PRINT WARNING - Printed copies of this document or part thereof should not be relied upon as a current reference document. ALWAYS refer to the electronic copy for the latest version. PURCHASING AND SUPPLY MANUAL FOR PUBLIC HEALTH ORGANISATIONS JANUARY 2006 TABLE OF CONTENTS CHAPTER 1 – PURCHASING PROCEDURES 1.1 1.1.1 1.1.2 1.2 INTRODUCTION ................................................................................................. General Definitions.................................................................................................. NSW Health Procurement Advisory Panel.............................................................. RESPONSIBILITIES OF OFFICERS INVOLVED WITH PROCUREMENT ..................................................................................... Purchasing ...................................................................................................... 1.1 1.2 1.4 1.5 1.5 1.6 1.2.1 Drug 1.3 GENERAL RESPONSIBILITIES ....................................................................... 1.3.1 Best Practice ............................................................................................................ 1.6 1.3.2 General Orders ......................................................................................................... 1.7 1.3.3 Standing Orders ....................................................................................................... 1.8 1.3.4 NSW Government Expectations .............................................................................. 1.8 1.4 1.5 1.6 PROCUREMENT STRATEGY........................................................................... HEALTH SERVICE PROCUREMENT ............................................................. STATE CONTRACTS CONTROL BOARD (SCCB) GENERAL PURCHASING LIMITS................................................................... 1.11 1.13 1.13 1.6.1 Goods and Services/Works up to $3,000 incl GST ................................................. 1.13 1.6.2 Goods and Services/Works over $3,001 and up to $30,000 incl GST..................... 1.13 1.6.3 Goods and Services/Works over $30,001and up to $20,000 incl GST.................... 1.13 1.6.4 Goods and Services/Works over $250,000 incl GST .............................................. 1.13 1.6.5 Printing................................................................................................................. .... 1.13.1 1.7 1.8 FLY BUY CARDS ................................................................................................. PRIVATE SECTOR PARTICIPATION IN PUBLIC HEALTH SERVICES ........................................................................................... 1.14 1.14 1.15 1.16 1.16 1.8.1 Government Guidelines ........................................................................................... 1.8.2 General Principles.................................................................................................... 1.9 CO-ORDINATION OF NSW GOVERNMENT TELECOMMUNICATION .................................................................................. SUPPLY OF GOODS FROM HOSPITALS TO OTHER ORGANISATIONS ............................................................................................... CONTRACTS WITH PRIVATE HOSPITALS/NURSING HOMES .............. 1.10 1.17 1.18 1.11 25(1/10) 1.12 1.12.1 1.12.2 1.12.3 1.12.4 1.12.5 1.12.6 1.12.7 1.12.8 1.12.9 LEASING OF EQUIPMENT ............................................................................... 1.19 Background .............................................................................................................. 1.19 Considerations ......................................................................................................... 1.19 Provision of Lease Facilities .................................................................................... 1.19 Probity Issues ........................................................................................................... 1.20 Approval Levels ....................................................................................................... 1.21 NSW Government IT Master Leasing Facility ........................................................ 1.21 Classification of a Lease .......................................................................................... 1.22 Guidelines for Lease Classification ......................................................................... 1.23 Standardised Clinical Equipment Evaluation and Indemnity Agreement for Loan and Trial (of Clinical Equipment) Forms .................................................. 1.24 1.12.10 Procurement of Photocopier Equipment and Other Imaging Devices ..................... 1.24.1 1.13 1.14 CONTRACTORS – CONDITION WHEN ENGAGING .................................. 1.34.1 RADIATION ONCOLOGY EQUIPMENT – HEALTH PROGRAM GRANTS ................................................................................................................. 1.34.2 RADIATION ONCOLOGY EQUIPMENT – HEALTH PROGRAM GRANTS ................................................................................................................. 1.34.2 1.15 APPENDICES 1-A NSW Government Code of practice for Procurement. Details of Specific Practice Requirements ................................................................................................. 1-B Standards of Behaviour ............................................................................................... 1.35 1.40 26(13/5/10) CHAPTER 1 – PURCHASING PROCEDURES 1.1 INTRODUCTION 1.1 Officers dealing with stores and services should acquaint themselves with the relevant sections of the following handbooks/documents: • • • • The current issue of the State Procurement’s Contract Schedule and the General and Special Conditions of Contract Accounts and Audit Determination for Public Health Organisations NSW Government Procurement Policy NSW Government Code of Practice for Procurement The attention of all officers is directed to the confidential nature of prices and conditions shown in the State Procurement Contract Schedule and circulars. This information is to be used only for official purposes and must not be conveyed to persons or firms who are not holders of the particular contract. Attention is also drawn to the necessity to maintain strict control over all contract schedules, which should be kept in a secure place when not in use. To ensure the security of contract schedules areas are required to keep a record of the schedule issued to each officer and arrange a regular check to see whether the schedules are in the custody of the officers concerned. If it is found that any of the schedules has left the possession of an officer a report, giving all relevant details, should be furnished immediately to senior management. The State Procurement Policy is to be adhered to. It is to be noted that the “Preference” element of the policy applies to all purchases not just tenders. (Detailed in Chapter 3 Appendix 3B.) Public health organisations irrespective of the source of funds, are to ensure competitiveness in all their dealings whether of an expenditure or revenue nature. If revenue ventures are undertaken, e.g. vending machine contracts, baby photos, telephones, televisions, etc quotation and preferably tender action as specified in the Supply Manual should be undertaken. The extent that the matter is advertised should be based on an assessment of the benefits to be derived by the person or contractor offering the service. Staff involved in revenue ventures are to make themselves aware of the requirement under the Trade Practices Act. Methods of procurement and disposal should be chosen to achieve the best value for money, taking into account as appropriate quality, reliability, service support, initial and ongoing costs and other factors relevant to the circumstances. Ordering direct from NSW Government period contracts should always be the first option for common-use items for all NSW Government agencies if the product and contract conditions meet requirements. (See Chapter 2) All officers are to be aware of their responsibilities in respect to health and safety when engaging contractors. The Department of Health issued PD2005_227 “Better Practice Guidelines for including health and safety in the engagement, management and evaluation of contractors in health services”, the document incorporates an OH&S risk management approach to contractor management and provides a framework for local procedures in compliance with current OH&S legislation. The content of PD2005_227 is included in Chapter 3 Appendix 3-C of this manual. 24(7/09) CHAPTER 1 – PURCHASING PROCEDURES 1.2 Although equipment proposed to be procured may be built to appropriate Standards and the supplier/ manufacturer may have complied with the NSW Occupational Health & Safety Act 2000 and NSW Occupational Health & Safety Regulations 2001, this does not absolve Health Services and their OH&S responsibilities. Health Services need to ensure that their OH&S obligations are addressed and that equipment being procured is fit for purpose, used in accordance with supplier/manufacturer instructions and that staff are appropriately trained in its safe use. Health organisations are not to utilise contracts organised by the Commonwealth Government or other non-NSW state government entities. The content of this manual incorporates the general provisions of the ICAC document “Contracting for Services: The Probity Perspective”. In relation to the public health system (Areas, hospitals etc) the Director-General of Health has the authority to determine the purchasing policy and procedures to apply. Non-adherence to stated policy requires approval by the Director-General (or delegate). All applications for exemptions from these policy requirements should be addressed to the Department’s Director, Asset & Contract Services. 1.1.1 General Definitions Agency Any one item Health Service. Relates to the total value of the purchase of any one item or to one line of requisition. An item may not be “split” into its components nor a succession of orders for quantities of the same item issued for the purpose of avoiding any limitations to any delegation of authority. In relation to period contracts, the cost over the life of the contract is the determining factor. (See Period Contract next page.) The officer authorised to incur expenditure on various items in line with Health Service delegations. The officer appointed, authorised to pay claims. The practice of trading off one tenderer’s prices against another’s in order to obtain lower prices. Party calling for tenders and/or awarding a contract. All organised activities concerned with demolition, building, landscaping, maintenance, civil engineering, process engineering, mining and heavy engineering. The CACC consists of representatives of key agencies involved in construction procurement and assists the Government in the development of consistent and effective construction procurement practices, and in promoting the application of these practices by agencies. Person whose employment is governed by a contract of service, or a person deemed to be an employee under Australian or NSW industrial law. Entity that employs a person or persons under a contract of service or a person deemed to be an employer under Australian or NSW industrial law. Authorised officer Authorising officer Bid shopping Client Construction Committee Employee Employer 21(1/06) CHAPTER 1 – PURCHASING PROCEDURES 1.3 Employer association Fair Goods Organisation representing the interests of employers that is registered under Australian or NSW industrial law. Being unbiased, reasonable and even-handed. Being fair does not mean satisfying everyone or not reasonably pursuing one’s legitimate interests. A fair decision may still adversely affect parties. Includes without limiting the generality of the expression: i) assets such as equipment, plant, machinery, motor vehicles, tools, furniture, furnishings, floor coverings, office equipment, scientific apparatus, books and appliances which have useful lives of more than one year, hardware, medical and pharmaceutical supplies, information technology software and hardware; and ii) consumables such as stationery and provisions which are generally used up within a year. Motor vehicles are included in the definition of stores (note that only certain officers have the delegated authority to approve the purchase of motor vehicles and/or accessories). Organisation representing the professional, trade or commercial interests of its members in an industry. Fixed assets that support economic and social development in a fundamental way. Inventions, original designs, and practical applications of good ideas protected by law through copyright, patents, registered designs, circuit layout rights and trademarks. Also includes trade secrets, proprietary know-how and other confidential information protected against unlawful disclosure by law and through additional contractual obligations, such as confidentiality agreements, contracts and conditions of tendering. Regularly collect information to review performance against specified criteria. Client, tenderer or service provider. An entity’s role in a procurement will determine whether it is a client, tenderer or service provider for that procurement. Period contract means a contract under which there is a standing offer for the provision or disposal or goods or services over the period of the contract on the order of any customer for whom the contract has been arranged. Option periods are considered to be part of the term of the period contract. A contract over a period of time for the supply of services or goods where the price and quantity/extent of the service is known is not a period contract, it is a contract for the provision of the service/goods. The cost over the life of the contract should be the determining factor as to if and when tenders should be called viz over $250,000. All activities involved in acquiring goods or services either outright or by lease (including disposal and lease termination). Includes acquiring consumables, capital equipment, real property, infrastructure, and services under consultancies, professional services, facilities management and construction. 24(7/09) Industry association Infrastructure Intellectual property Monitor Party Period contract Procurement CHAPTER 1 – PURCHASING PROCEDURES 1.4 Public Health Organisations Purchasing officer Quotation/tender Service provider Services State Contracts Control Board Tender Tenderer Union Value for money Public health organisations as specified and scheduled in the Health Services Act and the Public Health System Support Division and bodies created under Part 1A of the Health Services Act. Term used to cover those officers responsible for the purchasing of orders. Whatever the value of the goods or services, “quotation” refers to oral offers only (unless written is specified) while “tender” refers to written offers. Includes contractors, subcontractors, suppliers and consultants that contract to provide goods or services. Includes without limiting the generality of the expression advisings (other than legal advisings) consultancies, management of information technology projects, printing services, installations and the performance of professional or trade operations of any kind (see separate conditions related to the procurement of consultancies and printing). The SCCB is established under the Public Sector Employment and Management Act 2002. Its membership includes representatives from the central, budget and non-budget agencies. It assists the Government in the development of consistent and effective non-construction related procurement practices, and promoting the application of these practices by agencies. Includes a price, bid, offer, quotation, consultant proposal or expression of interest lodged in response to an invitation or request for tender. Entity submitting a tender. Organisation of employees also referred to as a ‘trade union’, which is registered under Australian or NSW industrial law. This term also includes the Labor Council of New South Wales. The benefits, compared to whole-of-life costs. 1.1.2 NSW Health Procurement Advisory Panel The Department has established the NSW Health Procurement Advisory Panel. The Panel will be the principal source of advice on all major NSW Health procurement projects, except for those matters dealt with by the State Contracts Control Board and the Board of Reference and Advice, Department of Commerce. The objects of the Panel are to: • • • promote and promulgate best practice in procurement by public health organisations; provide advice to the Director-General, the Department of Health and public health organisations on the procurement of buildings, equipment, goods and services, consumables and contractors; and monitor the procurement practices of the Department of Health and public health organisations. The Panel is comprised of: • • • • • • the Deputy Director-General, Health System Support; the Director, Asset and Contract Services; a nominee of the Director-General, Department of Commerce; a health service chief executive nominated by the Director-General; a probity auditor; and two independent persons nominated by the Director-General. 21(1/06) CHAPTER 1 – PURCHASING PROCEDURES 1.2 RESPONSIBILITIES OF OFFICERS INVOLVED WITH PROCUREMENT 1.5 Under no circumstances are prices or conditions that are quoted/tendered to be divulged to any parties until quote/tender action has been finalised. Confidentiality of prices and conditions is to be maintained. An officer shall not knowingly requisition, attempt to obtain or obtain any goods or services, or dispose or attempt to dispose of goods, in a manner designed to circumvent or avoid any provisions of this Manual. Officers must disclose in writing to their immediate superior or other appropriate senior officer, any financial or other interests held by them immediately upon becoming aware that a potential conflict between personal interest and official duty, whether real or apparent, has arisen or is likely to arise. Special attention is directed to the necessity of: • • Effecting economy in dealing with and in the use of all health service property, in the methods of working, and in the number of officers employed; Ensuring that goods or services requisitioned or otherwise obtained shall be only such as will suffice for the reasonable needs of the health service or area and that excessive stocks of goods are not carried therein (except for bulk purchases in order to effect economies); Encouraging officers to submit suggestions for increasing the efficiency of the health service, or for diminishing the work to be performed and expenditure to be incurred; and Training officers, and providing facilities for them to improve themselves, in matters connected with their official duties by attendance at training classes organised by the health service in which they are employed, etc. • • Where under the purchasing policy any duty, obligation or power is imposed or conferred upon the Chief Executive, such duty, obligation, or power may be performed or exercised by a responsible officer delegated by the Chief Executive. 1.2.1 Drug Purchasing Those responsible for purchasing drugs must ensure that drugs listed in the “NSW State Contracts for Pharmaceuticals” are purchased from the approved supplier. It is essential to the continued success of the contract system that all hospitals order from the approved contractor. Any enquiries or complaints in regard to drugs purchased under the contract system are to be directed to the Supply Officer, Pharmaceuticals Contract, State Procurement on (02) 9372-7641. All purchase orders arising from the Pharmacy Department are to be signed by the Chief Pharmacist or his/her delegate. 21(1/06) In the case of a health organisation this would be a pharmacist.6 Orders for drugs of addiction specified under the Poisons and Therapeutic Goods Act 1966. handling and administration of drugs throughout the hospital.1). to report to the Contracts Control Board any case in which a contractor has not fulfilled any condition of a State Procurement contract. It shall be the duty of the Chief Executive.1 Best Practice Procurement processes should be structured to minimise costs for all parties. All officers will be held responsible for the safe custody of all goods and property under their care and control and for keeping any such goods in good order and condition. “Guidelines for the Handling of Medication in New South Wales Public Hospitals” (Refer to Patient Matters Manual page 20. or representative. hospital authorities should seek the active and continued involvement of the hospital’s Drug Committee.3. Each hospital is expected to take every possible step to keep drug expenditure to a minimum. consistent with the standards of behaviour required by the NSW Government Code of Practice for Procurement. However. details shall be advised to the Chief Executive through the usual channels. efficiency. For information on the handling and control of drugs including the role of the Drug Committee. and economic administration of the health service and the officer in charge of each area shall be responsible through the usual channels to the Chief Executive for the proper management of the area. orders for drugs of addiction are to be countersigned by either the Director of Nursing or the Director of Medical Services. Nursing Staff. 1. Officers in charge of buildings shall give timely notice in writing through the usual channels to the Chief Executive of any repairs which may be required. whoever is determined to have the responsibility by the hospital’s CE. Commitment to continuous improvement and best practice performance is expected of all those involved in government procurement. and its regulations shall be authorised only by a person authorised in terms of that Act.1 GENERAL RESPONSIBILITIES The Chief Executive shall be responsible to the Department for the discipline. in the case of contracts arranged locally. but are not limited to: 23(9/08) . control. Any officer who reasonably considers that health service property has been improperly dealt with shall advise the Chief Executive in writing through the usual channels and the Chief Executive shall forward copies of the advice together with any appropriate recommendation and report to the AuditorGeneral. storage.CHAPTER 1 – PURCHASING PROCEDURES 1. refer to PD2007_077. and all other personnel associated with the purchase. the Chief Pharmacist. Areas where this commitment may be demonstrated include. Orders for drugs of addiction are to be countersigned by the Director of Pharmacy or his or her nominee who is a pharmacist. In a small organisation where no pharmacist is employed. 1. To this end. Visiting and Staff Medical Officers. A Chief Executive shall ensure that all order forms are properly controlled and safeguarded. on request. 1. EDI. service provision. Aboriginal participation. Occupational health and safety management. and workplace injury management. gas. Payment practices. Other than for items purchased through petty cash goods and services shall only be requisitioned on an official order and appropriate entries shall be made in the Commitments Register. physical and financial resources. 1. Co-operative relationships. (2) authorised by the Chief Executive (3) correctly recorded in the Commitments Register In computer generated order systems or where hard copy orders are not generated. In respect of periodic service payments. g. Training management. Management of procurement risk. where individual orders are not raised. Non-adversarial dispute resolution. No order shall be placed unless there is evidence that the appropriate certification has been made regarding the authority to incur expenditure and availability of funds (a completed requisition would satisfy this requirement). g. Environmental management. electricity etc. and Innovation in design. processes and use of technology. Officers must. service quality and value for money outcomes. Planning and management of human. Ethical business practices. Tendering and contract management. Workplace practices. e. 21(1/06) .CHAPTER 1 – PURCHASING PROCEDURES • • • • • • • • • • • • • • • Client focus.3. Supply chain management.7 Details of specific practice requirements are provided at Appendix 1–A. available only to persons authorised to have access to them and used only for the purchase of goods and services for the health organisation. controls are to be in place to safeguard the integrity of all orders raised and to ensure that all orders are properly authorised. including reflective practices down the contract chain.2 General Orders Goods and services for a health organisation shall be: (1) ordered on its official order form. Orders are to be numbered sequentially (computer generated acceptable) and a record maintained of all order numbers. Commitments registers are to be maintained in respect of all goods or services to ensure that costs incurred as a result of the placement of an official order are accounted for. a standing order or register of payments is to be maintained as a control against double payment. furnish to the Contracts Control Board such information as it requires to perform its functions. e. 21(1/06) ..CHAPTER 1 – PURCHASING PROCEDURES Hospitals purchasing instructions are to be followed when submitting orders ensuring that: • • 1. timeliness. Twelve months orders with set quantities and prices. Policy in relation to preference for Australian and New Zealand products will be applied.” The Government expects that: Value for money will be pursued through fair and effective competition. g. 1. Examples of such orders are: a. with delivery of set quantities at set times. dentists. impartiality and fairness are familiar terms which are subject to multiple interpretations. with higher value cases being normally subject to open invitations to bid. as a guide to distribution upon receipt.4 New South Wales Government Expectations EXPECTATIONS What the New South Wales Government Expects “The community is entitled to expect that:.the products reflect the best value obtainable.g. taking account of quality.. e. with total dollar limit. a standing order may be placed.. Twelve months orders. b. Twelve months orders.. Where goods are ordered once to cover a certain period.. with no specification as to the number of each unit required overall or at a specific time.. e. with set quantities and prices. Under no circumstances are order forms to be used to obtain goods or services for other than hospital use. Impartiality and Fairness Value for money. agencies will buy from it to achieve savings derived from aggregating the State’s purchasing power. telephone charges etc. with deliveries at call.3. visiting specialists. initial and ongoing costs and other relevant factors. or selective invitations following a process of publicly inviting pre-registration or expressions of interest. Value for Money. a.3 Standing Orders For record purposes an order number may be allocated to services of a repetitive nature. with only one order being issued for a twelve month period. Other things being equal.. service.. If suitable goods or services are available from a NSW Government period contract.3. reliability. items at a per unit price....8 Full details are quoted on orders and copies of orders for items not to be placed into central store and should indicate the section for which they are required. the extent of competition sought by agencies will be consistent with the financial value of the procurement or disposal. 12 months. 1. . Impartiality means endeavouring to be objective and even-handed. clause 7 concerning the protection given to commercially valuable information). reliability and environmental impacts.. The processes of inviting and assessing bids or proposals will safeguard against favouritism. honestly and lawfully.. It can be unfortunate. knowledge and responsibility of the people involved including any external advisers will be appropriate to the nature. the principle of impartiality does not require publicly advertising for bids in every case or inviting bids from firms which are poor performers. “The community is entitled to expect that:. For example.. Being impartial includes taking account of practicalities. the lowest price bid might offer the best value if it meets other essentials. initial and ongoing costs are all factors which can make a significant impact on benefits and costs. However. timeliness. The principle of competitive neutrality will be applied wherever an internal bid is lodged in competition with external bids. for example. It is important to be clear about how value for money will be determined in any particular set of circumstances prior to assessing bids. in some circumstances fairness can also require taking account of the effects of actions on others. but not unfair..CHAPTER 1 – PURCHASING PROCEDURES 1. quality. complexity and magnitude of the procurement or disposal. such as quality. improper practices and opportunities for corruption.public sector personnel and their agents in dealings with the private sector act skilfully and knowledgeably.” The Government expects that: The skill. it is unfair to call tenders when there is no serious intent to award a contract subject to receipt of a satisfactory offer. The principle of competitive neutrality is outlined in Contracting and Marketing Testing Policy and Competitive Tendering and Contracting Out Costing Guidelines both published by the NSW Premier’s Department and obtainable from the NSW Government Information Service.. that people are adversely affected by decisions. Commercially sensitive information from tenderers will be treated confidentially subject to the requirements of the law. Fairness does not mean pleasing everyone. For example. (See Freedom of Information Act 1989. impartially and fairly. Private interests will not be allowed to influence decisions about procurement or disposal. For example. service. However.9 Value for money is determined by considering all the factors which are relevant to a particular purpose.. the impartial person will endeavour to objectively establish the criteria for determining best value for money and will endeavour to objectively assess each bid against the criteria. reliability.. Key information about winning bids such as name and price accepted will often be released. Value for money does not mean “lowest price”. schedule 1. 21(1/06) .. Fairness overlaps with impartiality in the sense of being even-handed. . All actions taken and requirements placed on others will comply with statutory requirements..10 “The community is entitled to expect that:....private sector firms whilst pursuing their own goals act honestly and lawfully in their dealings with government agencies and seek to provide the community with good value.. Needs will be defined in ways which do not unduly limit the range of bidders.. Opportunities to bid or to pre-qualify to bid will not be unduly restricted. “The community is entitled to expect that:.. inflation of prices to compensate unsuccessful tenderers. Bidders and contractors will act ethically.. They will disclose any conflict of interest and will not seek to undermine fairness and impartiality on the part of government agencies... 1..” The Government expects that: Bidders will seek to achieve best practice standards in their industry and will demonstrate that in fulfilment of contracts.. “The community is entitled to expect that:.... 21(1/06) ...CHAPTER 1 – PURCHASING PROCEDURES Agencies will have proper regard to the costs to industry of developing bids... Bids will only be submitted where there is a firm intention to proceed on the part of the bidder. REALISING THE EXPECTATIONS Full realisation of the expectations requires commitment and integrity on the part of officers of NSW Government agencies and on the part of private sector participants.. Bidders and contractors will comply with State and Commonwealth legislation including the trade practices and consumer affairs laws.” The Government expects that: Public sector executives and other persons involved in procurements and disposals will be aware of their responsibilities and will be able to account for their actions and decisions.mechanisms of audit and accountability enable reporting of the extent that processes and outcomes match these expectations. records of procurement and disposal decisions including the reasons for recommending and deciding on the selection and rejection of offers will be kept in a manner which facilitates audit and other normal processes of accountability.” The Government expects that: Fair opportunity will be seen by agencies to go hand in hand with obtaining best value for money... Parties will not engage in practices such as collusion in tendering. In particular.... hidden commissions or other such secret arrangements.there are fair opportunities available to persons and firms to bid or pre-qualify to bid for public sector business.... 4 PROCUREMENT STRATEGY If a decision has been made to use procurement to meet some or all of the identified service need. (Chapter 6) update pending Guidelines for the Engagement and Use of Consultants – information about the Government’s expectations about the use of consultants. draw upon other specialist expertise from within your agency or from outside.CHAPTER 1 – PURCHASING PROCEDURES 1. See Appendix 1-B. present information in their bids in the most succinct fashion appropriate to the Department’s requirements. bidders should: • • • respect the conditions of bidding set out in documents supplied by the Department including. values and practices which are consistent with the expectations. your project team needs to have appropriate authority and approval to act and make decisions. If necessary. (Chapter 10) Motor Vehicle Policy – outlines requirements that must be addressed in the management of motor vehicles. These are: • • • • • Simple Procurement Guidelines – information on how to conduct the procurement process for low risk/value goods and services. When establishing the project. 21(1/06) . the project is to be defined sufficiently so that funding approval can be obtained. (Chapter 4) Guidelines for Government Advertising – outlines requirements for advertising activities including approval requirements Appoint the project officer or team The skills and experience of the person or team needs to reflect the importance of what you are buying. when stated. the format bids are to be prepared.11 Chief Executives of NSW Government agencies must commit their organisations to objectives. In order to minimise the complexities and costs of assessing bids. respond promptly to all reasonable requests for additional information and meetings. Specific guides exist for particular types of goods and services procurement. 1. Private Sector Firms and Others Seeking to do Business with the NSW Government Private sector firms and other bidders for NSW Government business should commit themselves to meeting the expectations placed on them. (Chapter 2) Disposal Guidelines – information on how to conduct the disposal process for surplus or unserviceable goods. and the wider business and government context. financial implications. relevant industry standards. a Gateway Business Case Review will need to be completed. existing SCCB/agency arrangements you could tap into and the experience of other agencies buying similar goods and services. preferred and alternative options. a cost benefit analysis. funding. Managing stakeholder demands. Consider the potential environmental.12 At each stage during the process. If project-specific funding is required through the State Budget. an industry association that could provide useful information. including unrealistic expectations. This should include potential suppliers. including appropriate approval authorities. Further references: The Independent Commission Against Corruption has published guides to assist NSW Government agencies in understanding and managing probity issues. The potential for benefits or adverse impacts needs to be identified at an early stage and managed throughout the procurement process. Occupational Health Safety and Rehabilitation Guidelines. This will assist you to recognise and take action on any obstacles at an early stage and to maintain stakeholder support. [Further information: Business Case Guidelines. social and economic development goals. identify stakeholders. project resources and timeframe. A business case typically includes the context for action. Environmental Management Guidelines] Establish potential service providers Research of the marketplace needs to be done. Particular references are: • Pitfalls or Probity: Tendering and Purchasing Case Studies • Contracting for Services: The Probity Perspective • Direct Negotiations in Procurement and Disposals. stakeholder considerations. For purchases over $5 million agencies are required to prepare an Industry Impact Statement. (Premier’s Circular 00-79). Plans to monitor and manage the risks identified should be developed and updated during the project. [Further information: Risk Management Guideline]. economic development and social benefits and impacts Procurement should not occur in isolation of the Government’s broader environmental. from the beginning of a project will help to keep it on time and budget. This should include the consequences of the project failing on service delivery. stakeholder and change management plans. a risk assessment needs to be done. Submission for Funding Approval The Government’s Strategic Management Framework provides a guide to the budgetary process. and how the success of the project will be judged and how this will be measured. [Further information: Economic Development Guidelines. Undertake a risk assessment Before deciding to proceed with the project. [Further Information Economic Development Guidelines] If the estimated cost of the project is in excess of $10 million or the project is assessed as high risk using the Gateway Risk Profile Assessment Tool. a detailed business case will be required. 21(1/06) .CHAPTER 1 – PURCHASING PROCEDURES Engage stakeholders 1. 25(1/10) .5 HEALTH SERVICE PROCUREMENT 1. 1.6 GENERAL PURCHASING LIMITS 1.CHAPTER 1 – PURCHASING PROCEDURES 1. where the SCCB has arranged a period contract.000 limit.3 Goods and Services/Works over $30.000 limit. 1.1 Goods and Services/Works up to $3. (b) 1. Where there is no SCCB period contract.2 Goods and Services/Works over $3.000 in value inclusive of GST Not in contract goods and services may be obtained to best advantage without quotations subject to the following conditions: (a) Rates being considered reasonable and consistent with normal market rates for items of a like nature.13 * The procurement of goods and services by Health Services must be through the State Contracts Control Board (SCCB). and Requirements not being split into components nor succession of orders for the same goods or services for the purpose of enabling the goods/service to be obtained under the $250. and Requirements not being split into components nor succession of orders for the same goods or services for the purpose of enabling the goods/service to be obtained under the $30. purchasing can be undertaken within the delegations established by the Department.000 in value (inclusive of GST) being obtained by seeking at least one (1) written proposal.000 in value inclusive of GST A minimum of three (3) quotations must be obtained in writing. and Requirements not being split into components nor succession of orders for the same goods or services for the purpose of enabling the goods/service to be obtained under the $3. subject to the following conditions: (a) (b) Rates being considered reasonable and consistent with normal market rates for items of a like nature.001 and up to $250. (a) (b) Rates being considered reasonable and consistent with normal market rates for items of a like nature.6.000 in value inclusive of GST Not-in-contract goods and services up to $30.6.6.000 limit. if they are available.001 and up to $30. 13.6. Westmead and Ambulance Service of NSW have been granted interim accreditation and may undertake procurement activities up to a value of $100 million without reference to the Department of Commerce.CHAPTER 1 – PURCHASING PROCEDURES 1. NSW Health has an Agreement with its preferred supplier to provide a print management service. Area health services.nsw.gov. 24(7/09) .5 PRINTING The delegations for printing have been aligned with the delegations for procuring goods and services.health.1 Goods and Services/Works over $250. Affiliated health organisations can tender themselves.au/ecsd/ssc/purchasing. Total value includes purchase cost and whole of life costs. 1. Additional information on the procurement of printing can be found at http://internal.6.html and then clicking on the Printing link. Required to submit full details and specifications to the Department of Commerce (NSW Procurement – Contracting Services) for the invitation of tenders. Procurement of printing under this Agreement precludes the need for staff to obtain additional quotations as the service provider will undertake this task on behalf of the Health System.001 in value inclusive of GST (including period contracts) Full tendering action required. Children’s Hospital.4 1. at a lesser value than the Department’s delegation. Notwithstanding the above delegation. diagnostic services). whether initiated by the private or the public sector. if Departments/Agencies consider the proposed purchasing action to be of such a nature as to warrant consideration of State Procurement/SCCB. the matter can be referred for consideration irrespective of monetary value. h. tendering and contracting continue to apply in these cases. irrespective of whether the items concerned are available in contract. Benefits could include. Monetary figures are inclusive of GST. d. i. Health Services located in rural areas are able to make local purchases of up to $1500 in value. community health centres. provided that the local purchases are more advantageous. In such situations employees are not ultimately put to any expense and are not to gain any personal benefit from the transactions. gaining points on the employees’ personal “Fly Buy” cards or other credit card loyalty schemes. Rates being considered reasonable and consistent with normal market rates for items of a like nature. a. j. binding etc. These procedures should be applied to all proposals involving privately funded infrastructure (eg hospitals. b. or to tendering or contracting for capital works funded by the public sector. 1.1 FLY BUY CARDS (PD2005_260) Public health system employees on occasion are required to procure goods on behalf of the organisation or patients/clients and then recoup the expense from the organisation or patient/client. g. the matter can be referred for consideration irrespective of monetary value. if Health Services consider the proposed purchasing action to be of such a nature as to warrant consideration of Department of Commerce (State Procurement)/State Contracts Control Board. e. 1. but are not limited to. layout.14 The abovementioned delegations are subject to the following conditions. Requirements not being split into components or succession of orders. c.CHAPTER 1 – PURCHASING PROCEDURES SPECIAL NOTE: 1. Monetary figures are inclusive of GST. f.2 PRIVATE SECTOR PARTICIPATION IN PUBLIC HEALTH SERVICES (91/102) This Section outlines current Departmental policy on the procedure to be followed by all Health Services in dealing with proposals for private sector participation in the provision of health services paid for by the State. Health Services are also to ensure that details of requirements of a repetitive nature are to be referred to Department of Commerce (State Procurement) so that consideration can be given to the arrangement of a period contract if necessary. Where Health Services do not have the expertise to implement this Delegation they may refer the request for purchase to State Procurement for appropriate action. printing. The usual arrangements for purchasing. Notwithstanding the above delegation. 21(1/06) . The monetary threshold includes the whole printing process of design. Health Services may wish to impose their own limits. for internal management purposes. These procedures do not apply to purchasing of goods and services for use by the public sector. 15 Guidelines for Private Sector Participation in Infrastructure Provision were issued in July 1990 by the NSW Department of State Development.to indicate the financial and non-financial consequences of implementing the proposal. Preliminary feasibility analysis . Proposals involving the sale. The Department’s Human Resources Branch must be involved in discussions on industrial issues prior to submitting a proposal. Assessment of industrial impact . operations and financial) of the Department/Area/Hospital. Assessment of impact on the public sector . while maintaining sufficient flexibility to allow a range of creative solutions to be submitted. the approval of the Cabinet Capital Works Committee is also required.to provide some assurance that the proposal is realistic and achievable. or lease for 3 years or more. of land or buildings must also be referred to the Department’s Asset & Contract Services Branch. 21(1/06) . Before calling expressions of interest for public health infrastructure or services.CHAPTER 1 – PURCHASING PROCEDURES 1. Commercial/economic evaluation . Private Sector Development Branch. it is essential that the following analysis has been carried out: • Strategic analysis .8. Copies of the Guidelines are available from the Director. The strategic analysis would review long term site utilisation if a proposal envisages sale or lease of publicly owned land or buildings. The essence of the Guidelines is the calling of Expressions of Interest (EOI). to ensure that all private sector organisations capable of undertaking the project have an opportunity to do so. For capital works estimated to cost more than $5 million. a brief should be prepared in accordance with the Guidelines for Private Sector Participation in Infrastructure Provision for issue to respondents. • • • • If the foregoing analysis indicates that private sector development is feasible and likely to be costeffective.to identify and evaluate the costs and benefits of alternatives available for the provision of a service.to indicate possible union/association reactions to implementing the proposal. The brief to be issued to respondents must be approved by the Director-General and the Minister before calling expressions of interest. the proposed role (organisational. The brief must include (inter alia): • • criteria for assessment of proposals.1 Government Guidelines 1.to demonstrate where the proposed activity fits within the corporate plan for the Area and whether the activity is viewed as a core activity or peripheral service. The Guidelines have been taken into account in preparing this circular. 9 CO-ORDINATION OF NSW GOVERNMENT TELECOMMUNICATIONS (Prem. other licensed carriers. The point of contact will usually be the Director. authorities or departments. • The Department’s Central Administration can assist Areas in each step of the process. ights-of-way. and will be responsible for co-ordinating input from other Branches. operated. activities and staffing. licensed resellers and second carrier proponents regarding lease. authorities and departments intending to commercialise telecommunications assets should refer all proposals to the Telecommunications Unit. but are not restricted to the following: -r optical fibre. Private Sector Development or. co-axial or other cable. sites (both permanent and moveable) suitable for pay telephones. avoidance of joint ventures and creation of public subsidiaries. Capital Works.2 General Principles Relationships with the private sector should incorporate the following principles: • • • separation of public and private facilities. microwave and radio systems.8. the Director. 21(1/06) .16 When the EOI brief has been approved. avoidance of contingent liabilities or indemnities having particular regard to the requirements of Loan Council.CHAPTER 1 – PURCHASING PROCEDURES 1. access to Government retail outlets and other commercial arrangements. rooftops and ducting. These officers can advise on feasibility studies and the approval process. contracting and other arrangements to be cost-effective. commercialisation or options for use of telecommunications assets owned. 1. expressions of interest should be invited by public advertisement. 1. FACILITIES AND ANCILLARY MATTERS BY THE COMMERCIAL SERVICES GROUP’S TELECOMMUNICATIONS UNIT The following directives apply to all NSW Government departments. formal commercial contracts for all trading relationships. structures. towers. sale. Such assets include. Memo 91-22) DIRECTIVE FOR THE ADMINISTRATION OF NSW GOVERNMENT TELECOMMUNICATIONS ASSETS. authorities and agencies. maintained or otherwise controlled by NSW Government agencies. taking account of potential revenue losses and both capital and recurrent costs. Government agencies. The Telecommunications Unit shall have responsibility for the co-ordination of all negotiations with Telecom/OTC. 1. radio aerials and other telecommunications devices. for proposals associated with currently approved works. establishment of arms-length. Such organisations must be non-profit earning and be in receipt of State Government financial assistance. liaison with telecommunications standards organisations including Standards Australia.CHAPTER 1 – PURCHASING PROCEDURES 2. particular organisations request to purchase goods or services from hospitals. 3. 1. Government agencies. The Telecommunications Unit has responsibility for coordination of the following aspects of telecommunications within Government: liaison with the Commonwealth Department of Transport and Communications regarding radiospectrum licensing and other telecommunications regulatory matters. The State Procurement has advised that the Government has recently decided to grant community oriented and charitable institutions access to the Department’s purchasing facilities. Broadly speaking. These include: no Government bodies are to enter into network or service contracts with Telecom or OTC with terms in excess of one year without approval of the Telecommunications Unit. if it is permitted to do so. any proposed expenditure above $1 million be referred to the Telecommunications Unit so as to ensure that such investments are consistent with the Government’s network design and future evolution. rather than deal through a public hospital to gain similar concessions. each proposed purchase shall be referred to the Telecommunications Unit for approval. 1. education. subject to meeting certain conditions. 4.17 The provisions of Memorandum 90-66 are confirmed and still applicable to all agencies. liaison with Austel regarding regulatory matters and technical standards. these organisations must be registered charitable or community benevolent organisations providing a community aid service related to the aged. child welfare. To ensure that the telecommunications interface of any PABX (in excess of 50 lines) purchased prior to the establishment of the Government’s private telephone network is consistent with the implementation of the Government’s network. although provision exists for the Minister of Industrial Development and Decentralisation to approve access to organisations which do not meet the full criteria. applications and other submissions to the above organisations should pass such submissions through the Telecommunications Unit. it would be preferable for these organisations to make direct use of the facilities of the State Procurement. 21(1/06) . For this reason. authorities and departments wishing to make representations.10 SUPPLY OF GOODS FROM HOSPITALS TO OTHER ORGANISATIONS Periodically. disabled. health or disadvantaged persons or other organisations which from time to time may be included in Government Welfare programs and access is approved by the Minister of Industrial Development and Decentralisation. under which access is granted.11 CONTRACT OF SERVICES BY PUBLIC HEALTH ORGANISATIONS CONTRACTS/AGREEMENTS FOR AREA HEALTH SERVICES AND STATUTORY HEALTH CORPORATIONS TO PROVIDE SERVICES Delegation means the approval of an Area Health Service or statutory health corporation entering into contracts or agreements with any person for the provision of any service by the area health service or statutory health corporation to that person. all potential contracts over $50. combinations of private sector and non public sector health contracts does not exceed 10% of total capacity. Accordingly. If the Agencies involved are so entitled. then it will not be necessary to approach hospitals for the supply of goods.000 per annum are to be submitted to the Department of Health for approval. the organisation is able to provide advice on new/recurrent contracts with non public health organisations to the Finance and Commercial Service Division at the end of each quarter. 21(1/06) . The Minister for Health’s approval is required for all such contracts.18 Because of the complexities of Government Accounting and also questions which could arise as to the legal situation of the hospital if it supplies goods obtained under certain privilege to voluntary agencies which may not be entitled to the same privilege. It is suggested that hospitals should advise these organisations to apply to the State Procurement and the Minister for Industrial Development and Decentralisation seeking access to the Department’s purchasing facilities. contingency plans for alternate supply arrangements in case of failure or breakdowns are in place before entering into any contracts. Chief Executives of area health services and statutory health corporations are delegated authority to approve contracts for non-direct care public health services with other organisations for the provision of services from excess capacity of normal operations to a value of $50. the Department is naturally not anxious to encourage any system of sale or transfer of goods from hospitals. the procedure to be followed in the first instance is to ascertain from the State Procurement and the Minister for Industrial Development and Decentralisation whether the Voluntary Agencies involved are entitled to deal directly with State Procurement.000 per annum for any single contract by the area health service or statutory health corporation subject to: • • • • • • the provision of services is from excess capacity arising from the normal operations of the organisation. Longer contracts will need Departmental approval.CHAPTER 1 – PURCHASING PROCEDURES 1. PROCEDURES: Under no circumstances are delegates to approve contracts for the provision of direct care public health services. contracts are for three (3) years or less. 1. outlining the conditions mentioned above. 12.1 Background 1.2 Considerations Basic considerations in leasing equipment are: 1.12.12 LEASING OF EQUIPMENT (PD2005_146) 1. (Definitions of a finance lease and an operating lease are attached.CHAPTER 1 – PURCHASING PROCEDURES 1. and finance leases can only be approved on a specific case basis by the Treasurer. The policy advised in this circular has been developed following consultation with and consideration of comments provided by Area Health Services.12.3 Provision of Lease Facilities: There are various methods of providing the leasing facility.19 For some time consideration has been given to the need for a leasing facility to be provided for both major and minor equipment. a lease arrangement could be beneficial. The opportunity to convert to new technology as it occurs during the term of the lease. not a finance lease. Any arrangement must be an operating lease. 21(1/06) . Provided there is a market for secondhand equipment which allows leasing companies to eventually dispose of the leased equipment and thus provide competitive lease rates. 2. A central lease facility arranged by tender and available either on a structured take up arrangement or on ad hoc take up. as well as criteria for classification. and is to provide details of the source of these funds and indicate that any impact on the Net Cost of Services result or other financial management requirements of the Health Service can be appropriately managed. 3. 1.) All approved lease proposals must contain a certification by the Chief Executive and Director of Finance that the proposal is an operating lease in accordance with Accounting Standard AAS 17. The Director of Finance is to certify that on a current and forward years basis funds exist to cover the lease payments. It could provide: • • Access to equipment not affordable on a capital purchase basis. Those involved in considering financing proposals through leasing are to ensure compliance with the provisions of relevant legislation and policy. 1. State Government policy does not condone finance leasing. evaluation of alternatives and decision-making are retained for accountability purposes. and that adequate documentation of financing proposals. the main ones being: 1. Supplier financed lease. 1. This is desirable both for commercial and probity reasons. and tenders then called accordingly. The major decision is. This does. how to approach the call for tenders and resultant evaluation. Therefore prior to calling tenders a decision needs to be made as to whether the items are to be subject to straight out purchase or a lease arrangement. However. This method needs further examination. restrict tenders somewhat. Third party finance arranged by the supplier.4 Probity Issues: • • • • • Basic equity of access to the total process is the main consideration. 3. A further option is to call tenders for the supply of equipment under a lease option. where it is reasonably certain that a particular number will be required within a particular period.20 A central lease facility would be suitable for program purchasing. as they can be arranged in the same tender as the equipment.CHAPTER 1 – PURCHASING PROCEDURES 2. based on value for money it would not be possible for a lease proposition to be assessed superior to a straight out purchase. however. 4. as suppliers can only tender if they can offer a lease option. The cost of finance would increase considerably if there is uncertainty as to the type and mix of equipment and the possible take up value. • • 21(1/06) . generally the most economic source of funds would run in the order: • • • Tendered Third party arranged by supplier Supplier. Supplier financed and third party (arranged by supplier) leases are convenient. either self funded or third party funded. ie quotations. but looks suitable mostly for structured statewide procurement. should be in line with the requirements for procurement at various expenditure levels indicated in the Purchasing and Supply Manual. of course. However. The method of procurement.12. 1. In general. tender documentation and evaluation methodology should clearly indicate the position. unless there is a consumables commitment attached which subsidises the lease cost. Third party finance arranged by tender for specific project. the best results are achieved by tendering the lease facility separate to the equipment acquisition. At the present time some tenderers are submitting lease options of various types as an alternative tender to an acquisition option. If for any reason the one tender calls for either a purchase or a lease option. tenders. CHAPTER 1 – PURCHASING PROCEDURES 1.000. All new operating leases that are IT in nature should be funded under the Master Leasing Facility. Where the equipment being procured has a functional relationship to another Branch of the Department. b. The threshold relates to the capital equipment cost or the extent of the take up under one facility. This evaluation should compare the viability of purchasing the asset against the lease option.21 Involves a capital equipment cost in excess of $500. Agencies should undertake a full evaluation using Treasury’s Financial Appraisal Guidelines prior to deciding to use the Facility.6 NSW Government IT Master Leasing Facility The Department of Commerce has established an IT Master Leasing & Asset Management Facility for use by NSW Government organisations. It should be noted that Treasury Circular 98/7 requires that all proposals for operating leases with a contract threshold amount of $1 million or more be submitted to Treasury for assessment. In particular.5 Approval Levels: 1.12. it should be submitted via that Branch. Finance and Commercial Services. 2. application can be made to the Department seeking increased levels. therefore be consistent with agencies’ IT strategic plans and be included in overall capital strategic plans. Use of the Facility does not absolve an agency from observing all current requirements relating to investment in IT equipment. Any claims for exemption from this requirement must be submitted through the Department to Treasury. prior to any in-principle decision being made on whether to proceed or any tender document being issued. Where a Health Service wishes to have a delegation in excess of the above levels. Applications are to be forwarded to the General Manager. a business case must be forwarded to the Finance Branch of the Department for consideration. Such application will be considered on a case by case basis and must demonstrate: • • • • ability to operate within Net Cost of Services allocations (SP&T and Special Projects excluded) ability to operate within the limit of Government Cash Payments ability to repay any loans to the Department ability to manage cash at bank.12. 21(1/06) . it is expected that all agencies follow procedures consistent with the applicable guidelines issued by the Office of Information Technology. Prior to any new lease commitment being entered into which either: a. or Involves a payment in any one year in excess of $100. 3. Projects being funded through the Facility should. 1.000. For the purposes of these restrictions an acquisition should not be split into its components nor divorced from the overall project to avoid the approval requirements. 1. maintenance.7 Classification of A Lease A lease is a finance lease if it effectively transfers substantially all the risks and benefits incident to ownership. 1.12. The agency must be able to demonstrate the cost effectiveness of a sale and leaseback by undertaking a detailed financial analysis. nor should a lease necessarily be classified as a finance lease by virtue of the route followed on these charts. If the agency wishes to retain the proceeds from the sale it will need to demonstrate that it can fund future lease payments from within existing forward estimates. General When calling for tenders other than a basic leasing facility the information requested from suppliers should be sufficient to clearly establish: • • • • • • The basic cost of the equipment items supplied. The substance of the transaction determines the classification. and any requirement to commitment to.CHAPTER 1 – PURCHASING PROCEDURES The Facility also contains a sale and leaseback option. The additional cost due to the leasing arrangement. No Is the lease non-cancellable? Yes Is ownership transferred by the end of lease term? Yes No Does the lease contain a bargain purchase option No Is the lease term for 75% or more of the useful life of the leased property? Yes Yes 21(1/06) . The following chart gives examples of situations in which a lease could normally be classified as a finance lease by a lessee and lessor.22 Where an agency wishes to sell an asset to a financing provider and then lease back this same asset the following requirements will apply: • • • • Approval to follow this approach must be sought from the Treasury through the Department. It should be ensured that contracts arranged do not place an obligation for ongoing commitment past the initial contract period. The examples do not necessarily reflect all possible situations in which a lease may be classified as a finance lease. The provider of the lease finance (supplier or third party). The cost of. 1. The validity of the arrangement as an operating lease. The cost of any associated consumables. The agency will need to reach agreement with the Treasury on how the proceeds from the sale are to be utilised. however. this criterion would not be appropriate for purposes of classifying the lease. in normal circumstances. b. 1. “Non-cancellable lease” means a lease which (i) (ii) can be cancelled only with the permission of the lessor or upon the occurrence of some remote contingency. or. 2. would incur a penalty of a magnitude that.23 Yes “Finance lease” means a lease which effectively transfers from the lessor to the lessee substantially all the risks and benefits incident to ownership of the leased property. The lease is non cancellable. including earlier years of use. 3. (iii) provides that the lessee. the lessee. and. “Operating lease” means a lease under which the lessor effectively retains substantially all the risks and benefits incident to ownership of the leased property. upon cancellation. Either of the following tests is met: (i) the lease term is for 75 per cent or more of the useful life of the lease property. from lessor to lessee.8 Guidelines for Lease Classification: The following criteria are presented as guidelines to assist in classifying leases. 21(1/06) . 1. The effective passing. would be committed to enter into a further lease for the same or equivalent property with the same lessor or a third party related to the lessor.12. could be expected to discourage cancellation. upon cancellation. of substantially all of the risks and benefits incident to ownership could normally be assumed where the following criteria are satisfied: a. if the beginning of the lease term falls within the last 25 per cent of the total useful life of the leased property. Finance Lease 1. or. or.CHAPTER 1 – PURCHASING PROCEDURES No Is the present value of minimum lease payments equal to or greater than 90% of the fair value of the leased property? No Operating Lease Leasing (Information Based On Accounting Standard AAS 17) Definitions of Types of Lease: 1. CHAPTER 1 – PURCHASING PROCEDURES (ii) 1.24 the present value, at the beginning of the lease term, of the minimum lease payments equals or exceeds 90 per cent of the fair value of the leased property to the lessor at the inception of the lease. (The discount rate to be used in calculating the present value, is the interest rate implicit in the lease.) 1. In order to discount the minimum lease payments to their present value as at the beginning of the lease term, the lessee will need to know or be able to ascertain the interest rate implicit in the lease. Where the lessee knows the fair value of the leased property at the inception of the lease and is able to make a reasonable estimate of their dual value, the implicit interest rate can be readily computed. However, in certain circumstances the lessee may not know the fair value of the leased property or be able to estimate reasonably the residual value. In these circumstances the lessee will need to estimate the interest rate implicit in the lease. 1.12.9 Standardised Clinical Equipment Evaluation and Indemnity Agreement for Loan and Trial (of Clinical Equipment) Forms (Information Bulletin 2004/29) NSW Health Procurement (HP) has developed a set of standard forms for use by Health Services in the evaluation of Clinical Equipment. The forms were developed collaboratively with Health Service Clinical Product Managers and Biomedical Engineers and have been extensively trialled across the state. Use of the four forms (listed below) will help minimise risks to Health Services in acquiring (loan) clinical equipment for evaluation. Their use in conjunction with the HP’s Clinical Equipment Evaluation Database will also help minimise the incidence of multiple evaluations of the same equipment across Health Services. Health Services are advised in the interest of minimising unnecessary duplication of effort to use the Forms in all clinical equipment evaluation initiatives. Standardised Clinical Equipment Evaluation & Indemnity Agreement Forms: A. B. C. D. Clinical Equipment Presentation & Indemnity Form Clinical Equipment Specialist Review Form Clinical Equipment Evaluation Results Committee Recommendation Forms The forms are available on the HP’s intranet site. 22(5/07) CHAPTER 1 – PURCHASING PROCEDURES 1.12.10 Procurement of Photocopier Equipment (PD2006_032) 1.24.1 New South Wales Treasury has advised that State Contract 390 allowing operating leases finished on 31 December 2005, and the Imaging Devices contract that replaces it, Imaging Devices Contract 2390, has no provision for leasing. In accordance with Treasury advice, Health Services are not to enter into leases for photocopier equipment, or other equipment covered by the new Imaging Devices Contract 2390, and are to purchase these assets from 1 January 2006. Purchases are to be sourced from savings against the recurrent allocation and are to be reported as RMR > $10,000 unless individual assets are valued in excess of $250,000 in which case contact with your nominated Asset & Contract Services liaison officer will be necessary to establish a specific locally sourced projects for CAPDOHRS reporting requirements. The issue of this policy directive does not affect orders placed with lessors before 1 January 2006 which were subsequently settled after 31 December 2005. 22(5/07) CHAPTER 1 – PURCHASING PROCEDURES 1.24.2 22(5/07) CHAPTER 1 – PURCHASING PROCEDURES 1.25 NSW HEALTH PROCUREMENT CLINICAL EQUIPMENT GENERIC FORMS • • PART A - CLINICAL EQUIPMENT PRESENTATION & INDEMNITY FORM For completion by Suppliers PART B - CLINICAL EQUIPMENT SPECIALIST REVIEW FORM For completion by Biomedical Engineering / Infection Control / OH&S Specialists • • PART C - CLINICAL EQUIPMENT EVALUATION RESULTS For Completion by Trial Coordinators PART D - COMMITTEE RECOMMENDATIONS FORM For Completion by Clinical Product Procurement Committee RELEASE 1.1 – 25 May 2004 HP Clinical Equipment Procurement Working Party 22(5/07) CHAPTER 1 – PURCHASING PROCEDURES PART A - CLINICAL EQUIPMENT PRESENTATION & INDEMNITY FORM To be completed by Suppliers - [Page 1 of 4] 1.26 Note: Referencing suitable code & guidelines is acceptable when answering some parts of this form. Supporting documents may be attached to answer questions where space provided is insufficient. PRODUCT INFORMATION Description of Equipment [Attach relevant brochures] Description of Clinical Application Brand Name Model Number EAN/HIBC Compliant Contract Number Contract Item Number Describe any re-processing requirements Yes No Manufacturer Model Name NSW State Contract Department of Commerce Electro Medical Contract Yes Yes No No SUPPLIER INFORMATION Name of Supplier Address Phone E-Mail Web Address Representative Phone E-Mail REGULATORY COMPLIANCE TGA number Details of regulatory conformance [attached certificates] Applicable standards Facsimile Mobile 21(1/06) CHAPTER 1 – PURCHASING PROCEDURES PART A - CLINICAL EQUIPMENT PRESENTATION & INDEMNITY FORM To be completed by Suppliers- [Page 2 of 4] EVALUATION REQUESTED BY Name Organisation Phone PRICE INFORMATION Indicative value of equipment $ Discount available Yes Yes 1. 