NZICT broadly welcomes new govt procurement guidelines

NZICT CEO Candace Kinser says principles in line with international best practice

NZICT Group CEO Candace Kinser says government’s new procurement principles are “very much in line with good international best-practice standards”.

She applauds the emphasis on the long-term value of a proposal rather than its up-front price.

NZICT is also pleased at indications that more time will be allowed in future to get a bid together.

“That was something NZICT was quite keen on in our discussions last year with both the DIA [Department of Internal Affairs] and MBIE [Ministry of Business, Innovation and Employment,” says Kinser.

Ensuring “an adequate timeframe to pull together a good response” makes it easier, in particular to mount a collaborative bid and hence offers more opportunity to smaller suppliers, she says. “It’s nice to see they’ve adopted that.”

She praises the new guidelines for their clarity: “The language has been updated and changed so that it’s more straightforward. It has lot less of the legalese and you can read it and get a good idea of what it’s about and how it can directly impact or affect you.

“We’re also quite happy at the mention that [government is] looking at ‘meet the buyer’ events, whereby we can help showcase our extensive membership as well as the wider tech community,” Kinser says.

NZICT has been talking with the DIA about helping it organise such events and not just to meet buyers; “they’re keen for us to actually help pull together tech companies who will be able to present on some of the ideas and products and services they believe would best assist various agencies within the ministries in terms of their products and solutions.”

“Ideally” the first such event could be held later this year, she says.

Kinser referred to Catalyst IT co-founder Don Christie’s misgivings on the document’s language in Rule 4, about non-discrimination between suppliers, particularly those from different countries.

Opening the gates internationally applies both ways, she points out. “With the free trade agreements NZ has in place, it is a requirement that we allow other countries’ companies to tender within our own government agencies’ RFPs; but vice-versa, it opens up an opportunity for Kiwi companies to have the same rights to respond to foreign countries’ tenders as well. I think that often gets overlooked.

“I think it’s a great opportunity for Kiwi companies who are looking at exporting, particularly into China and other areas [with which] we do have FTAs,” she says.

NZICT did not succeed in lobbying for more flexibility in the dollar borderlines that trigger mandatory tendering, Kinser says. “For example $100,000 is when an RFP is required, and for a lot of smaller RFPs it can frequently cost a lot of money, time and resources to respond.” This means “the end-game becomes even more pressured,” she says.

So one of the requests NZICT made was to increase the lower threshold to $250,000 or $300,000, so as to reduce the bidding effort for smaller companies who would face more of a problem in assembling the resources to respond to an RFP, she says.

“Conversely, we could look at putting a cap on the topside. Currently $100,000 is the minimum [for an RFP to be compulsory] but there is no maximum. If more than $5m or $10m in ICT products and services [is involved] over the whole life of the project; we believe it should really be in consultation, it needs to happen ideally among a group of companies, especially for some of the larger projects, rather than going to RFP,” where there are strict controls on what bidders are allowed to know about their rivals’ bids and approaches. “It’s very difficult sometimes [under an RFP regime] for some of the smaller companies to understand who the other players are that could make up the matrix of a proposed solution.”

“Unfortunately because of the contractual obligations of the FTAs it’s my understanding that [such movement in the thresholds] is not possible,” she says.

Open dialogue

There could be more freedom for companies or consortia to proactively put up their own solutions, Kinser says.

“One of the things we’re going to be working on, hopefully, with DIA is asking member companies and tech companies to come together and come up with some innovative ideas. A lot of technology companies can actually pinpoint within central and local government, ‘this is where you can make savings, this is where we think you should be applying a killer solution or technology.’

“I think various angles have been attempted [in allowing for such proposals],” she says. “The Open Door to Innovation sort-of worked; it wasn’t a resounding success, but I think it needs to be looked at again and revamped. I think the more open dialogue, the more transparency in discussion that we as an industry-representative body can continue to have with various agencies and ministers on ideas and bringing them to bear, the better off everyone will be.

“I find it very interesting, even previously in my role at Telecom, in the health vertical, you could pretty quickly tell the Ministry of Health where they could make cost savings across various DHBs, but without it coming across as a sales pitch; just saying essentially: ‘Look, if you actually centralised more documents, you did this and you did that, you’d save a lot of money.’

“Lots of tech companies in various verticals for government have lots of innovative ideas of where they think they could offer value, but I think it gets tangled up in bureaucracy.”

There’s also a question of “how we open up those ideas without the tech companies being afraid of losing their [intellectual property] or having something go out to RFP that’s essentially exactly what they suggested and having to compete for something that they found the opportunity for,” Kinser says.

“It still remains to be seen whether or not we can progress that effectively; and I think that’s where there’s a little bit of hesitation and the trust needs to be built up.”

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