Use this template to develop a procurement policy that centrally documents the principles and values guiding your procurement decisions.
This template and guidance is best suited for agencies that are writing a new procurement policy, or updating a procurement policy that's very outdated.
If your agency already has a procurement policy and you want more specialised advice, email the New Zealand Government Procurement Advisory team.
Your agency's procurement and purchasing decisions can be used as a lever to achieve outcomes that your organisation wants. Policies are high level statements of the principles and values that guide procurement decisions. A good policy will say what staff will do, and why they should do it.
A procurement policy is a good place to identify your agency's:
Further details, like timeframes and documentation, are specified in separate procurement procedures, not in the procurement policy. Procedures are the 'how' you will do procurement.
Follow this process for creating or updating a procurement policy for your agency:
Policies should be reviewed and updated regularly, or when there are major changes. These might be internal changes, like shifting needs or new roles within your agency; or external changes, like new government priorities or legislation. You should specify a review cycle (for example, every three years) in the policy itself.
Developing and launching a new procurement policy for your agency is a chance to get people thinking about good procurement practices. It can also lead to discussion about achieving better value for money by taking a strategic approach to managing your agency's spend.
Before you start customising the policy, it may help to discuss with your executive team:
Prepare for your agency's procurement policy to be transparently available to other agencies. Like all procurement processes, it is also subject to audit.
A procurement policy example template is provided below, but you should also reference your agency's own policy templates, and work with your agency's policy team if there is one.
Your procurement policy might also be informed by:
You can analyse both historic and forecast spend to find out the volume, value and risk of procuring different types of goods and services.
This can help you to better understand how your agency should approach different categories of procurement, and the processes involved with each area of spend.
New Zealand Government Procurement Rules require mandated agencies to consider broader outcomes – secondary benefits generated from procurement activity. Not every outcome can be incorporated into every procurement, but your policy can specify actions your agency will take to deliver these benefits where possible.
Your agency should have a plan to manage the risk of major events like a pandemic or natural disaster. A risk management strategy should allow for the provision of goods and services during an emergency or supply shortage. Good risk management will reduce the need for emergency procurement. Urgent situations created by an agency through lack of planning or risk mitigation don't constitute an emergency.
You can't plan for everything you may need to procure in an emergency, but your organisation's procurement policy can list the best practice actions you will still take, including documentation. For guidance on what to do at different levels of emergency:
Guide to emergency procurement
Although elements of your policy will be specific to your agency, many public sector agencies have similar patterns of procurement, e.g. for office supplies, ICT equipment, or specialist consultancy services. Your agency could compare policy notes with other agencies for shared learning.
Much of the guidance on how to plan a specific procurement also applies to planning procurements in general. These steps can also inform your procurement policy.
The policy template provided here references your agency’s ‘standard procurement processes’. If needed, these should be detailed in a separate document. You might have different processes for different thresholds of spend. Flowcharts can represent all steps in each process; for example, high-value procurements may include a legal review.