2. 3. 4. 5. $ $ $ $ $ Facsimile 1.27 No No Are other methods for purchasing available, e.g. leasing, cost per test List accessories available 1. 2. 3. 4. 5. Are accessories available from other sources? Discount available for consumables List consumables available 1. 2. 3. 4. 5. Are dedicated consumables necessary? Delivery cost if not FIS Indicative installation cost Installation issues Method of disposal for: Equipment Packaging Consumables Replaceable components Additional Information supporting environmental friendliness of product $ $ Yes No Indicative cost of consumables 1. 2. 3. 4. 5. Yes No Lead time $ $ $ $ $ Indicative cost of accessories Yes No Days 21(1/06) CHAPTER 1 – PURCHASING PROCEDURES PART A - CLINICAL EQUIPMENT PRESENTATION & INDEMNITY FORM To be completed by Suppliers- [Page 3 of 4] OCCUPATIONAL HEALTH & SAFETY INFORMATION Contain hazardous substances Contain sharps Does the device contain or emit radioactivity? Provide details if answered Yes to any of the above Yes Yes No No Yes Manual handling issues Contain latex No Yes Yes No No 1.28 GENERAL EVALUATION INFORMATION Reference site(s): Contact person(s) at reference site: Equipment Status: Upgrade Supplier’s Policy & Detail(s): New to market Yes No Upgradeable Yes No HAZARD ALERTS Have there been any alert in Australia or international regarding this equipment? Action taken to address the alert: Yes No TRAINING AND SUPPORT INFORMATION User training & education available Description of user training & education Yes No Cost [if any] $ Technical support training available Description of available technical support training Yes No Cost [if any] $ Comprehensive workshop manufacture service manual Yes No Cost [if any] $ 21(1/06) CHAPTER 1 – PURCHASING PROCEDURES PART A - CLINICAL EQUIPMENT PRESENTATION & INDEMNITY FORM To be completed by Suppliers - [Page 4 of 4] 1.29 After sales “user” support available After sales “technical” support available After sales technical support provided by: Identify third party provider Yes Yes No No Cost [if any] $ Supplier Third Party Technical / Maintenance service support agreement available Description of Technical / Maintenance service support agreement Yes No 1. 2. 3. 4. 5. 6. List accessories supplied Serial number $ $ $ $ $ $ Indicative cost Quantity Supplementary specifications - where the Public Health Organisation provided specifications for equipment and / or terms for purchase, has these been adhered to and a copy attached? Alternative sources of accessories provided Proof of acceptance testing per AS3551 provided Service manual provided Operator’s manual provided Occupational Health & Safety declaration provided Signed “Indemnity Agreement for Equipment on Loan or Trial” provided [Refer to Indemnity Agreement form as provided by the Public Health Organisation] Signed on behalf of the Supplier Name of Supplier Representative Yes Yes Yes Yes Yes Yes Yes No No No No No No No Signature ______ ______________________________ Date _____/____/____ 21(1/06) 30 Upgrade Area Tender Substitution CAG Review New to Market BIOMEDICAL REVIEW Is the purchase of this equipment in line with the Organisation’s equipment standardisation / harmonisation strategies? Provide details / explanation if you answer “No” to the above Yes No Are accessories necessary? Are there alternate sources of accessories? Are dedicated consumables necessary? Comments on accessories / consumables: Yes Yes Yes No No No Has evidence been provided to confirm compliance to the following? Regulatory Compliance Quality Certification [ISO 9000]? Legible manufacturer / brand name on equipment? Date of manufacture stamp on equipment? Country of manufacture stamp on equipment? Estimated routine maintenance cost Installation issues: $ Per annum Yes Yes Yes Yes Yes No No No No No 21(1/06) .CLINICAL EQUIPMENT SPECIALIST REVIEW FORM To be completed by Biomedical Engineering / Infection Control / OH&S Specialists – [Page 1 of 3] Reason for Evaluation: 1.CHAPTER 1 – PURCHASING PROCEDURES PART B . Has acceptance testing been carried out Document attached Comments & recommendations Yes Yes Yes Yes Yes Yes 1. can preventative maintenance be carried out in-house? Special tool(s) required? Known problems or hazards with this equipment Comment on expected clinical effectiveness DOCUMENTATION EVALUATION REVIEW [Refer Part A – Form 4 of 4] Availability of service manual Paper CD Acceptable Acceptable Acceptable Acceptable Acceptable Acceptable Internet site Not acceptable Not acceptable Not acceptable Not acceptable Not acceptable Not acceptable Technical manual Full service information Description of circuits Description of spare parts Operators manual All necessary clinical information required to evaluate Comments & recommendations Market assessment – should other suppliers be assessed Evaluating Officer – Biomedical Engineering Name Signature ___ _________________________________ Position Date_____/____/____ Yes No 21(1/06) .g.31 No No No No No No Maintenance issues e. Biomedical testing is required.CHAPTER 1 – PURCHASING PROCEDURES PART B .CLINICAL EQUIPMENT SPECIALIST REVIEW FORM To be completed by Biomedical Engineering / Infection Control / OH&S Specialists – [Page 2 of 3] BIOMEDICAL REVIEW CONTINUED Acceptance testing as per AS3551 [Refer Part A – Form 4 of 4] Is there an “Acceptance Test” done by supplier? o Is the supplier provided “Acceptance Test” acceptable? o Is the documentation acceptable? o Is the date of testing acceptable? If answered NO to any of the above. 32 No No No No No No Evaluating Officer – Infection Control Name Position Signature ______________________________________ Date_____/____/____ OCCUPATIONAL HEALTH & SAFETY REVIEW [Refer Part A – Form 4 of 4] Contain Hazardous substances Manual Handling issues Comments & recommendations Yes Yes No No Evaluating Officer – Occupational Health & Safety Name Signature ____________________________________ Position Date _____/____/____ 21(1/06) .CLINICAL EQUIPMENT SPECIALIST REVIEW FORM To be completed by Biomedical Engineering / Infection Control / OH&S Specialists – [Page 3 of 3] INFECTION CONTROL REVIEW Does the item require disinfections or sterilisation? Does the equipment meet infection control standards? Are policies & procedures changes required? Is the equipment easy to clean? Are manufacturers instructions for cleaning / sterilisation available? Are cleaning / sterilising instructions provided appropriate? Comments & recommendations Yes Yes Yes Yes Yes Yes 1.CHAPTER 1 – PURCHASING PROCEDURES PART B . connectors easy to use Is the equipment easy to use in general? Are safety features appropriate? Are there any OH&S issues? Are there any storage issues? Are there any cleaning issues? Is operator’s manual provided acceptable? Functionality Ease of use Rate [tick] the overall acceptability of the equipment [10 being the best] 12 General comments 34 56 7 8 9 10 Acceptable Acceptable Yes Yes Yes Yes Yes Yes Yes Yes Not acceptable Not acceptable 1. e.33 No No No No No No No No Trial Coordinator – Sign.Off Name Signature________________________________________ Position Date _____/____/____ 21(1/06) .g.CHAPTER 1 – PURCHASING PROCEDURES PART C .CLINICAL EQUIPMENT EVALUATION RESULTS To be completed by “Trial Coordinator” – [Page 1 of 1] EQUIPMENT USER EVALUATION CHECKLIST Does the equipment do what it is expected to? Are accessories. CHAPTER 1 – PURCHASING PROCEDURES PART D .34 Clinical Product Procurement Committee Chairperson Name Position Signature________________________________________ Date _____/____/____ 21(1/06) .COMMITTEE RECOMMENDATIONS FORM To be completed by “Clinical Product Procurement Committee” – [Page 1 of 1] COMMITTEE RECOMMENDATION 1. as a matter of course. Contractor physical access to buildings and grounds is to be limited to those times when they can be supervised. no matter the value ($). Specifications/arrangements must clearly indicate the infrastructure arrangements viz. as a matter of course. In establishing payments to be made regard is to be had to the rates and expertise requirements specified under the contracts and not to the position title or grade within the Department.g the conference provides knowledge about health they could not get elsewhere and is essential for their role). Contractors are not eligible to be paid higher duties allowances. motor vehicles. If SCCB contract. are not to be allowed to attend external training courses/ conferences for skill development.000 (including GST). computers (internet access).CHAPTER 1 – PURCHASING PROCEDURES 1. If it is not a SCCB contract and the proposed amount of remuneration exceeds $30. Contractors are not employees of the public health organisation and therefore are not entitled to the same access to public health organisation facilities and resources. Contractors should be selected in the first place that have the previous skills to undertake the role they have been contracted for. to be given access to official resources such as phones. required lunch breaks and if contractors are engaged under quote action then fresh quotes are required after the finite period quoted for has expired. Only in exceptional circumstances would they attend external training/conferences (e. staffing category – this allows verification and agreement on charge rate. Contractors are not. Contractors.34.1 When engaging contractors. Under no circumstances are contractors permitted to use official resources for private purposes.13 CONTRACTORS – CONDITION WHEN ENGAGING 1. Contractors or groups of contractors are not to be placed under the ultimate supervision of another contractor. 22(5/07) b) c) d) e) f) g) . If it is required that additional services are required a revised contract is to be arranged. is the contractor to be given access to official resources. It is to be noted that under the provisions of the Crown Employees Public Service Conditions of Employment Award a “supervisor” cannot be a contractor/consultant for the purposes of that Award.000 (including GST) three quotes are required. state whether contractors are to be located at the public health organisation and provided with facilities (taking into account the capacity of the public health organization to provide facilities and their costs) or whether the service is to be provided at the contractors premises. If not under contract three quotes are required for procurements over $30. If use is approved for official purposes then such usage is to be reviewed to ensure that no inappropriate use occurs. This should be checked and be reflected in prices quoted so that all prospective suppliers are treated equally. the contract and requisition should specify the contract number. Arrangements with contractors should specify maximum number of hours to be worked per week. the undermentioned conditions are to be applied: a) Contractors are to be engaged through State Contracts Control Board contracts where the labour category is covered by those contracts. Financial and staff delegations can only be exercised by officers of the organisation who are appropriately delegated. Contractors cannot exercise financial or staff delegations of a position against which they are held. Only in circumstances. Internal training courses such as Trim are acceptable. where it is required as part of the contracted service. including Networking Information System funds.34. Networking Information System (NIS) payments are made by the Australian Government towards the cost of networking the treatment and planning equipment at the Radiation Oncology Treatment Centre (ROTC). 26(13/05/10) . MANDATORY REQUIREMENTS Area Health Services must seek approval from the NSW Department of Health to expend Health Program Grant (HPG) funds on eligible radiation oncology equipment. i) j) k) 1. Branches are responsible for the orientation of contractors and making them aware of the organizations Code of Conduct. security arrangements and other public health organization policies. a copy of which can be found at page 4.70. NIS funds can be used towards new or replacement items to enable networking of treatment and planning equipment. A Standard Contract is contained as an appendix to Chapter 3 and can also be found on the DoH Legal branch web site http://internal.au/legal/goods. Used for replacement equipment.000. Contractors. where a contract is over $30.health. Separately identified within the General Fund and used only for expenditure of a capital nature related directly to the provision of radiation oncology services. and to provide advice on the information that is to be provided. Where a contractor is liable to have access to sensitive/confidential documents or in formation Branches are to have the contractor sign a “Confidentiality and Privacy Deed”. Branches are to check whether the contractor is a company or sole trader to determine the public health organisations tax and superannuating responsibility.gov. If they are not then the public health organisation could possibly have to take tax and more importantly have to pay the 9% superannuation liability which could affect quote thresholds as well as possibly make a quote not the lowest once the 9% is added. HPG grant payments received from the Australian Government must be: • • • Used solely for equipment at the location for which the grant was paid. are required to sign contracts prior to commencement of services.CHAPTER 1 – PURCHASING PROCEDURES h) 1. Contracts are also required to be completed where persons are engaged from the State Contracts Control Board personnel contracts for periods in excess of 2 weeks.html.nsw. record check is required to be undertaken on the contractor or the contractor’s employee.14 RADIATION ONCOLOGY EQUIPMENT – HEALTH PROGRAM GRANTS (PD2010_025) PURPOSE The purpose of this policy is to advise Area Health Services of the process for expenditure of Radiation Oncology Health Program Grant funds (including Networking Information System funds) for proposed purchase of eligible radiation oncology equipment.2 Depending on the type of services to be provided consideration should be given to having contractors sign confidentiality agreements. Must confirm that the proposed purchase.000. and project timeframes.3 Area Health Services must write to the Director. is on the Area’s Locally Funded Initiatives Program. Maintenance and Renewals Program.000. 26(13/05/10) . Must use Networking Information Systems payments for purchases to facilitate networking the treatment and planning equipment at ROTCs. including information such as costs. Group T2. Must use HPG grant payments received from the Australian Government solely for equipment at the location for which the grant was paid. HPG funds balance. noting that any expenditure will need to be managed within the Capital Program limits. Must separately identify HPG grant payments within the General Fund. for example. where funding is provided on a ‘per attendance’ basis for services to Medicare-eligible patients (private inpatient and privately-referred non-inpatients). Must use HPG payments only for expenditure of a capital nature related directly to the provision of radiation oncology services. Must confirm that the proposed purchase. if > $250.000 and <$250. NSW Department of Health to seek permission to expend HPG funds for eligible Radiation Oncology equipment. HPGs operate as a reimbursement scheme. The Director SSDB: • • Will review requests to expend HPG funds. Will provide relevant information to SSDB about the proposed expenditure. BACKGROUND About this document Radiation Oncology Health Program Grants (HPG) are funds paid by the Australian Government to approved public and private Radiation Oncology Treatment Centres (ROTC) for major equipment associated with services detailed in the radiation oncology section of the Medicare Benefits Schedule (MBS).CHAPTER 1 – PURCHASING PROCEDURES 1. Additional approval requirements may be required for expenditure > $1 million. IMPLEMENTATION Area Health Services: • • • • • • • • • Will write to Director SSDB. business cases for projects > $1 million. Must ensure that any proposed capital expenditure is compliant with relevant NSW Treasury requirements.34. Statewide Services Development Branch (SSDB) with relevant information about the Radiation Oncology equipment proposed for purchase. Will arrange appropriate review and/or approval within the NSW Department of Health. if >$10. is on the Area’s Repairs. HPG requests above $10. and complementary to. the following is the list of radiation oncology equipment that is eligible to receive HPG payments from the Australian Government: • • • • • • Linear accelerator – single photon Linear accelerator – dual photon CT interfacing planning computers and workstations and planning computers for simple calculations and monitor unit checks Brachytherapy High Dose Rate (HDR) Brachytherapy seeds Simulators – conventional with or without CT attachments and CT-SIM (used solely for treatment planning purposes). Area Health Services should note that all expenditure above $10. NIS funds are part of HPG funds. Medicare benefits. New equipment may be added to the eligibility list from time to time.000 will need to be managed within the NSW Health Capital Program limits. As at February 2010.34. HPG funds are to be used as a source of funds towards replacement of HPG eligible equipment. The HPG rate is determined by the Australian Government and reviewed annually. Area Health Services must seek approval from the NSW Department of Health to expend HPG funds.4 Medicare Australia makes HPG payments to approved providers monthly. 26(13/05/10) . It does not provide funding for the cost of capital equipment. Medicare only reimburses patients for the professional costs of radiation oncology services provided to them. For the purposes of this policy. based on the number of eligible services claimed in the previous month and the HPG rates for each service. and to provide advice on the information that is to be provided to the Department. Networking Information System (NIS) funds are to be used towards the cost of networking the treatment and planning equipment at the ROTCs. The Radiation Oncology HPG is separate from. The purpose of this policy is to advise Area Health Services that they must request approval from the NSW Department of Health to expend Radiation Oncology HPG funds for proposed purchase of eligible radiation oncology equipment.CHAPTER 1 – PURCHASING PROCEDURES 1. HPG funds are to be used as a source of funds towards replacement of HPG eligible equipment. Key definitions HPG-eligible equipment The Australian Government prescribes which types of radiation oncology equipment are eligible.000 will require approval from the Chief Procurement Officer and/or the Chief Financial Officer. or Medicare Schedule items change. Projects that are >$10. It includes equipment numbers.000 must be included in the Area’s Repairs. Any commitment proposed for use of funds within the financial year in which the proposed expenditure is to occur. according to a rate determined by the Australian Government. It is revised as required when. reimbursement rates changes.CHAPTER 1 – PURCHASING PROCEDURES NIS payments 1. and an explanation for NIS payments. Legal Instrument The Legal Instrument is the document issued by Australian Government to the Area Health Service. Procedure for seeking approval to expend HPG funds Procedure for Area Health Service If an Area Health Service wishes to purchase equipment with a total cost >$250. Medicare Schedule items and amount payable. for example. Area Health Services must provide the following information in writing to facilitate the review of the request to expend HPG funds: • • • • • Brief explanation of need for equipment to be replaced. the equipment purchase must be included on the Area’s Locally Funded Initiatives Program. Estimated total cost of equipment (a copy of quote should be provided if available). NIS funds can be used towards new or replacement items to enable networking of treatment and planning equipment.000 that are not on the Locally Funded Initiatives Program. accessories/number of workstations. Details of equipment including type (linear accelerator etc).000. which lists the radiation oncology equipment which is eligible for HPG payments from the Australian Government.34. Maintenance and Renewal allocation. HPG eligible equipment changes at the ROTCs. 26(13/05/10) . brand to be acquired. end dates for HPG payments. capital balance. They are part of the HPG income received from the Australian Government. The proportion of costs payable is calculated by reference to the number of linear accelerators at the ROTC.000 and <$250. will not be approved.5 NIS payments are made by the Australian Government towards the cost of networking the treatment and planning equipment at the ROTC. It is calculated from time to time using a formula outlined in the Legal Instruments. equipment description. The disbursement of NIS funds normally occurs in November and May of each financial year. Any request for projects to expend HPG funds >$250. Current level of funds in the HPG account. and Will arrange appropriate review and/or approval within the NSW Department of Health. is on the Area’s Locally Funded Initiatives Program. Statewide Services Development Branch must: • Provide relevant equipment details to the Australian Government so that Medicare Australia can commence HPG payments at the correct rate and time. The Director Statewide Services Development Branch: • • Will review requests to expend HPG funds.34. After the equipment has been purchased. and additional approvals may then be required. if necessary about the HPG request.6 Confirmation that the proposed purchase.000. If the replacement is >$1 million. the Area Health Service must: • Provide the equipment’s serial number and the operational date to Statewide Services Development Branch. for example. is on the Area’s Repairs. noting that any expenditure will need to be managed within the Capital Program limits. Confirmation that the proposed purchase. and so that the Legal Instrument can be amended by the Australian Government. and Comply with NSW Department of Health purchasing and tendering policies when acquiring equipment.000 and <$250. and Details for a contact officer who can provide more information. Maintenance and Renewals Program. 1. Advise in writing if any aspects of the equipment request/purchase change. a supporting Business Case must be provided. Procedure for Statewide Services Development Branch Statewide Services Development Branch will review all applications from Area Health Services to expend HPG funds.CHAPTER 1 – PURCHASING PROCEDURES • • • • • Current average monthly accrual of funds.000. if one piece of equipment already approved needs to be amended to another piece of equipment. if >$10. Additional approval requirements may be required for expenditure > $1 million. as necessary. if > $250. 26(13/05/10) . Procedures after approval has been given Area Health Services must: • • • Advise Statewide Services Development Branch of the equipment number of the specific pieces of equipment and date that the equipment commences operation. Statewide Services Development Branch will provide relevant details to the Australian Government so that Medicare Australia can commence HPG payments at the correct rate and time. 7 Area Health Services must provide a statement to Statewide Services Development Branch for each financial year. HPG income (for each month).CHAPTER 1 – PURCHASING PROCEDURES Procedure for lodgement of annual HPG statement 1. 26(13/05/10) . and closing balance. HPG expenditure must include amounts for individual pieces of equipment and month in which the expenditure was completed.34. HPG expenditure. showing HPG opening capital balance. risks and impacts of their activities and to adopt measures to: • • • realise those opportunities. On construction projects. acceptable performance with. and support effective use of scarce resources . Occupational Health and Safety Compliance Service providers and their employees must comply with their occupational health and safety obligations under the Occupational Health and Safety Act (NSW). workers compensation insurance premium requirements. The OHS&R Management Systems Guidelines of the Capital Project Procurement Manual describe the management practices required of all parties on NSW Government construction projects. the Workplace Injury Management and Workers Compensation Act (NSW) and Regulations.CHAPTER 1 – PURCHASING PROCEDURES 1. and systematic approach to. and systematic approach to. and safety and dispute settlement procedures in applicable industrial awards and approved agreements. The Environmental Management Systems Guidelines of the Capital Project Procurement Manual describe the management practices required of all parties on NSW Government construction projects.including energy. relevant OHS industry codes of practice. Service providers shall have a demonstrated commitment to. all service providers are required to develop and implement an appropriate site specific environmental management plan. encourage recycling and re-use of materials and minimise waste.35 Appendix 1-A NSW GOVERNMENT CODE OF PRACTICE FOR PROCUREMENT DETAILS OF SPECIFIC PRACTICE REQUIREMENTS ENVIRONMENTAL MANAGEMENT The Government expects government agencies and all other parties to identify the potential environmental opportunities. OCCUPATIONAL HEALTH AND SAFETY MANAGEMENT AND WORKPLACE INJURY MANAGEMENT Occupational Health and Safety Management The Government attaches a high priority to the continuous improvement of occupational health and safety management and workplace injury management in procurement for all construction and other industry participants. Service providers shall have a demonstrated commitment to. Tenderers and service providers for major contracts are required to have a corporate Environmental Management System accredited by a government agency. manage those risks. acceptable performance with. water and materials. occupational health and safety management and workplace injury management. and enhance and protect the environment. environmental management. 21(1/06) . industrial awards and approved agreements are not permitted. o better training and skill development strategies. relationships and practices. flexible workplace arrangements. which may encompass: o improved occupational health and safety and workplace injury management o practices. Enterprise Agreements Enterprise agreements are important elements in achieving continuous improvement and best practice. All service providers. including the provisions of all applicable industrial awards and approved agreements. based on quality of work and productivity. including the scope of the enterprise’s operations and projects.CHAPTER 1 – PURCHASING PROCEDURES Dispute Resolution 1. unless payment is authorised or ordered by either the Australian or NSW Industrial Relations Commissions. and give effect to measures to increase productivity. Enterprise agreements should ideally: • • • reflect the needs of the enterprise. WORKPLACE PRACTICES Obligations Relating to Employment Principal contractors are accountable for compliance by their service providers with their legal obligations regarding their employees working on construction projects. Service providers are required to develop and maintain a pro-active and responsible approach to the management of industrial relations at the enterprise level and on projects. improve remuneration and working conditions. and the management practices to be implemented by service providers on construction projects. Industrial Relations Management The Government is committed to an improved industrial relations planning and management culture and better employee and employer relationships in the construction industry and other industries. determinations by WorkCover New South Wales inspectors made under the Occupational Health and Safety Act (NSW) and OHS Regulation 2001 must be accepted by all parties. 21(1/06) . their employees and their unions must also comply with their workplace obligations. Arrangements or practices designed to avoid workplace obligations under relevant laws. and o cooperative. No payment shall be made to employees for time spent engaged in industrial action (as defined in either the Workplace Relations Act (Commonwealth) or the Industrial Relations Act (NSW)).36 Where a dispute about occupational health and safety matters cannot be resolved at the workplace. The Industrial Relations Management Guidelines of the Capital Project Procurement Manual describe what is required of tenderers. This performance may be achieved as a reduction of the period of construction or a reduction in the construction cost or both. The agency here means the government agency responsible for the project. If a tenderer foreshadows a project agreement and the tenderer is awarded the contract. in accordance with legal obligations and the procedures outlined in applicable industrial awards or approved agreements.37 Project agreements incorporating site-wide payments. For example. conditions or benefits may be negotiated where the strategy has first been authorised by the relevant agency. Therefore project agreements should not override the approved enterprise or workplace agreements. Payments. project agreements will only be appropriate for major construction projects as defined by the agency. This process should be completed before site works begin. Typically. To take effect. skill development and occupational health and safety requirements. Dispute Resolution Service providers are required to make every effort to resolve grievances or disputes with their employees and applicable unions at the enterprise level. several identifiable contract packages within an overall project. Site allowances are awards made by the Industrial Relations Commission under the Industrial Relations Act (NSW) to provide compensation to affected employees engaged at a particular work site. 21(1/06) . conditions or benefits in a project agreement must be related to improved productivity measured in time and/or cost saving performance. The signatories to a project agreement may not use any term in the project agreement as a precedent on any other project or for any other purpose. irrespective of whether there is a construction contract between the agency and a service provider. a business case in support of that strategy must be submitted by the successful tenderer and only proceed if approved by the agency involved. to the benefit of the agency. Site Allowances Site allowances shall not be paid unless awarded by an industrial tribunal. Generally. in a privately financed project there may not be a construction contract with the relevant government agency but the agency will still retain the right. if they encounter conditions that are so far removed from the type of conditions ordinarily experienced on construction sites as to warrant extra compensation. high cost. there shall be no double payment or allowance of conditions or benefits. major projects will have some or all of the following features: an extended construction period. The integrity of existing individual enterprise agreements shall be maintained with any project agreement. to authorise the negotiation of a project agreement. While there may be a provision in a relevant enterprise or workplace agreement that enables the signatories to that agreement to include these provisions in a project agreement. a project agreement must be approved under either the Workplace Relations Act (Commonwealth) or the Industrial Relations Act (NSW). in consultation with the relevant service provider under the privately financed project contract. after arbitration.CHAPTER 1 – PURCHASING PROCEDURES Project Agreements 1. and special industrial relations. through any mechanism. This includes referral of the grievance or industrial dispute to the appropriate industrial tribunal for settlement. All parties to a grievance or dispute are required to comply with tribunal decisions. including: • • • extending employment opportunities to Aboriginal people. at the earliest opportunity.CHAPTER 1 – PURCHASING PROCEDURES 1. Service providers will be encouraged to pursue and implement training and skill development strategies appropriate to the focus. for membership or non-membership of organisations. Project Impacts The service provider must advise the client during the progress of the work. and work is to continue normally.38 Where resolution is not possible at a particular enterprise level. Strike Pay No payment shall be made to employees for time spent engaged in industrial action (as defined in either the Workplace Relations Act (Commonwealth) or the Industrial Relations Act (NSW)). subject to any legal appeal rights. involving higher levels of authority. unless payment is authorised or ordered by either the Australian or NSW Industrial Relations Commissions. The Training Management Guidelines of the Capital Project Procurement Manual describe the management practices required of all parties on NSW Government construction projects. size and capacity of the individual enterprises and to their contracts. ABORIGINAL PARTICIPATION Tenderers will be required for selected contracts to indicate measures they intend to implement if awarded the contract. TRAINING MANAGEMENT Service providers shall comply with the Government’s training management requirements and guidelines. the conditions prior to the dispute must prevail. the contract. 21(1/06) . Membership of Registered Organisations Membership of unions or employer associations is encouraged through proper and lawful means. enhancing the business skills of Aboriginal people. in the dispute settlement procedures contained in applicable industrial awards or approved agreements are to be complied with. While the dispute resolution procedures are being followed: • • • no industrial action is to take place. This precludes victimisation. costs or other related contracts. of any industrial relations or occupational health and safety matter which may have an impact on the progress of work. the graduated steps. and providing economic benefits to Aboriginal communities which could lead to improved conditions in Aboriginal communities. textile and footwear contracts must submit a statutory declaration to this effect.CHAPTER 1 – PURCHASING PROCEDURES 1. Tenderers for NSW Government clothing. clothing and footwear to: • • comply to the extent applicable. CLOTHING AND FOOTWEAR SUPPLIERS The Government requires suppliers of textile articles. with all relevant laws. 21(1/06) . with all relevant laws.39 The Aboriginal Participation in Construction Implementation Guidelines of the Capital Project Procurement Manual describe what is required of all parties on NSW Government construction projects. awards and other industrial instruments in relation to the employment and management of employees including outworkers. A tender will not be considered unless such a statutory declaration is lodged with the tender. EMPLOYMENT AND OUTWORK OBLIGATIONS FOR TEXTILE. awards and other industrial instruments in relation to the employment and management of employees including outworkers. and take all reasonable steps to ensure that their service providers comply to the extent applicable. clear and defensible. Parties shall comply with all legal obligations.CHAPTER 1 – PURCHASING PROCEDURES 1. Parties will maintain business relationships based on open and effective communication. Honesty and fairness: Accountability and transparency: No conflict of interest: Rule of law: No anti-competitive practices: No improper advantage: Intention to proceed: Co-operation: 21(1/06) . Parties will conduct all procurement and business relationships with honesty and fairness. Parties shall not engage in practices that are anticompetitive. The process for awarding contracts on government projects will be open. respect and trust. Parties shall not seek or submit tenders without a firm intention and capacity to proceed with a contract.40 Appendix 1-B STANDARDS OF BEHAVIOUR All parties will behave in accordance with the following standards at all times. and adopt a nonadversarial approach to dispute resolution. A party with a potential conflict of interest will declare and address that interest as soon as the conflict is known to that party. Parties shall not engage in practices that aim to give a party an improper advantage over another. ....16 State Contracts Control Board.. 2....12 2........................ COMMON USE PERIOD CONTRACTS ............................................ 2..........................4....................SIMPLE PROCUREMENT 2................9 EMERGENCY PURCHASES .....9 2............................................4 Monitor Performance .................................1 2................................ 2................ 2......................................................... 2.3 Approve the Selection ........ 2.................................10 STATE GOVERNMENT CONTRACTS EXEMPTIONS................................. 2..................................14 2..................25 2.........................10.... 2...................6 Other Considerations.. QUOTATIONS (NOT IN CONTRACT PURCHASES) ......9........................................2 2............................2 2...............................9.. 2...........................................1 2......................................................11 2...................12 2.................. 2..........................................................4 2.............. 2............ 2...........3 2....................................11 POLICY DIRECTIVE ON THE ACQUISITION OF CORPORATE APPLICATION SYSTEMS.......................6 2..........4 Health Quality Reporting System – SCCB Contract Exemptions...............1 Exem ption Procedures................. Rural Purchase Exemption .................................................................... 2......10....4 2............................4.....10............................4..............................................................2...................4 How to Use GSAS.......................15 2............................1 Summary of GSAS............... ORDER SPLITTING.........8 2.......5 2....... 2............2 Further Considerations .7 2................TABLE OF CONTENTS CHAPTER 2 ..........20 Evaluation of Clinical Consumables and Equipment ..1 2...6 2............... 2.........2 Evaluate Responses and Select a Service Provider ................. 2........................................8 2.......................................................................3 2.....................1 Obtain approval and Invite Quotations.....................5 Record Keeping........................................................11 2..6 2.......... APPENDICES 2-A 2-B 2-C Contracts Exemption Applications Web-based Forms..............13 2.................................................................................3 2..................................................... 2........................2 Background of GSAS.........3 Policy ......... PURCHASES WITHOUT QUOTATIONS..8 2............8 2..................................... 2......3 Lodgement of Applications for Exemptions ...9.....................................4.......... 2........7 2..23 23(9/08) .........................11 2..4...............7 2.................4........2 2............... 2....2........ PRINTING/STATIONERY ......... 2..................9...........................................................................................7 2........4...............10........4 INTRODUCTION ..............13 2.......................................................................................... Government Contracts for Bulk Supply .................................7 Variations After Contract Commencement ........................................................................9 2........ MAINTENANCE CONTRACTS ..... respectively. 4.4 Buying through Common Use Period Contracts Purchase without quotations up to $3. 24(7/09) 4. 6. Simple procurement methods described in the document include: 2. Define the need and specification Establish potential sources of supply In case of clinical consumables and/or equipment. Simple procurement occurs everyday through the organisation. 5. Procurement considerations like risk analysis and performance management should not be overlooked because of the low value of the purchase.000. or Written quotations up to $250.health.gov. ii) where there could be potential or perceived conflicts of interest. 9. Probity advice is required to be obtained for contracts in excess of $30. The process of simple procurement usually consists of the following steps: 1. 2.2 2. 3. The characteristics of simple procurement are typically that: 1. evaluate the product and register all evaluation information onto NSW Health Procurement Clinical Consumables Evaluation Database and Equipment Evaluation Database.000 For Consultancies which have different $ levels see Consultancy section.CHAPTER 2 – SIMPLE PROCUREMENT 2. 2. iii) where there might be subsequent probity issues. 5. 3.1 INTRODUCTION 2.3 2. While this type of procurement is generally straightforward. 6.1 Simple procurement covers the purchase of goods and services that are generally of low risk and where the value for money decision factors are likely to be primarily price and availability. 8.nsw. The advice of the Department of Health’s Asset and Contract Services Branch is to be sought in relation to all contracts which fall outside of the purchasing policy. the details of the product or service being procured are known the product is readily available the product has been procured previously there is a competitive market the primary selection criteria are price and availability there are low risks. This is system is located at http://internal. problems can arise if the process is mismanaged or key steps are omitted. 7. .000: i) which have not followed standard procurement processes.au/business/hp [Refer to appendix 2-C] Determine the procurement method Obtain the appropriate approval Invite offers/quotations Evaluate responses and select a service provider Obtain approval for the decision Monitor performance of the service provider. These contracts can be accessed by agencies and other approved organisations. The State Contracts Control Board (SCCB) has established over 300 centralised purchasing arrangements of this kind. EG.2 $30. The main features of common use period contracts are: 24(7/09) .000 Common use period contracts (State Contracts Control Board – SCCB) A period contract (or a “supply” or “common-use” contract) is a formal arrangement with a supplier to provide on request. PRIOR TO THE PURCHASE BEING MADE. THEY SHALL BE OBTAINED FROM THOSE SOURCES (NO MATTER THE SOURCE OF FUNDS) UNLESS THERE ARE SPECIFIC REASONS JUSTIFYING OTHERWISE. and 3-M (DoH only) are completed.000 to $250.CHAPTER 2 – SIMPLE PROCUREMENT Checklists 2. FOLLOWING ADVICE FROM NSW HEALTH PROCUREMENT.000 Contractors under $30. a business unit of the NSW Department of Commerce.10 for details on exemption application. AREAS/INDEPENDENT HOSPITALS ARE TO ADVISE THE RESPECTIVE CONTRACT OFFICERS AT THE OFFICE OF GOVERNMENT PROCUREMENT OF THE REASONS FOR DISSATISFACTION WITH CONTRACT ITEMS.000 to $250. DEPARTMENT OF HEALTH. ELECTROMEDICAL. and information technology components and services. 3-H. SUCH REASONS MUST BE SPECIFICALLY APPROVED BY THE DIRECTOR-GENERAL. See section 2. Information on these contracts and their use can be obtained from State Procurement.2 It is mandatory that the checklists at Appendices 3-G. IF AVAILABLE UNDER CONTRACTS ARRANGED BY THE STATE CONTRACTS CONTROL BOARD. NSW Government period contracts are arranged so that the purchasing power of many agencies can be combined to obtain the best value from suppliers. viz: Appendix 3-G DoH Only Procurements Appendix 3-H Health Services Procurements Appendix 3-M DoH Only Procurements 2. Some of the goods and services available under these arrangements include: • • • • • • • • fuel motor vehicles air travel stationery electrical and hardware components health consumables food. PERIOD CONTRACTS ORGANISED BY THE NSW DEPARTMENT OF COMMERCE MAY ALSO BE UTILISED WHEN PURCHASING EQUIPMENT. supplies or services at agreed rates and conditions for an agreed period.000 $30. equipment. operating under the terms of the specific common use period contract.3 service providers have been identified and selected in accordance with the NSW Government Code of Practice for Procurement purchases are carried out without the need for agencies to obtain competitive quotes essential contractual terms and conditions are already established. lower after inclusion of freight. contract items do not have to be purchased) subject to the conditions detailed below. (viz. and are covered by the competitive quotation process. Newcastle and Wollongong Metropolitan areas) up to a value of $3. 1. 2. Buying off a common use period contract constitutes ‘in contract’ purchasing.2 Where an area/independent hospital or several areas/independent hospitals combined consider that due to quantities or other variations to be ordered.2. where advantages exist over items under contract. delivery time. The officer approving a local purchase is to certify that the local purchase is more advantageous than contract and to record the reasons. as required by the General Purchasing Delegation Limits (see Chapter 1. g. more favourable prices or conditions should be sought from the State Procurement contractor the undermentioned action is to be taken: • Quantities and/or delivery requirements should be sufficiently different to combinations available under the contract to expect that more favourable rates could be achieved.000. Section 1. If a common use period contract lists more than one contracted service provider to supply similar goods or services. 2. for inclusion on the mailing list for the appropriate tenders. warranty and after sales service. Negotiation of Government Contracts for Bulk Supply on Behalf of Areas/Independent Hospitals 2. Officers of the opinion that any local firm may be in a position to service a local contract should advise the firm to apply to the State Procurement in writing. This approval does not apply to contracts arranged specifically for country areas. e. etc. This exemption is subject to the requirement that an item may not be “split” into its components nor a succession of orders for quantities of the same item issued for the purposes of avoiding the $3. the agency should match its needs with the alternatives offered by the different service providers. 21(1/06) .1 Rural Purchase Exemption The State Contracts Control Board has approved of purchases being made locally in country areas (outside Sydney. Purchases made where no common use period contract exists are considered ‘not in contract’.6). Each order placed by an agency or organisation comprises a separate contract. A contractual arrangement is activated by placing an order specifying the requirement directly with the service provider. 3.2. This information should be retained for audit purposes. Three (3) quotations are to be obtained where possible. and the goods and services are selected in accordance with the NSW Government Procurement Policy and other relevant government policy obligations.000 limit or any limitations to delegation of authority.CHAPTER 2 – SIMPLE PROCUREMENT • • • • 2. providing: • • • • 2. For items valued between $30. 2.000 (incl GST) at least one quote must be sought. including the random invitation of quotations at appropriate time intervals the required goods or services are not split into components or a succession of orders for the purpose of enabling orders to be placed without seeking quotations. and Requirements not being split into components nor succession of orders for the same goods or services for the purpose of enabling the goods/service to be obtained under the $30.001 and up to $30.3 For very low value purchases (under $3. and be requested to submit their quotations in writing to a specified location by the due date and time. The officer should also ensure: all receive the request at or about the same time all receive the same information represent a fair selection of available service providers. up to $30.000 it is to be ensured that: • • Rates are considered reasonable and consistent with normal market rates for items of a like nature.001 to $250. and fairness.001 to $250. equity and ethical dealing are assured. and delivery point. Quotations (Not in Contract purchases) $3. • • • • a description of the goods or services specifications the quantity required the name and telephone number of the officer to whom quotes and enquiries should be directed delivery lead time.000 incl GST) goods and services can be purchased without seeking quotations. When requesting quotations the following information should be provided to the service providers: • • • • • • 1. All requests to be directed through NSW Health Procurement to enable co-ordination prior to forwarding to State Procurement.000 When purchasing items valued between $3.4 The originating group is to provide indicative cost benefits to justify the large volume purchase.000 2. Quotations must be received in writing.000 (incl GST) a minimum of three quotes must be sought. Purchase without quotations up to $3. Where only one quotation is required viz.CHAPTER 2 – SIMPLE PROCUREMENT • • • • 2. The originating group to be involved in assessment of the response/s received and in the decision regarding acceptance. Quotations would be sought from the contracted suppliers under tender conditions thus ensuring confidentiality and probity in the process.000 (3 quote) limit.4 the rates are reasonable and consistent with the market rates for items of a similar nature regular reviews are undertaken to ensure the reasonableness of prices. 24(7/09) . Prices and conditions quoted are not to be divulged until quotation action has been completed. officers are to not knowingly invite multiple quotes from companies or branches of the same parent organisation. No quotation is to be entertained when it is received after the time fixed for the receipt except where: i) ii) there exists clear evidence that the quote was posted before that time. In all cases where fewer than three (3) quotes are obtained or emergency provisions are invoked the full reasons and support documentation are to be maintained and held pending audit. plus parts.5 A request for a quotation should also show a request number and the closing date. a list of the organisations submitting quotations and the cost and delivery details of the goods and services tendered. in any instance where fewer than three quotations are obtained. or facsimile/e-mail advice was received before that time detailing price and delivery schedules etc. All quotations are to be carried out as hereunder (NSW Government Code of Practice for Procurement July 2004). All quotes are to be treated confidentially. The evidence or the facsimile/email advice referred to shall be affixed to and retained with the quotation. No person or firm quoting is to be offered any advantages over any other person or firm quoting.g.CHAPTER 2 – SIMPLE PROCUREMENT 2. next page) A copy of the quote or quote/schedule should be attached to the purchase requisition/payment voucher as support documentation. a list of organisations invited to submit quotations. (see Clarification of Requirements. Quotations may be accepted on a cost per hour. The officer calling and receiving quotations shall record the following information: • • • • a description of the goods or service for which quotations were invited. To ensure competitiveness. the reasons for not inviting more quotations. Details regarding reasons for passing over more financially beneficial quotes are to be retained on file. which must allow a reasonable time for potential service providers to respond. repair of an electric motor where the final cost could not be determined until the repair is complete) providing that it is guaranteed that the estimated cost will not be exceeded by more than 30%. basis when the total final cost cannot be estimated. 21(1/06) . Quotations may be accepted where necessary for an estimated amount (e. service. Procurement ethics require that potential service providers are treated equally and fairly. Clarification of requirements Potential service providers may seek clarification of the specifications or other requirements after requests for quotations are issued. or those with a higher risk factor.CHAPTER 2 – SIMPLE PROCUREMENT 2. Late quotations A closing time for the submission of quotations is to be set.1 Obtain approval and invite quotations 2.6 Obtaining approval When the need and specification have been determined. and have been given a firm intention to proceed. The same evaluation method should be applied to each response. timeliness. It should be a combination of quality. The consideration of late offers may raise questions about the probity of the evaluation process.4. For higher value procurements. The NSW Government Procurement Policy frame-work requires NSW Government agencies to provide equal opportunity to local service providers of goods and services to compete for government business. Any conflict of interest must be declared and resolved. should be taken to the market. and the method of procurement selected. The selected quotation must provide the best value for money when evaluated against the assessment criteria. seek approval from the appropriate delegate for funding and permission to proceed. 21(1/06) . Inviting quotations Only procurement actions that can be funded. Late quotations should not be considered. The evaluation should achieve a fair comparison between the responses. If a late quotation is considered or accepted. an evaluation team may need to be established.4. 2. the reasons for doing so must be fully documented. Procurement personnel must ensure that clarifying information is given to all participating service providers to ensure that there can be no claims of unfair advantage. whole-of-life costing. and other factors as specified in the requirements. Best value is not necessarily lowest price. except where the appropriate delegate is satisfied that the integrity and competitiveness of the process is not compromised.2 Evaluate responses and select a service provider Evaluation should be conducted by those with relevant skills and knowledge appropriate to the value and importance of the procurement. Procurement officers are reminded of the ethical and probity issues involved in accepting and considering late offers. reliability. Government agencies must ensure the commercial confidentiality of responses is maintained. including the commitment to service delivery. as measured against the evaluation criteria. information on unsuccessful service providers responses must remain confidential. section 3. Contract records are kept so that: • clear public accountability can be demonstrated. 22(5/07) .4) provides guidelines on what information relating to the Government’s contractual arrangements with the private sector should. In the feedback. When the responses have been evaluated and a service provider selected. Limit feedback to the unsuccessful service provider’s response and how it did not meet the requirements. record the reasons for the recommendation.4. comparisons should not be made with the successful service provider’s response. The name of the successful service provider and the price accepted may be provided. good record keeping of decisions is imperative for auditing and accountability purposes.4. Approving officers must satisfy themselves that the best offer. application and benefits of service provider performance management. Unless otherwise authorised by the service provider or required by legislation. be made public. promptly advise both successful and unsuccessful respondents of the decision. particularly if the service provider offering the lowest price is not recommended. Effective and efficient contract management cannot be done properly without accurate and organised records. After placing orders with the successful service provider. and should not.3 Approve the selection An officer with the appropriate delegation should approve the recommendation to accept a quotation. For smaller. Upon request. less complex purchases. note the reasons for the selection on the relevant purchasing documents. 2. Refer to Premier’s Memorandum PM98-16: Records Management Standards and Practices. monitor the performance of the service provider against the specifications and requirements stated.4 Monitor performance The benefits generated by effective monitoring are significant in terms of encouraging continuous improvement.5 Record keeping Actions and decisions need to be accounted for and. Refer to the Department of Commerce Service Provider Performance Management Guideline which details the objectives.7 The NSW Government Code of Practice for Procurement July 2004 specifies that ‘bid shopping’ (trading off one service provider’s price against the price of another in an attempt to seek lower prices) be not permitted in government procurement. When the selection process is completed. is being accepted. 2.CHAPTER 2 – SIMPLE PROCUREMENT 2.7. provide feedback to unsuccessful service providers. in particular. and ensuring the terms and spirit of the contract are adhered to. Premier’s Memorandum 2007-01 Public Disclosure of Information Arising from NSW Government Tenders and Contracts (See Chapter 3. 2.4. assisting in the future design of specifications and contracts. CHAPTER 2 – SIMPLE PROCUREMENT • • regular and accurate reports to management and clients are prepared; and information is available for the assessment of claims and the resolution of disputes. 2.8 Comprehensive records should be maintained throughout the purchasing process, e.g checklists, evaluation criteria, weightings, decision-making processes and decisions made. These records should provide sufficient information to enable audit and independent review functions to be carried out. An individual file should be maintained for each procurement where possible. Records could include details of telephone conversations wherein any type of commitment etc. is made. Departure from established procedures for purchasing of services should only be for sound, welldocumented reasons. These reasons should be approved at a senior level by those not directly involved in the process. 2.4.6 Other considerations Officers must be aware of both The Australian and New Zealand Government Procurement Agreement and NSW Government Preference Scheme. Full details of an organisation’s responsibilities appear in Chapter 3 Appendix 3-B. 2.4.7 Variations after the contract has commenced Variations to the scope of the work requiring increased payments to the contractor can at times be appropriate as a result of unforeseen circumstances. Particular care is needed to avoid: • • • variations being used by a successful low bidder to increase the value of the job; variations being use to get around requirements for competitive bidding, e.g. 3 quotes, tenders; variations increasing the scope of the contract out of proportion to the original scope. All proposals for variations require very careful consideration, applying the principles of value for money; probity and accountability. Proposals to increase the value of the consultancy by 10 per cent or more demand a particularly thorough review. Apparently “exceptional” cases should be treated very cautiously. Variations to the contract during the progress of the project must be reported without delay and prior approval obtained for any proposed significant changes in work or cost. It is not good practice for approvals for significant changes in work or cost to be given by employees directly involved in the supervision of the contractor. Proposals for such variations are to be considered and determined by an independent senior officer, nominated by the Chief Executive. There can be a number of reasons for variation of the scope of a project after it has commenced, however, the most prevalent reason is a “weak” specification. It is imperative that officers developing specifications either have the necessary experience or obtain expert advice so that comprehensive specifications are developed. 2.5 Emergency Purchases Notwithstanding the provisions of this Manual the Chief Executive or his delegate may, without following the prescribed procedures in this Manual, purchase stores, or provision of services, in any case of extreme emergency to a value sufficient to meet that particular emergency. 21(1/06) CHAPTER 2 – SIMPLE PROCUREMENT Nothing in this section authorises the purchase of stores or the provision of services: a) b) c) at a price that is not reasonable or proper; or in excess of those necessary to meet the immediate needs of any emergency; or 2.9 otherwise than in accordance with the procedures provided for by this Manual in any case where any approval under this Manual could be obtained in sufficient time to meet the Health Service need. Order Splitting 2.6 Requirements must not be split into components or a succession of orders for the same services for the purpose of enabling the item/service to be obtained under the $250,000 limit for tenders or $30,000 for quotes, or the limits specified for printing. In respect to printing, the monetary threshold includes the whole printing process of design, layout, printing, binding, etc. 2.7 Printing/Stationery Printing The delegations for printing have been aligned with the delegations for procuring goods and services. NSW Health has an Agreement with its preferred supplier to provide a print management service. Procurement of printing under this Agreement precludes the need for staff to obtain additional quotations as the service provider will undertaken this task on behalf of the Health System. Additional information on the procurement of printing can be found at http://internal.health.nsw.gov.au/ecsd/ssc/purchasing.html and then clicking on the Printing link. * STATE HEALTH FORMS (PD2009_072) PURPOSE This policy and attached procedures define the processes for the creation and management of State Health Record Forms incorporated in Health Care Records. The scope of the policy is to have clinical statewide forms filed in the Health Care Record and the standardisation of the physical Health Care/Medical Record Cover as well as other health record documents such as labels and dividers. This policy includes but is not limited to Inpatient facilities, Community Health Centres and outpatient clinics/areas. MANDATORY REQUIREMENTS Health services are required to use standardised forms developed by the NSW Health State Forms Management Committee. All State Health Record Forms for inclusion (or potential for inclusion) in the Health Care Record must be approved by the NSW Health State Forms Management Committee (SFMC) or Health Service forms for use only within the Health Service must be endorsed by the local forms committee. 25(1/10) CHAPTER 2 – SIMPLE PROCUREMENT * Health Services must establish: • • A functional health service Health Records Forms Committee 2.10 Processes to ensure all line managers are accountable for the effective implementation of standard health record forms across the health service, including Directors of Clinical Operations, Clinical Governance and Nursing and Midwifery Services, Health Information Management units and facility based Health Information services. All NSW Health State Record forms can only be obtained from the State Print and Print Management contracted supplier. IMPLEMENTATION The Health Service Chief Executive is responsible for: • • Establishing a functional health service Health Records Forms Committee, a member of which must act as representative to the NSW Health State Forms Management Committee (SFMC). Establishing processes to ensure all line managers are accountable for the effective implementation of standard health record forms across the health service, including Directors of Clinical Operations, Clinical Governance and Nursing and Midwifery Services, Health Information Management units and facility based Health Information services. The Health Service Records Forms Committee is responsible for: • • • Reviewing clinical forms intended for statewide use. Approving all clinical forms to be used by its Health Service. Ensuring all clinical forms meet the requirements of relevant Australian Standards (e.g. AS2828), NSW Health Policy Directives, a Health Service and State Health Records Forms templates. Working with the NSW Health, appointed Print and Print Management Services contracted provider, to facilitate Statewide implementation of the Policy. • To standardise clinical forms across their health service where possible. • To provide a formalised communication network between Health Service forms users, Executive, the contracted Print Management Services provider and the SFMC. • • To make recommendations for ongoing introduction/amendment/deletion of forms. Ensuring that the terms of reference includes a requirement that direct clinical contribution is obtained as required. The custodians and authors of Health Records Forms (including the NSW Department of Health) are responsible for: • • • Ensuring all steps in the health record forms development processes adhere to policy. Submitting relevant forms through their health service representative to the SFMC for review and endorsement. If NSW Health Policy Directive or Guideline requires a Health Record form to be used or created in order to comply with that policy or guideline the form must be submitted directly to and processed through the NSW Health SFMC and form a part of that Policy Directive or Guideline before it is distributed for implementation. 25(1/10) CHAPTER 2 – SIMPLE PROCUREMENT Health Support is responsible for: 2.10.1 • Monitoring and Reporting: o o o o Supplier (Print and Print Management Services) performance Quality issues (product, artwork and supply) Health Service usage and expenditure Health Records Forms gallery • • • • • Management and support of the SFMC. Implementation of a Communication Plan. Collaboration with Health Item Master File program. Maintenance of the State Health Record Forms and bar-code number allocation register. Management of print supplier contract and meeting costs associated with contract, (e.g. destruction of obsolete forms etc). Persons undertaking the evaluation of forms are responsible for: • • • • • Confirming that the form is compliant with the current Australian Standards on Hospital Medical Records (AS2828). Ensuring the form has a consistent format and template. Ensuring that the form meets the criteria as per stated throughout the Appendices to this policy. There is clear evaluation criteria against which the form is to be evaluated. A diverse group is selected to evaluate where applicable and possible and that consultation with any Health Service which is taking part in the evaluation has been consulted with at the highest level. Evaluation report is clearly documented and that any changes made to a form are within the boundaries of any policy directive which the form maybe written from. That any change which is outside a policy within which the form has been written from is referred back to the content owners for approval. That the form is in and remains in State Forms Management Committee State forms template. BACKGROUND About this document • • • 1. 1.1 In line with the strategic reform initiative, NSW Department of Health has instructed Health Support Services to include forms rationalisation and print management across NSW Health. This project will ultimately cover all forms however initially health records rationalisation is being addressed. It is estimated that there are approximately 15,000 commercially printed health record forms being used across NSW Health. There is not a common Statewide process to develop or review health (clinical) record forms. Not all forms comply with current Australian standards (e.g. AS2828). NSW Department of Health develops policies and guidelines with health records forms incorporated for implementation across NSW Health without always making provision for – 25(1/10) CHAPTER 2 – SIMPLE PROCUREMENT * • • • A co-coordinated implementation plan across all Health Services and agencies 2.10.2 Compliance with the current Australian Standards (i.e. for paper-based health care records AS2828) Review of the printing and distribution requirements and impact across all Health Services and agencies. Key definitions 1.2 Health Record Form: A record of the provision of care, assessment, diagnosis, management and/or professional advice given to a person. This term is used inter-changeably with clinical form. A Health Record Form is a Clinical form that is endorsed by Health Service Forms Committee for use within the area/service. State Health Record Form is considered to be a: • • • Clinical Form that is mandated by NSW Department of Health for statewide usage. See appendix 3 for the Statewide forms templates. Clinical Form that Health Services have devised for health service or agency use. Clinical Form that has undergone a NSW Health State Forms Management Committee (SFMC) approval process. Health Care Record: A Health Care Record is a documented account of a patient’s/client’s health evaluation, diagnosis, illness, treatment, care, progress and health outcome that provides a means of communication for all health care personnel during each visit or stay at a health service. It is the primary repository of all information regarding patient/client care. The record is used to care for the patient/client during an episode of care but may also be used for future episodes of care, communication with external health care providers and regulatory bodies, planning, research, education, financial reimbursement, quality improvement and public health. The health care record may also become an important piece of evidence in protecting the legal interests of a patient/client, clinician or Health Service. The health care record may be in hard copy, electronic or other form, and unless otherwise indicated, the provisions of this policy directive apply equally to all health care records regardless of the media in which they are kept. Health Service: a Health Service within the boundaries of the Health Service Act 1997 (which includes Area Health Services/Chief Executive Governed Statutory Health Corporation, Board Governed Statutory Health Corporations, Affiliated Health Organisations - Non Declared, Affiliated Health Organisations - Declared, Public Hospitals) SFMC: NSW Health State Forms Management Committee. Site: Physical facility or service e.g. Hospital, Community Health Centre, Renal Service, Justice Health site. Location: Ward, Oral Health, Clinic, Unit e.g. ICU, ED 25(1/10) CHAPTER 2 – SIMPLE PROCUREMENT * 1.3 Rationale The introduction of statewide health records forms will assist in: • Promoting quality processes through o o • • • • 2.10.3 Consistent business practices when designing and implementing clinical forms across NSW Health. Statewide standardised document control for all Health Record Forms included in NSW Health Policies. Health Services and agencies transferring to electronic medical records systems. Streamlining the implementation of NSW Health Policy and forms at the Health Service and agency level. Supporting scanning of health care records, including a standardised bar-coding system and the maintenance of a State Health Record Forms Register. Promoting effective and efficient work practice by: o Decreasing the workload at Health Services and Agencies, who are currently responsible for the implementation of forms incorporated in NSW Health policies and guidelines. Standardising information and formatting to assist staff across NSW Health to accurately and consistently collect patient information, regardless of the health care facility or service. o 2 2.1 NSW Health State Forms Management Committee Terms of Reference The Committee has the following Terms of Reference: • • • • • • • • • Co-ordinate the development of State Health Record Forms and documents. Standardise State Health Record Forms and documents and across the whole of NSW Health where possible. Ensure compliance with relevant Australian Standards where appropriate. Ensure liaison and co-ordination with the Electronic Medical Records Project (eMR) and other related electronic information systems. Provide a formalised communication network between form users, NSW Department of Health, Health Support and the contracted Print and Print Management Services Supplier. Disseminate forms and related information across NSW Health. Approve statewide health record forms and allocate a unique form number. Oversee the maintenance of the State Health Record Forms Register. Ensure actions and issues are assigned to the appropriate personnel either within Health Support, Health Services/Agencies, NSW Department of Health or the contracted Print and Print Management Services Supplier. 