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Emergency procurement guidelines

How to manage procurements for unforeseen and sudden situations.

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If the situation is unforeseen or sudden and requires an urgent response, it qualifies as an emergency.
Your agency head can approve procurements up to a value sufficient to meet the immediate needs of the emergency.
You can only procure what’s required for the immediate needs of the emergency.
You don’t have to comply with Procurement Board Directions, policies or your agency’s accreditation terms.
You still need approval from the relevant financial delegate and to disclose contracts over $150,000.
You can use any procurement method that meets your needs in the time available.
You don’t have to demonstrate value for money. But you must always use government resources efficiently, effectively and economically.
You must manage conflicts of interest. You must always comply with your agency's code of conduct, the public sector values and the law.
Keep records. Record all decisions and approvals, including reasons for the emergency procurement.
You must report every emergency procurement to the Procurement Board.

Authorise emergency procurements

The head of an agency can, in an emergency, authorise procurements to a value to meet the emergency.

This is allowed by clause 4 of the Public Works and Procurement Regulation 2019 (PWP Regulation). Such procurements are exempt from section 176 of the Public Works and Procurement Act 1912 (PWP Act).

The agency can then speed up the procurement because they won’t need to meet any policies or directions of the Procurement Board.

The PWP Regulation and PWP Act don’t define ‘emergency’. So it can be given its ordinary meaning:

‘an unforeseen occurrence, a sudden and urgent occasion for action’.

The agency will still need to:

confirm there are funds available
comply with financial delegations.

The agency head can appoint a nominee

The agency head can also nominate a government agency employee to make authorisations. This must be done under clause 4 of the PWP Regulations.

Standard agency delegations (under the Government Sector Finance Act 2018 or Government Sector Employment Act 2013) are not enough.

Download a sample form of authorisation. DOCX, 37.45 KB

Which rules don’t apply

For an authorised emergency procurement under clause 4 of the PWP Regulation, you don’t need to comply with:

any policies or directions of the Procurement Board
the requirement to use whole-of-government contracts or mandated schemes
terms of your agency’s accreditation
the requirement to achieve value for money
principles of probity and fairness
complaints regime in section 176 of the PWP Act aligned with the enforceable procurement provisions in PBD-2019-05.

For an authorised emergency procurement under clause 4 of the PWP Regulation, you don’t need to comply with the PBD-2019-05 Enforceable Procurement Provisions.

You must however document the decision and reasons for the emergency procurement.

This will assist your agency if a supplier challenges the use of clause 4 of the PWP Regulation.

Even though you don’t have to evaluate value for money for emergency procurements, you must always use government resources efficiently, effectively, economically and in accordance with the law.

You should try to follow the Procurement Policy Framework as much as possible.

Assess proposed emergency procurements

You should assess each proposed emergency procurement case by case. Check if the value meets the immediate needs of the emergency.

Your assessment may include (but is not limited to):

the type, quantity and value of the goods or services to be procured and their general availability in the market
your agency’s functions and operations
other relevant factors around immediate needs of the emergency.

If you determine that the procurement is over what’s needed to meet the immediate needs of the emergency, you won’t be able to rely on clause 4 of the PWP Regulation to conduct an emergency procurement.

Report all emergency procurements

You must report every emergency procurement authorisation to the Procurement Board as soon as possible.

In an evolving emergency, you can provide consolidated reports at regular intervals.

Download the emergency procurement reporting template XLSX, 18.58 KB.

Email completed reports to nswbuy@treasury.nsw.gov.au

Use any suitable procurement method

For an authorised emergency procurement under clause 4 of the PWP Regulation, you may use any procurement method.

Consider:

how quickly and where you need the goods or services
the type and quantity of goods or services
the number of potential suppliers
their ability to supply the goods or services, where and when.

Your procurement documentation should state this is an emergency procurement pursuant to clause 4 of the PWP Regulation.

Consider contract terms

Ensure there is a defined contract period that doesn’t exceed the need to respond to the emergency. Or you can ensure there are rights for the agency to stop procuring once the emergency ends.

You should use these rights in a reasonable and fair way. For example, allowing for reasonable closure payments to suppliers if contracts are terminated early.

Be careful about these types of provisions:

clauses which seek to make the arrangement exclusive
force majeure clauses – if the emergency poses particular risks for the procurement, it may be best to have a specific clause rather than relying on a force majeure regime
representations or undertakings by the agency that it is complying with all laws including the PWP Act. Instead, consider a representation or undertaking that the procurement is being conducted under clause 4 of the PWP Regulation.

Keep records

Record all decisions and authorisations about emergency procurements, including:

the nature of the emergency and the justification for conducting an emergency procurement (why)
why the procurement is needed and limited to the immediate needs of the emergency
authorisation by the agency head or their nominee
type of procurement process (how)
suppliers approached (who)
type of goods or services (what)
the value (how much)
where the goods or services are required
timeframe (when) for the contract, including any rights for early termination
reporting of the emergency procurement to the Procurement Board.

You should also keep standard procurement records, such as:

criteria used for selecting suppliers
outcome of any comparative assessments or price assessments
licence and insurance checks,
contract documents.

Continue to disclose contracts over $150,000, as per the Government Information (Public Access) Act 2009.