Hon Lianne Dalziel, Minister of Commerce, Minister for Small Business, Minister of Women’s Affairs, MP for Christchurch East from New Zealand provides her views on the importance of procurement to government and its connections with sustainability in a ‘CIPS’ Strategic Procurement Forum opening address.

Some excerpts from her speech:

Procurement is too important to be treated as a technical, administrative activity that sits somewhere in the finance or corporate services section with little senior management interest and attention. It is the government’s view that it is time to raise the profile of the profession.

The reality is that good procurement is essential to the government’s ability to achieve its wider policy objectives. Procurement is a strategic delivery tool and therefore requires a strategic approach.

It is important to remember that the government is a significant purchaser of goods and services. In particular sectors, such as ICT, the government is the single largest customer in the domestic market.

The total size of the government procurement market is difficult to estimate, but OECD averages suggest that government procurement expenditure in New Zealand is in the range of $14 – $20 billion per annum.

For example, by promoting sustainability in the government’s own operations and in business development New Zealand firms can lead the market for goods and services that are sustainable.

Sustainable procurement is one of a package of six projects developed in the context of the government’s aim to make New Zealand the first truly sustainable nation, and the need for long term sustainability strategies to meet the challenges New Zealand faces in the 21st century.

The project that will be of particular interest is enhanced sustainable procurement. This is again led by the Ministry of Economic Development. It builds on progress made by the Ministry for the Environment’s Govt3 programme in achieving the necessary “cultural change” within the public sector to recognise and embed sustainability factors in procurement decisions.

As well as integrating sustainability into a single government procurement policy and implementing a national framework for sustainable procurement, this project involves setting standards for sustainable procurement; developing sustainability performance indicators, targets and reporting mechanisms; and implementing a carbon costing methodology for procurement decisions.

By September this year specific standards will be mandated across public service departments. These include: paper (including recycled content and default duplexing); timber and wood products (to ensure they are legally sourced); travel (for motor vehicles and air travel versus video conferencing); and light fittings (for energy efficiency). These will be rolled out to the wider state sector over longer timeframes. A wider range of sustainability standards will be developed over time targeting areas of greatest impact, such as buildings, ICT equipment, white goods, textiles, uniforms and cleaning products.

…procurement decisions should be based on best value for the taxpayers’ dollar over whole-of-life and this will demand careful judgements by procurement practitioners over a range of factors that will inevitably include price, origin of supply and more.