25(1/10) CHAPTER 2 – SIMPLE PROCUREMENT * • • • 2.10.4 Regularly review the statewide electronic forms web-site, when developed, for accuracy and initiate remedial action as required. Make recommendations for ongoing introduction/amendment/deletion of forms. To complement existing Health Service Forms Committees to ensure only endorsed approved (local or state) health record forms are produced for filing in the Health Care Record. Governance 2.2 The Committee will be responsible to the Deputy Director-General, Health System Support. 2.3 Representation NSW Health Services (NSCCAHS/HNEAHS/SESIAHS/SSWAHS/SWAHS/GSAHS/ GWAHS/NCAHS/CHW and Justice Health) Health Support By Invitation as required • • • • • • • 3 3.1 Standards Australia representative NSW Department of Health representative eMR Project Team representative Ambulance Service NSW representative MH-OAT representative Print and Print Management Services Contractor representative Other persons involved with special projects involving clinical forms and health records Development of Statewide Health Record Forms Identification of need for new or revised health record forms Sources for identifying the need for the development or revision of a State Health record form include, but are not limited to: • State executive sources including legislative requirements, NSW Health Policy Directives, Guidelines, Australian Standards and specific industry requirements, better practice or research evidence Service reviews, Incident Information Management System (IIMS), complaints, root cause analysis (RCAs) and peer review Internal and External audit reports Development Stage • • 3.2 Custodians and authors of proposed State Health Record forms are required to: 25(1/10) CHAPTER 2 – SIMPLE PROCUREMENT * • • • • • • • • • • • • • • • Search for an existing or similar form. 2.10.5 Source relevant documentation where possible and ensure forms comply with Best Practice, both in forms design and clinical practice. Ensure compliance with NSW Health policy directives, guidelines and information bulletins. Ensure there is endorsement from Health Services and supply confirmation of this in writing to the SFMC. Ensure that the form utilises the SFMC Forms Template. Contact relevant Health Service Forms Committee to identify which form is to be replaced and provide reasons for replacement Through their SFMC representative, send an electronic version of the form and completed application package for approval to the SFMC – see appendix 7 for application checklist Consider usage when stock numbers are being established. Specify colour, print and other specifications at the time of form submission. Comply with relevant Australian Standards (e.g. AS2828) Ensure forms are developed in liaison with appropriate clinical representation at both State and Area level. Ensure forms meet medico-legal requirements. Ensure relevant stakeholders are alerted to form development. Ensure training and/or implementation guidelines and materials are developed and distributed to appropriate Area representatives prior to the introduction of the form. The AHS is to establish a single line of communication with the SFMC; and the process for submission to the SFMC should confirm the above has been undertaken and the proposal endorsed at an Area Health Service level, prior to submission. Considerations 3.3 The impact of creating new Health Record forms is to be considered. This impact may include: • • • Increased staff work load due to staff completing the form and Medical Record/Clinical/Health Information Department filing the form. Increased size of medical records, which may impact on storage space and have potential OH&S issues due to the weight Costs – for example the colour of form or print, NCR paper, A3 size and booklets. Instructions/protocols/checklists should not, as a general rule, be included on the back of forms. Rather, alternate approaches should be explored to minimize interference with clinical documentation and unnecessary space requirements in the health care record. For example, instructions can be laminated and placed in an obvious area when introducing the form and/or be included in a procedure. 25(1/10) 10. paper. AS2828). o Compliance with current Australian Standards on Hospital Medical Records (AS2828) provision of supporting policy and guidelines current clinical policy clinical work flow financial resources implementation requirements and the provision of training materials decrease in duplication of data items decrease in space requirements of health records i. Provide support to authors in design and concepts (e. once approved. scanning requirements).e. storage requirements. A bar code identifier must be allocated based on the determined state form number. Consultation Phase A consultation phase will occur for a two week period from the time the form is released to the AHS’s or relevant Health Bodies for comments to be received back. Revised forms. If a form is deemed to pose a clinical risk it is to be destroyed at the contracted printers and the artwork removed. Photocopying of blank State Health Record forms for use and filing in the Health Care Record is not permitted.g. to manage printing of the form using the approved SFMC template.4 Validation Stage The NSW Health State Forms Management Committee (SFMC) will review the proposed Health Record form based on the following criteria: • • • • • • • 3. colours of print. 25(1/10) . will be printed for use when the current supply is depleted. then it will be deemed ineligible to be filed into the Health Care Record. 3. Informing author or custodian of approval or non-approval Managing the gallery of State Health Record Forms.6 Only Health Record forms endorsed by the SFMC (or Health Service Forms endorsed by the local Forms Committee) will be filed in the Health Care Record.g. Working with the NSW Health contracted Print and Print Management supplier. If a Health Record form is released for use without an authorized form number and bar-code identifier when one is required.CHAPTER 2 – SIMPLE PROCUREMENT * 2. A unique form number must be allocated from the State Forms Register.5 Form must comply with NSW Health State templates and current Health Record Standards (e. Evaluation Criteria All Health Record Forms will be evaluated on: • • • • • • • • best practice through o Consistent format and standardised template. 6 Transition Period 2.CHAPTER 2 – SIMPLE PROCUREMENT * The evaluation process shall include consultation with the Health Services. Progress notes. If more than one form exists then there will need to be consultation with the key stake holders via the members of the SFMC about the design of the most clinically functional and cost effective solution. and the costs of destruction. The replacement Statewide form must be available on the Print Management Services vendor’s web site before old stock is depleted to ensure continuity of supply. etc. b. then the stock will be written off and the entire cost of the stock and destruction costs will be invoiced to the initiating source. c. Where there is stock held which has not moved in the last 12 months. 3. Examples of these forms are. Once the SFMC has developed a new form the Print Management Services vendor will be advised not to replace current stock of previous old forms. Fluid Balance charts. The Option to Write Off Old Stock If a Health Service or NSW Department of Health Division needs to write off excess "old" stock (in order to introduce "new" stock rapidly). Phased Transition The SFMC will determine based on usage and/or clinical criteria the priority for the standardisation of Statewide forms. When the stock is low or no longer available the “Flag” on the Print Management Services vendor’s web site will direct users to the NSW Health Statewide standardised form that must be used.7 Implementation High usage clinical forms will be identified for standardisation into the NSW Health statewide template. If old stock is still available after 6 months the Print Management Services vendor will identify this issue with the SFMC for a decision to either: • • • Contact the owner of the form and advise them of “The option to write off old stock” Make the stock redundant Discuss with the relevant Health Service to determine who will bear this cost. unless advised otherwise within 2 months time If no response or advice is given after that period. 25(1/10) . Medical record covers. d.10. The Service Level Agreement Contract allows that the Print Management Services vendor is responsible for the (write off) cost of the first 3 months of stock held. they must be advised that: a. The Health Service would be responsible for the cost of the remaining (unused) "old" stock. It is expected that this is where the greatest impact should be gained for cost saving and standard work practice. the Print Management Services contractor would notify the owner of the stock of their intent to write off and destroy (noting the above incurred costs). The final form to be registered with State Forms Number. category and barcode. the outcome of the trial must be evaluated to determine whether the new form has been accepted by users (results of a compliance audit). The Health Service or agency Forms Representative is to advise the NSW Health State Forms Management Committee (SFMC) Convenor of the proposed form.CHAPTER 2 – SIMPLE PROCUREMENT * State Mandated Forms (those included in a NSW Health Policy Directive) a. Low Usage Forms b. a minimum trial period of up to 3 months may be required. During the trial period. g. New forms required by Policy Directives in the process of formulation will follow the requirements of this policy elsewhere described Health Record forms that require a trial The following guidelines are to be followed for introduction of a new State Health Record Forms which are not available in the NSW Health Print and Print Management Contractor’s State Health Record Forms Library: a. c.7 2. 25(1/10) . For forms that have a high usage. f. 3. providing education and supervising the form trial.8 Those forms that are identified by the SFMC as extremely low usage can be made available via the relevant website (primarily the NSW Health authorised Print and Print Management suppliers’ website). c. stocks of the “old” form (if a revised form) must be withdrawn from circulation. 3. All trial forms to adopt the State Forms Template and to be allocated a ‘Trial State Forms Number category and bar code’. These forms must adhere to this policy including usage of the approved NSW Health clinical forms artwork and must be approved by the NSW Health SFMC. See Appendix 7 for the Application Checklist. b. whilst forms that have a low usage may require up to a 12 month trial period. h. to enable a true and accurate trial of the “new” form to occur. it can be transitioned to the NSW State Forms Template immediately as there is no stock on hand.10. If a local area wishes to continue using the trial form they must give it a local form number. Complete the request and forward it to the Health Service Forms Committee Representative advising of the need to develop/introduce a State Health Record Form. These forms can be viewed and printed direct from the website. If the trial is unsuccessful the current version should be deleted from the State Health Record Forms website as a State form or re-designed. d. The SFMC is to formulate the appropriate Working Party who will be responsible for coordinating.8 If the form is Print on Demand (POD). As identified by the SFMC by usage at the present time this is expected to be in the realm of 100 per annum per site. At the end of the trial period. The time period required for the trial of a form will be dependent on the usage of form. If the form is warehoused existing stock will be run out and the form transitioned into the NSW State Forms Template ready to be printed on the next reprint. e. 10.Health Forms Design Appendix 3 .Version 2 (PD2005_593) Medical Records (PD2005_015) 4. Management.State Health Care Record Cover Artwork Appendix 5 .NSW Health State Health Record Form Design Checklist 25(1/10) .Forms Committee Process and Procedure a – State Health Care Record Form Process – New Form Process b – State Health Care Record Form Process – Targeted Form standardisation Appendix 2 .Paper Based Health Care Records 4.Terminal Digit Colours for Health Care Record Covers Appendix 6 .State Forms Templates Appendix 4 . Storage and Disposal of Health Care Records (PD2005_127) Privacy Manual .Strip Colours and Patterns Appendix 7 .3 Glossary SFMC = NSW Health Statewide Forms Management Committee HIMS = Health Information Managers HS = Health Service PD = NSW Health Policy Directive POD = Print On Demand HSS = Health Support MHOAT = Mental Health Outcomes Assessment Tool 4.9 Australian Standard AS2828 .2 Internal Electronic Information Security Policy (PD2008_052) Medical Records in Hospitals and Community Care Centres (PD2005_004) NSW Health Patient Matters Manual Principals for Creation.CHAPTER 2 – SIMPLE PROCUREMENT 4 4.1 REFERENCES External 2.4 Appendices Appendix 1 . Electronic. the maintenance charge not exceeding ten per cent (10%) of either the replacement value of the equipment or the original purchase price plus subsequent Consumer Price Index increases. Circ. where any increase sought during the currency of the agreement appears excessive.CHAPTER 2 – SIMPLE PROCUREMENT 2.1 The GSAS program provides a limited choice of ‘best of breed’ software packages for corporate applications. Maintenance contracts may be arranged subject to: • • • • • there being no existing contract arranged by the State Contracts Control Board covering the maintenance of the equipment concerned.9. 21(1/06) . the matter is to be referred to the Department of Commerce (State Procurement) for investigation. at all times it being ensured that the selected firm is the most appropriate and economical source of supply. Micro-Computers. The overall goal of the program is to reduce the variety of software used in the public sector and gain the advantages that flow from this. the maintenance charge not exceeding the purchase cost of new equipment which performs a similar function or supersedes the existing equipment.9 2. An independent review of the program has confirmed that it is delivering benefits to the government. Audio Visual and Miscellaneous Equipment 2. This Circular replaces an earlier one but does not represent an overall change of policy. In any case the charge shall not exceed those rates being charged for identical components and maintenance services at other installations in Australia.11 Depending on the type of equipment involved it may be necessary to enter into a maintenance contract to ensure the continued operation of the equipment.9. 99-35) (Government Selected Application Systems: GSAS) Summary • 2.8 Maintenance Contracts for Accounting. All agencies are required to use GSAS selected packages for applications covered by the program. The GSAS program is one of the vehicles for this.2 Background One of the core strategies in the State’s 1997 Information Management & Technology Blueprint ‘A wellconnected future’ was to make the Government a smart acquirer of Information Management & Technologies (IM&T). Office and Testing Machines. One or more GSAS products are used in 85% of budget sector agencies and 80% of 169 agencies of all types. expiration of the warranty period. 2. Photographic. Plans for applications in the GSAS program should be established in agencies’ IM&T Strategic Plans. Policy Directive on the Acquisition of Corporate Application Systems (Prem. CHAPTER 2 – SIMPLE PROCUREMENT 2. The use of GSAS products is mandatory for all agencies except State Owned Corporations who are strongly encouraged to use them. Electronic Mail. Such requests must be accompanied by a business case. reduced software licence fees and lower maintenance charges from the government’s purchasing power.9. Since GSAS products are provided under common use Agreements between the vendors and the State Contracts Control Board. The following applications are in the GSAS program: • • • • • • Human Resource & Payroll Management. GSAS products are to be used when the GSAS application provides a substantial part of the agency’s functional requirement.12 It is estimated that the savings from the program total about $25 million across government. The Information Technology Supply of the Department of Commerce is responsible for the day to day operation of the program.3 Policy All NSW Government ag encies are to o btain th e benefits of th e GSAS pro gram for th e acq uisition of new. financial and other enterprise-wide functions) Property Management will be added in 1999. justifying the non-GSAS acquisition. 2. These savings come from the elimination of the costs of tender processes by agencies. upg raded or e nhanced a pplication so ftware is required a nd th e ap plication is in th e program. They must be signed by the Chief Executive. It is recognised that there may be circumstances when an agency needs to adopt or continue using a package for a GSAS application from outside the product range. If at least 60% of the functional requirement can be satisfied by a GSAS application then an exemption must be sought before acquiring a package that is not a GSAS product. Requests and advice are to be submitted to the Office of Information Technology within the Department of Commerce. 2. Financial Management.4 How to use GSAS Full details about the program are in IM&T Guidelines published by the Office of Information Technology and available from their web site. other applications may be added in the future.9. Library Management Integrated Management (combining HR/Payroll. State Owned Corporations are requested to advise their reasons for not using GSAS. an agency need only select from the limited choice of products and agree an Official Order (Contract). Before starting such acquisitions an agency required to use GSAS must request an exemption for that application. 21(1/06) . Intentions regarding GSAS applications must be covered in IM&T Strategic Plans. Records Management. with life-cycle costs. re placement. CHAPTER 2 – SIMPLE PROCUREMENT Further Information 2. particularly if site specific supplier preference is encouraged without compelling reasons. This is due to a number of factors including the establishment of NSW Health Procurement and the involvement of clinicians in the process.gsas. In addition. and public health organisations should have protocols in place to remedy the situation. a submission may be made to the Department of Health to this effect. 2.asp 2. At times problems may be experienced with products or services. Where it is considered that the only solution is exemption from the use of the contract. 22(5/07) . A major component of the policy is that where goods and services are available under contracts arranged by the State Contracts Control Board they should be acquired by public health organisations from that source.1 Exemption Procedure In recent times there has been significant improvement in the way State Contracts are arranged and managed by the State Procurement. Industry groups such as the Patient Care Technology Group also play an important role in developing specifications. By using non-contract suppliers where State Contracts exist.11. hospitals would be contravening policy directives contained in the Purchasing & Supply Manual issued by the NSW Health Department (Chapter 1 . evaluating products offered and determining the most suitable suppliers for contracts.nsw. As a result of these measures products on State Contracts are systematically and professionally evaluated making it unnecessary in most instances for hospitals to undertake independent evaluations or to use suppliers who are not on State Contracts.10 Purchasing Under State Government Contracts Exemption Applications (PD2005_093) Policies and procedures applicable to purchasing in the NSW Public Health system are set out in this Manual.10.gov.oict.au/content/2. Details of the procedures are as follows. Clinicians and other health end users now have the opportunity of being involved in the determination of tenders by serving on Contract Advisory Groups.13 Enquiries concerning the purchase of packages and concerning exemptions from GSAS or GSAS policy should be directed to:The Executive Director Office of Information Technology Department of Commerce Phone (02) 9228 3500 More information at http://www.2. such action may raise probity issues that contravene the ICAC guidelines on the code of conduct for public officials.Purchasing Procedures). If the hospital user has not had a satisfactory outcome to the problem at Stage 2. Stage 4 . the hospital user should communicate the problem to State Procurement. The duration of the exemption will be indicated at the time that the exemption is approved. It is expected that most complaints would be resolved at this stage and would not be escalated to Stage 2.10. The issue will be escalated to Stage 4 if the only resolution possible is an exemption from the Contract. (b) Details of the procedure leading to the submission of an exemption application are indicated hereunder. the time taken for each stage should approximate two weeks.In instances where a satisfactory outcome has not been achieved in Stage 1. Depending upon the complexity of the issue. unsuitable conditions of contract. and 22(5/07) . the purchasing procedure outlined in the Purchasing & Supply Manual issued by the NSW Health Department with regard to quotations\tenders should be strictly adhered to. The Council will discuss with those involved and the relevant Contract Management Committee in an attempt to resolve the problem. through the HQRS. Stage 2 . a formal application for an exemption from the State Contract should be submitted to NSW Health Procurement (HP) on the prescribed form (appended) found in the HP intranet site. Exemptions are granted only on rare occasions. 2.2 Further Considerations Exemptions from the use of specific common period contracts may be granted by the NSW Health Department upon the recommendation of NSW Health Procurement.NSW Health Procurement will endorse the exemption application from the hospital user and forward it to the NSW Health Department. It should be noted that: a. Stage 3 . level of performance or as a result of an unresolved dispute. and There may be rare instances where exemptions are required for reasons attributed to a specific technical/clinical need. Internal procedures in place in Hospitals and public health organisations in regard to products complaints need to be followed up before further escalation. Stage 1 – The first stage of the process involves interaction between the hospital user and the contract supplier. The issue will be escalated to Stage 3 only if State Procurement is not in a position to resolve it in conjunction with the hospital user and the contract supplier. b.CHAPTER 2 – SIMPLE PROCUREMENT The NSW Health Department and NSW Health Procurement recognise that: (a) 2.14 State Contracts are arranged so as to provide the best value for money on a statewide basis and in this context Areas are advised that to not purchase from the contracts because better prices or conditions exist locally is not a valid justification for deviation from the contracts. Exemption approval or denial will be conveyed directly to the hospital user by the NSW Health Department under advice to NSW Health Procurement and the State Procurement. In instances where exemptions are granted. applicants still need to follow proper delegation and approval procedures.e. 2. Approvers may approve or reject applications. Application for exemptions entered onto the HQRS are electronically submitted to Authorised Public Health Organisation approvers. the application from the hospital should be accompanied by costings of the alternate products that are to be used. status of application. i. To improve efficiency in the exemption process. 22(5/07) .10.3 Lodgment of Applications for Exemptions Applications for exemptions are to be submitted to the Chief Executive of NSW Health Peak Purchasing Council.15 If an exemption is being sought for reasons such as incompatibility with existing equipment and/or user protocols.CHAPTER 2 – SIMPLE PROCUREMENT c. as part of the Health Quality Reporting Systems (HQRS). if approved the application is forwarded to the HP Procurement and Contracts team for processing. See Appendix 2-A for details of the web-based exemption form. The online system not only expedites the process. 2. Although there is a shift into automation. The system has an installed check and balances procedures that will help the user adhere to the exemption guidelines. but also makes the information available to all stakeholders in real time. the paper-based system has been replaced by a secure on-line system. CHAPTER 2 – SIMPLE PROCUREMENT 2.16 Appendix 2-A Data Entry form 21(1/06) . CHAPTER 2 – SIMPLE PROCUREMENT 2.17 21(1/06) . CHAPTER 2 – SIMPLE PROCUREMENT 2.18 Notes and Attachment form Log form 21(1/06) . 19 Reporter’s Details form 21(1/06) .CHAPTER 2 – SIMPLE PROCUREMENT Outcome form 2. the State Contracts Control Board invites representatives of agencies to participate on Contract Management Committees alongside specialists. The following terms are used in regard to deliveries of stores: FOR . To ensure that the appropriate price and full benefits of the contracts are received. When orders are prepared it should be ensured that delivery dates are nominated. consignment details are advised. (For further information contact (02) 9887-5490.the supplier is requested to advise the courier or delivery form to charge the receiver Areas should pay particular attention to notifications from State Procurement regarding changes in contractors.au or by telephoning NSW Buy on 1800 NSW BUY (679 289).station is specified) FOB . and that Authorising Officers' signatures have been obtained. FOB etc. Registered users can also search and browse in contract goods and services on smartbuy® www. 22(5/07) .com. To ensure that the items in contracts reflect the needs of agencies.) Any problems with the contracts should be reported to State Procurement or the Information Technology Service.1 Appendix 2-B STATE CONTRACTS CONTROL BOARD How to find out if an item or service is “on contract” Detailed information on goods and services on contract is available from the NSW Buy website www.nsw. discount amounts are entered. Nominees for Health related contracts are called for by NSW Health Procurement.free into store PREPAID FREIGHT . Placing of Orders All health specific contracts of the SCCB are “free into store” and public health organisations should not be paying freight/cartage or associated costs.free on rail (free delivery to nearest station .smartbuy.the supplier is requested to pay for freight and add the charge to the invoice FREIGHT ON . Orders for in contract items are to be made directly on the contractor using the appropriate order form.au How to participate in the development of the contracts The development of period contracts is a co-operative undertaking. Members of the committees participate in the development of specifications and the selection of the successful tenderers. so that purchases do not continue to be made from a supplier who is no longer a contractor.nswbuy. the quoted or estimated price is shown.gov. whether the price includes FIS.CHAPTER 2 – SIMPLE PROCUREMENT 2. health organisations should identify themselves as a client of the State Contracts Control Board and quote the appropriate contract number wherever possible.free on board (free delivery to nearest port) FIS . as far as practicable. until details of the new contract are received. The Director. areas may purchase stores and services for short term needs to best advantage. prices and conditions of contract should you become serious in purchasing equipment. prior to the date of commencement of any original or new contract.CHAPTER 2 – SIMPLE PROCUREMENT 2. EQUIPMENT AVAILABLE FROM ELECTRO-MEDICAL PERIOD CONTRACTS The following equipment is available on Period Contracts. orders placed on pre-existing contracts shall be paid at the rate claimed less any discounts applicable under the expired contract. Please contact the Electro-Medical Unit (02) 9372 8148 for the latest information on Period Contracts. notify the Department concerned of any such contract and of any subsequent variation of the contract. 21(1/06) . Alternatively you can approach the supplier for period contract pricing and equipment information and place an order direct on the supplier by quoting the period contract no. Should the pre-existing contractor refuse supply.21 If State Procurement does not notify areas of amended contracts in time to place orders. State Procurement shall. CHAPTER 2 – SIMPLE PROCUREMENT 2.22 21(1/06) . The Web Form replaces the Product Presentation hard copy forms given to Suppliers to complete. Biomedical Engineering & Clinical Product Management to collaboratively work together and assist in the evaluation of a product. This triggers an email to the initiator of the process enabling the evaluation to commence. This in effect supports conditions as stipulated in point 2. a rigorous product presentation and evaluation process is to be completed. It is essential that a pre-agreement with a Supplier is established prior to the registration of an evaluation. This is done through a dedicated HP Website called the Supplier Product Presentation Web Form for Suppliers. Initiate the evaluation tracking and reporting process by registering a proposed evaluation onto the abovementioned databases. Access product evaluation information from other Public Health Organisations. Enable a Supplier to submit product presentation information required prior to the commencement of the agreed evaluation. 3. “Authorised Public Health Organisation Users” agree to abide by the following conditions: 1. Enable appropriate expertise such as Infection Control. Health Services viewing other Health Services evaluations do so as a guide/reference only and is not to be used as the sole reason to award or not award a contractor/supplier. To assist Public Health Organisation in the process. 2. as proposed by prospective Suppliers or as requested by any Public Health Organisation staff. Database evaluations registered onto the system are entered as a form of “Health Service records keeping” and “information sharing”. OH&S. 5. This information may be utilised as reference to support any further evaluation or as the basis for further discussion with local users. These systems enable Public Health Organisations to: 1.23 Appendix 2-C EVALUATION OF CLINICAL CONSUMABLES & EQUIPMENT Prior to a Public Health Organisation accepting the use of clinical consumables or clinical equipment. 4. Enable Public Health Organisations – Product Evaluation Committees ensure that all requirements relating to the selection of Clinical Consumables and/or Clinical Equipment are taken into consideration in product selection.CHAPTER 2 – SIMPLE PROCUREMENT 2. NSW Health Procurement developed the Clinical Consumables Evaluation Database and the Clinical Equipment Evaluation Database. 6. 22(5/07) . Health Services acknowledge that item evaluation criteria used by other Health Services might not be consistent with their own evaluation criteria. Enable product presentation data as submitted by the Suppliers per point 2 to automatically populated appropriate sections of the database. HP SYSTEMS & DATABASE CONDITIONS OF USE The use of all HP Systems and databases are subject to specific conditions of use. 2. 3. that is accessible by all Health Services subject to conditions as stipulated in point 2. USER ACCREDITATION .au/business/hp Specificity of Information Supplementary to point 3 – Certified users should acknowledge that events or activities that led to the report being entered on onto the above system. The training sessions also equip each user with the necessary skills that will assist them in obtaining maximum benefit from the use of each system.gov. i.24 Prospective tenderers/suppliers of clinical consumables/clinical equipment for evaluations are to be advised by the Health Service that evaluation details are to be entered onto the statewide system. 2. and when accessing and analysing information entered by other Public Health Organisations. ensure the recipients are aware of the conditions stipulated on this document. 22(5/07) . Users are to ensure that they take reasonable care when forwarding extracted information to other Health Service staff. Confidentiality Information entered onto the above database is confidential and specific for internal NSW Health use only. • • • • • • • Clinical Consumables Evaluation Database Clinical Equipment Evaluation Database Health Quality Reporting System Tenders & Contracts Database Electronic Tendering System TenderMax – Tender Preparation Evaluation System BBS for surplus consumables & Equipment All of the above systems are located at http://internal.e. These factors may or may not be consistent in other sites.nsw.HP SYSTEMS & DATABASES The HP requires all Public Health Organisation authorised users of the following HP systems to complete an accreditation training as provided by the HP. all users are aware of their duties and responsibilities when entering and submitting reports.CHAPTER 2 – SIMPLE PROCUREMENT 4.health. This ensures that prior to the allocation of user ID’s and passwords. This in effect supports conditions as stipulated in point 2. might be directly relevant to specific Health Service environments or to the specific use of the product. CHAPTER 2 – SIMPLE PROCUREMENT HEALTH QUALITY REPORTING SYSTEM – SCCB CONTRACT EXEMPTIONS – VENDOR PERFORMANCE & RISK MANAGEMENT (IB2007_039) 2.25 This Information Bulletin is to be read in conjunction with the Purchasing and Supply Manual’s: • • Chapter 2 - Simple Procurement, specifically Section 2.10 - State Government Contract Exemptions; and Chapter 7 - Receipt, Custody and Delivery of Stores, specifically Section 7.21 – Reporting. This Information Bulletin applies to all clinicians and biomedical engineers of all public health organisations, except the Department of Health. Full compliance is required. What is the Health Quality Reporting System (HQRS)? The Health Quality Reporting System (HQRS) is a secure statewide system that enables reporting of quality issues for clinical goods, equipment or services purchased by Health Services. The HQRS was established to: • identify, document and alert all Health Services of clinical product quality issues and risks for immediate management; • ensure that there is a consolidated quality reporting system to allow the performance of vendors to be effectively managed; • provide the basis for managing the granting of exemptions from the requirement to use State Contracts. The HQRS is accessible through the gateway to Health Procurement Systems at http://internal.health.nsw.gov.au/business/hp/. What HQRS is not While HQRS have some similarities with another quality reporting system – the Incident Information Management System (IIMS), they are not integrated. The IIMS was established to identify, track and manage clinical, workforce and corporate incidents across the public health system, while HQRS has a focus on issues surrounding the quality and appropriateness of the performance of goods and equipment. On some occasions it may be necessary to complete both IIMS and HQRS reports. How is HQRS useful? The HQRS is an essential tool for vendor performance management and SCCB contract exemptions. A. Vendor Management Information reported in the HQRS is shared amongst authorised users across the NSW Health system to raise awareness of performance issues that have arisen. It also serves as a mechanism to escalate product performance issues to ensure risks are adequately managed: 1. 2. Supplier – as the first escalation level, to resolve contract and product issues directly by Area Health Service officers. Office of NSW Procurement, Department of Commerce – for escalated issues resolution of SCCB contract items after attempts to satisfactorily address the matter with the supplier. 23(9/08) CHAPTER 2 – SIMPLE PROCUREMENT 3. 4. 2.26 Health Procurement (HealthSupport) – for escalation of unresolved issues after 1 & 2 above. Therapeutic Goods Administration (TGA) – the TGA is not part of the escalation process. Issues forwarded to the TGA are those determined as in contravention of the Therapeutic Goods Act 1989. Product issues and incidents reported on the HQRS receive immediate attention by the suppliers due to its statewide transparency. Advice on issues resolution is accessible to all health system users in real time. B. SCCB Contract Exemption Exemptions are granted only in rare and exceptional circumstances. Detailed procedures in Chapter 2, section 2.10 of the Purchasing and Supply Manual must be followed. For SCCB contract exemptions, a similar escalation process is followed: 1. 2. 3. Supplier – first stage of product issue resolution. Office of NSW Procurement, Department of Commerce – second stage of product complaints resolution if it is not satisfactorily addressed between the Area Health Service user and supplier. HQRS – third stage of resolution through a formal lodgement of application for exemption from the SCCB contract. HQRS contains the prescribed electronic form that allows the information to be accessed and actioned by Health Procurement. After consideration of the exemption request by Health Procurement and/or NSW Department of Health, the outcome is entered back into the HQRS for immediate access by all system users, and will be a permanent record for audit purposes. Tracking of SCCB contract exemptions allows each Area Health Service user to understand the unique circumstances taken into account when granting exemptions. This information can be used in making informed decisions when a similar problem occurs. For strategic management, historical information on SCCB contract exemptions is used by Health Procurement and NSW Department of Health to manage contracts and the renewal process. Management of the HQRS Health Procurement manages the system, training and certification of users and allocation of access codes. They also manage flow of information to the appropriate agencies and their response times through entries monitoring. The Procurement and Contract Services Unit of NSW Department of Health monitors compliance to the policy set out in the Purchasing and Supply Manual. Access to HQRS Access to HQRS is restricted to authorised users only who are members of the Clinical Product Manager’s Group, or the Clinical Equipment Procurement Network. Authorised users understand the duty of care to be exercised when adding information to the system or using information from the system. Non-members of the authorised groups are encouraged to have their contribution of promptly reporting incidents and issues by contacting the relevant authorised user in their area. Lists are attached in Appendices A & B. New members who have not yet been given access and training must contact Health Procurement’s Steve Woodall on 02 8644 2018 or Email:
[email protected] 23(9/08) CHAPTER 2 – SIMPLE PROCUREMENT APPENDIX A - CLINICAL PRODUCT MANAGERS’ GROUP Alexander, Trish Clinical Product Advisor Hunter New England AHS T: 02 6767 8074 A: PO Box 9783, Tamworth NEMSC 2348 E:
[email protected] Birrell, Merrilyne Infection Control Greater Western AHS T: 08 8080 1370 E:
[email protected] Cane, Denise Clinical Product Manager Sydney West AHS T: 02 9845 7543 A: PO Box 533, Wentworthville 2145 E:
[email protected] Deeley, Mark Medical Equipment Manager Ambulance Service of NSW T: 02 9320 7620 / M: 0421 029 429 E:
[email protected] Grey, Cathy Senior Nurse Manager South Eastern Sydney & Illawarra AHS T: 02 9540-7731 / M: 0404 024359 A: Locked Bag No 10, Taren Point Delivery Centre, Caringbah E:
[email protected] Hardy, Leonie Clinical Product Nurse Sydney West AHS T: 02 9845 7438 A: PO Box 533, Wentworthville 2145 E:
[email protected] Hopwood, Janelle A/Clinical Products Manager Greater Southern AHS T: 02 6933 8036 A: PO Box 8546 Kooringal NSW 2650 E:
[email protected] Lees, Chris Project Officer - Clinical Services Ambulance Service NSW T: 9320 7877 / M: 0422 003 366 E:
[email protected] Leonard, Alan Senior Nurse Manager South Eastern Sydney & Illawarra AHS T: 02 4285 2583 / M: 0407 725008 A: Fernhill Place, 469 – 471 Prince’s Highway, Fairy Meadow 2519 E:
[email protected] Mackaway, Leica Area Clinical Product & Procurement Manager Sydney West AHS T: 02 4734 2034 A: PO Box 63, Penrith 2751 E:
[email protected] McKinlay – Hogan, Helen Clinical Products Manager South Eastern Sydney & Illawarra AHS T: 02 9540 7990 E:
[email protected] Murray, Bernadine (Deputy Chairperson) Area Product Manager Northern Sydney & Central Coast AHS T: 02 4320 2147 / M: 0417 031249 A: PO Box 361, Gosford 2250 E:
[email protected] O’Hara, Cathy Area Supply Services Sydney West AHS T: 02 9845-7560 A: PO Box 533, Wentworthville 2145 E:
[email protected] Patrick, Clive Clinical Resource Manager Sydney South West AHS T: 02 9828 6356 E:
[email protected] Rutledge, Faye Clinical Product Manager Greater Southern AHS T: 02 6933 8031 E:
[email protected] Scahill, Stan 2.27 Dept. of Biomedical Engineering, Liverpool Hospital-SSWAHS CEPN Representative T: 02 9828 6490 E:
[email protected] Shepherd, Lyn (Chairperson) Products Manager Hunter New England AHS T: 02 4941 4506 E:
[email protected] Skaines, Marcia Area Clinical Product Manager North Coast Area Health Service T: 02 66 255 703 / M: 0413 018 528 E:
[email protected] Sullivan, Margaret Area Clinical Product Manager Sydney South West AHS T: 02 9757 8005 / M: 0407 661528 A: PO Box 7060, Wetherill Park 2164 E:
[email protected] Taylor, Anne Infection Control Consultant Greater Western AHS T: 02 6885 8787 E:
[email protected] Winters, Stephen Clinical Products Coordinator Children’s Hospital Westmead T: 02 9845 3640 A: PO Box 4001, Westmead 2145 E:
[email protected] Bulaon, Valentino Data & Catalogue Manager, Health Procurement Health Support T: 02 8664 2051 E:
[email protected] 23(9/08) CHAPTER 2 – SIMPLE PROCUREMENT APPENDIX B - CLINICAL EQUIPMENT PROCUREMENT NETWORK 2.28 Allen, Mal Manager Bio-Medical Greater Southern AHS T: 02 4827 3220 E:
[email protected] Deeley, Mark Medical Equipment Manager Ambulance Service of NSW T: 02 9320 7620 / M: 0421 029 429 E:
[email protected] Devasagayam, Jonathan Director of Biomedical Engineering South Eastern Sydney & Illawarra AHS T: 02 9350 3382 E:
[email protected] Jones, Linda Procurement Officer Sydney South West AHS T: 02 9515 4819 E:
[email protected] Lobsey, Ray Manager - Dubbo Biomedical Engineering Greater Western Area Health Service Ph: 02 68858773 / 02 68857919 (for teleconference calls) E:
[email protected] McCauley, James Head of Biomedical Engineering Children’s Hospital Westmead T: 02 9845 2586 E:
[email protected] McKinnon, Darren Biomedical Engineer Children’s Hospital Westmead (Alternate) T: 02 9845 2595 E:
[email protected] McLennan, Michael Title North Coast AHS T: 02 6656 7579 E:
[email protected] Meshram, Latish Senior Project Officer - Clinical Asset & Contract Services Branch, NSW Health Department T: 02 9391 9215 E:
[email protected] Morrison, Bruce Director of Biomedical Engineering Hunter New England AHS T: 02 4921 3150 / M: 0418 476 385 E:
[email protected] O'Meley, Patrick Area Director, Biomedical Engineering SSWAHS T: 02 9515 8089 E:
[email protected] Pavan, Camillo (Deputy Chairperson) Senior Biomedical Engineer South Eastern Sydney & Illawarra AHS T: 02 9382 2783 E:
[email protected] Scahill, Stan (Chairperson) Dept. of Biomedical Engineering, Liverpool Hosp. Sydney South West AHS T: 02 9828 6490 E:
[email protected] Sullivan, Margaret Clinical Product Manager – Sydney South West AHS CPMG Representative T: 02 9757 8005 E:
[email protected] Walton, Craig Consultant, Biomedical Engineering Northern Sydney & Central Coast AHS T: 02 9926 8958 E:
[email protected] Bulaon, Valentino Data & Catalogue Manager, Health Procurement Health Support T: 02 8664 2051 E:
[email protected] 23(9/08) TABLE OF CONTENTS CHAPTER 3 - COMPLEX PROCUREMENT (TENDERING) 3.1 3.1.1 3.1.2 3.1.3 3.1.4 3.2 INTRODUCTION AND PROJECT MANAGEMENT...................................... 3.1 Gateway Reviews and Business Cases..................................................................... 3.1 Procurement Management Control........................................................................... 3.2 Checklists ................................................................................................................. 3.3 Probity ...................................................................................................................... 3 .3 PROCUREMENT STRATEGY ........................................................................... 3.3 3.3 3.4 3.4 3.5 3.6 3.7 3.8 3.8 3.9 3.9 3.10 3.12 3.12 3.13 3.13 3.2.1 Product Evaluation ................................................................................................... 3.2.2 Tender Method ......................................................................................................... 3.2.3 Expression of Interest & Selective Tendering.......................................................... 3.2.4 Types of Expressions of Interest .............................................................................. 3.2.5 Tender Networking................................................................................................... 3.2.6 Procurement Plan and Evaluation Criteria ............................................................... 3.2.7 Contract Periods ....................................................................................................... 3.2.8 Procurem ent Plan Approval ..................................................................................... 3.3 DOCUMENTATION ............................................................................................. 3.3.1 Request for (RFT) Documents ................................................................................. 3.3.2 Sections of the Standard RFT................................................................................... 3.3.3 Preparation of RFT using “Preparation/Evaluation Software”................................. 3.3.4 Tender Evaluation Plan – Preparation...................................................................... 3.3.5 Selecti on Criteria...................................................................................................... 3.3.6 Review of RFT ......................................................................................................... 3.4 ADVERTISING TENDERS .................................................................................. 3.14 3.14 3.15 3.16 3.16 3.17 3.17 3.18 3.18 3.18 3.4.1 Advertisement .......................................................................................................... 3.4.2 Tender Invitation ...................................................................................................... 3.4.3 Tender Briefings & Clarification.............................................................................. 3.4.4 Electronic Tendering ................................................................................................ 3.4.5 Electronic Tendering – Security............................................................................... 3.4.6 Electronic Tendering – System Outage .................................................................... 3.4.7 Recording of RFT Recipients................................................................................... 3.4.8 Amendments to RFT Documents ............................................................................. 3.4.9 Meetings with Tenderers .......................................................................................... 3.5 RECEIVING AND OPENING OF TENDERS ................................................... 3.19 3.19 3.20 3.20 3.20 3.22 3.22 3.22 3.5.1 Electronic Tendering (E-Tendering) – Lodgement & Receipt ................................. 3.5.2 Receipt of Tender ..................................................................................................... 3.5.3 Tender Box ............................................................................................................... 3.5.4 Tender Opening & the Tender Opening Committee ................................................ 3.5.5 Late Tenders ............................................................................................................. 3.5.6 Alteration to Tender Submission After Receipt ....................................................... 3.5.7 Clarification of Tenderer’s Information ................................................................... 21(1/06) 3.6 TENDER EVALUATION ..................................................................................... 3.23 3.23 3.25 3.25 3.26 3.26 3.6.1 Evaluation Procedures.............................................................................................. 3.6.2 Negotiations ............................................................................................................. 3.6.3 Alternative Tenders .................................................................................................. 3.6.4 Review Process......................................................................................................... 3.6.5 Evaluation Report & Recommendations .................................................................. 3.7 AWARDING THE CONTRACT.......................................................................... 3.27 3.27 3.28 3.28 3.29 3.7.1 Approval ................................................................................................................... 3.7.2 Letter of Acceptance ................................................................................................ 3.7.3 Advice to Unsuccessful Tenderers ........................................................................... 3.7.4 Public Disclosure of Information Arising from NSW Health Tenders .................... 3.8 CONTRACT MANAGEMENT ............................................................................ 3.32.6 3.8.1 Contract Manager ..................................................................................................... 3.32.6 3.8.2 Ensuring Accountability and Record Keeping ......................................................... 3.33 3.8.3 Central Tender & Contract Database ....................................................................... 3.33 3.8.4 Resolving Issues ....................................................................................................... 3.34 3.8.5 Service Provider Performance.................................................................................. 3.34 3.8.6 Operation .................................................................................................................. 3.3 5 3.8.7 Variation after the Contract has Commenced .......................................................... 3.36 3.8.8 National Product Catalogue...................................................................................... 3.36 APPENDICES: 3-A Gateway Review Process............................................................................................. 3-B Purchasing Policies...................................................................................................... 3-C Better Practice Guidelines for Including Health and Safety in the Engagement Management and Evaluation of Contractors in Health Services ............ 3-D Contract Documentation Checklist.............................................................................. 3-E Permit to Work Procedures.......................................................................................... 3-F Piggy Back Provisions................................................................................................. 3-G Checklist 3 for Procurement $30,000 to $250,000 DoH ............................................. 3-H Checklist 4 for Procurement $30,000 to $250,000 Health Services ............................ 3-I Checklist 5 for Procurement $250,000 to $10M DoH................................................. 3-J Checklist 6 for Procurement $250,000 to $10M Health Services ............................... 3-K Checklist 7 for Procurement Over $10M DoH............................................................ 3-L Checklist 8 for Procurement Over $10M Health Services .......................................... 3-M Checklist 9 for Procurement Under $30,000 DoH ...................................................... 3-N Contract DoH up to $200,000...................................................................................... 3-O Procurem ent Notification Form................................................................................... 3.37 3.41 3.49 3.62 3.63 3.65 3.66 3.68 3.70 3.72 3.74 3.76 3.78 3.79 3.93 25(1/10) CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.1 INTRODUCTION AND PROCUREMENT MANAGEMENT 3.1 “Complex procurement” refers to procurement of goods and services where the item being purchased is not available from contracts arranged by the State Contracts Control Board is over $250,000 in total value (including period contracts). The total value, including GST, applies to total value of the contract over the full contract term, the purchase cost including whole of life costs. In this instance, the tendering process is to be undertaken. Incorporated in this section are the procedures to be followed when purchasing goods and services/works that falls under the category “complex procurement”. See Consultancy Section for different $ levels from when tenders required. Further Considerations: All officers are to be aware of the provisions of Chapter 1 “INTRODUCTION” prior to procuring items or services as “NOT-IN-CONTRACT”. The NSW Government Procurement Policy – issued by the New South Wales Treasury July 2004 is to be adhered to with special note being made of the “Standards of Behaviour” at Appendix 1-B of Chapter 1 that all parties are required to follow. It is to be noted that the “Preference” element of the Policy applies to all purchases, not just tenders. The NSW Government Preference Scheme is detailed in Appendix 3-B. A large proportion of public health organisations have adopted electronic tendering through the utilisation of a web-based central gateway for the electronic exchange of tender documents [Tender advertising and receipt of responses]. The use of tender preparation & evaluation software has also commenced in some public health organisations to fully automate the process. Where possible, information that covers these new elements of tendering has been added to this chapter. 3.1.1 Gateway Reviews and Business Cases Specific additional requirements exist in respect to: • Projects where the capital value exceeds $500,000 (assets such as equipment, building equipment, software programs etc) and for initiatives submitted to the Department or Treasury for approval and/or funding. In these situations it is required that a “business case” be completed. Business Case Guidelines, which provide a “how to” resource to develop a business case can be found at http://www.premiers.nsw.gov.au High risk procurements or all other procurements valued at $10 million ($5 million ICT) or more will require a Gateway Review that is an independent assessment applied at key decision points in the procurement process. A review at the Business Case Gate must be carried out on all high risk projects and projects over $10 million. Appendix 3-A provides an overview of the process. A risk profile assessment is to be used for all procurements over $1 million and for those procurements that due to their nature could be considered a possible “high risk” to determine whether they are a “high risk” wherein the Gateway Review Process is required. If a procurement is considered “low” or “medium” risk either an independent in-house or independent internal/external review is required. Those procurements categorised as “high risk” require an external independent review. The Risk Profile Assessment tool is to be used to determine levels of risk and this can be located at http://www.smarterbuying.nsw.gov.au/gateway/ 24(7/09) • • CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.1.2 Procurement Management Control 3.2 Strategic Procurement and Business Development (SP&BD)’ Procurement Advisory Service (SP&BD) Unit is accountable in providing procurement and probity advice to help control the risks of major procurement across the NSW Health System. To enforce monitoring, an early notification of intended procurement is necessary. The Procurement Notification Form in Appendix 3-O must be filled out and submitted to Procurement Advisory Service (SP&BD) once a plan to tender over $250,000 is approved. To provide a procurement and advisory control over major procurements across the NSW Health system. Additional requirements are specified hereunder: Projects Over $10 million are to be managed by Strategic Procurement and Business Development (SP&BD) • Public health organisations, Ambulance Service and Department of Health are required to advise the Strategic Procurement and Business Development (SP&BD) of the Department of the proposed procurement of any goods and services, including consultants. SP&BD will be the procurement sponsor and chair the Project Steering Committee. Client CE’s and advisers will be represented on the Steering Committee. Project will be handed over to the client on completion. • • • Who will undertake procurement processes such as specification development, tendering etc is to be determined by the Steering Committee. Projects $1 million and under $10 million • • • • • Client CE is project sponsor and chairs Steering Committee; SP&BD is to be represented on the Steering Committee; SP&BD is accountable for procurement and probity advice (including selection and monitoring of such providers); SP&BD facilitates reviews and approvals required at specified milestones/gates; Client is accountable and required to certify that all requirements and advice have been complied with at specified “Gates” in the procurement process. The client is responsible for undertaking all procurement processes such as specification development, tendering etc. except where the Department determines otherwise. Procurements over $250,000 and under $1 million • Public health organisations and the Ambulance Service are to provide advice to the Strategic Procurement and Business Development (SP&BD) Branch prior to any procurement over $250,000 and under $1 million where tendering is required. The Branches of the Department of Health are required to advise SP&BD prior to any procurement over $150,000 where tendering is required. SP&BD will provide procurement and probity advice. • 24(7/09) au/business/hp 24(7/09) . 3.$250.1.000 Appendix 3-M 3. where there could be potential or perceived conflicts of interest. Both databases are managed by NSW Health Procurement and can be accessed through the HP Gateway http://internal. Procurement Checklists available include: For NSW Department of Health Checklist 1 for Procurement of Consultants Appendix 5A Checklist 3 for Procurement $30.000 .000 Appendix 3-H Checklist 6 for Procurement $250.1 Product Evaluation In most cases of clinical procurement.2.4 Probity The advice of the Department of Health’s Strategic Procurement and Business Development (SP&BD) Branch is to be sought in relation to all contracts which fall outside of the purchasing policy.$10M Appendix 3-J Checklist 8 for Procurement over $10M Appendix 3-L Considering probity risks within overall project management is important to ensure that government projects are managed with transparency. recognise and remedy probity risks for the better management of significant projects and managing relationships with contractors and external providers.000 .000 .2 PROCUREMENT STRATEGY 3. where there might be subsequent probity issues. Probity advice is required to be obtained for contracts in excess of $30. For Health Services Checklist 2 for Procurement of Consultants Appendix 5B Checklist 4 for Procurement $30.3 It is mandatory that the Checklists as listed hereunder are completed for all NOT IN CONTRACT procurements.nsw.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.3 Checklists 3. Area authorised officers who are either Clinical Product Managers or Biomedical Engineers evaluate the product (consumable or equipment).gov.health.000 . This publication was created to assist public sector organisations to understand. Reference should be made to the November 2005 ICAC document “Probity and Probity Advising: Guidelines for Managing Public Sector Projects”.000: i) ii) iii) which have not followed standard procurement processes.000 Appendix 3-G Checklist 5 for Procurement $250.$250. Well-defined stages are followed and evaluation results are centrally stored in the Clinical Consumables Evaluation Database or the Clinical Equipment Evaluation Database. Reference should also be made to Premier’s Memorandum 98-12 covering the use of probity auditors by Government agencies.1. fairness and in the public interest.$10M Appendix 3-I Checklist 7 for Procurement over $10M Appendix 3-K Checklist 9 Engaging Contractor under $30. Tender methods may include: • • • • • Open tenders .2 Tender Method 3. 3. Selective tenders . Procedures The officer with the appropriate financial delegation is to approve the invitation of EOI’s and the selective tender process. when choosing the procurement method. complexity and timing of the project and the extent to which an innovative approach is required.2. encourages competition and satisfies government procurement requirements and your agency’s procedures and delegations. A minimum of three (3) selective tenders is to be invited.Request for tenders (RFT) and anyone may submit a tender.2. Pre-registered tenders . if all 3 they are available.No tender is issued and a supplier is approached directly.A limited number of pre-qualified suppliers are invited to submit a tender.3 Expressions of Interest & Selective Tendering Definitions Expression of Interest (EOI) – is the process of inviting prospective tenderers to forward their intention and capability to provide goods/services as described in general terms by the public health organisation with the intention to possibly call for costed tenders or quotations at a later date through the release of a more detailed specification. in most cases this will follow the calling of Invitation for Expressions or Interest [EOI].CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. a limited number of suppliers are invited to submit a tender Invited tenders . try to avoid direct negotiation. The most common method used for goods and services contracts is an open tender process. Depending on the nature of the project. an EOI or RFP might be a good option. Selective tenders . As a rule.4 It is important. Direct negotiations .After an earlier EOI or request for proposal (RFP). responding to and evaluating the process. You should also take into consideration the impact the method will have on both you and potential suppliers in issuing. Valid reasons must exist and the delegated officer is to record the reasons for only inviting selective tenders. you may wish to have a single or multi-staged process.Is the process of inviting tenders from pre-qualified prospective tenderers without advertising. If you are uncertain about what the organisation needs or what is available. [Refer to ICAC’s publication Direct Negotiations in Procurement and Disposals] Whichever method you choose document the reasons why. as it removes competition and makes value for money more difficult to demonstrate. When deciding which method consider the value. Expressions of Interest may be called: 21(1/06) . that the way you choose to buy is fair.Generally used in emergency situations or for specialist goods and services where there are a limited number of suppliers known to exist. There is little point pre-qualifying many firms if only a few jobs will occur each year. Other than the advertising component all other tendering procedures as contained in this manual are to be complied with when undertaking selective tendering. Where invitations are restricted to a limited number of registered firms. or For the purpose of establishing the available expertise in the market place and forming a panel of acceptable contractors for selective quotation or tender action in relation to future tasks requiring that expertise. by review for non-performing or non-responding firms and by being kept open for new registrants and previously rejected applicants. environmental assessments. the published criteria for pre-qualification should be sufficiently demanding or refined to limit the number of qualifying firms to those who best meet the needs of the organisation.2. Where there is liable to be a large number of firms likely to be interested or there is little reliable information about capable firms in the market. which best satisfy the published criteria are registered as pre-qualified firms. The number of firms given pre-qualification status should be relevant to the amount of work available from the public health organisation.5 Where the requirements of the request can be met by various means and it is not possible to be sufficiently specific in relation to the information/documentation requested from potential contractors so as to facilitate final evaluation and decision.4 Types of “Expressions of Interest” a) Inviting applications for pre-registration for contracts for a specific category or work Lists of pre-qualified firms are an appropriate option when engaging contractors or consultants frequently for tasks within a specific field. constructions. 3. otherwise subsequent selective quotation/tendering action may be precluded. EOI’s are culled against selection criteria then detailed specifications are issued to short listed firms. To avoid that situation. followed by invitations to short-listed firms 21(1/06) .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) • • • 3. The list of pre-qualified firms is maintained by periodic advertisement at least every three (3) years. eg. by periodic review. tender opening. The advertisement and documentation must clearly indicate the action that could or will follow the Expression of Interest. there should be an express and ongoing obligation on registrants to continue to comply with the relevant criteria and to advise of any changes. b) Inviting expressions of interest or pre-registration for a specific contract. Invitations to tender for specific contracts are issued to all or some of the firms. Firms. assessment etc. An open invitation is issued for prospective tenderers to express interest in bidding for particular categories of work such as architecture. Tender box. the method of choosing firms to be issued with invitations should aim to provide all comparable firms with broadly similar opportunities to bid over a period of time. information technology or any definable activity. Also. which might affect their registration. When inviting expressions of interest or undertaking selective tenders tendering procedures as contained in this section are to be followed. if proposals are being sought. Overall. Requests for proposals are often called invitations for expressions of interest. This is particularly relevant where there may be a temptation to use an innovative idea of a firm in a specification for issue to other firms. It is desirable to declare any such intent so that the owner of the intellectual property rights can elect to grant a license to use the rights and to negotiate an appropriate fee and/or restrict the form of license. The short-listed respondents are then issued with a detailed specification and contractual information and invited to bid for the contract. This option is particularly suitable when: (a) a wide range of firms is likely to be interested and/or there is little reliable information about capable firms in the market.nsw. However.5 Tender Networking Tender networking is the coordination of contracts between public health organisations to reduce duplication of effort. The respondents are then culled against selection criteria stated in the invitation. it is best for that to be reflected in the title. The main objective is to establish a “single tender specifications” for goods/services with the aim of maximizing opportunities. 22(5/07) . 3. c) Inviting preliminary proposals or expressions of interest which contain proposals. the titles used are less important than clear statements of intentions. CE or Board of Directors] prior to initializing networking tenders with other public health organisations.