a project
manager, and construction delivery.
●● Procurement method selection guidance
assists agencies to select an appropriate
procurement method for a construction
project, taking into account its particular
characteristics, constraints and risks.
●● Access to a range of contract templates and
user guides that provide for appropriate risk
allocation ensuring that agencies and industry
contract on a consistent basis, saving
agencies considerable cost and time.
●● Panels of prequalified contractors and
consultants who meet NSW Government
standards, along with service provider
selection processes, provide agencies with
access to a range of services for building
and construction, project management,
architectural, engineering and quantity
surveying through to environmental and
site safety audits. This reduces the costs of
tendering and tender process management.
●● Guidance with tender process management
and the engagement of project directors and
project manager.
●● The substantial leverage provided by a whole
of government approach to management of
performance of contractors and consultants
using a system that is used to procure more
than $1.0Bn in government construction
projects annually.
●● Utilisation by more than 50 NSW Government
agencies and Local Government Councils
at any one time, the System and the related
services of NSW Procurement are estimated
to save NSW Government agencies at least
$50M annually through process efficiencies
and avoided costs.
GETTING STARTED ON YOUR
CONSTRUCTION PROJECT
- FOR AGENCIES
NSW PROCUREMENT – YOUR FIRST STEP
Enlisting the advice of NSW Procurement is the essential
first step in getting started on your construction project. The
specialist staff at NSW Procurement can provide guidance
from the initial planning stage through to end delivery.
STRATEGY SELECTION
NSW Procurement provides guidance for agencies in selecting
the most appropriate and cost effective approach to the
construction process. The procurement method selected will
take into account the particular characteristics, constraints and
risks of the project.
STANDARD CONTRACTS AND USER GUIDES
A suite of standard form contract documents are provided
for agency use including, GC21 Cooperative Contracting,
Minor Works, Mini Minor Works, Consultancy Services and
Project Management Services. These contain simple, effective
provisions that reflect NSW Government policy and provide
a reasonable allocation of contract risk. Documentation,
manuals and user guides are also provided to explain the
standard form contracts.
TENDERING AND SELECTION OF TENDERERS
Planning any tender process is essential to avoid common
pitfalls. NSW Procurement provides a range of guidance
material and support services for tendering and tender
process management that fully comply with NSW
Government requirements.
An agency is guided through a structured process of identifying
which contractors or consultants within the prequalified panel
might be offered an opportunity to tender, while maintaining
the high level of probity and confidentiality required by NSW
Government. This comprehensive multi-criteria selection
process takes into account the project estimated value,
procurement approach, geographic location, complexity,
sensitivity issues and related project parameters.
The agency then considers each contractor or consultant in
terms of the established criteria and is provided with supporting
information to assist decision making. This enables the agency
to understand more fully each firm’s strengths as well as areas
of risk or uncertainty. Agencies then invite tenders from the
tenderers selected.
Tender Management Services, a suite of professional resources
available through NSW Procurement, may be engaged to assist
in managing the tender process, from advertising through to
tender opening.
CONTRACTOR AND CONSULTANT
PREQUALIFICATION SCHEMES FOR CONSTRUCTION
Selective Tendering
Building works: Stonework restoration - Sydney Hospital
Selective tendering is usually used to enable rapid access to
a known panel of prequalified contractors or consultants, for
which significant information on capability and performance is
often already available.
To be eligible for selection to tender, contractors and consultants
must be prequalified to the appropriate Contractor or Consultant
Prequalification Scheme for Construction and related works.
Prequalification is based on a proven record of satisfactory
performance and financial and technical capacity. Contractors
and consultants must demonstrate a sound business structure,
adequate finances, effective management systems, appropriate
qualifications and expertise, relevant experience, and a
history of satisfactory project performance to be eligible for
prequalification.
The prequalification schemes encourage contractors to commit
to long term continuous improvement to achieve a high level
of performance on construction projects in return for increased
business opportunities and longer-term relationships through
cooperative contracting.
Architectural services
PREQUALIFICATION SCHEME
FOR CONSULTANTS
This scheme covers the following categories:
●● Project director services
●● Project management
●● Economic appraisal - Health
●● Value management facilitators
●● Engineering services
●● Architectural services
●● Electronic security
●● Quantity surveying
●● Environmental studies
●● Quality Assurance auditors
●● Site safety auditors
●● Environmental auditors
●● Dispute managers
PREQUALIFICATION SCHEME
FOR CONTRACTORS
This scheme covers the following categories:
●● Building works (including heritage projects)
●● Civil works including water infrastructure and
wastewater treatment
●● Fit-out and refurbishment
image left: Wastewater treatment
Selectvie Tendering
Building works: Stonework restoration - Sydney Hospital
BEST PRACTICE
ACCREDITATION FOR
CONTRACTORS
Best Practice accreditation recognises current
prequalified construction contractors who are
able to demonstrate a significantly higher level of
business capability, expertise and performance
for contracts valued at more than $2.5M.
Benchmarking studies undertaken by the
Department of Finance and Services indicate
that the overall performance of Best Practice
Accredited contractors is consistently higher
than that of other contractors under the
Department’s contracts.
Best Practice accreditation opens up a
greater number of business opportunities and
assures significantly higher levels of sustained
performance outcomes for the
NSW Government.
Construction
CONTRACTOR AND CONSULTANT
PERFORMANCE MANAGEMENT
NSW Procurement provides a fully integrated approach to the
management of performance.
Performance of contractors and consultants is monitored
and managed from a whole of government perspective to
encourage better supplier performance. Agencies and their
project managers prepare performance reports to enable clear
communication and understanding of performance outcomes
by relevant parties, encourage discussion on the desired
performance levels and enable decisions on the actions needed
to achieve the required performance levels.
The reports are provided to NSW Procurement in the first
week of February, May, August and November or immediately
whenever adverse performance is experienced. The reports
provide a means by which the NSW Government is able to track
the current performance capability of firms and is extensively
used when considering a firm for future work opportunities. In
this manner, the NSW Government drives industry capability
and performance improvement by providing more tender
opportunities to those firms which consistently achieve higher
levels of performance.
FURTHER INFORMATION
Contact the NSW Procurement Client Support Centre on 1800 679 289
to seek assistance with your construction project or go to www.nswprocurement.com.au
November 2012