Exemptions and preferences
- You may be exempt from using a government contract if your procurement is below a certain value.
- Special exemptions also apply when you use a small business, small to medium enterprise (SME), Aboriginal business or approved disability organisation.
- If the procurement is urgent or has Cabinet approval, you may be exempt from some NSW Procurement Board policies and directions.
- You must give preference to certain suppliers for some contracts.
Exemptions for whole-of-government contracts
The general rule is that you must use a whole-of-government contract wherever one exists.
However, there are some exemptions. You may qualify for an exemption due to the size or nature of the procurement or the supplier you choose to use.
Where you qualify for an exemption, you can often buy directly from a supplier. Even in this instance, you should always make sure you can still achieve value for money. For example, you should still be able to confirm the price you’re quoted is similar to market rates.
You should also check if your agency’s specific requirements or policies limit your use of exemptions due to concerns over safety, security or infrastructure.
Make sure you seek internal approval and follow your agency’s delegations manual.
List of exemptions
Check the list below to see if your procurement qualifies for an exemption.
| Value | Supplier type | Process | Policy or Board Direction |
|---|---|---|---|
<$10,000 | Any | You can buy directly from any supplier. | |
<$50,000 | Small business (up to 20 full-time equivalent employees) | You can buy directly from a small business. | Construction procurement opportunities for SMEs (PBD-2019-03) |
<$150,000 | SMEs and regional businesses | You can buy directly from an SME and regional business. | |
<$250,000 | Aboriginal business (recognised through an appropriate organisation) | You can buy directly from an Aboriginal business. | |
<$1 million | SMEs, for innovative trials | If you’re accredited, you can negotiate directly for proof-of-concept testing or outcomes-based trials for construction. | Construction procurement opportunities for SMEs (PBD-2019-03) |
No limit | Approved disability employment organisation | You can buy goods and services via a single written quote. |
Exemptions for covered procurements
Where Enforceable procurement provisions (PBD-2019-05) apply, they take precedence over all other rules and arrangements. Procurements that are subject to enforceable procurement provisions (EPP) are called covered procurements.
However, even with covered procurements, exemptions exist.
Read more about covered procurements.
Exemptions for emergency procurement
In an emergency procurement, you don’t have to comply with Procurement Board policies or directions or your terms of accreditation. However, where possible, we encourage you to still achieve value for money and comply with the Procurement policy framework.
Only your agency head or their delegate can approve an emergency procurement. You must then report this emergency procurement as soon as possible to the NSW Procurement Board at nswp.policy@treasury.gov.au
Even where you’re engaging in an emergency covered procurement, you may be able to use a limited tender rather than an open approach to market. However, you must be able to prove unforeseen events caused extreme urgency.
Approved exemptions
In some cases, exemption may be granted by an authorising body.
Cabinet- or ERC-approved procurements
In some cases, the NSW Cabinet or the Expenditure Review Committee (ERC) will approve a procurement.
When this happens, you don’t need to comply with procurement board policies or directions if they are inconsistent with cabinet or standing committee decisions.
You still must comply with the procurement policy framework, board directions and other policies that don’t conflict with these decisions.
If you’re engaging in a covered procurement, you’ll also have to comply with Enforceable procurement provisions (PBD-2019-05).
Other government entities
You can buy goods and services from another government entity that supplies these as part of its principal functions.
However, the cost, terms, and conditions of the contract must be consistent with TPP 2002-01 Competitive neutrality principles (PDF).
Preference for suppliers from Aboriginal business, SMEs and regional businesses
There are times you must give preference to buying from certain suppliers, particularly Aboriginal businesses and small to medium enterprises (SMEs) or regional businesses.
This applies even when you’re buying goods and services (or construction services) that are available as part of a standing offer, panel, or prequalification scheme.
Goods and services contracts
| Value | Supplier type | Process |
|---|---|---|
<$250,000 | Aboriginal business | You should first consider any Aboriginal business for procurements up to $250,000, even when there is a prequalification scheme or mandated whole-of-government contract in place. You may also purchase directly from an Aboriginal business based on one quote. You can invite multiple Aboriginal businesses to apply in a selective tender. |
| <$3 million | SME | You must first consider purchasing from an SME, for procurements up to $3 million, where you are permitted to directly purchase goods and/or services from a supplier, including from prequalification schemes and panels. |
Many Aboriginal businesses also qualify as small to medium enterprises (SMEs). If you choose to work with an Aboriginal business, you don’t also have to select an SME.
Read more about supporting Aboriginal businesses.
Read more about supporting SMEs and regional businesses.
Construction contracts
| Value | Supplier type | Process |
|---|---|---|
<$250,000 | Aboriginal business | You may negotiate directly with suitably qualified Aboriginal businesses even where there is a prequalification scheme or mandated whole-of-government contract in place. |
<$1 million | SME | You must make reasonable efforts to get a quote from an SME when you’re using these prequalification schemes: The only exception is where no SME can provide a competitive quote. |
<$1 million | Aboriginal business | You may invite multiple prequalified Aboriginal businesses to participate in a selective tender. |
Read Access to government construction procurement opportunities by SMEs (PBD-2019-03).