Page 3 - LGP Newsletter Flip Book Test_Neat

The data to support these, and other measurable benefits exist today. The message here is councils
need to extract and analyse this data to establish the value procurement delivers. We need to start
tabling data-driven future sourcing and procurement strategies.

Procurement needs to be better at finding and using data to quantify the value we deliver. If we can
do this together, and target what matters to general managers, councillors and Mayors then we as
procurement will get a seat at the proverbial table.

Forgotten Value

More recently in LGP’s engagement with councils, we are hearing many people explain that
departments outside of procurement do not understand why established LGP contracts are helpful, or
even valuable. Frustratingly for some in council, surrounding departments who have influence over
purchasing decisions do not understand (or don’t want to understand) the work aggregators like LGP
conduct on their behalf, and the reasons why this effort need not be duplicated by council.

This might be because we are seeing a flood of new people joining NSW local government due to
amalgamations and structural changes. Any council looking to run its own tender, where an
aggregated contract already exists needs to ask some pre-qualifying questions, such as the following:

• Is there an existing aggregated contract available for use?
• Does the optional aggregated contract have a greater volume of annual spend compared to the
spend I will offer to the market in the proposed council-level tender process?
• Does my council contract mitigate all the risks associated with this category and the contracted
suppliers? Do I have the in-house subject matter expertise to protect my council?
• Is the tendering process council applies ethical and probity rich? Are we aware of the leading
industry suppliers, will they see our tender, and do we offer enough value for them to invest in a
response?
• Does council have the available resources to potentially duplicate a contract, which already exists
and is available for council to use?

For those in council who are not aware, or for those people who want to circulate internally how and
why LGP contracts can be used without having to go to tender, you can use the detail provided below:

LGP has been ‘prescribed’ by the NSW State Parliament to carry out group tenders on behalf
of NSW local government. ‘Prescribed’ means LGP is named in the Local Government
(General) Regulation 2005 (NSW) and as such a council does not need to go to tender if that
council buys from a contract already set up by LGP. Councils can therefore procure goods or
services from LGP contracts for values greater than $150,000 (inclusive of GST), without the
need to tender themselves. In fact, for all but 2 of the LGP contracts they can procure up to
any value. Naturally councils can use LGP contracts to procure for amounts less than
$150,000 without restriction.

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