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Legislative Assembly for the ACT: 2000 Week 8 Hansard (31 August) . . Page.. 2842 ..

2.5 Best Practice Guidelines

Purchasing guidelines developed by the ACT Government are intended to provide agencies with assistance in the application of ACT Government policies and principles relating to purchasing of goods and services. The guidelines are intended to reflect the flexibility agencies have in their application and assist agencies to deliver services to the community on behalf of the ACT Government.

3. PURCHASING PRINCIPLES

3.1 Introduction

The six underlying principles of ACT Government Purchasing Policy are:

value for money;

open and effective competition;

probity and ethical behaviour;

environmentally responsible purchasing;

buying locally (Australian Capital Region); and

risk management.

3.2 Value for Money

The use of the value for money principle will assist agencies to evaluate offers and make a selection that achieves the best outcome in their purchasing activities. This is achieved when all costs and potential benefits associated with the purchase and use of a product or service are considered.

The tendered price is only one of the costs considered when evaluating an offer and purchasing decisions should therefore not be made on price alone. When entering into financial commitments eg contract arrangements, Agency staff should be satisfied that the selected offer will satisfy the value for money principle.

3.2.1 Obtaining value for money

When evaluating suppliers' offers, value for money consideration should be given to:

the costs and benefits involved on a whole-of-life costing basis, through the calculation of net present values;

� the other ACT purchasing principles and their impact on costs and benefits;

� the ability of the product or service to meet the Agency's technical and service level requirements;

� the capability and financial viability of the supplier to perform the contract; and

� ensuring that the contractual arrangements appropriately protect the Territory.

To ensure that value for money is achieved from the subsequent contractual arrangement Agency staff should:

� monitor, evaluate and document the performance of contractors; and

� reconsider contractual arrangements where the existing arrangements do not provide value for money.

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