The December 2024 update to the NSW Procurement Policy Framework introduces several significant policy shifts and mandates that will impact suppliers and agencies alike.
The changes mark a pivotal shift in how NSW Government procurement is conducted. Increased transparency, expanded opportunities for local suppliers, and ethical oversight of emerging technologies like AI reflect the fact that the government is genuine in its desire for greater innovation, accountability, and local economic growth by using its procurement muscle.
The new provisions reflect a series of Board Directions and policies approved since April 2024.
Mandatory Disclosure of Opportunities on buy.NSW
From 31 December 2024, all procurement activities (whether open or selective) with a total engagement value exceeding the Government Information (Public Access) Act (GIPA) disclosure threshold of $150,000 (inc GST) must be published on the buy.NSW tenders module, which will now serve as a central hub for opportunities.
This new rule supports procurement transparency and opens new avenues for suppliers, who should ensure they are registered on buy.NSW and ready to respond to tenders posted there. Agencies have been given a grace period of 12 months, with compliance required by 31 December 2025.
Boosting Local Participation in Large Contracts
From 1 January 2025, opportunities for local suppliers to win contracts valued at $7.5 million or more (ex GST) will increase. Agencies must:
- Check for local suppliers and determine whether they can meet their procurement needs.
- Ensure full and fair participation by giving local suppliers equitable opportunities to compete.
- Provide justification if a local supplier is not chosen, by documenting and explaining the reasons.
To ensure compliance and accountability, quarterly reporting to the NSW Procurement Board on the implementation of these measures is mandatory.
As a result of this change, local suppliers can expect greater access to large contracts, but competition will remain intense, given the estimated 11,000-plus ICT suppliers registered on Buy.NSW
Changes to Enforceable Procurement Provisions
Under amendments to the Enforceable Procurement Provisions, the September 2023 policy requiring procurement lists to remain open for applications on a continuous basis is now in effect.
This will give new suppliers unfettered access to procurement opportunities. Agencies covered by this provision were given 12 months to implement the change.
Other changes to the enforceable provisions that came into effect on 18 October 2024 include amending the clause prohibiting discrimination based on the origin of goods and services.
AI Ethics and Risk Management in Government Projects
A mandate regarding artificial intelligence has applied to AI projects with budgets exceeding $5 million or those funded by the Digital Restart Fund since 1 July 2024. Agencies are required to:
- Comply with the AI Ethics Policy: Ensuring responsible use of AI in alignment with ethical principles.
- Use the AI Assessment Framework (AIAF) at all stages of the AI lifecycle, including design, deployment, and operation. Periodic reviews based on the assessed risk of harm are also mandatory.