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. along with other criteria such as expertise and experience. this coordination will eliminate duplication of efforts and maximise the sharing of expertise in writing complex specifications. In such cases the confidentiality of responses and the intellectual property of firms must be respected. which are used as a basis for short-listing firms.Approval/endorsement should be sought from each public health organisation delegated authority [e.gov. Legal advice should be sought before pursuing that option. Public health organisations should consider the co-ordination of contracts between several organisations.health. followed by invitations to short-listed firms Some invitations to industry seek preliminary proposals and ideas. [The tender should only be for goods/services not covered under contracts organised via the State Contract Control Board by the Department of Commerce. Further Considerations a) Approval . increase purchasing power and promote rationalization of products and suppliers.2.g. It is to be noted that tender networking may be established through the “Quadrangle” initiatives.6 This method involves the issuing of an open invitation for prospective bidders to express interest in bidding for a particular contract. It is preferable for the organisation to title processes in terms which literally reflect the intention of the organisation.au/business/hp The guideline which support the “Smarter Buying for Government” policy and NSW Health policy on tender networking. Only persons and firms who applied for pre-registration or who submitted an expression of interest are considered. Hence. and (c) the task to be performed is unusual for the organisation. NSW Health Procurement created a document called “Tender Networking Guidelines” that is accessible via http://internal. (b) the value of the work and/or the level of complexity is relatively high. To assist public health organisations. foreseeable variations such as exchange rates/price increases. Each public health organisation is each own legal entity] Method of Awarding Ongoing Contract Management and Administration Contract Implementation Procedures c) d) For more information on tender networking please obtain a copy of the “Tender Networking Guidelines” available by contacting NSW Health Procurement or via the HP Website on the DoH Intranet on http://internal.Expression of interest to network any contract with other public health organisation should be arranged via the public health organisation respective representative on the HP Tenders and Contracts Networking Group [TCNG].nsw. The evaluation criteria. public health organisations will need to address the evaluation criteria. These representatives should have relevant expertise appropriate to the tender.au/business/hp 3. When preparing tenders. whole-of-life costs. the tenderer’s experience.health.gov.6 Procurement Plan and Evaluation Criteria A procurement plan is a comprehensive document that outlines the stages of the project and how it will be managed.Once expressions of interest are received. past performance and skill.The tender networking party once established is to agree on the cooperative management of the tender. Refer to NSW Government Code of Practice for Procurement. and mandatory requirements such as licences. Collectively. capacity. This includes but is not limited to the following: • • • • • • • • • • • • • • • • • • • Tender Specifications Respective roles and Responsibilities Cost sharing Maintenance of Confidentiality Probity and Ethics Considerations Time Frames Supplier Forum/Site Visits Advertising Documentation and Printing Tender Fee and Other Relevant Tender Charges Method of Tender Lodgement Tender Opening Arrangement Guidelines for Evaluation Analysis and Methodology Problem Resolution Mechanisms Approval Arrangements for each public health organisation [NB.7 Expression of Interest .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) b) 3. evaluation criteria represent how value for money will be assessed and are likely to include technical merit.2. Cooperative Management . it is recommended that a meeting with prospective networking partners be organised by the initiating public health organisation. This should build upon any business case that has already been developed. and described in the tender documents. The working party then establishes the “terms of reference” and strategies for the networking. Networking Partnership . which is the basis for evaluating tenders. 22(5/07) . and compliance with Government and/or agency policy. are to be finalised before tenders are called. and possibly their key weightings. A working party is then organised from the partnership through recruitment of member-representatives from each public health organisation. It is important that officers concerned with approving recommendations have not been involved in the evaluation process. This will include confirming the availability of resources for managing the procurement process and the sufficiency of funding to complete the project.7 Contract Periods 3.approving authority for tenders/quotations shall be the officer acting under delegation to incur expenditure [refer to more information in section 3.2. whose approval may be given in any particular case or class of cases. 3. These reasons should be approved at a senior level by those not directly involved in the process. When delays in reaching a recommendation extended beyond the price validity period stated by tenderer/s. The fact that the tender of a preferred supplier or a tender offering a preferred item is received late is not generally an acceptable reason for inviting fresh tenders. Terms of Tender Acceptance . The public health organisation is to include in its Delegations Manual to whom the authority is vested to approve Procurement Plans and the incurring of the expenditure.8].2. but if a tender other than the lowest is accepted the reasons therefore shall be recorded. Inappropriate procedures or actions have occurred during the tender processes. Departure from established procedures for purchasing of services should only be for sound. Some instances where fresh tenders may be considered appropriate are: • • • • When no suitable tender has been received.2. in its opinion. where appropriate. The review can also assess whether the project is ready to proceed to the tender stage. 24(7/09) . Tenderers are to be advised.8 Procurement Plan Approval Approval should be sought for the Procurement Plan prior to proceeding. on the circumstances for recalling tenders. welldocumented reasons. The approving authority or officer so delegated may accept such tender as. although the tender may not be the lowest received. Contracts with a length of five years or more require Ministerial approval. This clause does not cover extension of existing contracts. Further Considerations Approval to Proceed with Tender .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.8 Tenders shall not be invited to cover a total potential period in excess of three (3) years without the express approval of the Director General or CE (or delegates) of the organisation. is most advantageous to the health organisation. When no suitable tender has been received on time.The approving officer is not bound to accept any tender and may invite fresh tenders. Further consideration Under the Gateway Review Process a Procurement Strategy Review can be undertaken at the completion of this stage to confirm that the optimum procurement strategy is selected to deliver the project within its budget and time constraints. in addition to submitting a conforming tender. as deposits in excess of this figure may dissuade a competitive tenderer submitting an offer.gov.nsw. A maximum fee of $200 plus GST is suggested.3 DOCUMENTATION 3. It is NSW Health policy for public health organisations to use standard tender documentation adapted to meet local requirements. must identify the selection criteria on which the assessment of the tenders will be based. NSW Health Procurement (HP) established “generic documents” and “guidelines” for use by NSW public health organisations as follows: • • • • • A Practical Guide to Tendering Tender Networking Guidelines Request for Tender – Goods Request for Tender Services/Works (Minor) (under $250. The Agency should also have regard to the costs of tender preparation and the estimated benefit of the tender method chosen. 3. clear and precise document and include all necessary information for the tenderer to understand the proposed tender process and contract and how the evaluation panel will select the tenderer offering best value for money. To assist in the above directive.9 Request for tender documentation should be complete so as to clearly reflect the procurement strategy. The fee may be refundable to actual tenderers. must nominate a person for the provision of additional information and post tender feedback. Tender documents considerations: • • • • • • • • must provide details of the tender requirements. the preparation of tender documents involves a significant cost. and should provide positive encouragement to tenderers by allowing them the option. because of the nature of the specification. must clearly define the contractual obligations of the parties. If. to show how an alternative might offer better value for money. must draw attention to any special conditions or obligations under the contract which depart from the organisation’s normal practice.health. If eTendering is available and used no fee is to apply. with details of the roles and responsibilities of all parties.1 Request For Tender (RFT) documents The RFT outlines the tender and contract objectives and requirements.000) Request for Tender Services/Works (Major) (over $250.000) Copies of all of the above documents may be obtained by contacting HP or via the HP Website on the DoH Intranet site at http://internal. the organisation should consider imposing a reasonable fee to help defray such cost and limit distribution to bona fide tenderers. must designate any supporting information required from tenderers. including methods of lodgement and format preferences. must provide specification of the goods or services required.3. It needs to be a logical. that provide equal opportunity for all potential tenderers to offer goods or services that satisfy the organisation’s needs.au/business/hp 24(7/09) .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. 1) Specifications may be: Functional . If the specification exists. the public health organisation [under NSW Health] is obliged to share the information with other public health organisation. This includes plans. This will save time and effort and eliminate the need to start from the beginning.10 Section A .gov. This section is in place to accommodate special requirements and exceptions that are covered or not covered by the General Conditions of Tender and the General Conditions of Contract sections. and the outcomes expected by you (as the client). there should be a clear description of the nature of the goods and services sought. Section B . the conduct of the tender process and the application of any relevant Government policies to the process. Technical . 22(5/07) . Section C . When preparing specifications. Access to other states document may be requested via the HC contact in that state. this is another way of checking if the specifications already exist in other sites.outlines the proposed function of the product (focus on what is to be achieved rather than how it is to be done.General Conditions of Contract – this section of the RFT contains the clauses that govern the agreement that is in place when a tenderer is awarded a contract.details the required performance characteristics including performance criteria.nsw.General Conditions of Tender – this section of the RFT explains the rules governing the content and submission of tenders. Prior to the writing of specifications.) Performance . The HP also maintains a database of other states tender advertisements and may assist in determining if specifications were already created by other states including New Zealand. include enough information to allow tenderers to assess whether they have the capability and capacity to satisfy the requirements. Whichever you choose.3.2 a) Sections of the Standard RFT: 3.Specifications of the requirements – this section of the RFT provides a detailed description of the requirements of the goods/services/works as described in the tender document. Preliminary considerations prior to drafting specifications: The HP Tenders & Contracts Database was developed not only as a mandatory registry for public health organisation as a storage system for tenders & contracts documents.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. Section D . designs and technical drawings.Special Conditions – this section of the RFT contains additional clauses that govern the tender and the contract that is awarded to the winning tenderer.details the physical description of the item required. Further Considerations b) c) d) d. it is recommended that a database search be conducted to determine if specifications to be created already exist. It is also recommended that a general email be sent to
[email protected] to alert HP-TCNG members of the intention to write the specification. Avoid bias by making sure private sector consultation and input is balanced against later interests of a potential tenderer. The section includes forms and schedules which tenderers complete to provide the information required to suit the evaluation criteria. 80 Berry Street.11 Specifications need to be prepared in such a way as to encourage and promote competition. Person who has vested interest in a supplier or prospective supplier. Industrial Supplies Office .this section of the RFT is a response section that is intended for tenderers to complete and submit their company information as stipulated in the tender. especially in construction projects are to be instructed that specifications should be drafted in such a way so as to provide for maximum use of goods manufactured in Australia or otherwise to promote local employment.org. delivery or packaging. use generic descriptors at all times. This enables a prospective contractor to respond to the RFT. The office can be contacted at Suite 3. Be cautious when seeking advice from the private sector in the framing of specification requirements.Company Details and Tender Responses .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. when preparing specifications: • • • • • Make the distinction between specified requirements that are mandatory and those that are desirable. d. d. Person who is not independent of a supplier or prospective supplier. d.3) Specifications Prepared by Consultants . performance standards and performance measures. 2060. including products and prices. 24(7/09) .2) In addition. Use recognised industry terms and standards.Consultants engaged by the organisation. Include other requirements such as warranty. Never include terms or words in the specification that identifies or is directly linked to a specific brand or supplier identity. and State whether the requirement has to comply with a particular Australian Standard or other standard/legislation.au e) Section E . North Sydney.The NSW Industry Capability Network exists to give free advice on the availability and efficiency of NSW and Australian suppliers and contractors. The organisation is to ensure that the following sections of the “Response to RFT” are appropriately completed: • • • • Tenderer’s Details Settlement Discounts Price Basis Compliance/Acceptance of RFT Conditions Checklist. Telephone (02) 9025 3150 Email: enquiry@icnnsw. maintenance. and not be limited to commercial or brand-specific attributes. Century Plaza.4) The following persons are not to be involved in the preparation of specifications: • • • Employee of a supplier or prospective supplier. include life cycle costs. an outline of the evaluation report and recommendation to be written. The HP oversees the implementation of the abovementioned software including education of users and should therefore be contacted for this purpose. the process for decision making. Requirements for meeting objectives on local and regional enterprises – refer to the Economic Development Guidelines If performance bonds and unconditional undertakings are part of the tender. Further consideration: In the TenderMax™ format the essential components of the RFT have been re-distributed to enable responders to provide more objective responses as well as supporting documents that can be evaluated by the experts in the field.The RFT should clearly state whether alternative tenders will be considered and the basis upon which they are to be submitted and considered. the HP endorsed the use of a tender preparation/evaluation software called TenderMax™.3 Preparation of RFT using Preparation/Evaluation Software To further assist in the use of the standardised RFT.3. 3. any procedures for clarifying or checking information with tenderers. the use of Tender Preparation/Evaluation Software should therefore be considered subject to local requirements. 3. While the level of detail will reflect the nature of the project. the evaluation criteria with weightings.3. evaluation time and subsequently reduces demand on the Public Health Organisation resources. 24(7/09) . Government Trading Enterprises And State Owned Corporations. and information about awarding the contract and notifying tenderers. process timeframes. the role. It is acknowledged by the HP that the use of this software reduces tender preparation. Premier’s Memorandum 2003-05: Government Waste Reduction and Purchasing Policy. Interpreter Budget Requirements in Contracting Out Services and Funding Services Delivered by Non-government Organisations. Some key features are as follows: • • • • • • Better and objective design Imbedded auto scoring Comprehensive Reporting Audit Trails Overall Probity Portability In light of the above.4 Tender Evaluation Plan – Preparation The evaluation plan sets the rules on how tenders will be evaluated. and NSW Government Code of Practice for Procurement. agencies are to refer to the following documents . Premier’s Memorandum M2008-28: Government Energy Management Policy.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) Further Considerations • • • 3.Eligible Financial Institutions – Issue of Performance Bonds and Unconditional Undertakings Obtained for Government Contracts or Private Financed Projects (TC 08-01).12 • • • • Acceptance of Alternative Tenders . information to be used to evaluate tenders. and the governance of the evaluation process. Premier’s Memorandum 98–22. the plan should include information such as the evaluation objective. composition and functions of the evaluation team. 3. tenderer’s occupational health and safety management practices and performance. innovation offered. 3. tenderer’s workplace and industrial relations management practices and performance. Prior to the release of the RFT. previous performance of tenderer.5 3. including technical. clarity and consistency. management. capability of tenderer.3. social and environmental development initiatives. human resource. delivery times offered. evaluation criteria shall contain the critical factors to be used in the evaluation of tenders. Selection criteria must be clearly identifiable to tenderers in the tender document. Generally the weighting of the selection criteria shall not be disclosed to tenderers. tenderer’s environmental management practices and performance. Further Considerations • • 3. the weightings of the selection criteria should be determined prior to the issue of the tenders or at the latest before the close of tenders. but at the latest before tenders close. experience of tenderer and personnel proposed. it should be independently reviewed to: • • Check for content. and Confirm it only requests the information necessary to evaluate the tenders against the evaluation criteria. and conformity of tender with requirements. 21(1/06) . Ideally. valued adding components such as economic. but are not limited to: • • • • • • • • • • • • • whole-of-life costs.13 The evaluation plan should be prepared as early as possible. tenderer’s community relations practices and performance.6 Review of the RFT Seeking unnecessary information can add to the cost to service providers preparing and submitting tenders. Appropriate approval should be obtained for the evaluation plan Selection Criteria Selection criteria should contain the critical factors on which assessment of the tenders will be based to ensure the goods or services offered meet the specified requirements and achieve best value for money (see Standard Tender Document specifically the specification section for more info). if appropriate and relevant to the procurement.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) Refer in this regard to the NSW Government Code of Practice for Procurement and Premier’s Memorandum PM98-12 regarding the use of probity auditors. The evaluation criteria should be consistent with the proposed contract requirements and aim to identify the tenderer offering the best value for money. organisational and financial capability and capacity. including costs of disposal. In addition to prices tendered. quality offered. These factors may include. To comply with this Section the following steps should be taken: a) Utilise the “Electronic Tendering System” (eTenders) made available by NSW Health Procurement (HP) accessible via the HP website http://internal. A good advertisement is a key part of the procurement or disposal strategy and should include as a minimum: • • • • • • focuses most attention on the organisation’s need (scope and requirement of tender).) Where a tender is being invited to replace an existing contract sufficient lead-time for the tender process should be allowed for formalisation of the contract prior to the cessation of the existing contract. and is consistent in size and in placement with the value. importance and nature of the contract.nsw.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) Once the RFT has been reviewed and settled. 3. and/or the local press. confirm the availability of funds to proceed with procurement action and obtain formal agency approval to release the RFT. Where tenders are called by public advertisement public and health organisations should provide equal opportunity to all tenderers qualified to respond. All advertisements relating to Expressions of Interest and Requests for Tender in the Metropolitan area must be placed in the NSW Government composite advertisement. All tenderers are expected to respond with integrity to all requirement of the invitation to tender. 24(7/09) . if applicable and payment details prominent notification of the need for compliance with the “NSW Government Code of Practice for Procurement” or any other applicable Code. Further Considerations • • Even with eTenders hard copy ads should continue. time and how for lodgement of bids. states clearly the place. as appropriate. date.au/business/hp The eTenders system provides the template for the electronic advertising of tenders.14 Tenders shall be invited at such times and in such a manner as to ensure the greatest possible competition amongst tenderers.4 3.1 ADVERTISING TENDERS Advertisement 3. Any advertisement should be designed and placed so as to attract the attention of bidders in the relevant industry and/or location.gov.health. Organisations are to advertise in the metropolitan press. (Already in banner of Sydney Morning Health Monday. appearing in the Sydney Morning Herald Tenders Section on Mondays.4. Separate display advertisements are not accepted by the GAA. states how to obtain detailed documentation and details of contact person. price of purchasing tender document. Any requests for advertising outside of these guidelines must be approved by the GAA. All advertisements must display the following paragraphs: “It is the NSW Government’s objective to ensure that Australian Industry is given every opportunity to win Government contracts”.dawson@commerce. 21(1/06) .4. Invitations should allow sufficient time for bidders to fully develop bids. poorly prepared tender documentation and inadequate understanding of contract requirements. This approach ensures Tender information is consistent across government. the impacts of which may not be manifested until after the contract commences. and • relevant tender website address. explaining the justification for the variation to the GAA Guidelines and signed by the relevant delegated authority should accompany the request for advertisement placement. rural or specialist publications as appropriate. with two weeks considered the minimum.nsw. When setting the timeframe consider the value. tender documents can be posted to companies known to be potential suppliers. The problems caused as a result of unduly short tender periods include weak competition. When in doubt it is reasonable to ask several firms the period they would require to prepare a bid for the type of business on offer.2 The tender period needs to be sufficient to encourage service providers to submit a tender and for the tender to be a competitive response. Tender Invitation • • • • • b) c) 3. The organisation should ensure the nominated locations.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) • 3. • Tender number or reference. In such cases a detail letter addressed to the General Manager of the GAA. N.B this already appears in the banner of the Sydney Morning Herald on Mondays. Only information essential to the tender is to appear in all advertisements. make site visits etc. Advertisements may be placed in the classifieds section only of local. • phone enquiry number or fax number. reduces advertising costs and conforms to the NSW Premier’s Department regulations. If an extension beyond 24 hours is granted all known prospective tenderers must be advised and the extension advertised where the period of the extension allows sufficient time for the placement of an advertisement. As a guide. (PD2005_267) (frith.15 Each advertisement shall only display the essential information relating to the Tender: • Tender title and description. sites or samples are available for inspection by tenderers. To facilitate receipt of tenders. Please ensure that potential tenderers are able to access full details of each tender opportunity online.au) See PD2005_633 for NSW Health Advertising Policy.gov. Enquiries regarding tender advertising should be directed to the GAA by phone. on (02) 9372 7402 or by fax to (02) 9372 7422. Extensions of the closing time are to be avoided and may only be granted on the authority of an authorised officer with reasons for such extension being fully documented and retained on file. complexity or strategic nature of the tender. a common period is four weeks. 3 Tender Briefings and Clarification 3. this should be clearly referred to in the invitation to tender and stated as a condition of tender. and is encouraging industry to adopt corresponding electronic procurement practices. 22(5/07) .au/health. If it is compulsory for tenderers to attend a briefing session.nsw template”.16 A briefing for potential tenderers can be held to provide them with an overview of the tender documents and what is being sought. requirements or other matters.nsw. the HP progressed the establishment of NSW Health Tenders Web Page consistent with the “tenders.this includes any form of information.com. Technology for the sharing and management of project information online (see asset. this process should be managed in such a way as to not give one tenderer an unfair advantage over others.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) No tender documents are to be issued after the stipulated closing time.au).cfm To ensure consistency and probity. Agencies reviewing and re-engineering their procurement processes and instruments. significant savings and efficiencies are realised. This can be achieved by providing any clarifying information to all tenderers. the electronic process mirrors the traditional paper based system. By converting these manual/paper-based model to an electronic process. The health tenders public site is located at http://tenders. This is to provide the opportunity for prospective tenderers to understand the requirements/format and how tender responses may be lodged. Further consideration When utilising tender preparation/evaluation software for the release of an RFT.nsw. Where tenderers seek clarification of the tender specifications.au/health/shared/admin/index.4. Key features of the strategy include: • • • • An electronic tendering system and single NSW Government entry point which enables tenderers to electronically access tender documents and information and lodge tenders (see tenders. and Performance monitoring and reporting.nsw.gov. the HP as consistent with the implementation of the software called TenderMax recommend and provide support to the establishment of supplier briefing sessions prior to the release of tenders.au). 3.gov. whilst the admin site where public health organisations access the system to manage their tenders is located at http://tenders.4 Electronic Tendering The NSW Government Electronic Procurement Implementation Strategy (Premier’s Memo 2001-16) has established goals and targets for moving government procurement online. 3.gov. To support public heath organisations in the use of electronic tendering system. The briefing also provides an opportunity for tenderers to clarify issues before the tender closes.4.gov. No person or firm quoting/tendering is to be offered any advantage over any other person or firm quoting/tendering. are expected to abide by the following set of actions to overcome difficulties during system outage. This dictates that users are expected to implement business practices that promote strict security to tenders when using the eTendering system. therefore. b) Tenderer’s emergency Where despite the tenderer’s knowledge of the response lodgement requirement. Although the eTendering system is set to automatically log-out a user after a period of inactivity [30 minutes].5 Electronic Tendering – Security 3. HP. transmission speed also vary from 1 minute to 320 minutes or more. the transmission was still initiated late and was interrupted by system failure. it is the responsibility of the tenderers to allow themself ample time to lodge a response. This rule will eliminate the possibility of tenderers using the “ran out of time” excuse for failing to submit a response the proper way within the minimum two-week period. 3.4.. tenderers are expected to wait until return of service. If the outage is only of short duration and still leaves ample time for submission. an emergency situation may still occur. System outage affects the lodgement of tender responses.17 The handling of tenders demands high standards of confidentiality and probity.4. As tender responses vary in size (content-wise).e. In particular.6 Electronic Tendering .System Outage Tenders are by standard. the public health organisation shall endeavour to communicate the outage to prospective tenderers within possible means. HP shall in turn advice public health organisations of the system interruption. an emergency situation can be classified into two scenarios: a) ETendering system emergency Where time allocated by the Tenderer to initiate lodgement of a response is reasonable but an outage occurred which will last till closing time. submission should NOT be initiated fifteen (15) minutes before the closing time. In this instance. If a list of prospective tenderers is available. Department of Commerce. public health organisations and the prospective tenderers. Parties involved. However. the system should never be left unattended even for short periods. Where a re-try will past the closing time. 22(5/07) . Specific actions ensuring strict adherence to the eTendering standard procedures will eliminate confusion and misunderstanding. it is essential that the user log off the eTendering system at anytime their attention is required elsewhere. Passwords should never be revealed or written and stored where other people can view or access. Passwords should always be changed on a regular basis. open for a minimum of two (2) weeks. The Department of Commerce shall provide advance notice to all users of anticipated system interruption and expected return of service by forwarding an email to HP. i.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. Where the tender documents require a pre-tender briefing.4. [This may be subject to local Health Service policy] An option the Authorised Officer may take is to inform the tenderer that: An email response may be allowed subject to an accompanying letter with a strong and valid justification of the lateness of the tender response and failure to transmit is submitted. and become part of the tender documents.8 Amendments to RFT documents Where it becomes necessary to amend tender documents the amendments must be advised as an addendum to all tenderers in sufficient time for all tenderers to properly and fully consider the addendum before tenders close. Tenderers should be required to confirm its receipt in writing. The organisation should nominate a contact person with knowledge of the requirements of the tender to respond to all enquiries from tenderers. If the tender period is extended all known tenderers are to be advised of the new closing time and date. 3. In respect of eTendering an electronic alert is processed alerting registered respondents. Each addendum should state clearly that it is meant to be incorporated in the tender documents. Any information given to a particular tenderer. including ambiguities or discrepancies. All such enquiries should be recorded. noting time and date of receipt. Consideration may need to be given to extending the tender period when an addendum is issued.4.4. This will not apply in relation to confidential or intellectual property information provided by tenderers. 3.7 Recording of RFT Recipients The names and addresses of persons/firms who have been provided with the tender documents should be recorded to enable contact if changes occur to the conditions or specification. such a conference with tenderers should be minuted and the minutes should be forwarded to all tenderers.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. The public health organisation’s Authorised Officer is to assess the situation and/or discuss the matter with relevant Health Service personnel and acknowledge with the tenderer whether submission is to be accepted or not. Accepted submissions must be approved-stamped by the Area Contracts Registrar and witnessed by the public health organisation’s Authorised Officer. in writing. and the issue raised and any response provided. which clarifies any aspect of the tender.18 The tenderer is expected to immediately contact the public health organisation’s contact person for the tender before the closing time and convey the difficulty encountered. 3. the information provided should be conveyed in writing to all tenderers. Where an enquiry reveals a significant error. 21(1/06) . must also be communicated promptly. to all other tenderers. and should confirm in their tenders that allowance has been made for each addendum. Acceptance of such tender response is subject to the merit of the justification.9 Meetings with Tenderers During the tender period there may be a need to meet with the tenderers. Be mindful of probity issues associated with late tenders and the subsequent risk to the integrity of the evaluation process. insert addenda and download tender information.5. with fair competition that achieves and identifies the best value for money for Government and clients. except where the client is satisfied that the integrity and competitiveness of the tendering process has not been compromised. Where functions are unable to be segregated due to resourcing constraints. When downloading information on to disc. Such meetings are to be minuted and such minutes are to be forwarded to all tenderers and incorporated in the tender documents. Local internal auditors should also be consulted regarding any internal control issues. however controls are to be in place so that only authorized users can access the eTendering system to upload initial documents.5 RECEIVING AND OPENING OF TENDERS The invitation and receipt of tenders should be conducted using ethical behaviour and with probity. The process is to be transparent. The only exception to the above policy is where clarification is required which could be classified as commercial in confidence and discussion is only held with one tenderer. compensatory manual controls will need to be devised. Tender identification codes are to be securely locked away and only be accessible to the authorized tender officer. The procedures for the receipt.5. In such circumstances all tenderers should be offered the same opportunity and it is advisable to include such provisions in the tender documents. 21(1/06) c) d) e) f) . Late tenders should not be considered. In particular all system users must have a unique user ID and must not share passwords with others. The NSW Government Code of Practice for Procurement encourages the highest ethical standard in tendering practice by all participants. Refer also to publications of the Independent Commission Against Corruption for further information on probity in Government procurement. For example. CD’s/DVD’s should be dated and initialled by the Tender Opening Committee and attached to the Tender schedule. Staff creating RFT’s and Addenda should not be responsible for publishing those documents on the web site. 3.1 Electronic Tendering [E-Tendering] – Lodgement and Receipt All procedures that govern the tender opening and the tender opening committee as specified hereunder apply also to E-Tendering. Care should be taken to ensure that E-Tendering system functions are appropriately segregated. it should be burned to CD/DVD so that information cannot be altered.19 When tenderer meetings are held all tenderers must be invited and the meetings should refer exclusively to the tender documents and must not be in conflict with or add to the tender documents. opening and registration of tenders must safeguard the security and confidentiality of the tenders. a) b) The E-Tendering System must comply with the relevant organisation system Condition of Access.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. the agency administrator (User Management Function) should not be responsible for other functions within the system.5. 3. See Late Tenders – section 3. Computers do not have to be locked away in a room by themselves. 20 If a Tenderer submits a tender both in hard copy and by e-Tender the e-Tender document is to be either burned to CD/DVD or downloaded to hard copy and married to the hard copy tender document. Duplicate keys should be treated in a similar manner. 3.4 Tender Opening & the Tender Opening Committee There shall be a Tender Opening Committee. 21(1/06) . the information submitted electronically is to be the document accepted as the valid tender (a Tenderer might submit a hard copy tender. The box should be prominently located in a public area and should be capable of accommodating plans. which may accompany tenders. E-Tendering Consideration . 3.the system provides the function that requires 2 witnesses and the Contracts Officer to login their separate secure passwords before the electronic tender box can be opened. The Tender Opening Committee shall consist of not less than three (3) officers. h) 3.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. Upon lodgement and receipt of an electronic tender response. If a Committee of three (3) officers cannot exercise the functions of the Committee adequately. Arrangements must be made to safeguard the security and confidentiality of all tenders. If tender documentation is too large to fit in the tender box the “tender contact officer”. These procedures are to ensure all electronic tenders are handled on a consistent basis where problems with the technology are encountered. If a Tenderer submits hard copy information and also then the same information is submitted electronically by the tender closing date.5. RFT’s available on the “E-Tendering System” requires Tenderers to pre-register onto the system prior to viewing and downloading of RFT documents. specifically the Tenderer’s email address.5. g) Contingency procedures are to be in place to cover technology failure. are recorded. the majority of members of which should be independent of the assessment process. Confidentiality of the tendered information is to be ensured in any alternate storage of tendered information.3 Tender Box Each organisation is to maintain one tender box only which shall be maintained and secured with two different locks. is to be contacted so that the documents can be securely locked away. This process ensures that Tenderer’s contact details. including the receipt and processing of tenders. then decide to amend the information submitted and e-Tender the amended information).5. or other officer designated as being in charge of tender box. drawings etc. The keys to the locks will be held by separate senior officers to ensure that no single officer can open the tender box. a system generated email is forwarded to the Tenderer as an acknowledgment of receipt of RFT response. additional officers may be coopted with the approval of the officer who authorised the calling of the tender.2 Receipt of Tender Probity is vital in all stages of the tendering process. The tender box shall be opened in the presence of a Tender Opening Committee as soon as practicable after the time fixed for the closing of the tenders. Bids and other responses received should be recorded and handled so as to preserve their confidentiality. At this stage. E-Tendering Consideration – the eTendering system includes data encryption that is executed using encryption software. At a minimum upon removal of each tender from the tender box the following action shall be taken: • • Tenders numbered in order of opening Initialled on each page containing monetary references by not less than two members of the Opening Committee and the Convenor (HAC). subject to release of information about the winning bid at the completion of the selection process. Tender responses are received in an “encrypted” format to ensure that only recognisable and pre-registered electronic keys are able to “decrypt” these encrypted responses. It is desirable that each tender is examined to ensure that: • • • • it has been correctly completed and signed. They must be present during the entire tender opening process including the “burning of tender responses to CD/DVD process”.B. 22(5/07) . nominate a member of that Committee (including any co-opted member) to act as the senior member of that Committee. prices and other essential details have been included. Committees may be called together on an ad hoc basis. This occurs automatically when tender responses are received and requires no further action by the user. The organisation may elect to number and initial each page The particulars of each tender received and opened shall be entered on a schedule and shall include: • • • the names of the tenderers.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. All members of the Tender Opening Committee shall sign the schedule. items not tendered for have been acknowledged. there are no obvious irregularities. N. enters names of each member of the Tender Opening Committee onto the system. resealed and placed in the tender box. date stamped. the names of those who submit “no tender” and the pricing particulars of each tender. the tender should be endorsed to that effect by the officers present.21 It is not intended that the same Committee need necessarily consider each separate tender opening. The Officer who authorised the calling of the tender shall in respect of each Tender Opening Committee. it is required that the screen displaying all the names of the Tender Opening Committee is printed on paper for each member of the Tender Opening Committee to sign and acknowledge that they were present during the Tender Opening and decryption process. This signed document (Opening Agenda) is to be kept as part of the official record relating to the RFT. Confidential information from bidders must not be given to competitors or otherwise disclosed. Each tender opening committee member is assigned a unique user ID and password and is required to individually enter their details during tender opening. Should a tender be accidentally opened. Prior to tender opening and “decryption”. HP as per the request of the public health organisation. CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. A tender or written quotation received after the time advertised or fixed for its receipt shall not be considered unless: • • • • there exists clear evidence that the tender was posted before that time.6. Any such alteration or amendment must be by means of an explanatory letter. When a late tender is received. the possibility that other bidders will be concerned that a late bidder has obtained an unfair advantage. the organisation accepting the tender is satisfied that the integrity and competitiveness of the tendering process has not been compromised. The tenders and schedule are then to be forwarded to the committee or officer delegated to review tenders.5 Late Tenders 3.5. The dangers inherent in accepting late bids include: • • • the possibility that the late bidder has obtained information about the other bids after the closing time.Late tenders cannot be received electronically as the electronic tender box automatically closes at the specified closing date and time.5. 3. Except as provided in these procedures officers must not deface or make notations on tenders. The tests of integrity and competitiveness might include these questions: o o o o Was the late tender received prior to the completion of the tender opening and recording process? Was it clear that the cause of the lateness was beyond the tenderer’s control? Is the late tender significantly different that no information from other tenderers could have assisted in framing the late tender? Is a late tender the only conforming tender received? In respect to the first 2 points any such evidence or advice shall be attached to and retained with the tender. should be aware of probity issues.2 on “negotiations”) . In normal circumstances facsimiles are not acceptable unless approved by the Tender Contact Officer.5.g.7 Clarification of Tender’s Information 21(1/06) (See also clause 3. e. 3. confidentiality of prices. if accepting facsimile tenders.6 Alteration to Tender Submission After Receipt Tenderers should not be permitted to alter or amend the original of any tender or annexure thereto after receipt in the organisation.22 The responsibility rests with the bidders to submit bids on time. the possibility that a pattern of late bidding will develop. the late tender was the only tender received and it conforms to specifications. the time and date of receipt shall be noted in the document and endorsed by the recipient. or facsimile advice was received before that time detailing price and delivery schedules. E-Tendering Consideration . Organisation staff. The continuing role of that person in the tender evaluation and review is to be determined by an independent senior person to ensure that probity is maintained. If criteria have not been developed they must now be determined prior to the assessment. Such conflict of interest and actions taken must be documented to ensure transparency of the process. When necessary. so that the organisation that called tenders is satisfied that the best value is obtained from the tenderer finally awarded the contract.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. 3. Interaction with tenderers should be in writing. The tenderer must confirm their verbal advice in writing (signed and dated) prior to the completion of the evaluation process. tenders must be examined to ensure that tenders being considered are from the contractors who have been invited. An initial cull of bids clearly out of contention is in order so long as the cull is based on the pre-determined criteria.6. Where tenders have been invited from particular contractors. clarification of the statement or information should be obtained from the tenderer. Any discussion or contact with tenderers during the tender evaluation period must be done with due regard to probity. Time and effort spent during the tender evaluation and review period can be saved many times over during the execution of the contract. dated and signed and maintained with the tenderer’s submission. under consideration or rejected) of any tender must not be advised or implied to any tenderer. It is critical that tender evaluation and reviews are carried out thoroughly. Evaluation may be carried out by a committee or by a competent officer officially delegated. through the Selective or Pre-qualified Tender processes. It is not always necessary to conduct a detailed analysis of all bids. If a person evaluating or reviewing tenders becomes aware that there is a potential conflict of interest in that person’s involvement in the tender review process. expert advice from outside the organisation may be called for. The same criteria must be applied during the assessment of bids. in particular: • • • No information on the evaluation process must be divulged to any tenderer. In circumstances where an issue is discussed verbally with the tenderer. that person must declare their interest. to ensure an objective and rational basis for the assessment.23 In circumstances where a statement or information provided in a tender submission is open to interpretation or is not understood.6 Selection criteria should have been advised to bidders during the invitation process. Tender evaluation criteria are used to help identify the best value for money tender and are linked to the information required from the tenderers in the tender documents. The status (preferred.1 Evaluation Procedures Clear tender evaluation procedures must be established prior to the close of tenders. TENDER EVALUATION 3. All tender information must remain confidential between the tenderer and the persons within the organisationcalling tenders who have a direct involvement with the particular tenders. The clarification request must be framed in a manner that does not result in the tenderer gaining advantage over other tenderers (eg revising or expanding the offer). 21(1/06) . the discussion must be documented. It may be necessary to contact tenderers to clarify certain technical aspects of their tender. contained in this section. Any conflict of interest with evaluators must be declared and resolved.24 The evaluation is to involve a fair comparison of tenders. Where applicable. i. . Further Considerations Agencies must ensure the confidentiality of tenders is maintained. The process is to be conducted by personnel with sufficient skills and knowledge in matters appropriate to the nature. Team members will contribute a mix of skills to the evaluation process. evaluating officers should refer to Treasury’s Policy Statement on the Application of Competitive Neutrality (Treasury Policy Paper TPP02-1 refers). the availability of spare parts and service facilities should be checked. Any tender that does not comply with the tender requirements may be passed over. Except where the nature of the goods/services/works to be acquired call for a different approach. Such contact should be made with discretion by a senior officer and should be for clarification only. value and importance of the procurement. Technical • • • • • Price • • Price comparisons are to be made on a net basis.) 24(7/09) Technical/clinical evaluation entails a detailed comparison of tenders against the specification with those tenders having significant departures from the specification being eliminated (nonconforming tenders). not amendment. tenders should be evaluated in terms of their technical. See section 3.1. (Appendix 3-B and 3-B1 re Australia-United States Free Trade Agreement. price and commercial suitability. base price less trade-in and/or settlement discount if feasible plus any applicable surcharges and exclusive of GST. the reasons must be clearly documented by the evaluators. Refer to Premiers Memorandum 98-12 concerning the use of probity auditors by Government agencies.e. or high risk. Price/cost comparisons should be on the basis of whole of life cycle cost including cost of disposal where applicable. The ability of tenderers to meet the technical requirements of the specification may need to be evaluated. Preference in favour of New South Wales country and/or Australian manufactured items is to be applied on the scale laid down in the Government Purchasing Policy. If circumstances make it desirable to accept a tender that is not entirely in accordance with the specification all tenderers must be given an opportunity of meeting the variation. or a non-conforming tender is recommended. When a tender is passed over or rejected.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. using the same evaluation method and criteria for each tender. For complex procurement with a high value. appropriate to the various aspects of the tender being evaluated. When evaluating tenders from other Government agencies. an evaluation team must be established.4 “Probity”. the organisation must deal fairly with all tenderers in a manner. Tender documents must state clearly the conditions that apply to the evaluation of conforming tenders and any negotiations with tenderers. In any tender related negotiations or evaluations. Tender negotiations must not involve trading-off one tenderer’s price against other tenderers’ prices. if so. Organisations must first exhaust negotiations with the tenderer that is the closest to conforming. If installation is involved. The aim is to achieve a conforming tender. including documentation covering who does what. referred to as ‘bid-shopping’.3 Alternative Tenders Tenderers are encouraged to tender in accordance with the tender requirements. or other. Organisation must not in any way use negotiation (including post tender negotiation) as an opportunity to trade off different tenderer’s prices against others in an attempt to seek lower prices. The negotiation process should be open and accountable. This practice. is prohibited under the NSW Government Code of Practice for Procurement. Tenderers may submit alternative offers/tenders. unless time constraints dictate to the contrary. Negotiations Organisations and tenderers should give careful consideration to their role and conduct in negotiations to ensure their behaviour reflects the ethical principles. Tenderers’ price variation conditions. which may be considered but must meet the objective and intent of the tender requirements. The purpose of the negotiations must be established and made clear to all participants prior to the commencement of negotiations.6. Do they differ from those set out in the tender documents and. This practice is known as “bid shopping”. i. The decision to proceed with negotiated tenders should be when conformity to requirement is considered achievable and must be approved by the organisation’s Chief Executive. before negotiating with subsequent tenderers. Whether tenderers are seeking to impose unacceptable conditions in any other respect. are they acceptable? Tenderers’ financial status and ability to meet delivery requirements. negotiations may be conducted with the tenderer. A separate response should be submitted for each alternative offered.25 Tenderers’ delivery terms. The organisation reserves the right to reject any alternative Tender. which reflects the “Standards of Behaviour “ as listed at Appendix 1-B of chapter 1.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) Commercial . 3.e. whether FIS. whether arrangements for payment are clearly understood. and is unacceptable. which is the closest to conforming to the tender requirements and provides best value for money.Factors to be considered under this heading are: • • • • • 3. 21(1/06) . must be maintained by the organisation.6. If after a competitive tendering process none of the tenders are acceptable or conforming. when and why.2 3. Written records of all negotiations. There are instances when the organisation may negotiate with the preferred tenderer to mutually improve outcomes. or appropriate delegate. Tender to specification.6.6.5 Evaluation Report and Recommendation Following completion of the tender evaluation process and selection of a preferred tenderer. e. The review aims to provide the organisation’s decision makers with confidence that the process used to select the proposed service provider is robust. on what formulae? Is the point of delivery as required or acceptable? Is the recommendation before you in writing and does it make sense? If lower price tenders are not recommended are the reasons sound for passing them over? Does any member of the Tender Review process have a conflict of interest arising from the matter before them? Have all elements of the NSW Government Purchasing Policy where appropriate been complied with? Has the appropriate authority to incur expenditure been obtained? 3. The report should be a complete account of the evaluation and must be able to stand up to independent scrutiny. viz.g. b) indicate that the appropriate authority to incur expenditure approval has been obtained. 21(1/06) . schedules etc.4 Tender Evaluation Process 3. tender opening. Preference applied in conformity with Government policy. Do your terms and conditions apply or has the tenderer imposed his own and do you know whose prevail? If the tenderer’s terms and conditions prevail are you prepared to accept them? Is the price clearly understood? If imported is there a foreign currency component and if so at what rate of exchange? Is there a settlement discount and is it clear? Is the price firm or subject to rise and fall and if so. tender boxes. the tender evaluation team or delegated officer is to prepare an evaluation and recommendation report recording the reasons for the evaluation team’s recommendation and submits it to the organisation’s delegated authority for approval to accept the recommended tender. The Tender Evaluation committee or delegated senior officer is to: a) e ndorse the recommendation.26 Tender Evaluation may be carried out by a committee or by a competent officer officially delegated. and c) forward to the approving officer or alternatively specify reasons for not supporting the recommendation and return to the evaluating officer etc.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. The recommendation is to be signed-off by each member of the Tender Evaluation Committee in writing and should contain all relevant information so that it is fully understandable without reference to the actual tenders. In deciding whether to support or reject the recommendation the following factors should be considered: a) b) c) d) e) f) g) h) i) j) k) l) m) Tendering procedure correctly carried out. The evaluation done by the appropriate technical people and is the evaluation methodology valid in respect to the stated reasons for rejection or selection of a tenderer. the evaluation process been performed correctly. even if delivery is protracted that the item will still be required when received.27 A preamble should refer to such matters as the need for the item being acquired. have had an administrator appointed or. the source of any approvals to acquire and/or proceed to tender. If there is any unresolved conflict between the terms and conditions set out in the tender documents and those sought by the recommended tenderer. This process is repeated until the recommended tender is reached. If the recommended tender varies from the specification in any significant respect this fact must be noted in the recommendation together with appropriate comment. are subject to a winding up order. If the latter is the case.1 Approval The officer or committee with the appropriate delegation approves the evaluation and recommendation report to accept the successful tender(s). are bankrupt. the date tenders closed. Health organisations should exhaust negotiations with the tenderer that submitted that most acceptable tender before negotiating with the next most acceptable tenderer. and funds are still available. unsupported general statements such as “not to specification” and “insufficient information provided” are not acceptable.7 APPROVING/AWARDING THE CONTRACT 3.7. is being accepted. are corporate entities with persons involved directly or indirectly in the management of the entity who are disqualified under corporations law. being given. 21(1/06) . Approving officers must have delegated authority to incur expenditure up to the limit of the tender to be approved. the number of tenders received and whether any were received after closing time.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. Health organisations may choose not to accept tenders from or award contracts to tenderers who: • • • • • have breached the Code and are subject to an applicable sanction. There is a tendency for the final cost to exceed the Budget estimate. tenders being passed over will be dealt with in ascending price order with full reasons. Approving officers must be satisfied that the best offer. unless time constraints or the closeness of the tenders dictate otherwise. a brief description of the item. The body of the recommendation will indicate whether the lowest tender is acceptable or whether lower priced tenders are not being recommended. details are to be included in the recommendation with appropriate comment. It is important that the reasons for not recommending lower tenders are set down in detail. If two or more acceptable tenders are equal in all respects preference is to be given to the current contractor if renewing period contracts. The committee or officer making the recommendation is to indicate that: • • • the item is still required. 3. or the previous supplier. as measured against the evaluation criteria. supported by reference to the relevant specification clause. When this situation does not apply the matter is to be referred to the approving authority for determination by ballot. information included in unsuccessful tenders is to be treated as commercial-in-confidence 3.2 Letter of Acceptance The acceptance of a tender and therefore the notification of award of a contract is conveyed by a Letter of Acceptance.3 Advice to Unsuccessful Tenderers Unsuccessful tenderers should be advised promptly of the organisation’s decision after approval procedures have been completed. if requested a debriefing should be given to unsuccessful tenderers. 24(7/09) • . 3. Public health organisations and the Ambulance Service are required to execute an appropriate formal contract for all procurements over $250.4 for provisions. The NSW Government requirements for Public Disclosure of Information Arising from NSW Government Tenders & Contracts (Premier’s Memorandum 2007-01). Openness to tenderers can benefit the organisation whereas restrictions on feedback can frustrate future improvements in bidding. There is no requirement to formally execute a contract unless there is a specific requirement in the contract to do so. The Letter of Acceptance must clearly define the contract. Direct comparisons should not be made with the successful tender response. After acceptance of the contract by the winning bidder. Where there is no such requirement the contract is legally binding without such formal execution. it is important that the Letter of Acceptance be properly addressed and communicated to the Contractor. a debriefing should be given to unsuccessful tenderers. Contracts are to be executed by those officers with the delegated authority to do so. See Appendix 3-N. See 3.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. Explicit advice about future bids should be avoided.28 When the selection is completed agencies advise the successful tenderer with formal notification of acceptance of its tender or award of contract. The unsuccessful tender would be discussed in terms of how well it met the tender requirements and evaluation criteria.7. It is Department of Health policy for Central Administration that as tenders are normally over $250. Any comparisons should be made against the selection criteria rather than with the successful bidder.12 of the Combined Delegations Manual.000.7. which is to form part of the contract.7. including identification of any post tender correspondence. In respect to the Department of Health such officers are specified on page 8. As a number of important contractual matters rely on the Date of Acceptance of the Tender. Unsuccessful tenderers are to be advised as soon as possible after contract award of the decision. The feedback should be limited to the facts of the unsuccessful bid. In such cases the precise terms of the contract in relation to a Formal Instrument of Agreement need to be upheld. Unless otherwise authorised by the tenderer or required by legislation. Upon request.000 formal contracts are to be executed for every tender. • Organisations should offer feedback to encourage better bids the next time. Section 10 of contract disclosure procedures explains how information is to be disclosed.29 The timing of the release of “feedback” information needs to be managed to avoid premature disclosure which might impact on finalisation of the contract with the winning bidder. members of tender opening and evaluation committees and the senior staff overseeing these processes. Section 4 of contract disclosure procedures gives examples of various types of contracts and agreements that NSW Health may enter into that will require disclosure. These schedules of disclosure clearly define what information is to be disclosed and what is classified as commercial-in-confidence and must not be disclosed.nsw. The Premier’s Memorandum is available at http://www. Detailed information about the disclosure requirements is provided in the attached contract disclosure procedures and they must be read in conjunction with this policy. The Chief Executive Officers of public health organisations. should be dealt with by agencies. A proforma form to assist with disclosure is located at http://internal.dpc. tender and contract processing.gov. The purpose of the revised guidelines is to: • set out the requirements for disclosing tender information.7.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) • 3.au/operations/apmd/pmb/procurement/templates. Administrative Units of the Health Administration Corporation and Directors of Department of Health Branches are responsible for ensuring that the requirements of this policy together with the attached contract disclosure procedures are communicated to and followed by staff involved with procurement. Health Infrastructure and the Ambulance Service of NSW). However. over and above that which is required to be disclosed under section 15A of the FOI Act.htm 25(1/10) .4 Public Disclosure of Information Arising from NSW Health Tenders & Contracts Under NSW FOI Act 1989 (PD2009_047) Premiers Memorandum M2007-01 Public Disclosure of Information Arising from NSW Government Tenders and Contracts introduced revised guidelines regarding new contract disclosure obligations pursuant to section 15A of the Freedom of Information Act 1989 (NSW) (the FOI Act). unsuccessful tenderers should be advised as quickly as possible. the Department of Health and the Administrative Units of the Health Administration Corporation (including Health System Support.au/publications/memos_and_circulars/ministerial_memoranda/2007/M2007-01 In order for the NSW Health System to meet its legal obligations under the FOI Act it is important that officers contracting with the private sector are aware of and comply with the disclosure requirements. * 3. Section 9 of the attached contract disclosure procedures relate directly to the provisions of section15A of the FOI Act. • describe the new contract disclosure obligations in section 15A of the FOI Act. This policy applies to all staff of all public health organisations.health.nsw. Sections 7 and 8 of contract disclosure procedures provides assistance in defining the class of a contract and broadly describe the information that is to be disclosed.gov. the Institute of Medical Education and Training. the timeframe(s) for disclosure and the officer(s) responsible for ensuring that appropriate disclosure occurs. and • outline how requests for contract information. 30 These procedures are to clarify the requirements and responsibilities for disclosure of information arising from NSW Government tenders and contracts. the Department of Health and Administrative Units of the Health Administration Corporation (including Health System Support.000 do not have to go to public tender the information covered by the FOI Act must still be disclosed where the value of the procurement is over $150. and outline how requests for contract information.000 or more are to have certain information disclosed. members of tender opening and evaluation committees and the senior staff overseeing these processes.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) * Purpose 3. Applicability These procedures apply to all staff of all NSW public health organisations. Institute of Medical Education and Training. Note 2: Contracts awarded to suppliers for State Contracts Control Board Whole-of-Government or Health panels are not disclosed upon award of contract as these contracts are standing offer arrangements and do not relate to a discrete procurement activity. Chief Executives of public health organisations.gov.au/publications/memos_and_circulars/ministerial_memoranda/2007/M2007-01 In order for the NSW Health System to meet its legal obligations under the FOI Act it is important that officers contracting with the private sector are aware of and comply with the disclosure requirements.000 and procurement activities between $150.000 is placed with a supplier. Disclosure pursuant to the FOI Act is to occur when an individual order in excess of $150. Health Infrastructure and the Ambulance Service of NSW).dpc. Introduction Premiers Memorandum M2007-01 Public Disclosure of Information Arising from NSW Government Tenders and Contracts introduced revised guidelines regarding new contract disclosure obligations pursuant to section 15A of the Freedom of Information Act 1989 (NSW) (the FOI Act).nsw. Administrative Units of the Health Administration Corporation and Directors of Department of Health Branches are responsible for ensuring the requirements of the policy and these procedures are communicated to and followed by staff involved with procurement. The purpose of the revised guidelines is to: • • • set out the requirements for disclosing tender information. The method of tendering or negotiation is irrelevant. describe the new contract disclosure obligations in section 15A of the FOI Act.000 and $250. should be dealt with by agencies. What contracts are to be disclosed? All government contracts with the private sector with a value of $150. 