Purchasing Goods and/or Services - valued at $50000 and under
Quotation processes for purchases of goods and/or services (including leases or rentals of equipment) with a value of $50 000 or less are at the discretion of agencies(Treasurer's Instruction 1105). In making a decision on the process you will need to weigh the value of the purchase and the cost of seeking quotations against the need to ensure value for money and that other Government purchasing principles have been observed.
Everyone that purchases on behalf of the Government needs to understand the rules that govern Government purchasing and the responsibilities of the Government buyer, regardless of the value of the purchase.
Tasmanian Government purchasing is conducted by encouraging fair and open competition between suppliers, with the objective of achieving best value for money. Government buyers must behave ethically and comply with the Procurement Code of Conduct. Government buyers must also enhance opportunities for local businesses to bid for Government business and comply with applicable requirements of the Buy Local Policy.
Refer to Purchasing Overview for a summary of purchasing policies, principles and procedures. See Purchasing Principles and Purchasing Policies, Processes and Procedures for more comprehensive information.
The following requirements are mandatory:
- you must use a whole-of-government / common-use contract or whole-of-agency contract, if one has been established;
- you must avoid bias towards a particular brand - use generic terminology when describing your requirements;
- you must seek written approval from the Head of Agency or Deputy Secretary if you wish to engage a consultant (Treasurer's Instruction 1113);
- agencies must refer all requests for legal advice, civil litigation services and commercial and conveyancing legal services to Crown Law (Treasurer's Instruction 1118);
- the Government Information Technology Conditions (GITC) must be used for most IT purchases, regardless of value. There are exceptions to this rule - refer to Treasurer's Instruction 1123 for further information; and
- the resultant contract must comply with the Crown Contracts Confidentiality Policy (refer Treasurer's Instruction 1401).
With the exception of the above mandatory requirements, the purchasing process you use is a matter for your judgement, but you should consider the following:
- for low risk/low value procurements, using the relevant Request for Quotation template documentation prepared by the Crown Solicitor;
- documenting the purchase - as a Government buyer you are fully accountable for the purchases you make. For accountability and probity reasons it is a good idea to briefly document the purchase including:
- a description of what you want to buy;
- quotes received (and when they were requested and when they were required by); and
- which quotation was successful and a justification of that decision if it is not obvious,
- shop around - do not fall into the habit of using the same supplier over and over. Test the market and make sure you receive value for money;
- consider using a more rigorous written quotation or tender purchasing process if the purchase is complex or high risk; and
- invite quotations from businesses that have previously expressed an interest in supplying the good or service being purchased.
The following table provides an example of the steps required to purchase goods and services valued at $50 000 or less. Whether you need to use all the steps, and in what order, will depend on the nature of the purchase.
1. Define your needs
You should focus on what you want (ie outputs), rather than on how it is to be done (to allow suppliers to offer creative solutions). Make sure that you define your needs clearly, accurately and completely.
Some requirements you may wish to consider when defining your needs include:
- functional and performance characteristics;
- maintenance / servicing;
- installation / commissioning;
- packaging; and
- delivery terms (time and place).
2. Identify the purchasing method
You must use a whole-of-government common use contract, or whole-of-agency contract, where one has been established.
3. Assess the impact of the procurement on local suppliers
Consider whether local suppliers are available and how you will ensure that you enhance those local suppliers' ability to compete in the procurement.
4. Obtain approval to purchase
The approval process required will depend on your agency but will generally involve obtaining permission to seek quotations and ensuring that funds are available.
5. Determine how any offers are to be evaluated
You may wish to consider developing an evaluation plan. See here for further information.
6. Invite quotations
Each supplier must be provided with the same information and be given the same amount of time to prepare a quote.
It is a good idea to provide suppliers with a written specification and request a written quotation. If you are provided with a verbal quotation, write it down.
7. Evaluate the offers and select the successful supplier
Your decision needs to be defensible. You should provide an explanation of your selection in writing.
8. Obtain approval for your decision
The approval process will depend on your agency's internal requirements.