25(1/10) . over and above that which is required to be disclosed under section 15A of the FOI Act.000. The Premier’s Memorandum is available at http://www. tender and contract processing. Note 1: Even though the General Purchasing Delegation in relation to public tendering has been increased to $250. 000 or more are to have certain information disclosed. or (ii) to provide specific goods or services (such as information technology services). Contract information disclosure requirements The FOI Act requires the routine disclosure of contract information as follows: Tenders For all public calls for tender.000 is placed. expressions of interest or other such public calls which may result in a contract with the private sector: 25(1/10) . What is a government contract? All government contracts with the private sector with a value of $150. What information is to be disclosed? The information to be disclosed is dependent on the class of the contract. but does not include a contract of employment.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) * 3. A lease of real property where the parties to the lease are NSW Health and a private sector entity. A flowchart is attached to assist in determining the class of the contract that has been entered into and thus the information that is to be disclosed. In the context of the NSW Health System operationally a government contract is generally understood as: (a) A contract between NSW Health (including Area Health Services and other Health related entities) and a private sector entity under which NSW Health (including Area Health Services and other Health related entities) or the private sector entity agrees: (i) to undertake a specific project (such as a construction. Visiting Medical Officer contracts and contracts not with the private sector (such as those with another government agency. (b) Are any contracts exempt? Individual employment contracts (but not labour hire contracts with employment agencies). a firm price quotation where a supplier commits to hold a price for a period of time but there is no guarantee or commitment to volumes or value of purchases by the Health system does not require disclosure pursuant to the FOI Act unless an individual order in excess of $150. infrastructure or property development project). Note 4: A formal Pricing Agreement where there is a commitment on the part of the supplier to maintain a particular price whilst expenditure remains above a specific benchmark and there is signoff by both parties is defined as a contract for the purposes of disclosure. Area Health Services or internal business unit).31 Note 3: A Preferred Supplier Agreement that may be entered into by an Area Health Service or other entity under a standing offer panel contract is defined as a contract and disclosure of information must be made in accordance with the FOI Act. or (iii) to transfer real property to the other party of the contract. It is to be treated in the same manner as a Preferred Supplier Agreement. However. The projected expenditure over the life of the Agreement is to be used in determining the contract value. For a multi-stage tender process: What information? The names and addresses of the shortlisted entities. When? Within 60 days after the contract becomes effective. What? The information set out in schedule 1 (see section 9 below). and • location of the tender call documents. When? Within seven (7) days of these entities being advised of their short listing. Who? The officer undertaking the procurement or managing the procurement process. Contracts Class 1 contracts are: All contracts with an estimated value $150. (This information is generally contained in the tender advertisement) When? Disclosure at the time tender calls are advertised. 25(1/10) .000 or above. • the date responses to the tender call close and where responses are lodged. What? The names and addresses of all entities who submit responses. When? Within seven (7) days of the date tender calls closed. Who? The officer undertaking the procurement or managing the procurement process. goods or services that are the subject of the tender call. The onus is on this person to provide all necessary information to an officer who has access to publish information on the e-tenders website. Who? The Chair of the Tender Opening Committee. except where such disclosure is likely to compromise the competitiveness of the subsequent tender process.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) * 3. The onus is on this person to provide all necessary information regarding the shortlisted suppliers to an officer who has access to publish information on the e-tenders website.32 What information? As a minimum: • a concise description of the proposed works. when. if so. or • involve a transfer of land or other asset to a party in exchange for the transfer of land or other asset to an agency. Who? The officer undertaking the procurement or managing the procurement process.1 Who? The officer undertaking the procurement or managing the procurement process. and • where some but not all of the provisions of the contract have been disclosed. less confidential information. or • have been the subject of a tender process and where the final contract terms and conditions are substantially negotiated with the successful tenderer (this includes alliance type contracts).000 or above) which also: • result from a direct negotiation where there has not been a tender process. What? The information set out in schedules 1 and 2 (see section 9 below). What? The information set out in schedules 1 and 2 (see section 9 below) and publication of the complete contract. contracts with an estimated value $150. or • involve a privately financed project as defined by relevant Treasury guidelines. When? Within 60 days after the contract becomes effective. Class 3 contracts are: Class 2 contracts where the estimated value of the contract is $5 million or more. • a statement as to whether the contract or provisions will be published and. When? Within 60 days after the contract becomes effective. NSW Health should disclose: • the reasons for not publishing the contract or provisions. Note: If the class 3 contract is not published in its entirety or some items of the contract are not disclosed for reasons of confidentiality.32.e. Who? The officer undertaking the procurement or managing the procurement process. The onus is on this person to provide all necessary information regarding the successful supplier to an officer who has access to publish information on the e-tenders website. or • involve operation or maintenance obligations for ten (10) years or longer. The onus is on this person to provide all necessary information regarding the successful supplier to an officer who has access to publish information on the e-tenders website. a general description of the types of provisions that have not been published. The onus is on this person to provide all necessary information regarding the successful supplier to an officer who has access to publish information on the e-tenders website. 25(1/10) .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) * 3. Class 2 contracts are: Class 1 contracts (i. during the construction and operational phases of a contract to undertake a specific project (such as construction. (e) Where relevant. or nominal. the pricing formula for tolls or usage charges). (d) Particulars of the project to be undertaken. (b) Particulars of any related body corporate (within the meaning of the Corporations Act 2001 (Commonwealth)) in respect of the contractor. cost to the State. (b) Particulars of future transfers of significant assets to the contractor. a summary of information used in the contractor's full base case financial model (for example. is to be apportioned between the parties. including the date of their proposed transfer. (g) Particulars as to any significant guarantees or undertakings between the parties.2 The schedule 1 information required to be disclosed is as follows: (a) The name and business address of the contractor.32. infrastructure or property development). SCHEDULE 2 (section 15A(3) FOI Act) The schedule 2 information required to be disclosed is as follows: (a) Particulars of future transfers of significant assets to the State at zero.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) * SCHEDULES OF DISCLOSURE FOR CONTRACTS SCHEDULE 1 (Section 15A(2) FOI Act) 3. quantified (where practicable) in net present-value terms and specifying the major assumptions involved. that will be involved in carrying out any of the contractor's obligations under the contract or will receive a benefit under the contract. (f) A description of any provisions under which the amount payable to the contractor may be varied. (d) The components and quantum of the public sector comparator if used. the goods or services to be provided or the real property to be leased or transferred under the contract. 25(1/10) . including the date of their proposed transfer. including any guarantees or undertakings with respect to loan agreements entered into or proposed to be entered into. (h) In the case of a contract arising from a tendering process. or any other private sector entity in which the contractor has an interest. and (i) A description of any provisions under which it is agreed that the contractor is to receive payment for providing operational or maintenance services. the method of tendering and a summary of the criteria against which the various tenders were assessed. (g) A description of any provisions with respect to the renegotiation of the contract. particulars of how risk. (e) The estimated amount payable to the contractor under the contract. (f) Where relevant. (c) The results of any cost-benefit analysis of the contract conducted by the agency. and (h) Particulars of any other key elements of the contract. (c) The date on which the contract became effective and the duration of the contract. au/operations/apmd/pmb/procurement/templates. Who is responsible for disclosure of information? Tenders The officer undertaking the procurement or managing the procurement process e.nsw. whether at present or in the future. • The contractor's cost structure or profit margins.gov.htm is to be completed and forwarded to Procurement Advisory Service. project or contract manager is responsible for providing the tender information. The Chair of the Tender Opening Committee is responsible for ensuring the list of respondents is published. 25(1/10) . has the primary responsibility for disclosure.gov.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) * SCHEDULE 3 (definition of 'commercial-in confidence' provisions in section 15A(14). project or contract manager. This form should also be used for quotation processes with a value between $150. This person will normally be the Chair of an Evaluation Committee who is making a recommendation on the successful supplier to management. submissions or similar documents that will lead to a contract requiring disclosure or executing such contracts should reinforce the requirement for disclosure and follow-up to ensure it this has occurred.000. • Any intellectual property in which the contractor has an interest.g. How is information disclosed? All tender and contract information required to be disclosed is to be posted on the government tenders website https://tenders. Senior staff approving evaluation committee reports. The Contract Award Details form found at http://internal. Contract Information The officer undertaking the procurement or managing the procurement process e.000 and $250.3 Commercial-in-confidence information which is not to be disclosed is as follows: • The contractor's financing arrangements. • The contractor's full base case financial model.au (or such other internet website authorised by the Premier for the purposes of the FOI Act). or • Any matter whose disclosure would place the contractor at a substantial commercial disadvantage in relation to other contractors or potential contractors. If this level of access is not available in the Area Health Services Health Support Services will be able to publish information on the Area’s behalf.32.health.nsw.g. Strategic Procurement for NSW Department of Health contracts and for Area Health Services contracts to the Area Tenders and Contracts Managers who have authorised access to the NSW Health e-tender website. FOI Act) 3. Where both electronic and hardcopy submissions have been received care must be taken to ensure that all the respondents are disclosed. In most cases it will be necessary to provide all required information to another officer who has access to publish information on the e-tenders website. advice or assistance can be obtained from the Procurement Advisory Service.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) * 3.gov.32. How long does the information disclosed have to remain on the website? Tender information remains posted until the tender process has been concluded and either a contract has been awarded or a decision is taken not to award a contract.4 When required.health. Contract information remains posted for at least thirty (30) days or until all work under the contract has been completed or goods are supplied. the NSW Department of Commerce will undertake disclosure for any tender processes they manage or contracts they enter into and Health Support Services will be responsible for disclosing their tendering and contracting processes. whichever is the greater.au or telephone (02) 9391 9215.nsw. pas@doh. 25(1/10) . Further information Additional information. . 1 Contract Manager The public health organisation’s contract manager should be appropriately experienced and skilled.8. the contract manager should convene a contract review meeting with the successful tenderer (now called the supplier). At this meeting. public health organisation representatives and other stakeholders as appropriate. particularly if the contract is to last a few years and to identify any misunderstandings early. This meeting is important to establish a good working relationship with the supplier. discuss all aspects relating to the performance of the contract to ensure all parties have a common and clear understanding of their responsibilities and obligations. As soon as possible after the award of a contract. and should understand the overall scope and nature of the contract. and the contracting parties. Effective contract management will ensure the parties meet their contractual obligations and the contract provides value for money. and the risks involved.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.8 CONTRACT MANAGEMENT 3. Appropriate contract management systems and procedures should be established commensurate with the size. Particular care is to be applied to ensure that any sub-contracting is done in accordance with the contract and within the scope of the contract. 25(1/10) .32. risk and complexity of the contract. Hold contract review meetings during the contract at intervals appropriate to the nature of the contract. The contract manager must have the necessary authority to administer contractual matters.6 3. its primary objectives. It would take place after all testing has been completed but prior to rollout of the solution. decision-making processes and decisions made.8. maintain/update. Refer to Premier’s Memorandum PM98-16: Records Management Standards and Practices.health. User access and copies of user guides may be organised by contacting HP. synchronisation of start date.g. with the purpose of assessing the state of readiness to commission the project and to implement the change management required. good record keeping of decisions is imperative for auditing and accountability purposes. The system provides a standardised registry for tenders released/advertised and for contracts established/formalised.33 Contract payments should be made strictly in accordance with the terms of the contract. and information is available for the assessment of claims and the resolution of disputes.gov. Access to the database is via the HP Website on the DoH Intranet http://internal. e. Be aware of the client’s obligations under Treasury Circular TC01-12: Annual Reports Legislation .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. Contract records are kept so that: • • • clear public accountability can be demonstrated. It also enables the public health organisation’s to efficiently record. These records should provide sufficient information to enable audit and independent review functions to be carried out. 22(5/07) . Comprehensive records should be maintained throughout the purchasing process.3 Central Tender and Contracts Database The Central Contracts & Tenders Database is a mandatory system for all public health organisations to utilise. evaluation criteria. Effective and efficient contract management cannot be done properly without accurate and organised records.nsw. in particular. Under the Gateway Review Process a Pre-commissioning Review can held after a deliverable has been produced but prior to its use by the public health organisations. regular and accurate reports to management and clients are prepared. monitor/evaluate information regarding “in-house” tenders and contracts. These reasons should be approved at a senior level by those not directly involved in the process.8. Records could include details of telephone conversations wherein any type of commitment etc. welldocumented reasons.2 Ensuring Accountability and Record Keeping Actions and decisions need to be accounted for and. Departure from established procedures for purchasing of services should only be for sound. An individual file should be maintained for each procurement where possible. expiry dates of contacts. and instantaneously obtain other public health organisation information on tenders and contracts with the view of coordinating efforts and/or elimination of duplication. is made. eg checklists. 3.Reporting on Payment of Accounts (Does not apply to public health organisations).au. 3. weightings. 5 Service Provider Performance The performance of the service provider should be monitored. The Service Provider Performance Management Guideline details the objectives.8.8. The assessment of open tenders. These reports are designed to assist in: • • The assessment of the technical. It is advisable for the organisation to have a system for reporting on the performance of its contractors. Care should be taken not to destroy the file and evidence whilst it is still relevant to a performance report. including the commitment to better service delivery. assisting in the future design of contracts. 24(7/09) . To help manage the performance of service providers Government agencies should acquire. Reports should contain information on the following three areas: • • • Contract details as known at the Date of Acceptance of Tender.34 Any misunderstandings or disagreements should be resolved as quickly as possible. quality assurance. An assessment on various measures of performance namely: time management. alternative dispute resolution techniques are used rather than litigation. coordination of subcontractors. Whenever performance becomes unsatisfactory. management and financial capabilities of Contractors. Formal reports should be prepared: • • • • Evaluating the contracted work outcomes including from the aspect of quality and integrity. consultants and suppliers. These details will not change during the duration of the contract. 3. Good contract management and regular clear communication between the parties should solve problems as they arise throughout the term of the contract and minimise the prospect of disputes. encouraging continuous improvement. It is government policy that. standard of work. and ensuring the terms and spirit of the contract are adhered to. evaluated and measured against the contract requirements. management and quality of site personnel. At termination of the Contract. application and benefits of supplier performance management and exchanging information with other agencies. rewarding superior performance. Documentary evidence to back up reports must be located on the file with copies attached to the Report or references to minute numbers on a file. For less routine and potentially serious problems the contract should specify a mechanism for resolving issues. maintain and exchange appropriate information about the performance of service providers on contract.4 Resolving issues 3. wherever appropriate. At regular intervals during the Contract. Details of variations in cost and extensions of time.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. The benefits of effective performance management for service providers and agencies are significant in terms of obtaining better outcomes. contract administration and OHS&R. 35 In the case of unsatisfactory performance by a Contractor. During this phase. All staff that has a role in ensuring the success of the contract should be made aware of their responsibilities. The public health organisation’s practices in operating its assets should also be consistent with: • • Premier’s Memorandum 2003-05: Government Waste Reduction and Purchasing Policy. Payments should be timely. Operating costs must be controlled. ongoing monitoring of the service provided will need to be undertaken.6 Operation The operation phase covers the use and in some cases maintenance of the good and or service procured. the public health organisation needs to pursue initiatives that: • • • • Enhance the link between service outcomes delivered to the community and the maintenance of the assets involved in the delivery. The Asset Information Guideline and Asset Maintenance Strategic Planning Guideline included within the Total Asset Management Manual offer guidance in maintenance planning. To do so successfully. Access to reports should be limited to those persons or organisations that have a direct need for the information on a particular contract or Contractor. Risks to the public health organisation can be identified and ameliorated. reducing service disruptions and losses due to asset failure. Competent staff should be assigned to the role of administering the contract. 21(1/06) . Establish clear links between maintenance objectives and asset performance. 3. Resolve uncertainty regarding the disposal of assets.8. The costs of asset maintenance can be quantified and budgeted with confidence. The maintenance plan provides a foundation for continuous process improvement. risks managed and flexibility enhanced through maintenance planning. If it is proposed to report adversely on a Contractor’s performance. and Gain the commitment of operational maintenance managers and staff to Maintenance Planning. The plan provides a feedback to improve future application of the maintenance process. The public health organisation is to ensure that it fulfils all its obligations to the other party or parties. and Reduced environmental impact by controlling resource usage. monitoring commensurate with the value of the purchase. should be undertaken to ensure the outcomes required for the procurement are met. The benefits to public health organisations and Government are: • • • • • • • Assets perform at optimum levels. and Premier’s Memorandum 98-35: Government Energy Management Policy. immediate action should be taken to address and resolve the problem with the Contractor. This action should be taken at one level removed from the day-to-day management of the contract.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. The performance of the asset can be reviewed to suit service delivery needs. In cases where service contracts are used. then the Contractor must be given a chance to respond to any criticism of the Contractor’s performance. however. As the submission of product data onto the NPC is mandatory for successful tenderers. applying the principles of value for money.gs1au.7 Variations after the contract has commenced 3. e.g. Apparently “exceptional” cases should be treated very cautiously. Variations to the contract during the progress of the project must be reported without delay and prior approval obtained for any proposed significant changes in work or cost. 3.org/services/gs1net). the most prevalent reason is a “weak” specification. It is imperative that officers developing specifications either have the necessary experience or obtain expert advice so that comprehensive specifications are developed. It is not good practice for approvals for significant changes in work or cost to be given by employees directly involved in the supervision of the contractor. In consideration of the extensive process for submitting product data onto the NPC. 23(9/08) . immediate understanding of the national project may expedite the data load process. Particular care is needed to avoid: • • • variations being used by a successful low bidder to increase the value of the job.8. as part of a national supply chain initiative.8 National Product Catalogue Tenders for medical surgical devices/consumables include clauses that promote the use of the National Product Catalogue (NPC). The NPC.8. it is recommended that tenderers who are not familiar with this project be encouraged to immediately seek information (initially by visiting http://www. tenders.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. 3 quotes. variations increasing the scope of the contract out of proportion to the original scope. probity and accountability. Proposals to increase the value of the consultancy by 10 per cent or more demand a particularly thorough review. is recognised by all States & Territories as a common approach regarding the source and structure of product and pricing data. variations being use to get around requirements for competitive bidding. nominated by the Chief Executive. All proposals for variations require very careful consideration. Proposals for such variations are to be considered and determined by an independent senior officer.36 Variations to the scope of the work requiring increased payments to the contractor can at times be appropriate as a result of unforeseen circumstances. There can be a number of reasons for variation of the scope of a project after it has commenced. The Project Sponsor is the senior manager responsible for the procurement. GATEWAY REVIEW OUTLINE • The Gateway Review consists of a series of structured Reviews that examine procurements at six key decision points (or gates) in the procurement cycle.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. the Project Team and other stakeholders.37 Appendix 3-A GATEWAY REVIEW PROCESS PURPOSE The purpose of the Gateway Review process is to independently assess whether an appropriate level of discipline is applied across the procurement cycle.affordability. These gates are Strategic. Initially there is a review of the risk of the procurement. The Risk Profile Assessment is used to determine risk rating and thereby the level of independence required of Reviewers. Procurement Strategy. The Project Sponsor initiates a Review. Low risk procurements will be reviewed by a small team of Reviewers independent of the procurement. technical consultants. medium and low). service delivery. but may be from within the proponent organisation. At each Review the project is assessed against seven Key Success Factors . with the authority to make decisions affecting its progress. The process addresses the lack of initial preparation evident in managing major asset procurements which in turn leads to significant time and budget overruns. Medium risk procurements will be reviewed by a small team of Reviewers independent of the procurement and at least one person independent of the proponent organisation. planners. Three categories of risk have been identified (high. It also includes assistance with documentation of the Review report and Review logistics. • • • 21(1/06) . sustainability. risk management. The underlying rationale for the Business Case is revisited at each gate. senior managers and client representatives. receives the findings and determines what action. Tender Review. Pre Commissioning and Post Implementation. the Project Sponsor. The Review runs as a series of interviews with key stakeholders including Project Team members. if any is required to address the recommendations. The Review process is facilitated by the Department of Commerce. From time to time expertise may be sourced from outside the government sector where appropriate. Reviews are held over one to two days following a half-day planning session undertaken a week prior to the Review. Business Case. Facilitation includes providing training and support to Reviewers. Typically: o o o o High-risk procurements will be reviewed by a small team of Reviewers independent of the procurement and the proponent organisation. governance. stakeholder management and change management. • • • Reviewers are generally senior government employees selected for their relevant expertise in the particular stage of procurement being reviewed. including built infrastructure. Reviews will be mandatory at the Business Case Gate for all high risk procurements and other procurements valued at $10 million or more ($5 million for ICT). with enough detail to make an informed judgment. It is not intended that documentation be produced especially for the Review. The decision to complete one of these gates should be based on the risk profile of the procurement and the Project Sponsor’s understanding of how the procurement is progressing. This assessment goes beyond simple financial thresholds to consider issues such as: • • • • • • impact the procurement will have on the agency’s service delivery level of integration the project requires with other initiatives amount of experience an agency has with similar procurements level of expertise available in the marketplace degree of innovation involved in the procurement solution complexity of the procurement method Gateway can then be targeted at complex and risky procurements that would benefit from increased scrutiny. Nor is it expected that Reviewers read in detail all documentation associated with the project. For these gates it is recommended that agencies have: 21(1/06) . information and communications technology (ICT). APPLICATION • • • The process applies to all procurement.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) • 3. services and capital equipment. The tool calculates an indicative risk score based on the options selected. Action will range from fine-tuning project details to a decision to take a major change in direction. The Review report is produced in draft form on the day of the Review and the final report is provided to the Project Sponsor for appropriate action. Agencies are encouraged to apply the other five Gateway Reviews to their procurements.38 All information tabled in the Review is confidential with documentation provided by the Project Team on behalf of the Project Sponsor. Reviewers will need to read sufficiently to gain an overview. • BENEFITS The potential benefits include: • • • • • • More accurate project scoping and estimates Reduced time and cost overruns Improved alignment of service delivery with available funds Improved procurement discipline Better risk management Reinforcing agency responsibility and accountability for decisions GATEWAY RISK PROFILE ASSESSMENT TOOL The Gateway Review Process is applied based on an assessment of a procurement’s potential risk profile. An online tool has been developed to assist agencies to complete the assessment quickly and easily. Rather. • Refine the Review methodology to account for lessons learned.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) o o o • 3. on all high risk procurements and other procurements valued at $10 million or over ($5 million for ICT). THE RULES Treasury will support the process by: • Making suitable officers available as Gateway Reviewers. • Ensure appropriate Project Sponsors are appointed. Agencies will: • Undertake the Risk Profile Assessment for all procurements over $1M and include them with their routine submissions to Treasury as required. • Take responsibility for Review findings. system development and maintenance role. a small team of people independent of the project and a least one person independent of the proponent organisation review medium risk projects. COVERAGE The mandatory Business Case Review: • Applies on a whole-of-government basis to all government departments. • Funding the Department of Commerce in its facilitation. agencies review their processes to ensure they are aligned with Gateway for low risk procurements. Department of Commerce will: • Maintain. statutory authorities. • Manage Reviewer training and support agencies in Reviewer selection. Business Case Gateway Reviews will be linked to the Budget process by agencies submitting a copy of their review to Treasury with any bid for capital funding. • Maintain the database of Reviewers for the mandatory Business Case Review. • Make suitable officers available as Gateway Reviewers. • Link Gateway Reviews at the Business Case stage with the budget process as required. IMPLEMENTATION • The Gateway Review process commences 1 July 2004. develop and promulgate information about the Gateway Review Process. 21(1/06) . • Does not apply to State Owned Corporations subject to the State Owned Corporations Act. trusts and other government entities. • Facilitate Reviews.39 a small team of people independent of the project and proponent organisation review high risk projects. • Undertake Business Case Reviews as a minimum. 40 21(1/06) . 3.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) THE SIX GATES The six gates in the procurement process are indicated below. 5 M inisterial Discretion Country Industries Scheme Information To Applicants Country Industries Preference Scheme application For Registration 3. ensure that specifications and other tender documents are drafted in such a way as to favour locally sourced goods and services.1 Preference – Australian and New Zealand Content 2.3 Country Industries Preference Scheme (CIPS) 2.au/nswtcir NEW SOUTH WALES GOVERNMENT PURCHASING POLICIES The general intention of the NSW Government purchasing policy is to promote employment and industry development in Australia and New Zealand. TC07/18 is available from the NSW Treasury website: http://www. 2. ensure that agents.4 Post Tender Negotiations 2. consultants and others acting on their behalf adhere to the same policy.nsw.gov.41 Appendix 3-B PURCHASING POLICIES 1. Treasury Circular TC07/18 Procurement Economic Development Guidelines Amendment to the Price Preference Schemes states the Procurement Price Preference Schemes.2 Government Procurement Agreement 2. and/or Exercise Ministerial discretion. *The Australian Bureau of Statistics categorises a large business enterprise as a business employing 200 or more people. 4. For tenders exceeding $100.treasury. comprising the Australia New Zealand Price Preference Margin and the Country Industries Preference Scheme. selection of a Contractor is based on consideration of all competitive proposals in accordance with the request for tender and specifications and one of the key aspects of this selection process should be the conformity to NSW Government purchasing policy in relation to preference for Australian and New Zealand goods and services.000 the “responsible” Minister: Can authorise post tender negotiations. The organisation is to ensure that: • the above policy is adopted. The organisation should be aware that: • • • • Any Australian or New Zealand supplier feel that they have been excluded from tendering or recognize in any way by contract terms or specifications in this tender/quotation have to right to write in confidence to the Chief Executive Office of Economic Development Premier’s Department. in favour of an Australian tender where the Minister believes circumstances would warrant such intervention. As a consequence all government departments and declared authorities have been directed to: • • • • adopt this policy in all their purchases.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. New South Wales Government Purchasing Policies NSW Government Preference Scheme 2. The Government gives direct effect to this policy by ensuring that Australian and New Zealand suppliers receive preference in Government contracts. This is consistent with NSW obligations under the Australia United States Free Trade Agreement. 24(7/09) . will cease to apply to large enterprises (as defined by the Australian Bureau of Statistics*) effective 1 January 2008. design engineering.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. project design.60 $l0. Country Industries Preference Scheme (CIPS) NSW country manufacturers may be eligible for an additional preference of 2. Suppliers should note that New Zealand content is regarded as local content and should not be included as imported content for the purposes of this scheme. together with customs clearing charges.5% or 5%. or any charges of overseas origin. Goods partly manufactured in New Zealand can claim local content based on the value of local manufacture. eg. inclusive of the value of any services. The 20% margin is added to the tendered prices of goods (and related services) with a declared imported content prior to a comparison of prices as part of the tender evaluation process. Tenderers should also include detailed statements from their sub contractors on the imported content of the goods and related services they are offering. Related services include architectural deign.00 = $l. However. The imported content of goods and related services is: • the estimated duty paid value. project management and related consultancy/professional services provided in conjunction with the supply of goods or construction activities.00 + $1. 22(5/07) . It is a condition of tendering that tenderers are required to provide details of the imported (non Australian & New Zealand content in their tenders and to make available records (as necessary and when required) to substantiate imported/local content claims. under the Country Industries Preference Scheme (CIPS) when: • • the supplier is a registered country manufacturer. overseas freight and insurance. consultancy or engineering effort. the supplier quotes their registration number and the applicable preference margin in their tender.42 NSW GOVERNMENT PREFERENCE SCHEME (See Appendix 3-B1 for details concerning the Australia-United States Free Trade Agreement) Preference – Australian and New Zealand Content The NSW Government Procurement Policy mandates departments and declared authorities to apply a price preference to goods (and related services) of Australian and New Zealand origin.60 = $11.00 80% 20% x 80% x $l0.60 No preference margin is applied when assessing tenders for the provision of services alone (ie. goods not manufactured in New Zealand (imported) and offered in a tender are not considered New Zealand goods. Unrelated to goods). For example: Tendered price: Imported content: Preference margin: Price used for evaluation: $l0. depending on location in NSW. The scheme requires that a 20% price preference margin be applied to the imported content of all tenders where local manufactured content is claimed by any tenderer. result in contracts being let by fine margins to overseas companies. the cities of Newcastle. To claim preference under ClPS. Wollondilly and Wingecarribee. In this case a preference of 5% is added in favour of (i) above and 2. 21(1/06) . the Minister responsible for the tendering agency may determine that negotiations be entered into with one or more of the Australian tenderers. and the supplier is tendering as the prime contractor. where tenders in excess of $100. Information and forms are at Attachment A. The scheme therefore.000 are received. Wyong. Wollongong. over Australian companies.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) • • 3. the cities of Gosford Lake Macquarie. and offers/tenders have also been received from: an approved New South Wales country manufacturer located outside the County of Cumberland. with a view to an Australian tenderer being given the opportunity to reduce the tendered price. but is within 20% of the lowest tender (before application of preference). in some cases. NSW country manufacturers must be registered with the Department of State and Regional Development. an Australian tender is still not the lowest. • If an interstate or New Zealand supplier is the preferred tenderer after the application of Australian and New Zealand preference. If. and after application of the preference loadings. Post Tender Negotiations The preference scheme takes cognisance of the fact that Government tendering procedures may. no New South Wales country industries preference will be applied.5% in favour of (ii) above. The ClPS preference is added to the tendered prices of all other tenders after the application of the 20% preference margin against overseas content. the Council of Camden and the councils and cities listed below under (ii) and/or an approved New South Wales country manufacturer located in the Councils of Port Stephens. Maitland.43 the goods being sought are those for which the supplier/country manufacturer is registered. Cessnock and Blue Mountains. Penrith and Liverpool. makes provision for Australian companies to obtain the contract and thereby increase employment of Australian workers. over all other New South Wales and overseas manufactured goods. and the councils of Shellharbour and Kiama a further New South Wales country preference surcharge shall be applied. as follows: • If a metropolitan New South Wales or overseas manufacturer (except New Zealand) is the preferred tenderer after the application of the Australian and New Zealand preference. if the Minister believes the circumstances so warrant. an Australian manufacturer is being passed over. after the application of the above schemes. Ministerial discretion may then be exercised in favour of the Australian tender.44 The preference scheme also recognises that the fundamental principle guiding government procurement is to achieve best value for money when spending public funds. With this in view. the Minister responsible for the tendering agency is to be advised. In respect of all contracts having a value of $l00. where significant purchases are involved. an element of Ministerial discretion is built into the scheme to enable the Minister responsible for the tendering agency to make the final decision. maintenance. interchangeability.000 or greater where. Further Information For further information about the preference scheme contact: Regional Development Division State & Regional Development Level 44 Grosvenor Place 225 George St SYDNEY NSW 2000 Phone: (02) 9338 67l7 Facsimile: (02) 9338 6726 21(1/06) .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) Ministerial Discretion 3. and the NSW Governments wider economic development and social objectives detailed in the NSW Government Procurement Policy will each have a significance in the evaluation process alongside the price aspect. delivery. Factors such as technical performance. in comparison with their city-based competitors. Maximum preference of 2. Blue Mountains. assembly and/or erection on site. Effected by all New South Wales Government agencies (ie. Preference eligibility will be granted only to such country manufacturers as can demonstrate that in comparison with their city-based competitors. the application for preference must be subject to various qualifications and limitations and these are set out hereunder as a guide to those companies seeking to participate in the Scheme: 1.5% 3. Wollondilly. The preference will be applied as a variable margin of up to a maximum of 5% (2. Greater Cessnock. . The preference applies only to the cost incurred in the manufacture of goods at the country factory and does not extend to any costs associated with installation.5% in respect of the areas specified in l (a) above) in favour of an eligible country manufacturer over metropolitan – based manufacturers only after determination of the basic order of tendering in accordance with the practice usually followed by the particular department or authority concerned where applicable. government departments statutory authorities and other entities).45 The COUNTRY INDUSTRIES PREFERENCE SCHEME was introduced by the NEW SOUTH WALES GOVERNMENT in 1970 as a means of providing a further measure of assistance to the state’s country manufacturing industries. Gosford and Shellharbour. Of necessity.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) COUNTRY INDUSTRIES SCHEME INFORMATION TO APPLICANTS 3. Wollongong. suffer definable economic disadvantages which can be directly attributed to their country location. The preference to approved country manufacturers applies in addition to the general preference accorded to Australian and New Zealand manufacturers competing with overseas manufacturers. Penrith and Liverpool and the Council of Camden: In the Cities of Maitland. The Scheme is intended primarily to benefit manufacturers located outside the metropolitan areas of the State which. The preference applies on the following basis to approved manufacturing industries located outside the county of Cumberland. they suffer a definable economic disadvantage which is directly attributed to the country location. the Cities of Newcastle. 8. Lake Macquarie. Port Stephens. 6. Maximum preference of 5% 4. The preference will be applied to purchase. 22(5/07) 2. Wingecarribee and that part of the Council of Hawkesbury which was previously part of the Shire of Colo. Preference eligibility will be granted only for such a range of specific goods as the applicant manufacturer can demonstrate are WHOLLY or SUBSTANTIALLY manufactured at the country establishment. 7. therefore. 5. and the councils of Kiama. Wyong. Elsewhere in NEW SOUTH WALES. specifically draws attention to his eligibility in his tender and is able to quote his formal PREFERENCE REGISTRATION NUMBER.46 is offering goods of the specific nature in respect of which eligibility has been granted. offers goods which are considered by the purchasing department or authority to be of a satisfactory quality and specification. The preference will be applied only in instances where an eligible country manufacturer: 3. is tendering in the capacity of a prime contractor for the supply of the goods in question. submits a tender in competition with a NSW city manufacturer who would normally win the contract. v. PROCEDURE FOR REGISTRATION Country manufacturers seeking to participate in the Scheme are required to complete in full (attaching a separate sheet where space is insufficient) the attached APPLICATION FOR REGISTRATION form and return to: FINANCIAL ASSISTANCE OFFICER COUNTRY INDUSTRIES PREFERENCE SCHEME DEPARTMENT OF STATE & REGIONAL DEVELOPMENT PO BOX N818 GROSVENOR PLACE SYDNEY NSW l220 Country manufacturers eligible for registration will be given PREFERENCE REGISTRATION NUMBERS which must be specifically quoted in any tender submitted to the Government Authority in respect of which the application of preference is sought. 21(1/06) . ii.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 9. i. iii. iv. products manufactured at the country establishment in respect of which preference is sought: State the approximate value added (ie labour/overheads) at the country establishment by your enterprise in the manufacture of its products. Location of any other manufacturing establishments operated by enterprise: If your enterprise is a holding company. List 7.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) COUNTRY INDUSTRIES PREFERENCE SCHEME APPLICATION FOR REGISTRATION 1. 21(1/06) . 5. Ex-factory price (excl profit) LESS cost of materials/components parts Approximate value added in terms of labour & overheads % 100 _______ _______ 6. 4.47 Address _________________________________________________________ _______________________________________Postcode_________ 2. Address of country establishment where products –in respect of which preference is sought are manufactured Address _ ________________________________________________________ __________________________________________Postcode________ City/Council ___ Phone No. ____________________________________ Fax No. state the company concerned. ____________________ __________________ Date of commencement of manufacturing activities at the country establishment. 3. the location of its manufacturing establishments and the address of its head office. Name and business address of country manufacturing enterprise: Name _________________________________________________________ 3. a subsidiary or an associate of another company. ....................... overseas Ex subsidiary..........................................................in the State of New South Wales this ........the.....one thousand nine hundred and ..........................................48 List sources of major raw materials and/or component parts brought into the country establishment by your enterprise for the manufacture of the products in respect of which preference is sought.................. ignature of Declarant..................................... Briefly list the factors which you consider place your enterprise at an economic disadvantage compared to metropolitan competitors and which can be claimed to be directly attributable to a location in a country area: Has your enterprise previously tendered successfully for the supply of goods to a NSW Government department or authority? YES/NO If YES details should be furnished..............................................................day of............... associate or another establishment of enterprise 9......................... Before me: ...... be supplied from that establishment................ metropolitan.................................................. 10..... STATUTORY DECLARATION I. Taken & declared at.................... S .............................. interstate.............. Name Title/Designation of .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 8..... (Enterprise) do hereby solemnly declare and affirm that the answers to the questions and statements made in this application are true and correct in every particular and that the products in respect of which preference is sought are manufactured at the country establishment and would in respect of any Government contract awarded................. ................................... . 3..........P 21(1/06) ..J...................... Raw Material/Component Source ( ie local............................. 1 Appendix 3-B1 22(5/07) .48.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. 48.2 22(5/07) .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. 48.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.3 22(5/07) . CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.48.4 22(5/07) . An employee performs work under the control of another person (the employer) in exchange for payment. MANAGEMENT AND EVALUATION OF CONTRACTORS IN HEALTH SERVICES (PD2005_227) This circular applies to public health organisations as defined under section 7 of the Health Services Act 1997 (including Area Health Services. in many cases. etc. employees. Contractors are not employees. 4. which is usually referred to as a contract for services. There are certain features. The document incorporates an OH&S risk management approach to contractor management. 2. 21(1/06) . which distinguish the two types of worker under the law. OCCUPATION HEALTH & SAFETY Who is a contractor? A contractor is an individual. provide any service. Visiting Medical Officers). medical (eg agency nurses. Some additional features that may indicate a worker is a contractor include the following: 1. breaks. over the manner in which the work is performed. They aim to assist Health Services recognise the risk of injury or occupational illness to contractors. visitors and others in the workplace that may arise from the presence of contractors on the premises. The relationship is that of a contract of service. over their work conditions (such as hours. the Department of Health. all types of repair and maintenance. consulting and construction. and The worker charges for his/her services by supplying an invoice (rather than receiving wages) and is generally responsible for the payment of tax. managing and evaluating contractors in Health Services. examples of the work or services undertaken by contractors may include cleaning. Only Risk Managers should contact the Department.) or. Health Services are to develop and implement OH&S procedures for contractor management within their Health Service based on the Guidelines and local needs. and provides a framework for local procedures in compliance with current OH&S legislation.49 Appendix 3-C BETTER PRACTICE GUIDELINES FOR INCLUDING HEALTH AND SAFETY IN THE ENGAGEMENT. Corrections Health Service. The nature of the worker’s involvement carries a risk of financial loss or opportunity to make a profit from the work. In this case the employer hires a contractor for a service but may not have control over who performs the work. For the purposes of this document. organisation or legal entity engaged under a contract for services to perform any work. The worker carries his/her own tools or equipment The worker is free during the engagement to perform similar work for others. and the Ambulance Service of New South Wales. and the Children’s Hospital at Westmead). The Guidelines outline the NSW Health policy for including health and safety principles in procedures for engaging. Inquiries in relation to this circular should be directed to Health Service Risk Managers. This relationship is contrasted with a contractor relationship. 3. or supply any goods at an agreed price or rate.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. they also delegate their OH&S responsibilities. The worker may work for several host companies over a period of time and may have a relationship with several employment agencies. 3. and Section 10 provides that persons having control of premises used by people as a place of work must ensure that the premises are safe and without risks to health. In turn. These obligations cannot be delegated. 21(1/06) . Key legislation The Occupational Health and Safety Act 2000 and the Occupational Health and Safety Regulation 2001 are based on the concept of duty of care relating to the health. safety and welfare of their own employees. safety and welfare at work of their employees. Recent court decisions in NSW have demonstrated that employers who retain contractors remain liable for ensuring that the contractors’ employees (and sub-contractors) are not exposed to risks to their health and safety while at the employer’s workplace. their subcontractors. and the sub-contractors’ employees. the word “contractor” refers to the principal contractor. Part 2. Usually no contract exists between the host company and the worker. In this document. Division 1 of the Act sets out the duties of employers. The management of Health Services is responsible for determining whether an individual would be considered a contractor or an employee. an essential element is the contract of engagement. Many employers also believe that where they do not have direct control over the manner in which the work is performed or the service is supplied (particularly where trades persons or other professionals are involved). given the employer’s need to show due diligence. and applying relevant policies and legislation accordingly. NSW OH&S legislation imposes simultaneous obligations on a variety of persons and entities who have control over a workplace. safety and welfare at work.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. manufacturers and suppliers relating to health. their employees. have a responsibility to ensure the health. Who has the responsibility for OH&S issues? Some employers erroneously believe that they can delegate their OH&S responsibilities by engaging contractors to undertake hazardous work that would otherwise be done by employees. In particular: 1. self-employed persons. 2. Section 8(2) requires the employer to ensure that other persons are not exposed to risks to their health or safety arising from the employer’s undertaking while they are at the employer’s place of work. safety and welfare of persons at work. However. Section 8(1) requires the employer to ensure the health. health facilities cannot point to contractors as having sole responsibility for health and safety. controllers of work premises.50 In cases of staff hired through employment agencies. including contractors. contractors as employers themselves. designers. public health organisations as defined under section 7 of the Health Services Act 1997 (including Area Health Services). In this way. “NSW Health” refers collectively to the NSW Department of Health. 21(1/06) . Health Services are corporations. Directors and managers of corporations.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. as the employer’s representatives in the workplace. The contract should clearly state who would be responsible for notifying WorkCover NSW under section 86 of the Act. The legislation requires the notification of accidents. and new or altered procedures relating to their health and safety at work (Part 2.000 (first offence) and $825. and of the premises. The Act also includes a requirement for employers to consult employees on any risk assessments. Such other occurrences include an injury that will prevent the person from attending the person’s usual place of work for a continuous period of at least seven days. 6. decisions. All employers (and other parties) must ensure that all risks to health and safety at a place of work are identified. assessed and eliminated or controlled.000 (first offence). NSW Health – for the purposes of this document. or $82. Glossary A number of terms will be in regular use in these guidelines and are defined here for convenience of reference: 1.51 All duty holders must take all practicable steps within their control to secure the safety of any contractor engaged to carry out work. death and certain other occurrences to WorkCover (section 86 and 87 of the Act and Part 12.1. plant or substances used. and the NSW Ambulance Service. Hazardous Work – any work that has the potential to harm the health and safety of a person. Contract – an agreement between two or more parties. 2. Contractor pre-qualification – a systematic procedure for screening the health and safety practices and culture of organisations or individuals that supply plant and equipment. Health Service – for the purposes of this document. Division 2). of the Regulation). The maximum fine for corporations for a breach of sections 8.500 or imprisonment for two years or both (subsequent offences). may face a penalty of up to $55. 5. or 11 of the Occupational Health and Safety Act 2000 is currently $550. and the NSW Ambulance Service. Due diligence – the use of all reasonable foresight and care in the planning and conduct of activities to protect the health. Legislative liability Occupational Health and Safety legislation applies to all places of work in NSW and an employer who has not taken adequate steps to eliminate or reduce risks can be penalised for not complying with the legislation even if no injury has occurred. 9. human resources. Such risk management forms the basis of contractor management. For the purposes of the Occupational Health and Safety Act. or services. The legislation includes a requirement for ongoing risk management (Chapter 2 of the Regulation).000 (subsequent offences). Incident Report Forms are available from WorkCover NSW. public health organisations as defined under section 7 of the Health Services Act 1997 (including Area Health Services). 3. safety and welfare of everybody in the workplace. a pool of preferred contractors can be established. 10. 4. “health service” refers individually to the NSW Department of Health. Principles for contractor engagement. the process of estimating the magnitude of risk exposures and deciding the urgency with which they are to be controlled. Including in contract documentation the facility’s OH&S requirements and a clear definition of the contractor’s OH&S responsibilities. 2. patients. assessed. controlling or eliminating. monitoring and communicating risks associated with any activity. Implementation of these procedures should be commensurate with the foreseeable level of risk of each case. and A safe place of work is provided for contractors working in Health Services. Contractor Evaluation a. and eliminated or controlled so that: 1. The health and safety of employees. 3. before engagement. Communication and consultation between the Health Service and contractors on OH&S issues. The procedures shall have provision for the following principles of: 1. a. managing and evaluating contractors. Contractor Engagement Conducting and documenting an OH&S risk assessment before work commences. while on the Health Service’s premises. visitors and others will not be put at risk by the activities of contractors in the workplace. 21(1/06) 2. An ongoing process for monitoring and managing the contractor’s compliance with OH&S statutory requirements. NSW HEALTH POLICY About this section This section states the NSW Health policy for the engagement. the contractor’s capability and suitability to carry out the work in a manner that is safe and without risks to health. based on a risk assessment. which includes OH&S criteria and a Register of Injuries. Safe Work Method Statement – a written statement. assessing. Policy Each Health Service is to ensure that risks to health and safety at the workplace are identified. a. and the OHS requirements imposed in the contract. and c. C 3.52 Risk management – a logical and systematic process of identifying. ontractor Management Ensuring that induction and ongoing training is provided as necessary according to the degree and type of risk to which contractors may be exposed while on the Health Service’s premises. b. management and evaluation of contractors and sets out 9 principles for good practice. function or process in a way that will enable organisations to minimise losses and maximise opportunities. .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 7. Risk assessment – a crucial component of risk management. 9. Assessing. b. A post-engagement performance review. 8. management and evaluation Each Health Service is to develop and implement procedures for engaging. and c. to be prepared by a contractor for all hazardous work. clearly stating the safest way to do the task. supervisors and team leaders. 2. 4. Setting policy direction for the health and safety of all staff employed in Health Services. Managers. 2. and regular evaluation of the effectiveness of the procedures for contractor management. 3. promotion and support of the contractor management procedures in their areas of responsibility. are responsible and accountable for: 1. for a List of Preferred Contractors. 3. 4. which include OH&S considerations. ACCOUNTABILITIES NSW Department of Health The NSW Department of Health is responsible for: 1. Division 2 of the Occupational Health and Safety Act 2000.53 Compiling criteria. management and evaluation of contractors on the Department of Health premises. or other controllers of work premises. and Reporting outcomes to the appropriate CE or the Director-General.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) b. Chief Executives Chief Executives are responsible and accountable for ensuring: 1. Consultation with employees on any OH&S decisions by means of an OH&S Committee or OH&S representative in accordance with Part 2. 21(1/06) . and Acting promptly to resolve any OH&S issues or disputes concerning contractors at the facility. This includes participation in monitoring contractor OH&S performance against the facility’s contractual requirements and the post-contract evaluation process. and Establishing procedures for the engagement. 5. Taking appropriate action when hazards related to the presence of contractors in the work place are reported or unsafe situations are observed. 2. supervisors and team leaders Managers. Risk Management Staff Risk management staffs are responsible for supporting and advising relevant managers to ensure OH&S input in all phases of contractor engagement and management. 3. The implementation of a contractor management program in their facilities which is consistent with the objectives of NSW Health. The effective implementation. Evaluation and monitoring of local contractor management procedures. Ensuring staff under their control are made aware of contractor management procedures and possible hazards which may arise from the presence of contractors in the work place. The development of local procedures which complement the NSW Health policy. etc. and Monitoring and reviewing health and safety issues related to the presence of contractors in the workplace (including risk assessments. other facility staff. Cooperating with the employer to enable compliance with occupational health and safety requirements.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) Occupational Health & Safety Committees Occupational Health and Safety Committees are responsible for: 1. inclu ding visitors. visitors. 4.54 Providing a channel of communication for employees with concerns about contractors in the work place. new or changed procedures. decisions about measures to eliminate or control risks. 2. and Immediately reporting to their supervisors any concerns relating to the safety of themselves.). Employees Employees are responsible for: 1. at the e mployer’s place of work. Taking re asonable c are fo r the h ealth a nd safety o f oth ers. 3. Participating in the consultative process. 2. 3. 21(1/06) . patients or the contractors. Improper conduct in relation to children or other patients 2. and Assessing. The presence of asbestos 11. Conducting and documenting an OH&S risk assessment before work commences. Identify all foreseeable risks to contractors and others in the workplace (employees. 2. the Health Service must identify beforehand any specific risks and requirements to be considered in the assessment. Security risks including the possible disconnection of warning systems 10. OH&S risk assessment A risk assessment should be undertaken to: 1. Including in contract documentation the facility’s OH&S requirements and clear definition of the contractor’s OH&S responsibilities. Product or service liability 5.55 This section describes the guidelines for policies and procedures that Health Services must put in place to meet the needs of the following principles of contractor engagement as outlined in Section 2: 1. Manual handling incidents 3. D isposal of waste 9. Depending on the type of the contract. concealed wires. Dangerous goods or chemicals 6. Safety isolation procedures 21(1/06) . 2. but are not necessarily limited to: 1. Co nfined spaces 12. and Identify all foreseeable risks to the health and safety of contractors arising from the activities of the facility. Buried pipes. such risks may include. 3. but are not necessarily limited to: 1. If the contractor is to conduct the risk assessment. before engagement. sufficient detail about how and when the work will be undertaken must be available. Requirements include. Satisfactory criminal record checks 2. contractor’s capability and suitability to carry out the work in a manner that is safe and without risks to health.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) ENGAGEMENT OF CONTRACTORS About this section 3. increased vehicular traffic 8. Increased fire risk. W arranties 4. Licences or qualifications 3. The Health Service and/or the contractor may carry out the risk assessment. noise and/or dust 7. The presence of heavy vehicles and mobile plant. etc. For the risk assessment to be valid. visitors. Medico-legal risks 4. patients etc) arising from the presence and/or activities of contractors in the workplace (including the likelihood of environmental risks such as chemical spills). nsw. A practical guide to basic risk management is designed to assist in conducting risk assessments. As a guide. Statements that reflect the outcome of the OH&S risk assessment(s) 3. 10. and A written system for reporting accidents and incidents. motor vehicle and third party property damage. Site Specific Safety Management Plans and Safe Work Method Statements should be presented are set out in the NSW Government Booklet “How to prepare Site Specific Safety Management Plans and Safe Work Method Statements”. a Health Service (Site) Specific Safety Management Plan or Safe Work Method Statement(s) depending on the contract’s value or complexity. Sig nage 7. mandatory training requirements and registration details. Procedures for ongoing risk assessment during the contract. 6. Provision of equipment eg personal protective clothing.56 Health Services must be satisfied that the contractor is capable of conducting an adequate risk assessment. A requirement for the contractor to have procedures for the recruitment. Procedures for on-going consultation and communication between the Health Service and the contractor(s). This is available at http://www. resources and supervision to do the job safely. Contract documentation Contract documentation should be commensurate with the work being undertaken/service provided and the level of foreseeable risk. Level of insurance cover required and verification of insurance coverage in such areas as workers’ compensation. Note: Instructions on how Project Safety Management Plans. It is essential that contract documents clearly state the responsibilities of both parties. Statements of OH&S requirements that must be complied with 2. A requirement for adequate personnel.cpsc. A requirement for a Project Safety Management Plan. Permit to work procedures 6. contract documentation may include the following. including issue resolution procedures. 12. Induction and training requirements. and must sign off on the assessment once it has been completed. References to facility safety rules and emergency procedures. Contractor licences. 13.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 5. 5. 21(1/06) . 8. 14. The lift-out work-sheet in the WorkCover NSW Hazpak. depending on the risk assessment: 1. 11.au/ohsr . Person al Protective Equipment 3. professional indemnity and public liability. Any control measures already in place for the hazards identified also need to be reviewed to determine whether they will be affected by the presence of contractors at the facility. consistent with legal reporting requirements. 9. 7.gov. Provisions for monitoring and managing OH&S compliance. control and monitoring of sub-contractors. 4. MANAGEMENT OF CONTRACTORS About this section This section describes the guidelines for policies and procedures that Health Services must put in place to meet the needs of the following principles of contractor management. as well as Prohibition or Improvement Notices issued and prosecutions initiated by WorkCover in the previous three years. they still maintain certain OH&S responsibilities under the legislation. In these instances. while on the Health Services premises. 2. and An ongoing process for monitoring and managing the contractor’s compliance with OH&S statutory requirements. Assessment should also include a review of the contractor’s incident/accident/injury statistics. and when and under what circumstances responsibilities change (eg hand over at completion). Unsatisfactory or Not Applicable. Responses of the contractor to each of the risk assessment issues and the essential requirements of tender documents should be examined individually and assessed. However. contract documentation should also clearly define the construction site. Networking within the public health care system and/or the NSW Health Intranet is another possible source of information. A checklist containing key OH&S requirements for consideration when preparing contract documentation is included at Appendix A. Some major building contracts are managed by the Department of Public Works. as outlined in Section 2: 1. Ensuring induction and ongoing training as necessary is provided according to the degree and type of risk to which contractors may be exposed while on the Health Services premises. 21(1/06) . When assessing contractor suitability Health Services must. the organisation(s) concerned should be contacted and questioned as to the overall OH&S performance of the contractor. If the contractor has supplied references. 3.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.57 For construction sites. for example Satisfactory. as a minimum. Weightings may be advisable if necessary to distinguish the importance of particular issues. Communication and consultation between Health Service management and the contractors on OH&S issues. Contractor capability assessment When assessing contractor suitability it is advisable to prepare a matrix of OH&S issues based on the findings of the risk assessment and the requirements written into the contract. and the OH&S requirements imposed in the contract. Health Services may have little control over the selection of contractors. custody and control over the work site. and state which parties have care. check the contractor’s training records and sight licences and other qualifications. 6. The nature and severity of the hazards identified by the risk assessment. If no solution can be agreed within their level of authority. 4. Permit to work systems (see Appendix 3-D) and isolation procedures. Familiarisation with equipment. Communication and consultation Good communication between Health Service management and the contractor(s) is vital so that OH&S concerns on both sides can be addressed. Manual handling policy. procedures and rules. 3. Other relevant facility specific safety rules. 8. procedures and rules. and Work in progress barriers and signs. Infection control policy. 3. The nominated persons will act as the respective points of contact for all complaints and other problems. and emergency procedures. The nature and scope of induction will depend on: 1. scope and nature of the contract. The issues addressed at induction and follow-up training may include: 1. 5. which are raised by the facility’s or the contractor’s employees and work together to resolve them. 2. The extent and level of ongoing communication depends on the size.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) Contractor induction and training 3. Injury treatment and hazard reporting procedures. Overview of relevant safe work method statements. The induction must be appropriate to the type and severity of hazards that they may encounter while at the facility. 6. Sign in and sign out procedures. The skills and experience of the contractors. It is important that contractors undergo induction by the facility before they are permitted to commence work. it is their responsibility to refer the problem to senior management for resolution in accordance with the issue resolution procedures set out in the contract. The equipment which is to be used. 5. 9. 10. The nature of the work environment. 21(1/06) . and The length of time that those being inducted will spend on the premises. an employer must ensure that any person who may be exposed to a risk to health and safety at the employer’s place of work is provided with any information. Protocols for regular meetings should be set out in the contract. Fire 4. 2. The responsibilities of their roles should be clearly stated for the benefit of all concerned. The facility and the contractor should each nominate a responsible person to supervise the OH&S and other requirements of the contract.58 In accordance with the new OH&S legislation. 7. instruction and training necessary to ensure the person’s health and safety. The task activities in which the contractors are to be engaged. General cooperation eg participation in evacuation exercises.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) Monitoring and managing compliance 3. Compliance with safety rules. The aim is to ensure that the contractor(s) are carrying out their work in a safe manner. Utilisation of hot work/working at height/confined space entry permits 8. This may involve some or all of the following: 1. All deficiencies found during monitoring must be raised with the contractor’s or sub-contractor’s employee and brought to the attention of the responsible person (see Communication and Consultation above). 2. The effectiveness of the Project Safety Management Plan. Reporting incidents and accidents 12. safe work practices and emergency procedures 6. Some OH&S issues that may need to be monitored on an ongoing basis are: 1. A post-work check. or the Safe Work Method Statement(s) as appropriate 2. These records will be needed during the post engagement contractor evaluation (see Evaluation of Contractors Section). smoking. Following facility sign in/sign out procedures 10. It is important that a checklist or other form be developed for this purpose and filled out on each occasion that monitoring takes place. Key facility policies. the Facility (Site) Specific Safety Management Plan. Adequacy of workforce. 21(1/06) . in consultation with the contractor(s). etc 7. Ind uction attendance records 4. Wearing visitor or contractor badge 11. Confirmation of the contractor’s understanding of how the work is to be carried out immediately prior to work commencing. A pre-work check (eg of safety equipment and tools) immediately prior to work commencing. Any identified shortcomings in contractor or sub-contractor employee behaviour must be notified immediately to the nominated contractor or delegated representative. and 13.59 The Health Service must ensure that the contractor(s) on site are appropriately supervised/monitored. Facility speed limits. Strategies must be put in place. use of alcohol and other drugs. 3. 4. eg on security. resources and supervision to do the job safely 3. manual handling. Wearing of personal protective equipment 9. to rectify any problems. Regular or periodic checks. Current and relevant licences and registrations 5. as outlined in Section 2: 1.. Criteria for compiling a List of Preferred Contractors Criteria for compiling a List of Preferred Contractors will include a number of aspects eg completion to time. 2. A post-engagement performance evaluation. the letter should advise that the contractor has been placed on the facility’s List of Preferred Contractors. through the OH&S Committee). Post-engagement performance evaluation When the contract is completed the Health Service should evaluate the contractor’s OH&S performance with the objectives of: 1. It is important that OH&S performance requirements set by the Health Service be measurable so that subjectivity is avoided. The contractor should be advised officially of the outcome of the post-engagement evaluation. which includes OH&S criteria. value for money. It will normally consist of examination of all the checklists or other documents completed during the monitoring process. Regular evaluation of the effectiveness of the procedures for contractor management. Determining whether the contractor would be considered for future work.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) EVALUATION OF CONTRACTORS About this section 3. the advice should be supported with documentation such as a list of the facility’s OH&S requirements with which the contractor consistently failed to conform or which required constant reinforcement by Health Service managers. If the outcome is unfavourable.g. and consultation with other managers who may have been affected by or involved in the contract work. This section is devoted only to OH&S aspects. 21(1/06) .60 This section describes the policies and procedures that Health Services must put in place to meet the needs of the following principles of contractor evaluation. and Providing feed-back to the contractor. Compiling criteria. technical expertise and reliability. This process should be formally documented. for a List of Preferred Contractors. which includes OH&S considerations. In defining the criteria. completion on budget. Measurable performance indicators will usually be based on the OH&S requirements of the contract. any records of complaints by Health Service employees (e. it is important that subjectivity is avoided and only measurable OH&S performance indicators are included. If the outcome is favourable. 2. and 3. In addition to a three yearly review. All contractor employees were provided with induction and training before starting work on the site. 2. and notifications of corrective actions were completed on time. A review process should be formulated and involve appropriate managers/supervisors and other staff directly involved in managing contractors. its contractor management procedures should be included in this system. Organisations already on the Health Service’s List of Preferred Contractors should be formally advised of any changes to procedures or OH&S requirements that may affect them in future contacts and be asked to acknowledge receipt of this information. Personal protective equipment was worn whenever necessary. 3. 4. it is good management practice to review procedures after they have been used for the first time or when any shortcomings are identified in practice. 21(1/06) . Ensure that they are working satisfactorily. 3. Regular evaluation of contractor management procedures Good management procedures require that documented systems and procedures be reviewed at regular intervals to: 1. If the Health Service already has a review system in place. and Ensure that they are being followed.61 Weekly workplace hazard and safe work practice inspections were carried out on time. The post-engagement performance evaluation (previously described) is a further occasion on which the need for a review of contractor management procedures may be identified. they should be reviewed on a three-yearly basis. 2. and Injury investigation reports were provided within the timeframe required.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) Some examples are: 1. Safe work method statements were provided. Otherwise. 5. and disciplinary action for OH&S breaches Operation of plant and vehicles Registration/licence provisions Equipment provision (eg Personal Protective Equipment) Restricted areas and operations (eg permits-to-work etc) Medical and first-aid provisions Ongoing consultation and communication between the Health Service and the contractor(s) and the employees of each Warranty Insurances (Worker’s Compensation. Professional indemnity and liability. contractor OH&S responsibilities Use and management of sub-contractors Initial and ongoing identification. The following key points should be considered for inclusion: • • • • • • • • • • • • • • • • • • • • • • • • • • Legal requirements Regulatory requirements The contractor’s OH&S management system Safe Work Practices Project Safety Management Plans.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.62 Appendix 3-D Contract documentation checklist Key points to consider: The contents of a contract should be commensurate with the level of foreseeable risk and the work being undertaken. Site Specific Safety Management Plans. assessment and control or elimination of risks Provision of OH&S information Induction and training provisions Safety rules and emergency procedures Installation procedures Commissioning procedures Technical specifications Guarding provisions Testing provisions Record-keeping and reporting requirements Monitoring of OH&S compliance. Third Party Property Damage) 21(1/06) . issue resolution procedures. Safe Work Method Statements Health Service vs. (Evacuation procedures and basic safety rules may be printed on reverse side. These are issued by WorkCover. Confined spaces Issued when contractors must enter confined spaces as defined in Chapter 4. Interruption to services Issued when building services (eg water. Part 4. eg welding or burning. the facility must ascertain that the contractor has adequate confined space entry procedures and those who will do the job have received training in those procedures. Noise Issued when contractors are to carry out noisy work. The conditions of issue should be similar to those for Hot Work. Interruption to fire Services Issued when firefighting and/or fire detection systems are to be isolated for the purpose of repair/renovation/maintenance. Division 9 of the Occupational Health and Safety Regulation 2001. electrical etc) are to be isolated for the purpose of undertaking repair.63 Appendix 3-E List of Permit to Work procedures Below is a list of permits-to-work types. Usually valid on day of issue only and returned to issuing authority on completion of job for which issued or on completion of work for day. “Working in confined spaces”. The conditions of issue are usually the same as for Hot Work. It should specify the times when noisy work may be carried out and any measures required to reduce the impact of noise on patients/visitors and staff.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.. Dusty work Issued as authority/notification to conduct work producing dusty conditions that might require the isolation of fire/smoke detectors. Before this type of permit is issued. which a Health Service may have in place. Please also note that the Occupational Health and Safety Regulation 2001 includes a requirement for licences and permits for demolition and friable asbestos removal work (Chapters 10). renovation or maintenance. 21(1/06) . Permit type Work – general Issued to contractors to notify site presence and must be carried at all times as proof of authority.) Hot work Issued as authority/notification to carry out hot work.3. exposed electrical/switchgear or service energised electrical equipment. The conditions of issue for Roof Access permits should be similar to those for Hot Work. It should specify the checks that must be made and the equipment to be worn before going onto roof areas and before working at height.5. Excavation Issued to contractors to permit excavation when it is known or suspected that there are underground services such as power cables.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) Roof Access/Working at Height 3. Permits to excavate should normally be issued for the duration of a particular excavation task. work in areas where asbestos is present.64 Issued when contractors must gain access to roof areas or work at height. of the Occupational Health and Safety Regulation 2001 with respect to the stability and other safety aspects of excavation should also be included in the permit to work. or in close proximity to. gas or fuel lines or telephone cables in the vicinity. and that the hazardous area is effectively barricaded to prevent inadvertent contact with live equipment. that a lock-out/tag-out system is in place. Asbestos Issued for work involving removal of asbestos. Please also see the Chapter 11 of the Occupational Health and Safety Regulation 2001 for legislative requirements. or work that may result in asbestos being disturbed. Before a permit of this nature is issued. The requirements set out in Part 8. Work on/in the vicinity of hazardous voltage Issued to contractors who need to work on. the responsible person must be satisfied that only licensed electricians will be involved. 21(1/06) . Standard Clause 2 Common Use Period Contracts “In the event that the State Contracts Control Board awards a Central Tender resulting in a Common Use Period Contract. and then another public health organisation proceeds to tender for the same item.65 Appendix 3-F PIGGY BACK PROVISIONS One -off Tenders or Period Tenders The situation often arises whereby a public health organisation calls and accepts tenders for a particular item. co-operation and co-ordination of tenders between public health organisations is encouraged. and the public health organisation may call joint tenders. State Contracts Control Board Tenders The State Contracts Control Board may call a tender that results in better terms and conditions than are obtainable under a pre-existing public health organisation tender. Standard Clause 1 Access to Contract (Piggyback Clause) “Whilst this tender specifically relates to the supply of goods/services to the public health organisation. it should not be made applicable if it is to the detriment of the public health organisation. The public health organisation can endeavour to re-negotiate the contract. [See separate section on tender networking. the parties acknowledge and agree that the public health organisation reserves the absolute right to obtain goods or services under the Central Tender Common Use Period Contract. When considering whether to take advantage of this clause public health organisations must ensure evaluation of the “value for money” aspects of taking it up at this time. In general. or failure to exercise. However. the right is reserved for any other public health organisation within the NSW Public Hospital system to access goods/services under the same or similar conditions”. Unfortunately the conditions of the first tender may not permit the second public health organisation utilising the benefits of the first tender. but inclusion of standard clause 2 in all public health organisation tenders would remove the difficulty.” 21(1/06) . any such right. To this effect the following clause is included in the standard RFT. delegated consultants with respect to the exercise of.] To this effect the following clause is included in the standard RFT. The Contractor shall have no claim against the public health organisation or any of its members.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. agents. officers. employees. the process. (for the Department) and record on Official File. Initiate Completion of Checklist to send to PAS.000 Steps to take Instructions: Sign and Date each step as it is completed.000 .au (this is not a link) or telephone 1800 679 289 ii) SIM.000 and not high risk . If project is not available through existing contract. Identify the contribution the proposed project will make to the Government and NSW Health's objectives.htm 5 Decide on the Procurement Process .66 APPENDIX 3-G CHECKLIST 3 NSW HEALTH .gov. its use is mandatory. Less than $250. Where fewer than three are invited. go to Commercial Manager. Establish and document the need for the Project. Include PAS member on Steering Committee as Probity and Process Advisor.au/operations/apmd/pmb/procurement/checklist/c1_nswhealth_consult ants.$250. Date of Awarding of Contract Successful Supplier/s awarded Contract Step CHECKLIST Procurement Goods and Services Over $30.nsw.000. Appoint Officer as Project Manager and estimate cost of the project.gov.health. go to http://internal. Read and understand Section 3 (Tendering) of the Supply Procedures Manual.health. the reasons should be documented and retained on file.au/Government+Procurement/Gateway+Review+Process/Project+Profile +Assessment+Tool. Is this project available through any existing contract? – Check with i) State Government Contracts at Commerce website. will go to open market. NOTE: NSW Health Guidelines advise obtaining a minimum of three written quotes as Best Practice. Develop the Scope.TO BE COMPLETED BY PROJECT MANAGER Procurement Over $30.4 Seek a Procurement Reference Number (PRN) from PAS or Commercial Manager SIM.nsw.New Procure ment Project – goods or service only . Quote/Procurement Ref No. Outputs and expected benefits of the procurement.000 and less than $250. Certify.pdf For IT related product or service. Official File Number Title Of Procurement Branch/Unit Project Manager Email Address Contact Phone No. SIM. in writing.Submit a recommendation to the Steering Committee (as appropriate) If project is available through existing contract.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.dpws. send the fully completed document to the Procurement Advisory Service. When the Procurement is finished.minimum of three written proposals required.au. iii) SP&BD All NSW Health Projects over $1MILLION (as a discrete project) must assess risk through the Department of Commerce Risk Assessment Tool titled Procurement Profile Tool at (this is not a link) http://www. the reasons should be documented. Email: pas@doh. Establish Supervising Manager responsible for delegation of funds – Establish Steering Committee (as appropriate). Where fewer than three quotations are invited. Create an Official File. Treasury Steps 1 . (this is not a link) www.Steps to take Initial Concept . Signature Initials Date 24(7/09) .gov.000.For Consultancy . Determine availability of in-house or possible internal alternative sources of supply.com.nswbuy.nsw. Government mandates (GST inclusive): $30. the availability of funds and authority to incur expenditure. invite minimum of three approved Suppliers to quote.Steps to take Complete Tender/EOI documentation including evaluation criteria (as appropriate).CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) CHECKLIST 3 NSW HEALTH . Issue next document and invite minimum of three short-listed bidders to tender. document the reason.67 Date OR TOTAL Price Paid: Statement of Compliance: This procurement was completed in accordance with NSW Health’s Procurement Policy Directions and all the steps listed above. Conduct ongoing management of Project. Single stage process: Review bids/tenders for reasonableness/ consistency & against selection criteria. Lodge the controlled document Tender Evaluation Criteria with PAS for security (as appropriate). Document the Recommendation Signature INITIALS 3. Evaluate.000 Steps to take Step 6 CHECKLIST Procurement Goods and Services Over $30. Confidentiality Agreement and Conflict of Interest Documents to be signed (as appropriate). Check response to Letter of Acceptance. Write Evaluation Plan and establish Evaluation Committee (as appropriate).000. Approving Officer sign off recommendation as per delegation. Develop a Probity Plan (as appropriate). to ensure it is properly signed by the successful tenderer (same legal entity) & that all conditions are agreed to. 9 Inform Shared Services of outcome to comply with public disclosure directive.000 and not high risk .TO BE COMPLETED BY PROJECT MANAGER Procurement Over $30. Document the Recommendation Certify that all relevant policy and procedures have been complied with. 7 Advertise Expression of Interest/Tender externally through Communications Unit OR OR If using existing contract. submissions/approvals are placed in Official File. 8 Bids Received by Tender Box(hard copy) & /or electronically via website . Less than $250. following best practice for NSW Health. document the reason and file. If three are not invited. correspondence. If multistage process. review EOI’s for reasonableness/ consistency with the market and against selection criteria. If three are not invited. After final acceptance of contract inform unsuccessful bidders in writing & give opportunity for debrief. Short-list chosen bidders. Tender Opening Committee completes procedure. Delegated Supervising Officer Name: Title: Signature:_____________________________________ Date: Delegated Supervising Officer Name: Title: Signature:_____________________________________ Date: 24(7/09) .000 and less than $250. OR Document the Recommendation. 10 Evaluate the supplier’s performance as per contract/SLA and place the Evaluation Report in the Official File. Ensure all bids/tender responses. Submit Purchase Order/Contract or Service Level Agreement to successful Supplier. Certify. Seek a Quote/Tender Number from Contracts Officer and record on Official File. go to Commercial Manager. Develop a Probity Plan (as appropriate). 5 Decide on the Procurement Process .68 APPENDIX 3-H CHECKLIST 4 HEALTH SERVICES . 6 Complete Tender/EOI documentation including evaluation criteria (as appropriate). iii) SP&BD TCNG Database – Follow HSS Process to access documents. Treasury Steps 1 . Include PAS member on Steering Committee as Probity and Process Advisor.000 and less than $250. the not go to open market.Submit a recommendation to the Steering Committee (as appropriate).au. Establish and document the need for the Project. send the fully completed document to the Procurement Advisory Service. in writing.000.000. Check for reports on previous projects process will go to open market. Outputs and expected benefits of the procurement. Determine availability of in-house or possible internal alternative sources of supply.nswbuy. Establish Supervising Manager responsible for delegation of funds – Establish Steering Committee (as appropriate).nsw. the reasons should be Where fewer than three quotations are invited.000. the availability of funds and authority to incur expenditure.4 Read and understand Section 3 (Tendering) of the Purchasing and Supply Manual. Initiate Completion of Checklist to send to PAS. the reasons documented and retained on file.000 . SIM.au (this is not a link) or telephone 1800 679 289 ii) SIM.New Procure ment Proj ect . Develop the Scope. When the Procurement is finished. Lodge the controlled document Tender Evaluation Criteria with PAS for security (as appropriate). www. Signature Date 24(7/09) .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. Government mandates or firms that may have worked with NSW Health –Check (GST inclusive): Over $30. Quote/Procurement Ref No.health. Create an Official File. Strategic Procurement & Business Development.Goods or Service howev er for Consultancy go to http://internal.pdf For IT related product or service.TO BE COMPLETED BY PROJECT MANAGER Procurement Goods and Services Over $30.Steps to take Instructions: Sign and Date each step as it is completed.au/operations/apmd/pmb/procurement/checklist/c2_areas_consultan ts. Less than $250. Less than $250. Where fewer obtaining a minimum of three written quotes as Best Practice.gov. Official File Number Title Of Procurement Branch/Unit Project Manager Email Address Contact Phone No. Write Evaluation Plan and establish Evaluation Committee (as appropriate).nsw.000 TCNG Database.com. the process will If project is not available through existing contract. Identify the contribution the proposed project will make to the Government and NSW Health's objectives. than three quotations are invited.gov. NOTE: NSW Health Guidelines advise minimum of three written quotes required.Steps to take Initial Concept . Is this project available through any existing contract? – Check with i) State Government Contracts at Commerce website. Date of Awarding of Contract Successful Supplier/s awarded Contract Step CHECKLIST Procurement Goods and Services Over $30. Email: pas@doh. If project is available through existing contract.health. Appoint Officer as Project Manager and estimate cost of the project. should be documented and retained on file. 2) Email copy to: Procurement Advisory Service.000. When the Procurement is finished.gov.000. Document the Recommendation Prepare the recommendation certifying that all relevant policy and procedures have been complied with.nsw. Email:
[email protected] Date OR TOTAL Price Paid: Statement of Compliance: This procurement was completed in accordance with NSW Health’s Procurement Policy Directions and all the steps listed above.000. correspondence.Tender Opening Committee completes procedure If multistage process.nsw. document the reason and file. Strategic Procurement & Business Development. invite minimum of three approved Suppliers to quote. Less than $250. to ensure it is properly signed by the successful tenderer (same legal entity) & that all conditions are agreed to. Document the Recommendation Signature INITIALS 3.health.au 24(7/09) . If three are not invited. If three are not invited.health. Ensure all bids/tender responses. following best practice for NSW Health.Steps to take Advertise EOI or Tender externally OR OR If using existing contract. Evaluate. Short-list chosen bidders.TO BE COMPLETED BY PROJECT MANAGER Procurement Goods and Services Over $30.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) CHECKLIST 4 HEALTH SERVICES . submissions/approvals are placed in Official File Conduct ongoing management of Project 10 Evaluate the supplier’s performance as per contract/SLA and place the Evaluation Report in the Official File. Approving Officer sign off recommendation as per delegation Submit Purchase Order/Contract or Service Level Agreement to successful Supplier. OR Document the Recommendation. Single stage process: Review bids/tenders for reasonableness/ consistency with the market and against selection criteria. Project Manager: Name: Title: Signature:_____________________________________ Date: Delegated Supervising Officer Name: Title: Signature:_____________________________________ Date: WHAT TO DO WITH THIS COMPLETED SIGNED FORM: 1) Place the signed original in the official file. Email: pas@doh. Issue next document and invite minimum of three short-listed bidders to tender. Check response to Letter of Acceptance. review Expressions Of Interest for reasonableness/ consistency with the market and against selection criteria. 8 Bids Received by Tender Box.000 . Step 7 CHECKLIST Procurement Goods and Services Over $30. send the fully completed document to the Procurement Advisory Service. 9 Complete the award section of the eTendering Admin Console to comply with public disclosure directive. document the reason.au. After final acceptance of contract inform unsuccessful bidders in writing & give opportunity for debrief. Less than $250.Steps to take Instructions: Sign and Date each step as it is completed. Outputs and expected benefits of the procurement.gov.nswbuy. Is this project available through any existing contract? – Check with i) State Government Contracts at Commerce website. Strategic Procurement & Business Development.70 APPENDIX 3-I CHECKLIST 5 NSW HEALTH .dpws. Determine availability of in-house or possible internal alternative sources of supply.p df For IT related product or service.health. Initiate Completion of Checklist to send to PAS. 24(7/09) . NOTE: NSW process. Include PAS Member on Steering Committee as Probity and Process Advisor.au/operations/apmd/pmb/procurement/checklist/c1_nswhealth_consultants. Treasury Steps 1 . will go to open market. Less than $10Million and not high risk . Seek a Procurement Reference Number (PRN) from PAS or Commercial Manager SIM. (this is not a link) www. (for the Department) and record on Official File. the process will not go to open market. Less than $10Million and not high risk . Establish and document the need for the Project. go to Commercial Manager. Where fewer than Procurement to manage Tender. Establish Supervising Manager responsible – Establish Steering Committee (as appropriate).000 Open Tender required.nsw. State written quotes as Best Practice.nsw.Steps to take Instructions: Sign and Date each step as it is completed.health. Identify the contribution the project will make to the Government and NSW Health's objectives.au.000.New Procurement Project .4 5 Read and understand Section 3 (Tendering) of the Supply Procedures Manual.au (this is not a link) or telephone 1800 679 289 ii) SIM.Submit a recommendation to the Steering Committee If project is available through existing contract.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. Quote/Procurement Ref No. SIM Appoint Officer as Project Manager and estimate cost of the project.TO BE COMPLETED BY PROJECT MANAGER Procurement Goods and Services Over $250.Goods or Service however if Consultancy go to http://internal.au/Government+Procurement/Gateway+Review+Process/Project+Pr ofile+Assessment+Tool. Strategic Procurement & Business Development Branch will assist with this process.gov. Decide on the Tender Process .nsw. the availability of funds and authority to incur expenditure.000. send the fully completed document to the Procurement Advisory Service.gov.Steps to take Initial Concept . Government mandates (GST Health Guidelines advise obtaining a minimum of three inclusive):Over $250. Certify. the If project is not available through existing contract. three quotes are invited. iii) SP&BD All NSW Health Projects over $1MILLION (as a discrete project) must assess risk through the Department of Commerce Risk Assessment Tool titled Procurement Profile Tool at (this is not a link) http://www. Signature Initials Date Create an Official File.com. the reasons should be documented and retained on file.htm IT Projects over $5Million must also undergo a formal Business Case Review as part of the Gateway Process. Official File Number Title Of Procurement Branch/Unit Project Manager Email Address Contact Phone No. Date of Awarding of Contract Successful Supplier/s awarded Contract Step CHECKLIST Procurement Goods and Services Over $250. When the Procurement is finished. Email: pas@doh. in writing. Develop the Scope. au 24(7/09) . Evaluate. document the reason. Develop a Probity Plan (as appropriate). invite minimum of three approved Suppliers to quote. Lodge the controlled document Tender Evaluation Criteria with PAS.nsw. to ensure it is properly signed by the successful tenderer (same legal entity) & that all conditions are agreed to. Ensure all bids/tender responses. Email: pas@doh. Contracts must go through Legal Branch (Department specific) Check response to Letter of Acceptance. following best practice for NSW Health.000. correspondence.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) CHECKLIST 5 NSW HEALTH . Document the Document the Recommendation. submissions/approvals are placed in Official File Conduct ongoing management of Project OR ii) 8 9 10 Evaluate the supplier’s performance as per contract/SLA and place the Evaluation Report in the Official File.health. After final acceptance of contract inform unsuccessful bidders in writing & give opportunity for debrief. Document the Recommendation Certify that all relevant policy and procedures have been complied with. TOTAL Price Paid: Statement of Compliance: This procurement was completed in accordance with NSW Health’s Procurement Policy Directions and all the steps listed above. Less than $10Million and not high risk . Inform PAS of outcome for public disclosure. Less than $10Million and not high risk . Signature INITIALS Date 7 Advertise EOI or Tender externally through Communications Unit OR i) If using existing contract. Short-list chosen bidders.71 Step 6 CHECKLIST Procurement Goods and Services Over $250.Steps to take Complete Tender/EOI documentation including evaluation criteria. review EOI’s for Single stage process: reasonableness/ consistency with the market and Review bids/tenders against selection criteria.000.TO BE COMPLETED BY PROJECT MANAGER Procurement Goods and Services Over $250.Steps to take 3. If three are not invited. for reasonableness/ OR OR consistency with the market and against selection criteria. 2) Email copy to: Procurement Advisory Service. Project Manager: Delegated Supervising Officer Name: Name: Title: Title: Signature:_____________________________________ Signature:_____________________________________ Date: Date: WHAT TO DO WITH THIS COMPLETED SIGNED FORM: 1) Place the signed original in the official file. Bids Received by Tender Box. Approving Officer sign off recommendation as per delegation Submit Contract or Service Level Agreement to successful Supplier.gov. document the reason and file. Recommendation Issue next document and invite minimum of three short-listed bidders to tender. Write Evaluation Plan and establish Evaluation Committee (as appropriate).Tender Opening Committee completes procedure If multistage process. If three are not invited. in writing. SIM Appoint Officer as Project Manager and estimate cost of the project.au/operations/apmd/pmb/procurement/checklist/c2_areas_consu ltants. Establish and document the need for the Project. 6 If project is not available through existing contract.4 Initiate Completion of Checklist to send to PAS. Email: pas@doh. Certify.000. Include PAS Member on Steering Committee as Probity and Process Advisor. www.au (this is not a link) or telephone 1800 679 289 ii) SIM. 5 Decide on the Tender Process .gov. the availability of funds and authority to incur expenditure. Quote/Procurement Ref No.72 APPENDIX 3-J CHECKLIST 6 HEALTH SERVICES . go to http://internal. the reasons should be documented and retained on file.nsw.Steps to take Instructions: Sign and Date each step as it is completed. When the Procurement is finished. Strategic Procurement & Business Development.000. Less than $10Million and not high risk . iii) SP&BD TCNG Database – Follow HSS Process to access documents.nsw.Submit a recommendation to the Steering Committee If project is available through existing contract. Lodge the controlled document Tender Evaluation Criteria with appropriate body for security.au. Determine availability of in-house or possible internal alternative sources of supply.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. Outputs and expected benefits of the procurement. 24(7/09) . go to Commercial Manager. Government mandates (GST inclusive):Over $250. Develop the Scope.com. Is this project available through any existing contract? – Check with i) State Government Contracts at Commerce website. Identify the contribution the project will make to the Government and NSW Health's objectives. Establish Supervising Manager responsible – Establish Steering Committee (as appropriate).New Procurement Project . the process will not go to open market. the process will go to open market. send the fully completed document to the Procurement Advisory Service. Check for reports on previous projects or firms that may have worked with NSW Health –Check TCNG Database. Read and understand Section 3 (Tendering) of the Purchasing and Supply Manual. Where fewer than three quotations are invited.gov. Less than $10Million and not high risk .health. Signature Date Complete Tender/Expression of Interest documentation including evaluation criteria. NOTE: NSW Health Guidelines advise obtaining a minimum of three written quotes as Best Practice. Write Evaluation Plan and establish Evaluation Committee (as appropriate). Seek a Quote/Tender Number from Contracts Officer and record on Official File.Goods or Service however if Consultancy. Official File Number Title Of Procurement Branch/Unit Project Manager Email Address Contact Phone No.Steps to take Initial Concept . Date of Awarding of Contract Successful Supplier/s awarded Contract Step CHECKLIST Procurement Goods and Services Over $250. Develop a Probity Plan (as appropriate).TO BE COMPLETED BY PROJECT MANAGER Procurement Goods and Services Over $250. Treasury Steps 1 .pdf For IT related product or service. Create an Official File.nswbuy. Over $1Million Risk Management Assessment through Gateway Process required.health.000 Open Tender required. Steps to take Advertise EOI or Tender externally OR OR If using existing contract. to ensure it is properly signed by the successful tenderer (same legal entity) & that all conditions are agreed to. Check response to Letter of Acceptance. OR Document the Recommendation.nsw. 2) Email copy to: Procurement Advisory Service. Project Manager: Name: Title: Signature:_____________________________________ Date: Delegated Supervising Officer Name: Title: Signature:_____________________________________ Date: WHAT TO DO WITH THIS COMPLETED SIGNED FORM: 1) Place the signed original in the official file. submissions/approvals are placed in Official File Conduct ongoing management of Project 10 Evaluate the supplier’s performance as per contract/SLA and place the Evaluation Report in the Official File. Short-list chosen bidders. Single stage process: Review bids/tenders for reasonableness/ consistency with the market and against selection criteria.Steps to take Step 7 CHECKLIST Procurement Goods and Services Over $250. Less than $10Million and not high risk . Approving Officer sign off recommendation as per delegation Submit Purchase Order/Contract or Service Level Agreement to successful Supplier. document the reason and file.TO BE COMPLETED BY PROJECT MANAGER Procurement Goods and Services Over $250. 9 Complete the award section of the eTendering admin console to comply with public disclosure directive. If three are not invited. If three are not invited. Less than $10Million and not high risk .000. 8 Bids Received by Tender Box. After final acceptance of contract inform unsuccessful bidders in writing & give opportunity for debrief. Issue next document and invite minimum of three short-listed bidders to tender. Document the Recommendation Signature INITIALS Date OR TOTAL Price Paid: Statement of Compliance: This procurement was completed in accordance with NSW Health’s Procurement Policy Directions and all the steps listed above. invite minimum of three approved Suppliers to quote. Evaluate. following best practice for NSW Health.Tender Opening Committee completes procedure If multistage process. Ensure all bids/tender responses.health.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. review EOI’s for reasonableness/ consistency with the market and against selection criteria. document the reason. Document the Recommendation Prepare the recommendation certifying that all relevant policy and procedures have been complied with. Email:
[email protected] CHECKLIST 6 HEALTH SERVICES .au 24(7/09) .gov. correspondence.000. the availability of funds and authority to incur expenditure.gov. Official File Number Title Of Procurement Branch/Unit Project Manager Email Address Contact Phone No.dpws. Seek a Procurement Reference Number (PRN) from PAS or Commercial Manager SIM. the process will not go to open market. Strategic Procurement & Business Development. the If project is not available through existing contract. 5 Decide on the Tender Process .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. NOTE: NSW Health process will go to open market. Initiate Completion of Checklist to send to PAS. in writing. (MANDATORY). www.Steps to take Instructions: Sign and Date each step as it is completed. Initials Date 24(7/09) .au. Project will be handed over on completion. Certify. Treasury Steps 1 . Develop the Scope.au (this is not a link) or telephone 1800 679 289 ii) SIM. Is this project available through any existing contract? – Check with i) State Government Contracts at Commerce website. Over $1Million Risk to request three or more written quotes however where Management Assessment through Gateway Process fewer than three quotations are invited.nswbuy.74 APPENDIX 3-K CHECKLIST 7 NSW HEALTH . Quote/Procurement Ref No. (for the Department) and record on Official File. Gateway process review is MANDATORY for all procurement over $10 Million. PAS to manage this process. Read and understand Section 3 (Tendering) of the Supply Procedures Manual. Date of Awarding of Contract Successful Supplier/s awarded Contract All Procurement over $10Million is to be managed by Strategic Procurement & Business Development Branch– Contact Chief Procurement Officer.gov. Establish Steering Committee (Client CEOs and advisers are represented on the steering committee). Identify the contribution the proposed project will make to the Government and NSW Health's objectives. iii) SP&BD All NSW Health Projects over $1MILLION (as a discrete project) must assess risk through the Department of Commerce Risk Assessment Tool titled Procurement Profile Tool at (this is not a link) http://www. Step CHECKLIST Procurement Goods and Services (except Consultants) Over $10Million Steps to take Appoint Officer as Project Manager and estimate cost of the project.health.com.4 Establish and document the need for the Project.nsw. the reasons required. State Procurement to quotes as Best Practice. send the fully completed document to the Procurement Advisory Service.nsw. should be documented and retained on file.Submit a recommendation to the Steering Committee If project is available through existing contract.au/Government+Procurement/Gateway+Review+Process/Pr oject+Profile+Assessment+Tool. Email: pas@doh. Outputs and expected benefits of the procurement. PAS will assist with this process. Create an Official File. Government Guidelines advise obtaining a minimum of three written mandates Open Tender required.htm Projects over $10Million (or $5Million IT) must also undergo a formal Business Case Review as part of the Gateway Process. Project Managers may choose manage the Tender.TO BE COMPLETED BY PROJECT MANAGER Procurement Goods and Services (except Consultants) Over $10Million . When the Procurement is finished. Establish Supervising Manager responsible – PAS is to manage the process and Chair the Steering Committee. Short-list chosen bidders. Document the Recommendation Certify that all relevant policy and procedures have been complied with. document the reason. TOTAL Price Paid: Statement of Compliance: This procurement was completed in accordance with NSW Health’s Procurement Policy Directions and all the steps listed above. Lodge the controlled document Tender Evaluation Criteria with PAS. submissions/approvals are placed in Official File iii) Conduct ongoing management of Project 10 Evaluate the supplier’s performance as per contract/SLA and place the Evaluation Report in the Official File. review EOI’s for reasonableness/ consistency with the market and against selection criteria.au 24(7/09) . After final acceptance of contract inform unsuccessful bidders in writing & give opportunity for debrief. If three are not invited. Single stage process: Review bids/tenders for reasonableness/ consistency with the market and against selection criteria. Issue next document and invite minimum of three short-listed bidders to tender.000 must go through Legal Branch (Department specific) Check response to Letter of Acceptance. Evaluate.Steps to take Complete Tender/EOI documentation including evaluation criteria.health. If three are not invited. document the reason and file. correspondence.Tender Opening Committee completes procedure If multistage process. Email:
[email protected] CHECKLIST 7 NSW HEALTH . following best practice for NSW Health. Write Evaluation Plan and establish Evaluation Committee. 7 Advertise EOI or Tender externally through Communications Unit OR OR If using existing contract. ii) Ensure all bids/tender responses. Approving Officer sign off recommendation as per delegation Submit Contract to successful Supplier.Steps to take Step 6 CHECKLIST Procurement Goods and Services Over $10Million .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.gov. to ensure it is properly signed by the successful tenderer (same legal entity) & that all conditions are agreed to. Document the Recommendation Signature Date Document the Recommendation. Project Manager: Name: Title: Signature:_____________________________________ Date: Delegated Supervising Officer Name: Title: Signature:_____________________________________ Date: WHAT TO DO WITH THIS COMPLETED SIGNED FORM: 1) Place the signed original in the official file.TO BE COMPLETED BY PROJECT MANAGER Procurement Goods and Services (except Consultants) Over $10Million . 9 i) Inform PAS of outcome for public disclosure. 8 Bids Received by Tender Box. 2) Email copy to: Procurement Advisory Service. invite minimum of three approved Suppliers to quote. Contracts over $250. Develop a Probity Plan and implement.nsw. 4 Establish and document the need for the Project.au/Government+Procurement/Gateway+Review+Process/Pr oject+Profile+Assessment+Tool. Establish Supervising Manager responsible – PAS is to manage the process and Chair the Steering Committee. PAS will assist with this process. Seek a Quote/Tender Number from Contracts Officer and record on Official File. Government mandates Guidelines advise obtaining a minimum of three written Open Tender required. in writing. the reasons process. Step CHECKLIST Procurement Goods and Services (except Consultants) Over $10Million Steps to take Appoint Officer as Project Manager and estimate cost of the project. should be documented and retained on file. NOTE: NSW Health process will go to open market. Official File Number Title Of Procurement Branch/Unit Project Manager Email Address Contact Phone No. Email:
[email protected]. Date of Awarding of Contract Successful Supplier/s awarded Contract All Procurement over $10Million is to be managed by Strategic Procurement & Business Development – Contact Chief Procurement Officer (MANDATORY).gov. Project Managers may choose Tender. State Procurement to manage the quotes as Best Practice. the If project is not available through existing contract.au (this is not a link) or telephone 1800 679 289 ii) SIM. Develop the Scope. iii) SP&BD TCNG Database – Follow HSS Process to access documents. Quote/Procurement Ref No. Strategic Procurement & Business Development.nsw. Project will be handed over on completion. All NSW Health Projects over $1MILLION (as a discrete project) must assess risk through the Department of Commerce Risk Assessment Tool titled Procurement Profile Tool at (this is not a link) http://www.au. Establish Steering Committee (Client CEOs and advisers are represented on the steering committee). Identify the contribution the proposed project will make to the Government and NSW Health's objectives.TO BE COMPLETED BY PROJECT MANAGER Procurement Goods and Services (except Consultants) Over $10Million .Submit a recommendation to the Steering Committee If project is available through existing contract.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. 5 Decide on the Tender Process . send the fully completed document to the Procurement Advisory Service. Initiate Completion of Checklist to send to PAS Read and understand Section 3 (Tendering) of the Purchasing and Supply Procedures Manual. PAS to manage this fewer than three quotations are invited.nsw. Treasury Steps 1 . Create an Official File. the process will not go to open market. Is this project available through any existing contract? – Check with i) State Government Contracts at Commerce website. the availability of funds and authority to incur expenditure. www.Steps to take Instructions: Sign and Date each step as it is completed. Over $1Million Risk Management Assessment to request three or more written quotes however where through Gateway Process required. Initials Date 24(7/09) . Certify.htm Projects over $10Million (or $5Million IT) must also undergo a formal Business Case Review as part of the Gateway Process.nswbuy. Outputs and expected benefits of the procurement.76 APPENDIX 3-L CHECKLIST 8 HEALTH SERVICES . Gateway process review is MANDATORY for all procurement over $10 Million. When the Procurement is finished.dpws.gov. If three are not invited. Document the Recommendation. review EOI’s for reasonableness/ consistency with the market and against selection criteria. following best practice for NSW Health.77 CHECKLIST 8 HEALTH SERVICES . Project Manager: Name: Title: Signature:_____________________________________ Date: Delegated Supervising Officer Name: Title: Signature:_____________________________________ Date: WHAT TO DO WITH THIS COMPLETED SIGNED FORM: 1) Place the signed original in the official file.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. Approving Officer sign off recommendation as per delegation Submit Contract to successful Supplier. Contracts over $250. Email:
[email protected] to take Step 6 CHECKLIST Procurement Goods and Services Over $10Million . If three are not invited. submissions/approvals are placed in Official File. Ensure all bids/tender responses. Issue next document and invite minimum of three short-listed bidders to tender.Tender Opening Committee completes procedure If multistage process. 2) Email copy to: Procurement Advisory Service. After final acceptance of contract inform unsuccessful bidders in writing & give opportunity for debrief.gov. Develop a Probity Plan and implement. Write Evaluation Plan and establish Evaluation Committee.Steps to take Complete Tender/EOI documentation including evaluation criteria. Conduct ongoing management of Project 10 Evaluate the supplier’s performance as per contract/SLA and place the Evaluation Report in the Official File. 7 Advertise EOI or Tender externally through Communications Unit OR OR If using existing contract.au 24(7/09) . invite minimum of three approved Suppliers to quote. Document the Recommendation Certify that all relevant policy and procedures have been complied with.health. Short-list chosen bidders. 9 Inform Shared Services of outcome for public disclosure. document the reason and file. Evaluate.nsw.TO BE COMPLETED BY PROJECT MANAGER Procurement Goods and Services (except Consultants) Over $10Million . to ensure it is properly signed by the successful tenderer (same legal entity) & that all conditions are agreed to. Lodge the controlled document Tender Evaluation Criteria with PAS. Document the Recommendation Signature Date TOTAL Price Paid: Statement of Compliance: This procurement was completed in accordance with NSW Health’s Procurement Policy Directions and all the steps listed above.000 must go through Legal Branch (Department specific) Check response to Letter of Acceptance. Single stage process: Review bids/tenders for reasonableness/ consistency with the market and against selection criteria. 8 Bids Received by Tender Box. document the reason. correspondence. Establish the Contractor has appropriate level of insurance (not necessary if under Dept of Commerce Contract).nsw. Establish the total price is a fair market price (order splitting forbidden) Seek approval from your Deputy Director General before any commitment is made (MANDATORY).$250.htm or telephone 02 9372 7791 4 5 6 7 What is the number of the Contract that will be used? If the Contractor is not engaged through an existing Contract. 8 9 Statement of Compliance: The engagement of this Contractor was completed in accordance with NSW Health’s Procurement Policy Directions and all the steps listed above.000-$10Million Checklist 7 for Procurement over $10Million Checklist 9 Engaging Consultant/Contractor under $30.au/Contract+Information+and+User+Guides/Contract+Information+and+User+Guides.dpws.000 Steps to take Instructions: Sign and Date each step as it is completed.supply. :Also available is the EasyGuide to Procurement under $30. Is this Contracting Category covered under any existing Contract? If so. Check possibility of in-house or possible internal alternative supply.pdf Procurement Checklists available include For Health Services For NSW Health Checklist 2 for Procurement of Consultants Checklist 4 for Procurement $30.au/operations/apmd/pmb/procurement/checklist/easyguide9under30thousand.nsw.gov.$250.000 24(7/09) .000 . Establish the Contractor satisfies Australian Tax Office requirement to ensure NSW Health is not exposed to superannuation & withholding tax liability (not necessary if Dept of Commerce Contract).000 Checklist 6 for Procurement $250.health. the availability of funds and authority to incur expenditure. document the reason and retain on Official File. – Check State Government Contracts at Dept of Commerce website Go to: Initial Date FINISH DATE: Phone Number: http://www.000-$10Million Checklist 8 for Procurement over $10Million Checklist 1 for Procurement of Consultants Checklist 3 for Procurement $30. in writing.000 Checklist 5 for Procurement $250.78 APPENDIX 3-M CHECKLIST 9 NSW DEPARTMENT OF HEALTH Engaging a Contractor Under $30. its use is MANDATORY. Delegated Officer Name:__________________________________________________________________________ Title:_________________________________________________________________________________ Signature:_____________________________________ Date: WHAT TO DO WITH THIS COMPLETED SIGNED FORM: Place the original in the official file.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.000 .go to http://internal.Steps to take Certify.000 . Do this BEFORE the commitment is made (or the Contractor may not get paid) Officer Engaging Contractor: Branch/Unit: Project Title: Dates of Engagement: START DATE: Total amount to be paid to Contractor: Step 1 2 3 Engaging a Contractor Under $30.gov.000 . gov.doc .79 APPENDIX 3-N STANDARD SERVICES/CONSULTANCY CONTRACT (Contracts below $200.CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.000) The Standard Services/Consultancy Contract can be downloaded from http://internal.health.au/legal/pdf/standard.nsw. CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.80 . CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.81 . CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.82 . 83 .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.84 . CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.85 . 86 .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3.87 . 88 .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. 89 .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. 90 .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. 91 .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. 92 .CHAPTER 3 – COMPLEX PROCUREMENT (TENDERING) 3. ..................... • Planning the Project and the Engagement ............................. The Specification ..... • B............... Engaging the Selected Consultant ...............6 4......8 4................................................ • Assessment of Bids ...............................8 4......................................... 1......... 9........................................... Determining the Need to Engage a Consultant ................................... • Awareness of Delegations and Procedures ........ Principles .......................... Procurement Levels ......................1 4... 4..11 4....8 4.. • Typical Components of a Well-Planned Project..................................... Minimum Number of Bids ....................3 4.........14 4.................................................8 4.......................................................7 4..................................................................... 6...................................................1 4..................................................................................................................................................................................................... • A............................................................ 5.........................................................................................9 4................. Definition ...........21 4............. Developing the Specification and Conditions of Engagement.................................................................................TABLE OF CONTENTS CHAPTER 4 – CONSULTANCY ENGAGEMENT ..................................................................................................................................... • Construction Projects . • Accountability & Record Keeping .3 4........... Selecting the Consultant ...... • Impartiality .. • Proper & Impartial Processes ......16 4....... • Fairness ..................................................... • Value for Money ............. Approaches to Seeking Bids ......................3 4................................................5 4....................4 4......19 4.. • Superannuation Liability .......................................................... • Inviting Bids.......... • Changes in Requirements After Invitations are Issued ......19 4............................................................................................ Conditions of Engagements ............... Managing the Project... Selection Criteria and Conditions of Bidding ...............................17 4.........18 4.......................... • • • 4.......18 4...................................20 4....................................................................................................................................................5 4............................................................................................................................................................................... • Late Changes to the Requirements ........19 4....................12 4.................18 4................. • Advice to Unsuccessful Bidders.....................................................................6 4.12 4..........................................................1 4......... Inviting and Receiving Bids and Tenders ..............................20 4.......... Minimum Levels of Competition .............4 4....................24 21(1/06) 2........................................................................... • Justification for Selection ......................................................Consultants/Contractors......17 4.................. • Late Bids ...........................................................23 4................ • Engagement Methods ............................................ • The Specification of Requirements and Conditions of Engagement .............................................................4 4........................................... 3.................................. • Distinguishing Consultants from Other Contractors .........................................................................4 4.......................1 4. • Conflicts of Interest .. • C.....................21 4...............6 4.. ... 7.... 8..................... • Proper and Ethical Practices by Consultants ......POLICY/PROCEDURES INTRODUCTION...................................................... • Checklist ............ • Security of Bids Received ............ • Briefing Conference ........................................... .....83 4...........29 4........................ Legislation and Policies to be Observed by Consultants ........ 11.......... Reporting the Use of Consultants ................. Consultancy Agreement from Crown Solicitor’s Office ............................................................ 24(7/09) .........28 4..............26 4... Managing the Consultant’s Work ............25 4. Annual Reporting Sample Disclosure ......... 12.......TABLE OF CONTENTS (Cont) 10................................88 Appendix 1 Appendix 2 Appendix 3 Appendix 4 Appendix 5 Appendix 6 - Prequalification Scheme for Engagement of Consultants – Performance & Management Services ..... Evaluation of the Consultant’s Performance .... • Variations After the Consultancy has Commenced ........................................................87 4.............................. Checklist for Engagement of Consultants ..............................26 4............82 4.............................................................................................. 4............. Consultancy Evaluation Report .................................................... Sample Invitation to Consultant to Make A Submission for Undertaking an Assignment .........................................................80 4...........30 4...................................... 1 The NSW Government expects that the professional expertise of public employees will be used as a first option in preference to engaging consultants. 2004-17 “Engagement and Use of Consultants” issued in July 2004. In practice the difference between consultants and other contractors is not always clear cut and judgements will need to be made based on the particular circumstances. DISTINGUISHING CONSULTANTS FROM OTHER CONTRACTORS For the purposes of these guidelines. The examples below are offered as illustrations. A copy of the Checklist is to be forwarded to the Department’s Asset & Contract Services Branch and will be incorporated in a centralised database. Because there are special requirements and delegations for the engagement of consultants and for reporting related expenditure it is important that consultancy services be distinguished from other services which are procured from the private sector. Training • • A person or firm engaged to provide advice on training needs and to develop training programs is a consultant. A person or firm engaged to provide the actual training would not be a consultant for the purposes of these guidelines. Use of the checklist is mandatory. Checklist At Appendix 5A (DoH) and 5B (Health Services and Ambulance Service) is a checklist of the different stages to be undertaken in the engagement of consultants process. 1.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES INTRODUCTION 4. DEFINITION For the purposes of this section a consultant is a person or organisation engaged under contract on a temporary basis to provide recommendations or high level specialist or professional advice to assist decision-making by management. The content of this section is mainly derived from Premier’s Circular No. 21(1/06) . Information Technology • A person or firm engaged to assist in the development of an information technology strategic plan and/or to assist with the development of specifications for the systems and/or to provide advice on implementation is a consultant. the following descriptions are given. Consultants should only be engaged when the required professional expertise is not available internally or cannot be provided in a more cost effective manner than can be obtained by engaging a consultant. Generally it is the advisory nature of the work that differentiates a consultant from other contractors. The definition does not apply to casual or temporary staff employed or engaged by a NSW health organisation. A person or firm engaged primarily to provide routine legal services such as conveyancing. would not be a consultant. Finance and Accounting • • A person or firm engaged primarily to provide advice on the financial viability of a government business enterprise is a consultant. Evaluation of activities and programs. the guidelines will apply to all legal work undertaken by the health organisation. Feasibility studies.g. would not be a consultant. A person or firm engaged primarily to provide routine auditing or routine accounting services even though that includes professional advice would not be called a consultant. A strong business case. Law firms and barristers will be expected to provide competitive fixed price tenders for any work involving provision of advice with reporting requirements also applying. The decision on whether to use consultants for design and layout of the report will be left to the discretion of each CE. Conduct of environmental scans and advice on planning. In exceptional circumstances an exemption from this ban may be granted by the CE. In exercising this discretion. editing. (PEO Circular 96-23 & 96-23A) 21(1/06) . will be necessary before approval will be given. Except for litigation work.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES • 4. This restriction applies to those aspects of the report preparation which can normally be carried out by agency staff.) Public agencies are not to engage consultants to prepare Annual Reports. CE’s should consider the Government’s commitment to restrict the unnecessary use of consultants and that they should only be used for design and layout of annual reports where the necessary expertise does not exist within the agency. for example supplying or writing the software and constructing the systems. Legal • • A person or firm engaged primarily to advise on legal issues relating to a proposed innovation or amendments to legislation is a consultant. text preparation. e. (Premier’s letter 21/9/90. Development of performance standards. drafting documents etc even though that includes professional advice.2 A person or firm engaged to undertake implementation in accordance with the specifications. etc. advocacy. Preparation of sales and marketing strategies. demonstrating cost effectiveness. Some other examples of consultancy projects are: • • • • • • Provision of advice regarding new technology and ideas. Approval to engage a consultant will be given only when the cost is justified by the anticipated benefits. with higher value cases normally subject to open invitations to bid or to express interest in bidding. detailed advice on the engagement and management of architects. quality. it is important to be clear about how value for money will be determined in any particular set of circumstances prior to assessing bids. the extent of competition sought by agencies will be consistent with the financial value of the procurement or disposal. proper and impartial process. service. engineers and other building industry professionals is contained in the NSW Government’s Capital Project Procurement Manual (CPPM). The following is intended to clarify their usage in this document. Other things being equal. a person or firm engaged to provide routine engineering services to a construction agency on that agency’s core activities. as contained in the Purchasing & Supply Manual are to be followed in respect to capital works projects (construction projects). timeliness. PRINCIPLES The key principles to be satisfied concern value for money. for example. Value for money does not mean “lowest price”. even though the services include professional advice. For example. reliability. Value for money will be pursued through fair and effective competition. It should be noted that the term “consultant” in the CPPM is used in accordance with industry practice and has a far wider meaning than in this document. would not be called a consultant for the purposes of the annual reporting provisions set out in these guidelines.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES CONSTRUCTION PROJECTS 4. VALUE FOR MONEY. As noted in this document. 2. proper and ethical practices by consultants and accountability. evaluation. However. The procedures for the opening of tenders. Value for money is determined by considering all the factors which are relevant to a particular purpose. This means engaging a consultant is a better option than undertaking the work in-house or taking other action. Value for money will be considered when deciding whether or not to engage a consultant. the lowest price bid might offer the best value if it meets other essentials. The CPPM should be used as the primary reference document for the engagement of contractors and consultants for all construction industry projects. such as quality and reliability. etc. 21(1/06) . initial and ongoing costs are all factors which can make a significant impact on benefits and costs.3 For capital works projects. IMPARTIALITY AND FAIRNESS Value for money. impartiality and fairness are familiar terms which are subject to multiple interpretations. The processes of inviting and assessing bids will safeguard against favouritism. but not unfair. For example. 21(1/06) . If the standard agreement is not used written declarations are to be obtained from consultants indicating that they have no conflict of interest and agreeing to advise the organisation immediately if and when a conflict of interest arises. Commercially sensitive information from bidders will be treated confidentially subject to the requirements of the law. For example. the principle of impartiality does not require publicly advertising for bids in every case or inviting bids from firms which are poor performers. Private interests will not be allowed to influence decisions about procurement or disposal. For example: They will: • disclose any conflicts of interest (see consultancy agreement) and will not seek to undermine fairness and impartiality on the part of government agencies. It can be unfortunate. the impartial person will endeavour to objectively establish the criteria for determining best value for money and will endeavour to objectively assess each bid against the criteria.4 Impartiality in the context of this document means endeavouring to be objective and even-handed. that people are adversely affected by decisions. it is unfair (and contrary to Government policy) to call tenders when there is no serious intent to award a contract subject to receipt of a satisfactory offer. PROPER AND IMPARTIAL PROCESSES The skill. The standard agreement includes clauses in respect to consultants declaring conflicts of interest. knowledge and responsibility of the employees involved in engaging a consultant will be appropriate to the nature. value for money will be pursued through performance monitoring and evaluation. Being impartial includes taking account of practicalities. 4. Fairness in the context of this document overlaps with impartiality in the sense of being even-handed. improper practices and opportunities for corruption. clause 7. schedule 1. See section 3 of this manual in respect to provisions that apply in disclosing information of winning bids. For example. Fairness does not mean pleasing everyone. (Refer to the Freedom of Information Act 1989. in some circumstances fairness can also require taking account of the effects of actions on others.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES Following the engagement of consultants. concerning the protection given to commercially valuable information.) Agencies will not cause industry to unnecessarily incur tendering costs. All actions taken and requirements placed on others will comply with statutory requirements. complexity and magnitude of the consultancy engagement. However. PROPER AND ETHICAL PRACTICES BY CONSULTANTS Consultants will seek to achieve best practice standards in their industry and will demonstrate this in the fulfilment of their contract. Consultants will act honestly and ethically. AWARENESS OF DELEGATIONS AND PROCEDURES The health service should ensure that employees involved in the engagement of consultants are aware of relevant delegations and procedures. in particular. detailing evaluation criteria. not engage in practices such as collusion in bidding. is made. inflation of prices to compensate unsuccessful tenderers. hidden commissions or other such secret arrangements. (See Part 12 of this section. expenditure on consultants will be recorded and publicly reported.5 comply with State and Commonwealth legislation including the trade practices and consumer affairs laws. welldocumented reasons. These records should provide sufficient information to enable audit and independent review functions to be carried out. good record keeping of decisions is imperative for auditing and accountability purposes. Refer to Premier’s Memorandum PM98-16: Records Management Standards and Practices. decision-making processes and decisions made. These reasons should be approved at a senior level by those not directly involved in the process. and information is available for the assessment of claims and the resolution of disputes. 4. regular and accurate reports to management and clients are prepared. ACCOUNTABILITY & RECORD KEEPING Public sector executives and other persons involved in procurements and disposals will be aware of their responsibilities and will be able to account for their actions and decisions. Comprehensive records should be maintained throughout the purchasing process checklists. 21(1/06) . weightings.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES • • • submit bids only when they have a firm intention to proceed. Departure from established procedures for purchasing of services should only be for sound. An individual file should be maintained for each procurement where possible. Effective and efficient contract management cannot be done properly without accurate and organised records. as required by the Annual Reports Acts.) • Ensuring Accountability and Record Keeping Actions and decisions need to be accounted for and. Health services are to ensure that only senior officers are delegated the authority to procure consultancy services and that such delegations are differentiated from normal authority to incur expenditure delegations. Records could include details of telephone conversations wherein any type of commitment etc. In particular: • records of procurement and disposal decisions including the reasons for recommending and deciding on the selection and rejection of bids will be kept in a manner which facilitates audit and other normal processes of accountability. Contract records are kept so that: • • • clear public accountability can be demonstrated. management. The cost estimate should detail the agency staff and administrative costs involved in specification preparation. Effective oversight. tender evaluation. the work and output expected from the consultant. Part of this consideration should involve the estimation and documentation of the cost and time implications of the alternatives. Calculation of such costs enables a realistic appreciation of likely project costs for comparison against the expected benefits. the contribution the consultancy will make to the health organisation’s aims and objectives. engagement and assisting and supervising the consultants should be estimated in monetary or time terms (such as person days) and identified separately in the statement of estimated costs. engagement and contract negotiation as well as assisting and supervising the consultants and evaluating their performance and effectiveness.6 3. The costs involved in specification preparation. briefing. the particular problem/s or issue/s which will be the focus of the consultancy. DETERMINING THE NEED DETERMINING THE NEED TO ENGAGE A CONSULTANT Action to select and engage a consultant should be initiated only where there is clarity concerning: • • • • • • the unavailability of appropriate staff or other critical resources in-house. 21(1/06) . cost-effective outcomes for all projects. 4. or the greater cost of doing the work in-house. evaluation of consultancy projects is essential. The degree of detail and formality will vary with the nature of the project but the governing components of a well-planned project will be similar. tender evaluation.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. briefing. a cost and time estimate should be prepared and the availability of funds should be confirmed prior to seeking approval to invite offers from consultants. the expenditure should be justified and when being costed should take into consideration overhead costs. If a decision is then made to proceed to a consultancy. The use of consultants on tasks as a means of assisting agencies achieve their objectives does not abrogate the agency’s responsibility for successful outcomes of projects. Clearly. and the benefits expected. Approval to engage a consultant should only be given if the organisation is satisfied that the work is essential and also cannot be performed internally by that agency. Consultants do not provide risk avoidance for an agency if projects are not successful. MANAGING THE PROJECT PLANNING THE PROJECT AND THE ENGAGEMENT Sound planning at the outset will increase the probability of successful. an estimate of cost. the unavailability or inappropriateness of other possible avenues. A project manager: This person. A project budget: This will usually be a matter for the project owner to determine or negotiate with other parties. a detailed timetable for the consultancy exercise will need to be finalised. preparation of the detailed brief and other documentation. supplemented by day to day liaison with the project manager. TYPICAL COMPONENTS OF A WELL-PLANNED PROJECT A project owner: This is a senior officer ultimately responsible and accountable for the management. When the consultant is appointed. “draft brief”. there will normally be a statement of objectives and terms of reference for the larger project and a subsidiary statement of objectives and terms of reference for the component to be undertaken by the consultant. the planning for the consultant will need to be incorporated into the total project plan with the key linkages with the larger project highlighted. It is essential that project responsibility be clearly assigned. The committee will usually be the main judge of the adequacy of the output. record keeping. arranging for invitations for bids and their receipt and assessment.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. and so on. should be reflected in the documentation issued to consultants. submissions and briefings to the project owner and the steering committee. outcome and costs of the project. who may be the project owner and/or may be assisted by project officers. A steering committee of key stakeholders or their representatives: The committee steers the broad direction of the project and would normally be chaired by the project owner. 21(1/06) . A project plan: At the outset this may be a draft timetable of major events and deliverables. Those arrangements and some of the other components listed above. such as the expected date of the engagement of a consultant and the expected (or required) date of completion of the major outputs of the consultancy. A statement of the intended outcomes and the terms of reference for the project: This will be approved by the project owner and/or the steering committee. arranging for the engagement of the consultant. day to day working relationships and liaison with the consultant.7 A list of the typical components which should be considered at the outset when initiating processes to engage a consultant is set out hereunder. Where the engagement of a consultant is part of a much larger project. with the linkages with the larger project shown. and statutory and other reporting requirements. The steering is often in response to material presented to the committee by project personnel including the consultant when appointed. is responsible for detailed project planning and operations including: • • • • • • • • preliminary planning. Reporting arrangements: Project planning must include reporting arrangements which will usually include periodic reports to the steering committee. “invite bids”. such as objectives and terms of reference. Where the engagement of a consultant is part of a much larger project. supplemented by a simple list of the initial activities such as “appoint steering committee”. If bids exceed a cost level where a greater degree of competition is called for. The monetary figures are inclusive of GST. PROCUREMENT LEVELS AND SEEKING BIDS MINIMUM NUMBER OF BIDS The optimum degree of competition obtains best value for the client without imposing undue costs on industry. Assuming all other things to be equal. the reasons should be documented. Exceptional circumstances where a lesser number may be appropriate are discussed below. Where estimated cost of the consultancy is over $150. The agency’s pre-bid estimate of the total amount which will be paid to the selected consultant determines the minimum level of competition to be sought when inviting bids. This may be a multiple stage process as discussed below. Following the declaration of a conflict of interest. For example.8 Recommendations and decisions at the initiating stage and throughout the processes should be free of any private or other interests which might undermine objectivity. the accountable manager will need to make a judgement as to whether or not to recommence the process. Consultants are to be required to complete a written statement that no conflict of interest exists and if selected for the consultancy that they will advise the organisation of any conflict of interest arising. proposal and other types of offer. Either way. if any. The optimum will vary with circumstances including the costs and complexity of bidding and the value of the services to be provided by the consultant. open invitations for bids may be made whenever that is considered justified. proponent etc. quote. Similarly. Where estimated cost of the consultancy is in the range of $30.000 An open invitation should be advertised in the press. The table below sets out minimum levels of competition to be sought. This is matter for judgement in each case. 21(1/06) .000 Written bids should be sought from at least three consultants who are believed to be capable of performing the work. the degree of competition should increase with the value of the work to be undertaken. Minimum Levels of Competition Where estimated cost of the consultancy is less than $30.000 to $150. That obligation should be extended to all parties advising the agency.000 One written proposal is acceptable if that is appropriate in the circumstances and the cost is reasonable and consistent with the market. In this section “bid” usually includes tender. the appropriate extent of involvement. of the person should be determined with action decided upon being able to withstand public scrutiny as to probity. 5.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES CONFLICTS OF INTEREST 4. the term “bidder” usually includes tenderer. MINIMUM LEVELS OF COMPETITION In many cases it will be appropriate to increase the number of bids above the minimums shown in the table. Under the code of conduct there is an obligation on employees to declare any conflict of interest. Open Invitations in the Press The requirement for open competition may be satisfied by: • • a single stage process whereby the press advertisement invites fully developed bids. In these cases. In these cases also. the course of action and the engagement must be approved by the Chief Executive or authorised person in line with delegations for this particular purpose. assertions that there is only one person or firm capable or available to undertake the project are often disproved when the market is tested by invitations for bids. the course of action and the engagement must be approved by the Chief Executive or authorised person in line with delegations for this particular purpose. open competition may be inappropriate or impractical. should be accessible by internal and external auditors. APPROACHES TO SEEKING BIDS The following information is offered to assist project managers choose the best method of seeking bids. In such cases the arrangement should be negotiated commercially with the aim of achieving the best value for money in the circumstances.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES Exceptions 4.000 relates to a project which is genuinely confidential and cannot be publicised. Additional information on these approaches to seeking bids is contained hereunder. In the circumstances the best option may be to invite proposals from three or more firms known by or recommended to the agency as being able to undertake the task effectively. It relies for best value outcomes on the ability of the people concerned to impartially select a group of firms likely to make competitive offers. 21(1/06) . or is genuinely urgent and cannot be deferred. Cases which are apparently “exceptional” should be treated very cautiously.9 The advice of the Department of Health’s Asset & Contract Services Branch is to be sought in relation to all contracts which fall outside of DoH policies. Where an engagement estimated to cost over $150. or a multiple stage process whereby the press advertisement invites pre-registration or expressions of interest which will lead to selection of three or more responding firms to be invited to submit detailed bids. and in all cases. one of which will be selected. For example. Seeking Bids from Selected Firms Without Public Advertisement This approach limits the opportunity to a small number of firms but also limits the costs to industry and to the agency of submitting and evaluating bids and can be relatively quick. The information is not comprehensive and advice from experienced sources will often be necessary. All documentation in these. There can also be rare cases where there is definitely only one firm or person capable of or available for the task and the options of changing the specification or deferring the task are not viable. Inviting Bids by Public Advertisement (Open Bidding) 4. There is little point pre-qualifying many firms if only a few jobs will occur each year. To avoid that situation. There is no time spent at the outset determining suitable bidders. Invitations to bid for specific contracts are issued to all or some of the firms. 21(1/06) . discussed below. The respondents are then culled against selection criteria stated in the invitation. Also. Followed by Invitations to Short-Listed Firms Agencies may issue an open invitation for prospective bidders to express interest in bidding for a particular contract. Firms which best satisfy the published criteria are registered as pre-qualified firms. The short-listed respondents are then issued with a detailed specification and contractual information and invited to bid for the contract. it can be unfair to expect many firms to incur high costs completing complex tenders when only one of the many can be successful. open tendering can cause high costs to industry and high processing costs to agencies. environmental assessments. Where the selection criteria and/or the specifications are complex and an excessive number of firms are competing. construction. information technology or any definable activity. Where invitations are restricted to a limited number of registered firms. Agencies issue an open invitation for prospective bidders to express interest in bidding for particular categories of work such as architecture.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES It is usually restricted to lower to mid-range value consultancies or where there are time or confidentiality constraints. The list of pre-qualified firms is maintained by periodic advertisement. by periodic review. Only persons and firms who applied for pre-registration or who submitted an expression of interest are considered. the method of choosing firms to be issued with invitations should aim to provide all comparable firms with broadly similar opportunities to bid over a period of time. there should be an express and ongoing obligation on registrants to continue to comply with the relevant criteria and to advise of any changes which might affect their registration. In those cases an invitation to express interest or prequalify. Inviting Applications for Pre-Registration for Contracts for a Specific Category of Work Lists of pre-qualified firms are an appropriate option when an agency is engaging consultants frequently for tasks within a specific field. Inviting Expressions of Interest or Pre-Registration for a Specific Contract.10 The main advantage of open bidding is that competition for the contract is fully open and can produce a wide range of competitive responses from which the agency can choose. is often preferred by industry and can be a more manageable and effective approach for agencies. the published criteria for pre-qualification should be sufficiently demanding or refined to limit the number of firms to manageable numbers. In many cases it can be efficient and highly effective. by review for non-performing or non-responding firms and by being kept open for new registrants and previously rejected applicants. However. The number of firms given pre-qualification status should be relevant to the amount of work available from the agency. It is desirable to declare any such intent so that the owner of the intellectual property rights can elect to grant a licence to use the rights and to negotiate an appropriate fee and/or restrict the form of licence. if proposals are being sought. the proposed conditions of contract.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES This option is particularly suitable when: (a) (b) (c) 4.11 a wide range of firms is likely to be interested and/or there is little reliable information about capable firms in the market. and the task to be performed is unusual for the agency. Followed by Invitations to Short-Listed Firms Some invitations to industry seek preliminary proposals and ideas which are used as a basis for shortlisting firms. DEVELOPING THE SPECIFICATION AND CONDITIONS OF ENGAGEMENT The key consideration in developing the documentation for issue to bidders is achievement of the project’s objectives including best value. Inviting Preliminary Proposals or Expressions of Interest Which Contain Proposals and Ideas. and information about the selection process. This is particularly relevant where an agency may be tempted to use an innovative idea of a firm in a specification for issue to other firms. the value of the work and/or the level of complexity is relatively high. In such cases agencies must respect the confidentiality of responses and the intellectual property of firms. along with other criteria such as expertise and experience. the titles used are less important than clear statements of intentions. the conditions of bidding including information about the process of selection and any instructions on the format of bids. Invitations for bids should include information about the task. Requests for proposals are often called invitations for expressions of interest. impartial manner which will stand up to scrutiny. Legal advice should be sought before pursuing that option. • • the objectives pursued and the outputs sought. Hence. 6. the terms of reference and other information needed by bidders to understand the agency’s requirements. (where the intention is to develop a short list of bidders for the second stage) will normally be broader in nature and along the following lines: 21(1/06) . This must be accomplished in a proper. it is best for that to be reflected in the title. i.e: • • the selection criteria.e. i. The information provided in invitations for the first stage of a two stage selection process. However. It is preferable for agencies to title processes in terms which literally reflect the intention of the agency. selection criteria for short-listing. Recommended Inclusions in Specifications of Requirements Note that it is not necessary to use the particular headings shown below and two or more of the items can be combined under one heading. the extent of consultancy effort likely to be involved. The objectives and the context: Understanding these is critical to the consultant’s appreciation of the agency’s needs. experience and capacity they possess. Details re Selection Criteria are listed under C hereunder. the fees to be charged. the time the assignment should take and the extent of any supporting facilities or services which may be required. The information about the task covering why the job needs to be done. The specification. 4. The selection criteria should be established in advance and set out in the invitation to bid documents. etc) and an indicative timetable for the commencement of the second stage. even for relatively small projects. A clear and comprehensive specification of the required assignment is a prime importance if misunderstanding and other difficulties are to be avoided. The recommended inclusions are listed under A “Specification” hereunder. The size and scope of the specification will vary according to the project and its complexity. For extensive projects each item should be covered in considerable detail to ensure that what is required is perfectly clear. in the last resort. However. For many consultancies. who will own the outputs of the consultancy? When will payments be made? Some recommended inclusions are listed under B “Conditions of Engagement” hereunder.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES • • • • the objectives and the nature of the task to be undertaken by the consultants. A. the outcomes sought and the outputs required is often called “the specification of requirements”. Bidders also need to know the contractual conditions applicable to the task. and conditions of responding to the invitation. This ensures that consultants have a satisfactory basis on which to assess the relevance of the skills. for example. is also the document protecting the agency’s legal rights. A comprehensive specification will include the terms of reference and information on timing and oversight and reporting arrangements. The Specification The specification serves as both a planning and control mechanism for the project and a prescription for results (outputs) to be achieved by the consultant. all the information can be in one document called “an invitation for proposals” or “the specification” or “the brief”. The documentation should include: 21(1/06) .12 THE SPECIFICATION OF REQUIREMENTS AND CONDITIONS OF ENGAGEMENT The amount of information provided to bidders will vary according to the project’s complexity from several pages upwards. the following points should be regarded as minimum standards for all specifications. This enables bidders to show how well they meet the criteria and enables the agency to make a decision with the best available information. For example. a statement of the purpose of the first stage (to develop a short-list. The undermentioned points should be used as a checklist. Resource provision may be negotiable depending on the content of the selected bid. The individual tasks to be performed: Where there are such essential processes.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES • • 4. The health organisation should be selective in preparing the material as in many cases. each with a measurable result specified in the documentation. The outputs sought: A very clear statement must be included of the specific things the consultant is expected to produce and/or do in satisfaction of the consultancy contract. The final reporting requirements: Many consultancies culminate in the production of a final report. The section of the documentation headed “terms of reference” will often include other components listed here such as the outputs sought. a statement of the background and the context in which the consultancy will occur. This includes legislation. equipment and staff support as appropriate. Anything specific the agency has in mind about review of drafts and the coverage. annual reports. The terms of reference: The terms of reference set out the substance and scope of the consultant’s task and define the boundaries to be worked within. it is not good practice to prescribe the processes the consultant should follow other than processes which are considered essential. It may also be appropriate to retain some material. copies of earlier internal management reports relevant to the subject matter area. for examination only by the selected consultant. The cost of the report is normally included in the consultancy fee. Any overriding or limiting considerations of general policy should be mentioned and problems to be solved should be identified and described. details of information flows and the like.13 a statement of what the agency wants to achieve as a result of the project with a focus on the desired outcomes as distinct from the outputs sought from the consultant. The resources to be allocated by the agency to the project: Include such details as accommodation. Relevant legislation and policy: Consultants are to comply with relevant Government policies. format and number of copies of the drafts and final report should be stated. samples of forms. In order to benefit from the consultant’s expertise and innovation. it may be necessary only to indicate that the material is available for consideration. The outputs should be measurable so that there can be no doubt as to the client’s expectations. Additional information: Any necessary background information needed to assist the consultants in preparing their proposal should be provided. such as consultation with various parties and analysis of certain things. equal employment opportunity. Areas which for instance may be relevant include procurement policy and codes of practice. This might cover organisation charts and functional statements. work measurement statistics. and workforce requirement should be highlighted in the project brief provided to the consultant. not essential to the proposal stage. 21(1/06) . policy or any other form of requirement which is relevant to the matter at hand which by its nature should apply to advisers to the agency as well as to the agency personnel. the individual tasks to be performed and relevant legislation and policy to be observed. ethical conduct. they should be stated at the outset. If the consultancy is complex it may be appropriate to divide the project into sub-tasks or stages. procedure statements. OH&S. environmental management. including the relevance of the agency’s EEO management plan. Conflict of interest: Consultants should be required to disclose in writing any existing conflict of interest and any conflict of interest which arises at any time during the consultancy.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. The information in the specification should include: • • • strategies in place to obtain diversity in the pool of applicants. Equal Employment Opportunity Policy: Consultants should be aware of the public sector’s policy on equal employment opportunity and anti-discrimination legislation. EEO requirements. should be highlighted in the specification requirements. They may also be asked to advise the agency of the steps they consider appropriate to protect the agency’s interests. disclosure and/or subsequent use of information: Where appropriate these factors should be specified. Legal advice should be sought if there is any doubt as to appropriate inclusions. If recruitment of public sector personnel is the task of the consultant. selection criteria includes equal employment opportunity principles. 21(1/06) . and an officer for day to day communication (as discussed in the previous section). or for copyright of other items being written or produced.14 The timetable: An indication of timing should be given including where appropriate a timetable for the production of periodic reports and the achievement of specific results. See Appendix 4 for details re “Legislation and Policies to be Observed by Consultants”. or part of the task. fortnightly in the form of brief written reports on progress and monthly in the form of written and verbal presentations to the steering committee). periodic reporting (say. Legal advice should be sought before pursuing that option. It is desirable to declare any such intent so that the owner of the intellectual property rights can elect to grant a licence to use the rights and to negotiate an appropriate fee and/or restrict the form of licence. Conditions of Engagements This list is not comprehensive and there will be conditions dictated by circumstances. This may be necessary to protect the health organisation’s interest in software or systems being developed. The oversight arrangements: These are best considered in the planning stage prior to the invitation for bids and disclosed so that bidders have an understanding of the working arrangements envisaged. Ownership of intellectual property. The oversight will often include: • • a steering committee of key stakeholders and/or a senior executive. Some invitations seek preliminary proposals and ideas which are used as a basis for short-listing firms for a second round of bidding. This is particularly relevant where an agency may be tempted to use an innovative idea of a firm in a specification for issue to other firms. B. In such cases agencies must respect the confidentiality of responses and the intellectual property of firms. A statement indicating when the consultancy is expected to commence and finish will often suffice. The timetable should be flexible enough to allow negotiation. opportunity for applicants to obtain information about the position. because of the nature of the consultancy market. e. Indemnity and insurance: Where appropriate. Where the consultant carrying out the assignment would be a strong contender for any implementation phase associated with it. The successful consultant should not have any commercial association with other organisations that would have a pecuniary interest in supplying any of the material or service requirements of the project under consideration. a check with the agency’s risk management adviser may be warranted to ensure that the contractual arrangements proposed do not unacceptably cap or exclude the liability of the consultant.g. made to them if requested to do so. it is often preferable for any economic appraisal component of the assignment to be carried out by another. it may also be appropriate to require that the firm be contracted in the name under which it is insured for professional indemnity. This may be. Where the consultant is engaged to provide advice of a type which is normally underwritten by professional indemnity insurance (such as legal or engineering advice). Future Consultancies and Associations Any role to be played by the consultant in implementing approved changes should be foreshadowed. culturally appropriate content and the use of material which reflect public sector equal opportunity policy. The consultant is to be instructed that he/she will be required to substantiate on-cost payments. the short list of suitable candidates includes people with diverse backgrounds. Termination of and variations to the contract: Provision should be made for the contract with the consultant to be terminated or the work content reduced or varied upon the consultant being given written notice. for example. It may even be appropriate to make the successful consultant ineligible to carry out subsequent action. periods of travel. 4. Personnel nominated by a bidder to undertake the consultancy: Because of the particular expertise and experience of the individual involved. Public officials: Consultants are deemed to be public officials under the provisions of the ICAC Act and the Protected Disclosures Act as they relate to corrupt conduct and making disclosures. an important safeguard is to stipulate that personnel nominated in the bid and/or allocated to the task by the consultancy firm cannot be changed without the concurrence of the client. the health organisation should be indemnified against workers compensation claims and public liability claims. expenses. upon the successful completion of the assignment or upon the completion of measurable interim outputs or stages. 21(1/06) .gender-neutral language. costs for meetings etc.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES • • selection panels include both male and female members. proof of such insurance may be appropriate. independent consultant. As an added precaution. This condition is to be included in any formal contract entered into with consultants. It should be made very clear that selection to carry out the assignment in no way implies a commitment to engage the prospective consultant to carry out subsequent. Because a firm can have a number of business names. Arrangements for payment of fees: It is important to state the basis upon which fees will be paid. related phases or to implement the report.15 If development of training material for public sector personnel is the task of the consultant requirements need to be included in the specification such as . with a final payment at the conclusion. Such substantiation will take the form of production of proof of travel means. This clearly signals the serious intent of the agency to obtain the skills sought. which are reflected in the selection criteria. such as expertise and experience. Best value bid does not simply mean the “lowest cost”. Choice of selection criteria: The choice of the criteria must be governed by relevance to the project and the practicality of assessment.16 C. It is usually worthwhile to specify the information sought (such as the personnel details noted above) and the format in which it should be presented. Detailed information requirements: The extent of information sought should be proportionate to the scale and cost of the project. The appropriateness and quality of the method the bidder proposes to follow including the approach to the task and the proposed schedule and timetable of activities. The expertise and experience of the people proposed to undertake the work: Of particular importance is information about the personnel who will undertake the consultancy. The total cost including any significant. The nature of the information required will be virtually determined by the selection criteria and the conditions of engagement.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. A typical set of criteria is: • • • • • The degree of understanding of the agency’s requirements demonstrated by the bidder. It is the product of the factors. are called for. The expertise and experience of the people proposed to undertake the work. Selection Criteria and Conditions of Bidding THE SELECTION CRITERIA Best value: The best value bid will be the one which best addresses the selection criteria determined by the agency. It is good practice to ask firms to set out in their bids the extent that each nominated person will be involved in the project and what their role will be. 21(1/06) . The firms’ experience in the related area. THE CONDITIONS OF BIDDING AND OTHER INFORMATION FOR BIDDERS Time and place for lodgement: As a minimum. additional use of the agency’s personnel and facilities etc. which each bidder’s proposal would require. Otherwise. it can be appropriate to state that firms may have to obtain skilled team members by contract from other firms for discrete sections of the task. It can also be appropriate to ask that bids be limited to a maximum number of pages to save costs for all parties. Specifying a format facilitates comparisons between bids. a bidder’s employees who eventually do most of the project work might be much less experienced than the persons highlighted in the bid proposal. which are not usually found together in one firm. Where multiple skills. the conditions of bidding deal with the information required from bidders and the place and deadline for lodgement of bids. It is also good practice at the outset to inform bidders of the nature of any non-confidential information about the winning bid which will be released or made available to inquirers. if the purpose is to determine a short-list for a second stage bidding process. Adequate steps are to be taken to maintain confidentiality of tenders/quotations. including a reasonable time period for their acceptance. 21(1/06) . less than three are received action may proceed to engage a consultant provided that full details of the action taken is documented. For example. Financial levels and associated policy relating to suitable means of inviting bids and tenders are as contained under “Procurement Levels and Seeking Bids” in Part 5 of this section. In all cases a nominated officer within the agency should give prior formal approval to the actual inviting of bids or tenders and the format. Invitations should allow sufficient time for bidders to fully develop bids. A sample invitation to a consultant to make a submission for undertaking an assignment is at Appendix 1. specific industry publications.17 Advice of your intentions: Bidders should be informed of the broad selection processes.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. clause 7. The agency should ensure that invitations are appropriately circulated in a manner most suitable to the specific nature of the consultancy. The problems caused as a result of unduly short tender periods include weak competition. the impacts of which may not be manifested until after the consultancy commences. See provisions of Premier’s Memorandum No 2000-11 contained in Section 3 of this manual. poorly prepared proposals and inadequate understanding of contract requirements. Invitations should clearly indicate that an agency has an equal employment opportunity policy. local newspapers). this should be stated.) INVITING BIDS The procedure for inviting bids for consultancy services is essentially dependent on the estimated cost and time of the proposed consultancy and the range of suitably qualified consultants to be given the opportunity to bid for the project.) 7. (See the Freedom of Information Act 1989. tender opening etc. When in doubt it is reasonable to ask several firms for the period they would require to prepare a bid for the type of business on offer. receipt of quotes/ tenders. schedule 1. (e. This officer should also be satisfied that the projected work has not been “split” to enable the total project to be kept below specific expenditure approval levels.g. A record of this approval with all relevant documents should be maintained. INVITING AND RECEIVING BIDS AND TENDERS (See Chapter 3 of this Manual for details re periods for advertisements. It is advisable for open-ended or roll-over agreements to be avoided. despite reasonable efforts to obtain three quotes/tenders. ethnic press. concerning the protection given to commercially valuable information. In those cases where. The senior officer giving approval to invite bids must be fully satisfied that the invitation covers a discrete project and does not bind the agency to further commitment to the selected consultant for additional work outside that being tendered. subject to public release of information about the winning bid at the completion of the selection process. SECURITY OF BIDS RECEIVED (see also Chapter 3 for detailed procedures) Bids received should be recorded and handled so as to preserve their confidentiality. has been and continues to be a sound approach to ensuring security during the lodgement process. BRIEFING CONFERENCE For some assignments. the time allowed for bids to be lodged should be extended. all bidders must be advised. with the preferred bidder. it may be useful to supplement the written briefing material by holding a briefing conference for the pre-selected consultants. It is best practice for the opening and recording of bids received to be undertaken all at once. To this end. Tender opening committees shall consist of no fewer than three persons. it may be appropriate to deal with minor changes to the specification or other documents in pre-contract negotiations. Successful bidders should be made aware that information concerning their bid and resulting contract will be disclosed in accordance with Memorandum 2000-11. where an inquiry reveals a significant error. particularly those which are large or complex. as far as practicable. If warranted by the nature of the changes. very shortly after the deadline. The advice to bidders of changes to the conditions or specification becomes part of the tender documents issued by the agency. ambiguity or discrepancy. Similarly. Clear and adequate briefing is essential to ensure fair competition between consultancy organisations. the same information.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. (See Chapter 3. the key for each securely held by different employees. Other means including electronic processes may also be appropriate so long as the security and the integrity of the tender processes can be assured. The same opportunities for obtaining information and.) CHANGES IN REQUIREMENTS AFTER INVITATIONS ARE ISSUED All bidders must be advised of any changes to the conditions or specification or other information changes which occur after the issue of invitations and before the closing date. Traditionally a tender box with two different locks. should be provided to all bidders.18 The same conditions must apply to all bidders. Confidential information from bidders must not be given to competitors or otherwise disclosed. near the conclusion of the selection process. 21(1/06) . Such a conference provides an elaboration of the contents of the briefing documents and given the consultants the opportunity to ask questions. agencies should ensure that consultants have an equal opportunity for access to relevant information. It may serve to reduce the time spent by officers in assisting individual consultants during the preliminary survey stage. by a number of employees who are independent of the assessment process. Notwithstanding the above. The names and addresses of persons/firms who have been provided with the invitation documents should be recorded to enable contact if changes occur to the conditions or specification. and they are within budget limits for the project. This should be done by people with relevant skills and knowledge appropriate to the nature. Bids should be assessed in a consistent fashion against the pre-determined criteria. Many consulting firms have high staff turnovers and. therefore. In all cases an officer with appropriate professional understanding of the work to be performed should be involved in the selection of the consultant.19 It is the responsibility of bidders to ensure that bids are submitted on time and a firm rule to not consider late bids may be adopted by individual agencies. It is important to allow each of the interviewed bidders the same opportunities to prepare and to put forward their approach. quotes or tenders to ensure value for money comparisons. If the only bid received is late. it may be appropriate to provide for the participation of an officer from outside the agency. Assessments for higher value projects. To help ensure that fairness and impartiality are seen to have been strong features of the assessment. an officer from another agency should be sought. Should this not be the case and it is decided to consider additional expenditure. a report should be provided detailing why the estimate was exceeded and confirming whether or not the scope of the work was correctly identified by the agency and understood by the bidders. It will often be appropriate to interview the two or three leading contenders. they conform with the specification and time criteria provided. Late bids may only be considered if the circumstances were beyond the control of the bidder and it can be demonstrated that there is no advantage to the bidder and the integrity of the bidding system will not be compromised. 8.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES LATE BIDS 4.000 should involve three or more assessors to facilitate a balanced assessment. it may be considered if it conforms with the specification. SELECTING THE CONSULTANT ASSESSMENT OF BIDS The grounds on which a particular consultant is finally selected for an assignment will vary from case to case but must conform with the New South Wales State Government’s Purchasing and Preference Policies. value and importance of the projects and who are free of any conflict of interest which might undermine the objectivity of the assessment. in selecting the consultant it is important to be satisfied that the actual personnel to be provided by the firm have the appropriate expertise and experience. Where an agency does not have a staff member with appropriate professional expertise. 21(1/06) . quotes or tenders received should be checked to ensure whether: • • • there is a sufficient range of legitimate bids. particularly those over $50. The engagement process for consultants is more akin to a staff recruitment action where the task is to obtain the most appropriate skills and expertise for the position. That will enable the agency to gain a better understanding of the bids and the bidders and to explore the depth of understanding each bidder has of the task and quality of the proposed methods of approach. Bids. consideration should be given to recommencing the process. The extent of documentation will vary with the complexity and value of the project but should cover: • • • • a summary of quotes/tenders received in ascending order of price. conforms with market prices. accompanying it. 21(1/06) . If the alterations are substantial. In these circumstances however. The justification for the recommendations based on the selection criteria including statements confirming that: 1. Changing a requirement during the assessment process can very easily lead to suggestions of impropriety by unsuccessful bidders. 3. Whether the specification has been fully satisfied or any variations are acceptable. and rise and fall and/or any other price variations are acceptable. 2.) The quote/tender is acceptable in terms of conditions and limitations. advice as to how quotes/tenders were invited and when and how they were received and recorded. full details of the recommended quote/tender and the justification for the recommendation. if any. In some cases the most fair and reasonable decision may be to ignore the change for the purpose of the assessment and to negotiate the alteration with the successful bidder after the bidder has been selected and prior to finalising the contract. Important considerations include the impact the change might have on: • • • the value and nature of the contract and the extent of private sector interest. and the fairness and cost of going back to bidders on the matter. The price is reasonable.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES LATE CHANGES TO THE REQUIREMENTS 4. (Such variations should be detailed. and giving any reasons for variations. the relativity of the current bids. JUSTIFICATION FOR SELECTION The reasons for the selection and for passing over bids should be documented. The organisation making the bid has the resources and ability to successfully undertake the work.20 If the requirements alter in the course of the assessment process. 4. an evaluation showing whether the quotes/tenders conform with the specification. consideration should be given to notifying all bidders of the change and giving them an opportunity to adjust their bids accordingly. the alteration should not be so significant as to give unsuccessful bidders a basis to complain that what is contracted is substantially different from that identified in the invitation to bid. 6. together with a contract document if considered necessary should be forwarded to the selected consultant. A certification as to compliance with all relevant policy and procedures should be incorporated in the recommendation to the approving officer.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 5. No consultancy should be justified merely as an extension of previous work undertaken. gender-neutral and culturally appropriate with provision made for persons with a disability to enable them to sit the tests. In relation to a staff recruitment consultancy. All documentation. preferences etc. the consultant has satisfied the agency that: a) if tests are to be used they are relevant to the particular job. The principal concern is to obtain best value for money whilst maintaining full probity and equality of competitive opportunity for bidders. (Department of Business and Consumer Affairs). Approvals of consultancies should be in accordance with current government policies. legislation and regulations. including the bids received. there will be appropriate representation of target groups on selection committees. The employee who analyses the bids and is responsible for preparing the above documentation and making a selection should not be the final person who approves the selection. ENGAGING THE SELECTED CONSULTANT ENGAGEMENT METHODS Following the approval to engage a consultant a formal letter of engagement. as applicable. an effective strategy for attracting applicants from EEO target groups is in place. The approving person for the acceptance of the recommended quote/tender should be an appropriate senior authorised officer.21 The performance of the organisation to be engaged has in previous similar projects for the agency or other agencies been evaluated as satisfactory. 9. It will be essential to obtain legal advice for complex and high cost consultancies where it may be necessary for the contract to be in the form of a deed. 4. b) c) The recommendation need not solely be governed by the selection of the lowest offer received. must be kept for record and audit purposes. 21(1/06) . which include the following: • • • • • Purchasing & Supply Manual Anti-Discrimination Act 1977 Annual Reports (Departments) Act 1985 and Regulations Annual Reports (Statutory Bodies) Act 1984 and Regulations Government Purchasing Policy covering offsets. made to them if requested to do so. amongst other things: • • • • • the requirements set out in the original specification and conditions of engagement. any subsequent correspondence and/or negotiations between the parties. 5. insurance and any other requirements which may need to be fulfilled. the agreed fee and method of payment (with any progress payments linked to satisfactory performance of specific tasks). 4. provision for termination. the time period for the consultancy. in relevant cases.g. The letter of engagement or contract should refer inter alia. 2. A formal contract document should be used on those occasions when the consultancy is of a large or complex nature or a particular product or output is required to a specified standard. financially and operationally of protecting the interests of the agency. expenses. At this stage. the agency’s responsible officer for the consultancy. 9. if there is any doubt as to appropriate action legal advice should be sought promptly. to: 1. periods of travel. e. and any matter warranting special mention (such as ownership of intellectual property if that needs to be made clear). The consultant is to be instructed that he/she will be required to substantiate on cost payments. The letter of engagement or contract should be capable legally. the proposals set out in the winning bid. the personnel confirmed by the consultants to work on the project.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. costs for meetings etc. the signed contract. 6. As a general rule a letter of engagement may be used for smaller consultancies where the consultant does not need to be on site or use agency facilities and where a written report as outlined in the specification is required as the product of the consultancy. 3. the original specification.22 The consultant should be required to provide a formal reply accepting the terms and conditions of engagement and. the basis (if any) for fee and work variations. the content or result of any subsequent correspondence and/or negotiations. the indemnity. The letter of engagement or form of contract should refer to. quote or bid submitted. the tender. 8. 7. This condition is to be included in any formal contract entered into with consultants. Such substantiation will take the form of production of proof of travel means. 21(1/06) . penalty clauses (where applicable).CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 10.12(3). 13. The Public Employment Office of Premier’s Department can provide advice to agencies on clarifying the distinction between employee and contractor. Hospitals.12. Legislation and Policies to be observed by consultants (see Appendix 4).CONSULTANTS/CONTRACTORS The attention of all Areas. an employment relationship cannot be established with the person actually providing the services.23 the guarantee provided by the consultant in respect of adequate and proper completion of the proposed work. despite a contract which suggests the person is not an employee. a person who has entered a contract for services will be considered an employee for the purposes of the Act if the contract “is wholly or principally for the labour of the person”. a contract for labour must be personal. 21(1/06) (d) . The Superannuation Guarantee (Administration) 1992 Act contains an expanded definition of “employee” under s.) Ensuring External Consultants are Not Deemed to be Employees Agencies must be careful to avoid inadvertently establishing circumstances whereby an individual consultant or contractor can be considered to be an employee and be eligible for employee benefits such as workers’ compensation. a contract will be principally for labour when more than half (50%) of the contract is for labour. Under s. It is therefore irrelevant whether they are designated as a contractor or consultant. The meaning of the term has also been subject to interpretation through an ATO ruling on the Superannuation Guarantee Act (No SGR 93/1). for example. SGR 93/1 contains the following guidelines to assist in the interpretation of this provision (a) (b) (c) a contract for labour is to be distinguished from a contract to supply goods or materials. (See Appendix 2 for draft consultancy agreement with Crown Solicitor’s Office clarifications. 12. and other Units is drawn to the potential liability for superannuation contributions when employing consultants and contractors. what is relevant is the actual nature of the relationships between the principals of the contract. If it is a contract with a company or trust to provide the service. 11. This could arise. labour includes mental and artistic effort as well as physical toil. The letter of engagement or contract should be legally. financially and operationally capable of protecting the interests of the agency. and agreed documentation to be provided prior to final payment for the consultancy. 4. SUPERANNUATION LIABILITY . by the person being subject to the routine direction and control of the agency. aged 65 or over. The timing of the release of any information needs to be managed to avoid premature disclosure which might impact on the finalisation of the contract with the winning bidder. any comparisons should be made against the selection criteria rather than with details of the successful bid. the agreed fee for the assignment.30 June 2002 1 June 2002 onwards x x x x x 5% 6% 7% 8% 9% The superannuation contributions must be paid into a complying fund. A check that a fund complies can be made by contacting the Insurance and Superannuation Commission (current telephone 13 1060). After acceptance of the contract by the winning bidder. and that the consultant/contractor also be requested to provide the relevant forms for completion. When formalising arrangements with consultants/contractors deemed to be employees.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES (e) 4. ADVICE TO UNSUCCESSFUL BIDDERS (See Chapter 3 re Premier’s Memo No 2007-01 re disclosure of information) Unsuccessful bidders should be advised promptly of the decision. 22(3/07) . paid to do work of a domestic or private nature for not more than 30 hours per week. Explicit advice about future bids should be avoided. or to be deducted from. such fund being one which meets the standards set by the Commonwealth Government. then it is not a contract for labour. In providing feedback on weaknesses. unless there are compelling reasons to do otherwise. It is suggested that when employing consultants/contractors deemed to be employees the consultant/contractor be requested to provide a letter from the fund which provides an assurance that they are a complying fund. The following SGC contribution rates apply: 1 July 1993 .30 June 1995 1 July 1995 . They may also be informed as to the weaknesses in their own bid. Contributions do not have to be paid for consultants/contractors deemed to be employees who are: • • • • paid less than $450 in any calendar month.24 if the contract allows the person to have the work of the contract performed by another. it should be clearly established whether the SGC liability is to be additional to.30 June 2000 1 July 2000 . any non-confidential details from the winning bid including price. under 18 years of age working for not more than 30 hours per week. unsuccessful bidders may be informed of the winning firm or person and.30 June 1998 1 July 1998 . work or target dates. the terms and conditions of engagement being followed. Develop a procedure for dealing with unsatisfactory performance. 5. ensuring legislative and policy requirements are adhered to. it is only necessary on the initial claims and then on a sample basis thereafter. 8. supervising the work. Define role of management committee/officer. Institute adequate record keeping procedures. where necessary with senior management. e. 2. Develop a mechanism for dealing with significant changes in cost. (see also Part 4 on “Managing the Project”). the client gets the product that has been specified (satisfying the terms of reference). Appoint a management committee to oversight progress. Whilst it would be preferable to undertake this substantiation on all claims. 4. MANAGING THE CONSULTANT’S WORK Effective oversight of consultancies is essential to ensure that: • • • • the client gets value for money and that cost overruns are avoided. unnecessary delays are avoided and the work is completed on time to the quality required. liaising with the consultant. The officer nominated as the project officer in the letter of engagement should normally be responsible for: • • • • • • • the performance of the consultant in meeting the requirements of the specification. 6. Evaluate the work of the consultant. explain this role to the consultant(s). disputes can be settled easily without extended litigation. Appoint a project officer(s) responsible for the performance and management of the consultant. Substantiation methods can incorporate: requesting production of air ticket stubs. and keep records of this evaluation for future reference. 3. and ensuring the payment of the consultants on cost fees (e.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. proof of periods of travel etc. obtaining receipts for costs associated with out-of-pocket expenses. 1. Typical steps in the management of consultants are outlined below.g. Define standards and set meeting and target dates for the consultant. 7. expenses) only being approved where substantiation has been provided by the consultant. 21(1/06) .g.25 10. the payment of the consultant’s fees being approved only when the services required have been satisfactorily provided. Particular care should be taken to ensure that any advertisements placed by the consultant on behalf of the agency conform with government policy and legislative requirements. It is essential that the consultant is managed in accordance with the terms of the contracts. Proposals to increase the value of the consultancy by 25 per cent or more demand a particularly thorough review. The evaluation of a project which involved the use of consultants should include both the performance of the agency and the performance of the consultant. probity and accountability.26 Sound planning of the oversight arrangements including periodic reporting on progress. Proposals for such variations should be considered and determined by the Chief Executive or a designated independent senior officer. and their appropriate implementation will contribute to these results. All proposals for variations require very careful consideration. it is not unusual for unforeseen events to arise calling for the consultant and the agency to combine in determining the best way of dealing with the situation. variations being used to get around requirements for competitive bidding. applying the principles of value for money. Particular care is needed to avoid: • • • variations being used by a successful low bidder to increase the value of the job. The consultant should be regarded in all major respects as part of the agency’s team. Particular care should be paid to any sub-contracting arrangements which must fall within the scope of the contract and be closely monitored in accordance with the contract. 11. if the consultant has special expertise it can be stimulating and beneficial for agency staff to work with the person. EVALUATION OF THE CONSULTANT’S PERFORMANCE Evaluation of consultancy projects is essential in determining whether the project objectives have been achieved and whether the use of consultancy assistance was justified and ensure that the lessons of experience can be applied in the future. 21(1/06) . Firstly.7 of the “Contract” at Appendix 2 which deals with sub-contractors. In all circumstances such approvals are to be able to withstand public scrutiny.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. However. “exceptional” cases should be treated very cautiously. Variations to the scope of the work requiring increased payments to the consultant can at times be appropriate as a result of unforeseen circumstances. variations increasing the scope of the consultancy out of proportion to the original scope. Secondly. As noted above. Poor or misdirected performance on the part of the consultant should be addressed promptly and before serious damage occurs. There are several advantages to this approach. It is not good practice for approvals for significant changes in work or cost to be given by employees directly involved in the supervision of the consultant. Thirdly. the termination provisions should not be applied until that avenue is considered the most practical and justifiable option. communication is open and free and much more effective. VARIATIONS AFTER THE CONSULTANCY HAS COMMENCED Variations to the consultancy during the progress of the project must be reported upon without delay and prior approval obtained for any proposed significant changes in work or cost. Such variations are best approved by the Chief Executive or a designated independent senior officer. unless there are compelling reasons to move quickly towards termination. See Clause 3. travel. Project operations • • consultant’s performance agency’s performance Factors to take into account when assessing the consultant’s performance are: • • • • • • quality of work. As well. timing and related factors. This will ensure that the agency is not blind to any lessons from its own actions in the matter. specification of need and other documentation given to bidders. methodology. It is particularly important to review the performance of the agency in an impartial manner when there is dissatisfaction about the consultant’s performance.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. the lessons from such projects are usually the most suitable to publicise freely in the organisation. Appendix 3 shows an example of an evaluation pro-forma which could be used. working relationships. 21(1/06) . advertising. planning and management arrangements. Unsuccessful projects and those which encountered serious difficulties are likely to reveal important lessons in the form of avoidable oversights and problems. clerical support. materials etc) and indirect costs borne by the organisation (facilities. the evaluations are best undertaken and disseminated in a spirit of learning rather than attributing blame. Project bidding • the extent of competition.27 An evaluation document should contain a statement of both direct costs incurred by the consultant (fees. other factors relevant to the project. While requirements for accountability must be observed. Very successful projects can offer models of best practice. If the project was divided into separate tasks. The areas of interest in reviewing projects involving consultants include: Project formulation • • • objectives. The evaluation should be completed prior to and forwarded with the recommendation for final payment to the consultant. timeliness. The most important evaluations will be those undertaken for projects which were very successful and projects which were unsuccessful or which encountered serious difficulties. cost. these costs should be allocated to the appropriate tasks carried out. materials etc) together with the estimated cost and the originally agreed cost. 21(1/06) . agencies also should group/categorise consultancies according to the nature of expenditure. Appendix 6 contains a sample disclosure report.000: • • the total number of engagements costing less than $30. REPORTING THE USE OF CONSULTANTS ANNUAL REPORTS Public disclosure of consultancies is to be made in Annual Reports in accordance with the Annual Reports (Departments) Regulation 2000 and the Annual Reports (Statutory Bodies) Regulation 2000. the amount spent in the year being reported should be stated. and the total cost of all such engagements. Categories of consultancy costs include: • • • • • • • • Finance and accounting/tax Information technology Legal Management services Environmental Engineering Organisational review Training Although consultancies under $30. While the strict confidentiality of evaluations is essential.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. Such evaluation should be formally made and retained in a central register within the agency as a permanent record for possible future reference.000: • • • the project title (shown in a way which identifies the nature of the work). and clearly describe the purpose of the consultancy. 12. If expenditure runs over more than one financial year. or to assist other agencies in considering the consultant for similar projects. they should still be categorised as above. a statement to that effect must be included in the Annual Report. Where the cost of the consultancy is equal to or exceeds $30.000.000 are not required to be individually identified. These evaluations can then be utilised when considering a consultant for future work. If no consultants were engaged during the year. organisations are requested to discuss any unfavourable report with the consultants concerned and advise them of the record that is being retained. In order to comply with the Regulations. Where the cost is less than $30. agencies must include in their Annual Reports the following information concerning the engagement of consultants during the financial year. and the actual cost of engaging the consultant. the name of the consultant or consultancy firm engaged.28 The evaluation provides a judgement on competence of the consultant and in particular of the individual personnel who carried out the work. In fulfilling the above requirements. ........ to which all the responding organisations are being invited.. It would assist our consideration of your submission if........... it is proposed to hold a briefing conference at .... Information on other assignments or any other matters which you consider to be relevant to your organisation’s competence to undertake the proposed assignment..................... including qualifications and experience.......g..................................... copies of your submission could be sent to: ...........29 APPENDIX 1 SAMPLE INVITATION TO CONSULTANT TO MAKE A SUBMISSION FOR UNDERTAKING AN ASSIGNMENT You are hereby invited to submit a quotation/tender in respect of a consultancy assignment to be commissioned shortly by this health organisation.......................................)......... in framing the cost statement.... If your organisation wishes to respond to this invitation it would be appreciated if ............. on ............... you would distinguish between consultancy fees and other costs which might be associated with the conduct of the assignment (e..... An indication of your organisation’s acceptance of the general conditions outlined in the attachment to this letter and any other specific conditions or business arrangements you may wish to have applied to the assignment. fares.... Details of the names........ If you wish to confer in greater depth.................................... Initial enquiries in relation to this memorandum or the assignment generally should be directed to: .................................................... A statement of fees proposed based on your organisation’s intended approach...... Enclosed are background information papers of the relevant area................... The person-day effort represented by the consulting fees should also be stated.............. of the consultants it is proposed to use.....CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4......... Terms of reference and working arrangements for the review are attached for your guidance. The assignment is ................. The submission must include: a) b) An outline of the intended approach to the assignment..... intended extent of involvement and other relevant details....... travel costs..................................... c) d) e) In order to elaborate on the terms of reference............... arrangements for this can be readily made.................... and generally assist you to gain a full understanding of the review requirements.... by ......................................... etc......... Chief Executive 21(1/06) ............. 30 APPENDIX 2 Premier’s Department New South Wales Guidelines for the Engagement and Use of Consultants Version 4 July 2004 Attachment Consultancy Agreement Guide Notes Revised March 2005 21(1/06) .CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. or a Government Agency that is not a legal entity or has no separate legal status. are merely emanations of the Crown which is a legal entity. in law.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES Consultancy Agreement 4. This is another issue that may or may not be appropriate depending on the particular consultancy. Guide Note 1 Government Departments are not legal entities but.91-2 (Guidelines for the formation and operation of subsidiary companies by departments and statutory authorities). levels of insurance. The corporate entity should not generally contract so as to bind the Crown. The Crown Solicitors Office has prepared Guide Notes to assist the use of the updated Consultancy Agreement. It is strongly recommended that any agency intending to use this Agreement seek legal counsel in formalising and finalising the final Agreement. See the Premier’s Memorandum No. a corporation established under the State Owned Corporations Act 1989 (NSW) or under other legislation). the corporate name of the entity should be used.au/gns001.31 The Crown Solicitor’s Office has amended and updated a Consultancy Agreement which had previously been used by the Premier’s Department and a number of agencies as a precedent.. Check also that the corporate entity has the statutory power to enter into the Consultancy Agreement.abr. a company search on the Consultant should be undertaken by the Principal before entering into the Consultancy Agreement. the full corporate name of the company should be used. A free company name search is available at http://www.au .asic. Guide Note 2 Where the Consultant is a company. 21(1/06) . Where appropriate.html . This updated document may assist agencies in preparing their own agreements. The Agreement also contains clauses regarding dispute resolution reflective of the Government’s policy in this regard. Matters such as liability caps. Please read through these Guide Notes before using the updated Consultancy Agreement as a base. A free Australian Business Number search is available from the ATO’s website http://www.business.search. the following description of the Principal should be used: “[insert name and title of the Minister/Chief Executive/senior office holder with appropriate delegation] of [insert name of Government Department/Government Agency] acting for and on behalf of the Crown in right of the State of New South Wales” Where the Government entity entering into the Consultancy Agreement is a legal entity (eg. questions of indemnity and intellectual property rights are just a few issues that need consideration in relation to specific clauses. Where the entity entering into the Consultancy Agreement is: • • a Government Department. disclosure of personal information and moral rights. The updated document takes into consideration recent changes in the law dealing with privacy.gov.gov. reflective of the particular services that are to be provided by the Consultant.32 Where the Consultant is/are an individual/individuals. under the Associations Incorporation Act 1984 (NSW)). should be included in Clause 1. Where: (a) (b) the “Request for Tender” and the “Proposal” are not to be annexed to the Consultancy Agreement. be used as the name for the Consultant. Where the Consultant is an unincorporated partnership. a club or society) as it may be difficult to enforce a contract against the members or the committee members of an unincorporated association. The name of the incorporated association should be used. Where appropriate. the partnership name can be used. Guide Note 4 The Consultancy Agreement has been drafted on the basis that the “Request for Tender” issued by the Principal and the “Proposal” submitted by the Consultant will form part of and be attached as Annexure “A” and Annexure “B” respectively. sub-clause (g) should be deleted. and/or the “Request for Tender” and the “Proposal” do not contain an adequate description of the Services to be provided. the association can be sued in its own name. Care should be taken when contracting with unincorporated associations (eg. The Consultancy Agreement has been drafted on the basis that its binds each entity separately and all the consortium entities jointly (see Clause 1. to the agreement. the full name(s) of the individual(s) should be used.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. The name(s) of the owner(s) of the business name should be inserted as follows: “[insert name of first owner] of [insert address of first owner]. Guide Note 3 Where appropriate.1. Guide Note 3A Consideration should be given as to whether sub-clause (g) in the definition “Confidential Information” is necessary.7). 21(1/06) . A business name is not a legal entity and must not. Where the Consultant is a ‘consortium’ of legal entities. other defined terms. [insert name of second owner] of [insert address of second owner] and [insert name of third owner] and [insert address of third owner] trading under the business name “[insert business name]” Where appropriate. by itself. It is also assumed that an adequate description of the “Project” and the “Services” is set out in the Request for Tender and the Proposal. The Rules of Court in each Australian jurisdiction now state that a partnership can be sued in the firm’s name... Where an association is incorporated (eg. a business name search should be undertaken by the Principal to ascertain/confirm the identity of the owners of the business name. Legal advice should be sought in this case. care should be taken to identify the appropriate parties who should enter into the Consultancy Agreement. the basis upon which the Consultant’s expenses will be reimbursed. in Clause 2.33 the definitions of these terms should be amended as appropriate. The frequency of such reports should be specified. Where there are no project objectives for inclusion.. 21(1/06) . Guide Note 9 The basis upon which the fees for the consultancy services should be paid (eg. (See Clause 6. as per the budget set out in the Consultant’s proposal. Guide Note 6 The timeframe within which the consultancy services are required to be provided should be specified in the agreement – there is provision in Schedule 3 of the Consultancy Agreement for the timetable to be included. There is also provision for details of any other reports which are required to be provided as part of the consultancy services to be specified in Schedule 5 of the Consultancy Agreement. Where “time is of the essence” in relation to the provision of the consultancy services. periodically. that definition may be omitted from Clause 1. Guide Note 8 Clause 3. a full description of the Services should be included as an additional schedule to the Consultancy Agreement. should be specified (eg. Guide Note 7 To ensure that the particular expertise or experience of the individuals who have been nominated in the Consultant’s proposal or tender are available to carry out the services. the names and details of such individuals should be specified in the Consultancy Agreement (see Item 3 of Schedule 1).1. on specific dates and/or on the achievement of specified milestones) should be set out in the Payment Schedule. It will also be necessary to omit all references to the “Project Objectives” in the definition of ‘Services’.3) Guide Note 10 The confidentiality and privacy provisions contained in Clauses 10 and 11 will need to be modified where the Consultant requires reciprocal confidentiality and privacy obligations from the Principal. as set out in an annexure to the Consultancy Agreement and/or as from time to time agreed in writing).1 should be amended. Clause 3. Where appropriate.5 requires the Consultant to provide progress reports to Principal.2 and in Schedule 2.4 provides that the Consultant may not substitute another person for a Specified Personnel without the Principal’s agreement.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. Guide Note 5 The Consultancy Agreement has been drafted to allow for the “Project Objectives” to be set out separately in Schedule 2. If necessary. Clause 8 (which permits an extension of time) may also need to be amended to suit the particular requirements of the consultancy. Clauses 3. the nature of the work. Section 195AR of the Copyright Act lists various factors to consider – for example. other text materials. 21(1/06) . the Principal should ensure that it obtains an irrevocable perpetual licence to use such intellectual property rights. an injunction to prevent or stop the particular activity constituting the infringement. a public apology or an order to remove or reverse the derogatory treatment of the work. relevant industry practice. purpose for which the work is used. Where the Consultant insists on owing the newly created intellectual property rights. distortion. Clauses 12.1 and 12. the right not to have authorship of the work falsely attributed. paintings. known as the right of attribution of ownership. blanket consents may be given by an employee for the benefit of his/her employer in relation to all works made or to be made by the employee in the course of his/her employment (for example. as a term of their employment contract). the right to be named as the author or creator of the work. maps. insist that it owns any newly created intellectual property rights. Remedies available to the creator of the work for infringement of his or her moral rights include damages. software and databases. Moral rights are granted only to individuals. known as the right of integrity (eg. drawings.34 Copyright and other intellectual property right issues require careful attention.2 will need to be redrafted as appropriate. in some cases. mutilation or material alteration of the work which is prejudicial to the creator’s honour or reputation). consent may only be given in relation to: (a) (b) specified work(s) existing when the consent is given. The Copyright Act 1968 (Cth) recognises three moral rights: 1. Generally. artistic works such as photographs. The Consultant may. A “defence” applies if the infringing act was reasonable having regard to all of the relevant circumstances. Clause 12. and dramatic and musical works and cinematograph film. or specified work(s) of a particular description. 2. Guide Note 12 “Moral rights” are rights relating to a creator’s reputation in connection with his or her work. and the right not to have the work altered in a prejudicial way.1 has been drafted on the basis that the Principal will own any new intellectual property rights in any New Contract Material which is brought into existence by the Consultant in the course of performing the Consultancy Agreement. articles. the making of which has not begun or that is/are in the course of being made.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES Guide Note 11 4. known as the right against false attribution. 3. the difficulty or expense that would have been incurred as a result of identifying the creator and so on. Copyright creators can give consent to acts or omissions (whether past or future) which may otherwise infringe their moral rights. architecture and sculpture. generally last as long as the copyright in the work and apply to a wide range of works including: • • • literary works such as manuscripts. However. both in relation to the works and the acts or omissions to which the consent applies. Again. limits the Principal’s remedies to re-performance/repair as permitted under the Trade Practices Act 1974 (Cth). The Principal should vigorously oppose the incorporation of any such provisions. It should be noted that TMF currently advises a minimum limit of $20.3 from the Consultancy Agreement. Maintenance of public liability and professional liability insurance for a period of 12 months post termination or expiry of the Consultancy Agreement is not unusual. Guide Note 13 Appropriateness of the indemnity clause is a risk management matter for the Principal to consider and any such clause should comply with the TMF’s contract of coverage. As in the case of the indemnity provision. consents must be specific. Copyright Act). the advice of the TMF Fund Manager should be sought by the Principal.35 Where the creator is a contractor or consultant. the advice of the TMF Fund Manager should be sought. the Courts may nevertheless in appropriate circumstances apportion liability. which provides for the Consultant’s liability under the indemnity in Clause 14. Note that an indemnity has not been provided in respect of losses suffered through the breach of the agreement.000 for professional liability insurance. ultimately the appropriateness of a limitation of liability clause is a risk management matter for the Principal to consider and any clause must comply with the TMF contract of coverage. the size/risk of the contract and the Consultant’s ability to obtain the required levels and types of insurance. If the Principal proposes to use the New Contract Material for a purpose or in such a manner that would otherwise infringe the moral rights of the Consultant or the creator of the material. that notwithstanding the omission of Clause 14.3. If there is any doubt. 21(1/06) . Clause 14. the specified acts or omissions which would otherwise infringe the Consultant’s/creator’s moral rights should be listed in Item 7 of the Schedule 1.2 to be apportioned where the indemnified party contributed to the loss. caps the Consultant’s liability. Note however. Guide Note 14 The appropriate level of insurance and duration should be assessed with reference to the Treasury Managed Fund (“TMF”) contract of coverage. if there is any doubt.000.000. (See ss. This is because the view has been taken that any indemnity for losses caused by breach would deliver no greater remedy that a suit for breach. Note that a Consultant might request the incorporation of a limitation of liability provision which: • • • • exclude implied warranties other than as expressly provided for in the Consultancy Agreement.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. may be omitted where appropriate. 195AW and 195AWA. and/or excludes liability for consequential losses. the advice of the TMF Fund Manager should be sought by the Principal.000 for broad form public liability insurance and $5. If there is any doubt. a party agrees that notices may be served on that party by email. special insurance arrangements may be required. 21(1/06) . Guide Note 15 By inserting an email address. if appropriate.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4.36 Where the Consultant is a ‘consortium’ of different legal entities. Delete the reference(s) to the email. The Agreement also contains clauses regarding dispute resolution reflective of the Government’s policy in this regard. http://www. questions of indemnity and intellectual property rights are just a few issues that need consideration in relation to specific clauses. The updated document takes into consideration recent changes in the law dealing with privacy.dpc.doc The Consultancy Agreement can be downloaded from 21(1/06) . This updated document may assist agencies in preparing their own agreements.nsw. disclosure of personal information and moral rights. Matters such as liability caps.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES Premier’s Department New South Wales Guidelines for the Engagement and Use of Consultants Version 4 Attachment 4. It is strongly recommended that any agency intending to use this Agreement seek legal counsel in formalising and finalising the final Agreement. Please read through these Guide Notes before using the updated Consultancy Agreement as a base.37 CONSULTANCY AGREEMENT Issued March 2005 The Crown Solicitor’s Office has amended and updated a Consultancy Agreement which had previously been used by the Premier’s Department and a number of agencies as a precedent. The Crown Solicitors Office has prepared Guide Notes to assist the use of the updated Consultancy Agreement.au/__data/assets/word_doc/0007/1015/Consultancy_Agreement_March_2005. levels of insurance.gov. This is another issue that may or may not be appropriate depending on the particular consultancy. Documents Relevant In All Cases • Code of Conduct of the Agency. Public Disclosure of Information Arising from NSW Government Tenders & Contracts.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. Conflicts of interest are to be declared and avoided. services are to be designed and delivered in ways that meet equity objectives and are fully response to diverse needs. For instance. Policy concerning Guarantees of Service and Quality Customer Service. for example. For example. For instance. Documents Relevant to Personnel Matters • • • Part 9A of the Anti Discrimination Amendment Act. Where appropriate. Examples of documents which can be relevant are shown below. This includes legislation. policy or any other form of requirement relevant to the matter at hand which by its nature should apply to advisers to the agency as well as to agency personnel. Contracting and Market Testing Policy. They must have been evaluated to ensure gender-neutrality and cultural appropriateness. For instance. Statement of intent to implement the Charter of Principles for Culturally Diverse Society. expectations and principles which are to be observed when undertaking procurement and disposal and when considering contracting out. Documents Relevant to Procurement. Premier’s Memo No 2007-01. there are a number of rules. Disposal and Contracting • • • • • NSW Government Procurement Policy. by practical placement. including Code of Practice for Procurement. Purchasing and Supply Manual Capital Project Procurement Manual. in merit selection is tests are used for position.38 APPENDIX 4 LEGISLATION AND POLICIES TO BE OBSERVED BY CONSULTANTS Consultants are to comply with relevant Government policies. 22(3/07) . Equal Employment Opportunity Policy of the agency. the tests must be relevant to the particular job. honest and ethical behaviour is always required. Adjustments must be provided for persons with a disability to sit the test or to be assessed by another suitable method. the relevant requirement should be highlighted in the project brief provided to the consultant. Documents Relevant to the Services the Agency Provides • • • Guarantee of Service of the agency. Equal Employment Opportunity Plan of the agency. Check for reports on previous projects or process. When the Procurement is finished. Process required. (this is not a link) http://www. $30. Where required.however if NOT Consultancy.nsw.Submit a recommendation to the Steering Committee If project is available through existing contract. Date of Awarding of Contract Successful Supplier/s awarded Contract Step CHECKLIST Procurement of Consultants Steps to take Initial Concept . the process will If project is not available through existing contract.aspx (this is not a link) or telephone 1800 679 289. Treasury Steps 1 . will go to open market.ii) SIM.000-three written proposals minimum of three written quotes as Best Practice.au/Consultants.dpws.000 . All NSW Health Projects over $1MILLION (as a discrete project) must assess risk through the Department of Commerce Risk Assessment Tool titled Procurement Profile Tool at (this is not a link) http://www. Determine availability of in-house or possible internal alternative sources of supply.nsw. iii) SP&BD.nswbuy. Identify the contribution the proposed project will make to the Government's and NSW Health's objectives. (for the Department) and record on Official File. go to Commercial Manager. For IT related product or service. Establish Supervising Manager responsible for delegation of funds – Establish Steering Committee (as appropriate). Include PAS member on Steering Committee as Probity and Process Advisor. Outputs and expected benefits of the procurement.000 -one written proposal PAS. go to http://internal.$150. the not go to open market. the reasons should be $1Million Risk Management Assessment through Gateway documented and retained on file. SIM Appoint Officer as Project Manager and estimate cost of the project. NOTE: NSW Health Guidelines advise obtaining a required.au/operations/apmd/pmb/procurement/checklist/htm for appropriate checklist.gov.nsw.39 APPENDIX 5A CHECKLIST 1 NSW HEALTH .gov. Official File Number Title Of Procurement Branch/Unit Project Manager Email Address Contact Phone No. send the fully completed document to the Procurement Advisory Service(PAS). Over $150.000 Open Tender required. Develop the Scope. Read and understand Section 3 (Tendering) of the Supply Procedures Manual. Establish and document the need for the Project. Certify. in writing.gov.TO BE COMPLETED BY PROJECT MANAGER Procurement for CONSULTANTS Steps to take Instructions: Initial and Date each step as it is completed.au. Government mandates firms that may have worked with NSW Health –Check with (GST inclusive):Less than $30. the availability of funds and authority to incur expenditure.health.New Procurement Project – Consultancy only .htm 5 Decide on the Tender Process . Signature Initials Date 24(7/09) . Initiate Completion of Checklist to send to PAS. Quote/Procurement Ref No.au/Government+Procurement/Gateway+Review+Process/Project+Profil e+Assessment+Tool. Over fewer than three quotations are invited. Create an Official File. Strategic Procurement & Business Development Branch to assist.health.com.4 Seek a Procurement Reference Number (PRN) from PAS or Commercial Manager SIM.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. Is this project available through any existing contract? – Check with i) State Government Contracts at Commerce website. Email: pas@doh. Document the Recommendation Signature Initials 4. Submit Purchase Order/Contract or Service Level Agreement to successful Supplier. Tender Opening Committee completes procedure. document the reason and file. Develop a Probity Plan (as appropriate). After final acceptance of contract inform unsuccessful bidders in writing & give opportunity for debrief. If three are not invited. Single stage process: Review bids/tenders for reasonableness/ consistency & against selection criteria. 10 Evaluate the supplier’s performance as per contract/SLA and place the Evaluation Report in the Official File. 8 Bids Received by Tender Box (hard copy) & /or electronically via website. following best practice for NSW Health.TO BE COMPLETED BY PROJECT MANAGER Procurement for CONSULTANTS Steps to take Step 6 CHECKLIST Procurement of Consultants Steps to take Complete Tender/EOI documentation including evaluation criteria.au 24(7/09) . Conduct ongoing management of Project. submissions/approvals are placed in Official File. Short-list chosen bidders. correspondence. 9 Inform PAS of outcome to comply with public disclosure directive.health.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES CHECKLIST 1 NSW HEALTH . Check for potential superannuation & withholding tax liability Approving Officer sign off recommendation as per delegation. Check response to Letter of Acceptance. review EOI’s for reasonableness/ consistency with the market and against selection criteria. If three are not invited. Write Evaluation Plan and establish Evaluation Committee (as appropriate).40 Date OR TOTAL Price Paid: Statement of Compliance: This procurement was completed in accordance with NSW Health’s Procurement Policy Directions and all the steps listed above. document the reason. 7 Advertise EOI or Tender externally through Communications Unit OR If using existing contract. Ensure all bids/tender responses.gov. Lodge the controlled document Tender Evaluation Criteria with PAS for security. Issue next document and invite minimum of three short-listed bidders to tender. OR Document the Recommendation. invite minimum of three approved Suppliers to quote. Confidentiality Agreement and Conflict of Interest Documents to be signed (as appropriate). 2) Email copy to: Procurement Advisory Service. Email: pas@doh. Document the Recommendation Prepare the recommendation certifying that all relevant policy and procedures have been complied with. Project Manager: Name: Title: Signature:_____________________________________ Date: Delegated Supervising Officer Name: Title: Signature:_______________________________________ Date: WHAT TO DO WITH THIS COMPLETED SIGNED FORM: 1) Place the signed original in the official file. If multistage process. to ensure it is properly signed by the successful tenderer (same legal entity) & that all conditions are agreed to. Evaluate.nsw. For IT related product or service. go to Commercial Manager.000-three written proposals three written quotes as Best Practice.dpws. the process.health. Include A&CS member on Steering Committee as Probity and Process Advisor. Is this project available through any existing contract? – Check with I) State Government Contracts at Commerce website.gov.nsw.htm 5 Decide on the Tender Process .dpws. Over quotations are invited. (this is not a link) http://www.Submit a recommendation to the Steering Committee If project is available through existing contract. iii) AC&S All NSW Health Projects over $1MILLION (as a discrete project) must assess risk through the Department of Commerce Risk Assessment Tool titled Procurement Profile Tool at (this is not a link) http://www.New Procurement Project – Consultancy only . 6 Complete Tender/EOI documentation including evaluation criteria. OR Signature Initials i) Date 21(1/06) .Steps to take Instructions: Sign and Date each step as it is completed.$150. invite minimum of three approved Suppliers to quote. Identify the contribution the proposed project will make to the Government's and NSW Health's objectives. When the Procurement is finished. the process will not project is not available through existing contract. Initiate Completion of Checklist to send to Asset and Contract Services.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4.nsw.000 . Read and understand Section 3 (Tendering) of the of the Supply Procedures Manual. Asset and Contract Services Branch to assist. inclusive):Less than $30. Establish and document the need for the Project. go to open market.however if NOT Consultancy. If using TCNG Contract. send the fully completed Document to The Director of Procurement and Contract Services (address below). Check for reports on previous projects or firms will go to open market. $30.nsw.htm (this is not a link) or telephone 02 9372 7791.000 -one written proposal NOTE: NSW Health Guidelines advise obtaining a minimum of required. the availability of funds and authority to incur expenditure. 7 Advertise EOI or Tender externally OR If using existing SCCB contract.gov. Treasury Steps 1 . must use successful supplier. If three are not invited. in writing. the reasons should be documented and $1Million Risk Management Assessment through Gateway retained on file. Process required. Create an Official File. Develop a Probity Plan (as appropriate).gov.000 Open Tender required.au/Contract+Information+and+User+Guides/Contract+Information+ and+User+Guides. Title Of Procurement:_____________________________________________________________ Quote/Tender Number Branch/Unit:______________________________ Official File Number:_____________________ Project Manager:________________________________________________________________ Title:__________________________________Email___________________________________ Contact Phone Number:_______________ Date of Awarding of Contract:____________________ Successful Supplier/s awarded Contract:______________________________________________ Step CHECKLIST of Consultants Steps to take Initial Concept . Establish Supervising Manager responsible for delegation of funds – Establish Steering Committee (as appropriate).TO BE COMPLETED BY PROJECT MANAGER PROCURING CONSULTANTS . Lodge the controlled document Tender Evaluation Criteria with appropriate body for security.au/Government+Procurement/Gateway+Review+Process/Project+Profile+ Assessment+Tool.supply.4 Seek a Quote/Tender Number from Contracts Officer and record on Official File and record on Official File. go to http://internal. Government mandates (GST that may have worked with NSW Health –Check TCNG Database. ii) SIM.41 APPENDIX 5B CHECKLIST 2 HEALTH SERVICES .au/operations/apmd/pmb/procurement/checklist/htm for appropriate checklist. Over $150. Develop the Scope. Certify. Outputs and expected benefits of the procurement. SIM Appoint Officer as Project Manager and estimate cost of the project. following best practice for NSW Health. document the reason and file. Determine availability of in-house or possible internal alternative sources of supply. Where fewer than three required. Write Evaluation Plan and establish Evaluation Committee (as appropriate). $150. Short-list chosen bidders.000 Checklist 6 for Procurement $150. Project Manager: Name:________________________________________ Title:_________________________________________ Date: Signature:_____________________________________ Delegated Supervising Officer Name:__________________________________________ Title:___________________________________________ Signature:_______________________________________ Date: WHAT TO DO WITH THIS COMPLETED SIGNED FORM: 1) Place the original in the official file. Asset and Contract Services Branch. If multistage process. TOTAL Price Paid: Statement of Compliance: This procurement was completed in accordance with NSW Health’s Procurement Policy Directions and all the steps listed above. Tender Opening Committee completes procedure.000-$10Million Checklist 8 for Procurement over $10Million 21(1/06) . Conduct ongoing management of Project.$150. Issue next document and invite minimum of three shortlisted bidders to tender. 10 Evaluate the supplier’s performance as per contract/SLA and place the Evaluation Report in the Official File.000 For Health Services Checklist 2 for Procurement of Consultants Checklist 4 for Procurement $30. to ensure it is properly signed by the successful tenderer (same legal entity) & that all conditions are agreed to. Evaluate.000-$10Million Checklist 7 for Procurement over $10Million Checklist 9 Engaging Consultant/Contractor under $30. review EOI’s for reasonableness/ consistency with the market and against selection criteria.000 Checklist 5 for Procurement $150.000 . Document the Recommendation Signature INITIALS Date OR 9 Complete the award section of the eTendering admin console to comply with public disclosure directive. Submit Purchase Order/Contract or Service Level Agreement to successful Supplier. Confidentiality Agreement and Conflict of Interest Documents to be signed (as appropriate).CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. After final acceptance of contract inform unsuccessful bidders in writing & give opportunity for debrief. Check for potential superannuation & withholding tax liability Approving Officer sign off recommendation as per delegation. If three are not invited. 2) Fax copy to: The Director. correspondence. Ensure all bids/tender responses. Single stage process: Review bids/tenders for reasonableness/ consistency & against selection criteria. Fax 02 9391 9522 Procurement Checklists available include: For NSW Health Checklist 1 for Procurement of Consultants Checklist 3 for Procurement $30.000 . OR Document the Recommendation. submissions/approvals are placed in Official File. Document the Recommendation Prepare the recommendation certifying that all relevant policy and procedures have been complied with.42 Step 8 CHECKLIST of Consultants Steps to take Bids Received by Tender Box(hard copy) & /or electronically via website . Procurement and Contract Services. Check response to Letter of Acceptance. document the reason. CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4.000 Consultancies less than $30.43 APPENDIX 6 Sample Disclosure Consultants equal to or more than $30.000 Total consultancies $X $X $X $X $X Development of specifications for the Finance Module of Financial Information System Advice on development of IT strategic plan Advice on legal issues arising from the XYZ agreement $X $X $X $X 21(1/06) .000 During the year X other consultancies were engaged in the following areas: Finance and accounting/tax Legal Total consultancies less than $30.000 Consultant Finance and accounting/tax ABC Partners 123 Ltd Sub-total Information Technology IT Solutions $ Cost $X $X $X $X Title/Nature Advice regarding assessment of risk management strategies Review of Finance function Computer Specs P/L Sub-total Legal Miscellaneous Law Firm Sub-total Total consultancies equal to or more than $30. an engagement can be made directly from the panel by inviting one (1) written quotation from a service provider prequalified under the Scheme.000 and $150. applying the following minimum levels of competition: 1.au/publications/memos_and_circulars/circulars/2008/c200834_prequalification_scheme_performance_and_management_services advises that a panel of prequalified consultants has been established by the Department of Premier and Cabinet in conjunction with the Department of Commerce under the heading “Prequalification Scheme: Performance and Management Services”.000 (there is no upper limit) an engagement can be made from the panel by inviting a minimum of three (3) service providers. Where the estimated cost of a project is less than or equal to $150.000. Area Health Services. http://www. For the Scheme however. the scheme introduces more flexibility to source prequalified consultants by direct engagement. The Scheme maintains a panel of pre-qualified consultants who provide services in the following areas of expertise: Performance Reviews Infrastructure and Major Projects Service Delivery Improvement Organisational Capability General Technical Expertise Usage NSW Health is not obliged to use the Scheme. and open invitation for work over $150. Where the estimated cost of a project is more than $150.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES PREQUALIFICATION SCHEME FOR ENGAGEMENT OF CONSULTANTS – PERFORMANCE AND MANAGEMENT SERVICES (IB2009_022) 4. the State Contracts Control Board has approved a less stringent delegation. Premier’s Circular No. prequalified under the Scheme. Where it is decided not to use the prequalified panel for consultancy work. the existing process for engagement of consultants applies.000.000. As set out below however.dpc. 2008 – 34. to submit proposals. 2. Affiliated Health Organisations and Public Health System Support Division.nsw. The Scheme also provides for easier flow-on of related work without further competition up to the lesser of three times the original contract value or $500. three written quotations for work between $30.000.000.44 This Information Bulletin applies to NSW Department of Health.gov. Ambulance Service of NSW. Competition Policy The current procurement policy of NSW Government and NSW Health requires a minimum level of competition based on the estimated cost of the consultancy – one written proposal for work less than $30. Public Health Units. 24(7/09) . Open invitations to tender are not required. including: State Contracts Control Board (period) contracts Construction-related consultant prequalification schemes Information and Communication Technology (ICT) Capital Investment Process .au/Consultants.com.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. A Standard Form of Agreement has been developed for this purpose and must be used whenever engaging consultants off the panel.au’ email addresses.Consultant Prequalification Scheme How to use the Scheme Initially a request for a list of prequalified service providers is to be made to the Department of Commerce citing the work types and specialties required for a particular engagement.com.nswbuy. Engagement Contract NSW Health and the service provider must enter into a separate agreement for each engagement. In summary these are: 24(7/09) .aspx There are some differences between and the Standard Form of Agreement and the Department’s existing Consultancy Agreement that staff should be aware of so they can assess whether the Scheme’s Agreement provides sufficient contractual protection or not.au/Consultants.aspx The Request Form is to be submitted by e-mail to: consultantprequal@commerce. In this case advice is to be sought from Department of Commerce. Staff may then make their own assessment from the list of pre-qualified service providers as to which will provide best value for money or may seek further assistance from the Department of Commerce.nsw.gov. A list of suitably qualified service providers will be returned by e-mail to the requesting agency. A request form which has been designed for this purpose and allows the Department of Commerce to actively monitor panel usage can be downloaded from the Department of Commerce website http://www.nswbuy. The Standard Form of Agreement can be downloaded from http://www.gov.au or by fax to (02) 9372 8077. The terms of the Standard Form of Agreement should not be modified unless there are exceptional circumstances which warrant modification. The Department of Commerce will only send a list to ‘nsw.45 The Scheme does not cover areas of procurement already addressed by other prequalification schemes or panel contracts. gov.au or telephone (02) 9391 9215. Any inquiries concerning this Information Bulletin may be directed to the Procurement Advisory Service pas@doh. privacy requirements. The Performance Report can be downloaded from http://www. ^ Clause 4. codes of conduct etc that are relevant to the engagement are included in a Schedule where a description of the Services is detailed.nswbuy. It is recommended that all policies.CHAPTER 4 – CONSULTANCY ENGAGEMENT – POLICY/PROCEDURES 4. A Performance Report is required for all engagements (including the value of any flow-on engagements) in excess of $150. codes etc that are communicated by the Principal.nswbuy. Data collection An important aspect of the Scheme is performance monitoring and reporting. policies. # Clause 9.000 and any engagements where the service provider’s performance has been considered unsatisfactory. 24(7/09) .health.au/Consultants.18(c) allows for additional insurance to be negotiated if necessary.12 states the Consultant must comply with laws.5 describes general limitations on the use of contract material however this may not be sufficient for particular consultancies. Existing policies regarding the use of Departmental standard conditions of contract and obtaining the requisite number of quotations remain in force when engaging consultants by means other than off the panel.com.aspx Further Details Additional information and documents related to the Scheme are available at the Department of Commerce web site http://www.com. The Purchasing & Supply and Supply Manuals will be updated with the content of this Information Bulletin.nsw. Scheme Agreement Public Liability Insurance GST Termination Privacy & disclosure of personal information Publication of material Policies Existing NSW Health Consultancy Agreement $10M * $20M Assumes all services provided Reflects that not all health are subject to GST services provided by a consultant may be subject to GST No provision for termination for Allows for termination for convenience convenience No reference to particular Contains specific clauses requirements for protection of relating to the protection of health information ^ health information Does not specifically address the Consent is required before a publication of material a consultant publishes any consultant may develop # material arising from the provision of a service General reference that Specifically incorporates incorporates the policies of an compliance with relevant NSW agency into the Agreement ^ Health policies * Clause 4.aspx.au/Consultants.46 Prequal. ..............8.........................................................OFFICIAL (PD2009_016) 1....3.................................................................................8........... 11 5......... 10 5........................................................ 6 5...................3 Eligibility ......................5 Reporting Requirements ......................................................................................... 6 5...............9..............13 Audit And Reporting Requirements ..........2.................................1 Official Visits of Staff Members Overseas .................... 3 DEFINITIONS...................................................................4 Private Funding .................................2.......................1 Air Travel Bookings .................................... INTRODUCTION ..................8...............2 Booking the Airfare ..............11 Protocol and Other Special Conditions ... 1.. 9 5................................................................ 13 5......2 Corporate Security Program ....................................1 2.............. 14 5........................................................................................................ 4......2..............................................................................................8..................................................................... 3 4 4 5..................... 11 5.............. 3..... OFFICIAL OVERSEAS TRAVEL...... 12 5.......... 10 5...........................2 Official Overseas Travel ....................3 Personal Accident Exclusions ............................... 5 3 5.........................2 Baggage and Personal Effects Coverage .......... 7 5............... 3 1.. 11 5....................................................................................3 Where the Notional Budget Allocation has been Exceeded ............................................................... 8 5.........................12 Health and Security ............................... TRAVELLING BY AIR .........................................7....................7.....................................................................7....................................................................................... 3 1.............................................................................................................................................1 Corporate Medical Membership .. 13 5...................................................................... 15 5.......................................9.........................................1 Application Process if Presenting a Paper at a Conference/Seminar (“Approval in Principle”) ...............................................3 Private/Annual Leave .......... 5 4................................1 General Fund Notional Budget ....9 Emergency Assistance ............... 8 5.............................................................................................2 Claims .......4... 10 5......... MINISIMING TRAVEL .4.................................................2 Application Process for all Official Overseas Travel (Attachment 2) ..2 Rescinds and Replaces ........................................4 Proof of Medical Insurance ...... 13 5...................... 8 5. 9 5............................4 General Fund.......1 Purpose and Scope ................................ 7 5....................7.................................................................................. 7 5........................................... 12 5...........4 Taxation Arrangements For Meal And Travelling Allowances .............2 Annual Notional Budget Allocations ........ 8 5..............................10 Pre Travel Arrangement ..1 Delegation of Approval ....................3 Procedure For Seeking Approval To Travel ................. 13 5..................................................................2........................................................................................................................................................1 Determining the Appropriate Daily Rate ...............1 Study Scholarships ............................................................3..............................................................................................................................1 Class of Air Travel ................. 15 24(7/09) ........................ 13 5........3 Loyalty Schemes and Airline Lounge Schemes .... 12 5. 7 5................ 14 5........... 4..............2 Sponsorship ...... 4 4...............7 Allowance Rates ..............................................................CHAPTER 5 – TRAVEL TRAVEL .................................................................................................................................6 Travel Allowances (Subsistence) – What is covered ..4................ 9 5.2.............................8 Travel Insurance ........................................................ 4 4.............. 11 5......................................................................3 Receipts ................................. 14 5.... .....................4....... 24(7/09) .........................1 Employer Accommodation (see cl.....9 Claims for Payment of Allowances .....6................................... 22 6.................. 25 7........................................... 28 7. 25 7...............................4 Residence Determined as Accustomed Place of Work ... 19 6..................................................................2 7.......... 22 6............................................. 6....................... 24 USE OF PRIVATE MOTOR VEHICLES ON OFFICIAL BUSINESS................6....Temporary Work Locations (TWL) ............................ 25 7..................................................................................................................................................1..................2................................ 15 6............................... 20 6........................................2 Point Determined as "Accustomed place of work" ...................5 Use Of Private Motor Vehicles ................1 Reimbursement of Insurance Excess (Policy) ..... 27 7......8 Meal Allowances (if not specified by an applicable Award or other industrial instrument) ...... 26 7...................... 22 6....... 28 7..........4 Private Vehicles Damaged on Official Business or Other Approved Travel .................... 16 6......... 28 7..................................1 Delegation of Approval ............ 21 6.................................... 26 7..................2......6...1 Official Business Rate ..........................13 Travel Insurance ...... 20 6.....................4...........................................................................3 Restrictions of Payment of Allowances .................... 22 6........................ 22 6...........9............... 26 7.................................4 Travelling Time ..........3 Visits to Accustomed Place of Work...................1 Insufficient Funds .1 Actual Expenses ..... 29 5..............3 Actual Expenses – Production of Receipts ...9...............Daily Allowances and Actual Expenses ....................................... 23 6................. 26 7.................. 25 7.7 Exemption from Deduction ........6......... 25 7...............2) .........14 Emergency Assistance ....................................... 22 6........1 Rates ...........................2........................ 23 6......CHAPTER 5 – TRAVEL 6................................................. 18 6.................................................................... 27 7....................................2 Non Employer Accommodation (see cl......... 18 6......................................................7 Living Allowances ...............7.... 18 6............2.............2) ................3 Means of Travel – Rail.... 24 7............9............................3 Replacement Registration Labels....................6 Travel Allowances ..2 Transport Rate ........................................ DOMESTIC TRAVEL ...... 20 6.................................... 17 6...... 24 7.............. 6..................................................................................... 25 7.................................................................2 Reimbursement of Funds ....2 Broken Windscreens . 23 6.............................................................................. Air or Road and Overnight Accommodation..................4...............................................................................................................12 Taxation Arrangements for Meal And Travelling Allowances ...............................5 Reimbursement of Travel Allowances ...7..........................2..................................10 Adjustment of Allowances ...........4 Motor Cycle Allowance ........................... 28 7.............................. 26 7..................................................... 23 6..................................2...........4....6 Deduction When Not Reporting to Accustomed Place of Work ......................................3 Casual Journey Rate ................................1.......................................4 Claims for Reimbursement ..... 16 6.........................2 Daily Allowances ...........2 Limitations on Payment .7.............................................Deduction From Allowance ..........6 Use of Private Motor Vehicles In Connection With Official Air Travel ..................................................2 Time for submitting claims:...........11 Part Day Travel Allowance................2 Class of Travel (All Modes Of Transport) ...........3 Insurance Requirements ...................1.............1 Payment in advance: ........ 22 6.........1...........10....10........................ 16 6....1 Deductions for Private Use ....5 Deduction When Reporting to Accustomed Place of Work ..............2.................... 24 7.....................Payment of Allowances ... 26 7................................................ NSW Health Service: Consists of those persons who are employed under Chapter 9. Employer: For the purposes of this document. It does not cover individuals or staff members of organisations who provide services under contract to a public sector organisation or service. The procedures to be followed when a Staff Specialist is undertaking TESL are provided for in the Salaried Medical Practitioners Determination and Policy Directive 2005-305 (previously Circular 2003/29). Where awards/determinations have specific travel allowance provisions that are more beneficial to the staff member.CHAPTER 5 – TRAVEL 1. Health Professional Registration Boards and the Institute of Psychiatry. It also applies to Staff Specialists travelling for reasons other than TESL. means any person authorised to exercise the functions of the employer of staff to which this policy applies. travel provisions in respect of such contract personnel should be set out in the relevant conditions of the contract or determined prior to any travel being undertaken by the contractor and are not to be any more generous than the provisions of this policy. DEFINITIONS Division of the NSW Health Service: consists of staff employed in or in connection with an area health service. declared affiliated health organisations in respect of their recognised services.3 1. Where necessary.8 Travel Insurance. 24(7/09) . or in connection with public health organisations providing corporate and other health support services to those public health organisations. statutory health corporations. or in connection with the provision of ambulance services. 2. Part 1 of the Health Services Act 1997 by the Government of New South Wales in the service of the Crown. or a declared affiliated health organisation. the provisions of this policy apply to all staff members of the NSW Health Service and the Department of Health.1 Purpose and Scope This document is the policy on official travel undertaken by staff members of the NSW Health Service and the NSW Department of Health. 1.2 Rescinds and Replaces Policy Directive PD2005_619 – Official Travel Policy 1. NSW Public Health System: includes area health services. those awards/determinations are to apply. Department of Health: For the purpose of this document means a staff member employed by the NSW Department of Health. The provisions of this policy do not apply to Staff Specialists undertaking Training. as well as the Ambulance Service of NSW and health support services.3 Eligibility Unless otherwise stated. a statutory health corporation. INTRODUCTION 5. It describes the conditions applicable and administrative procedures to be followed when a staff member undertakes official travel both overseas and domestic. Education and Study Leave (TESL) except in respect to point 4. Divisions of the NSW Health Service. 4. Alternative technology methods include teleconferencing and video conferencing. 4. Education and Study Leave provisions as provided for in the Salaried Medical Practitioners Determination 1997 for Staff/Senior Staff Specialists (as amended from time to time).au/Travel 24(7/09) . staff members accompanying a Minister: if required by the Minister. Chairpersons of statutory bodies and of Government bodies and committees.nswbuy. This includes New Zealand and Papua New Guinea. 5. Members of the Senior Executive Service or Health Executive Service. However some staff members are entitled to fly premium economy or business class when travelling to Western Australia. the staff member may travel in the same class as the Minister for the sectors where they travel overseas together. and staff members travelling overseas on duty as a member of a Government sponsored delegation or similar representative group: the submission to the Director-General/Chief Executive may propose that the staff member travel in the same class as the members who are not NSW staff members for the sectors where they travel overseas together.CHAPTER 5 – TRAVEL Official Travel means any travel by a staff member or any other person where a public sector organisation or service responsible to a Minister uses public monies to pay for the travel. (as varied from time to time).1 TRAVELLING BY AIR Class of Air Travel Staff members undertaking official travel must fly economy class. 4.4 TESL refers to Training. whether it is financed from the General Fund or the Special Purpose and Trust Fund.com. Staff members whose annual salary exceeds a Senior Officer Grade 1. Minister may waive the requirement to fly economy class for medical reasons. Carlson Wagonlit Travel (CWT) currently is the company appointed for the provision of all air travel.2 Booking the Airfare Staff Members are required to make all domestic and international travel bookings through the NSW Government’s Travel Management Company. Northern Territory and overseas when undertaking official travel. MINIMISING TRAVEL Staff members should explore alternative methods of communicating over long distances prior to considering travel. Further information can be obtained from the Department of Commerce at http://www. These are: • • • • • • Chief Executives. all additional costs are to be borne by the staff member. This company is appointed through a contract known as the Travel Management Company (TMC) – Contract 1008. 3. 1st year. • If a staff member wishes to travel in a class higher than their salary allows for as specified above. car hire and accommodation bookings. 02 8905 9631.1 Air Travel Bookings All domestic and international travel bookings are to be made with CWT – domestic travel – telephone no. The frequency (ie at least 4 times per month) and duration of official travel by a staff member.com/thetravelersite?nswgov. They can only nominate their destination and desired date and time of departure when booking air travel.5 CWT is contracted to offer the lowest logical airfare of the day. special permission must be sought by the Employer. 24(7/09) . 1 300 657 378 or 02 8666 1703. which can only be accessed through CWT. To reduce cost.carlsonwagonlit. Travel cannot be undertaken with an airline listed as unsafe by the consultancy firm Flight Safe Limited. international travel – telephone no. 4.2. These credits are reported on a monthly basis. Staff members should contact their local travel coordinator for travel bookings. 1300 307 852 or 02 8666 1751. taking into consideration times of meetings and possible schedule variations.CHAPTER 5 – TRAVEL 5. For example the initial leg of the journey should be a restrictive fare as it is less likely this will be required to change. Specific arrangements for staff specialists booking airfares in respect of TESL travel are contained in PD2005_305. restrictive fares will be sought where possible. Excellent rates have been negotiated with various airlines for overseas travel. Facsimile no 02 8905 9646. minor payment vouchers to Health Services involving matters which are captured by this policy. Staff members should keep variations to bookings to a minimum to avoid excessive additional costs. Facsimile no. 4. Choice of airline is not permitted unless a cheaper alternative is found. raising of purchase orders to Health Services. CWT will book a flight in accordance with the staff member’s specified needs. and the scheduling of flights and official business commitments. Department of Health Accounts Branch and Shared Services will monitor and reject arrangements such as airfare/accommodation bookings for Health Service staff members. and can search 20 minutes either side of the specified time of departure for the cheapest fare. Staff members may join and maintain membership of such schemes and facilities at their own expense irrespective of the nature and extent of their official travel. are considerations relevant to such decisions.3 Loyalty Schemes and Airline Lounge Schemes The Director-General or Chief Executive should decide whether to meet the cost of staff members joining or maintaining membership of airline lounge facilities or similar services. A concerted and planned effort is to be made to utilise CWT’s online booking tool for domestic travel as this reduces the cost of the service. Where there is no alternative to an airline listed as unsafe. Staff members cannot specify a desired airline they wish to fly on. This is the cheapest fare available that meets the staff member’s logistical needs. CWT has in place systems to capture and manage all credits arising from changes to restrictive fares to reduce any possible wastage. The cheapest of these negotiated rates is to be used if available. On-line bookings can be made at: https://sbt. HealthQuest and Management Health Administration Corporation (Health Support Services. particularly for transport overseas. HealthQuest and Health Administration Corporation (Health Support Services.Director-General If notional budget is exceeded: . Health Infrastructure and Institute of Medical Education and Training) . Clinical Excellence Commission.1 OFFICIAL OVERSEAS TRAVEL Delegation of Approval Delegation to approve official overseas travel applications is in accordance with the following: Source of Funding General Fund Submit Application To Approval By Division of the NSW Health Service (excluding Division of the NSW Health Service: those listed below) Within the notional budget: .Area HR/Area Executive Division of the NSW Health Service .Workplace Relations and Management** Sponsorship Division of the NSW Health Service (excluding Division of the NSW Health Service those listed below) . Benefits from airline.CHAPTER 5 – TRAVEL 5. No frequent flyer points are to be sought or allocated.Deputy Directors-General . CEC.Area HR/Area Executive NSW Department of Health NSW Department of Health. Health Infrastructure and Institute of Medical Education and Training) . Workplace Relations and Management Special Purpose and Trust Fund No funds sought. 5.Director. Workplace Relations and Excellence Commission.Director-General . is not to be influenced by the availability of frequent flyer points.Minister General Fund NSW Department of Health.Chief Executive .Workplace Relations and Management ** Division of the NSW Health Service .Director. only leave Division of the NSW Health Service for Official Travel .HR/ Executive NSW Department of Health .6 Staff members undertaking official travel are not to seek or accept frequent flyer points from any airline. HealthQuest and HAC Within the notional budget .Director-General .Chief Executive If notional budget is exceeded: . car or hotel loyalty schemes or lounge memberships are not to influence travel decisions.Human Resources/Area Executive . Clinical .Chief Executive Division of the NSW Health Service .Director.Chief Executive NSW Department of Health . 5.Minister NSW Department of Health. and choice of airline.Deputy Directors-General . Workplace Relations and Management 24(7/09) . firm or other organisation to attend or present at conferences or seminars is considered to be on official overseas travel and subject to this policy. Approval is at the discretion of the Employer or delegate. Sound reasons should be provided in support of any application to undertake official overseas travel to establish that a proposed visit is essential and will have significant benefit to the NSW Public Health System/the Department of Health and/or the State of New South Wales. the staff member undertakes official duty during absence overseas on leave granted for study purposes. should be based on the distance travelled and length of the conference/seminar. Workplace Relations and Management will monitor Department of Health. Where expenditure is via a sponsorship. the staff member undertakes some official duty during the course of a private overseas visit.2 Sponsorship A staff member who is sponsored (financed) by a person. Approval to take private leave while undertaking official overseas travel is to be limited to 1-3 days. or may receive financial support from the Employer during that time. 5. recommending officers should ensure that no conflict of interest exists for the individual. Papua New Guinea. 5. the staff member is on special leave for any purpose.2. HealthQuest and Health Administration Corporation (Health Support Services. or the staff member proceeds overseas for a tour of duty (on exchange or otherwise) with another government or a body such as the United Nations or one of its agencies.7 **Only requests endorsed by Deputy Directors-General are to be referred to Workplace Relations and Management. if any. 24(7/09) . 5.2.1 Study Scholarships Study overseas on scholarship is not considered official overseas travel even though the staff member concerned may be on part or full salary for the period of the scholarship or study leave. The strictest economy is to be exercised on overseas visits.CHAPTER 5 – TRAVEL 5. for the Division of the NSW Health Service. The length of absence and costs must be kept to the minimum practicable. Overseas travel includes travel to New Zealand.2. Each application should be considered on its merit and the amount of private leave approved. or for NSW Department of Health (refer to Staff Delegation A109).3 Private/Annual Leave The practice of taking private leave before.2 Official Overseas Travel Official overseas travel is travel out of Australia by staff members when: • • • • • the staff member is on duty. Clinical Excellence Commission. during or after official overseas travel is not encouraged. 5. Norfolk and Lord Howe Islands and other external Australian territories. Health Infrastructure and Institute of Medical Education and Training) expenditure for the Director General to ensure that travel approvals do not lead to over-expenditure of the allocation. or that is above the approved amount. the staff member is then required to complete the general application process for official overseas travel outlined in 5.3.2.CHAPTER 5 – TRAVEL 5. This requirement also encompasses private funding that may affect any claim on the administration for leave. and There is a real and demonstrable benefit to NSW Health. The criteria that must be met for approval to present a paper include: • • • • There has been no prior commitment to conference organisers by the individual to present a paper.4 Private Funding Staff members seeking approval for official travel shall disclose any funding from a private source at the time of making an application. 5. Workplace Relations and Management will then process the application for approval by the Director-General.3.1). Clinical Excellence Commission.3 Procedure For Seeking Approval To Travel Automatic approval for official overseas travel applications should not be assumed in any circumstance.2 Application Process for all Official Overseas Travel (Attachment 2) Applications for official overseas travel must be approved by the Chief Executive of the Division of the NSW Health Service for staff members of the NSW public health system. subsistence or travel costs. The relevant manager certifies the application is a high priority for the Department/NSW public health system. 5.2 below. applications must go through the Department’s Workplace Relations and Management directorate after endorsement has been given by the relevant Deputy Director-General. The staff member is presenting a paper of significance on an important Health issue. The application form at Attachment 3 is to be completed and submitted to the Employer for approval in principle. 24(7/09) . Therefore staff members should not give anirrevocable commitment in respect to a proposed overseas visit prior to approval. If approval in principle is granted. whether provided before or after a claim is made. For staff members of the NSW Department of Health. 5. HealthQuest and HAC entities (refer to section 5. 5. and the DirectorGeneral for staff members of the NSW Department of Health.1 Application Process if Presenting a Paper at a Conference/Seminar (“Approval in Principle”) “Approval in Principle” is to be obtained from the Employer prior to a staff member submitting either a paper or a synopsis for acceptance to conference/seminar organisers. Any costs incurred where approval is not given. will be the responsibility of the applicant and other person(s) concerned. during or following official travel.8 The Employer is not to be put to any additional cost as a result of any private leave undertaken prior.3. 4 5. The Chief Financial Officer. they have already been approved in principle by the Employer.4. Written approval is to be given prior to any official travel being undertaken. Length of absence and costs are kept to the minimum practicable.4).1 General Fund Notional Budget Each financial year.4. Departm ent of Health is authorised to increase the base am ount of the notional budget each financial year by such amount as considered appropriate. Sound reasons are given in support of the application and there is a real and demonstrable benefit to the Employer and the staff member. Deputy DirectorsGeneral should prioritise requests within their available notional budget to ensure their budget is not exceeded.3). Responsibility for ensuring the notional budget allocation is not exceeded rests with the Division of the NSW Health Service. The criteria that must be met for approval include: • • • • • There are funds available in the General Fund (see 5. The Department of Health’s allocation will be divided equally across all divisions. 5.4. Applications for overseas travel are not to be approved if the notional budget has been exceeded.CHAPTER 5 – TRAVEL All applications will be critically reviewed. a General Fund notional budget is established for official overseas avel undertaken tr by staff members. 5. and If the staff member is to present a paper at a Conference. Although the relevant Division of the NSW Health Serv ice or the Department of Health pay s for the travel. The proposed visit is essential and is of significant benefit for the NSW public health system and/or the Department of Health. and sound reasons in support of the request are to be provided by the applicant.2 Annual Notional Budget Allocations Each Division of the NSW Health Service and the Department of Health will have their own annual notional budget allocation. The Chief Financial Officer will advise Divisions of the NSW Health Service and the Department of Health of their annual notional budget allocation for overseas travel in advance. 24(7/09) .9 The application form at Attachment 2 is to be completed and signed by the appropriate manager prior to it being submitted to the Employer for approval and must include all documentation requested in the Checklist at Attachment 1. General Fund 5. regardless where there are funds available (see 5. the expenditure is recorded against the notional General Fund budget. Divisions of the NSW Health Service and the Department of Health are to provide reports on all overseas travel by staff members in their Division every 6 months. Official incidentals.7 for the actual rates. Department of Health. and the cost and funding source. 24(7/09) . The report is to include details of each staff member/s undertaking official travel during the previous 6 months. (To cover meals and incidentals. subject to the production of receipts). the date and duration.10 Where an overseas travel application will exceed the notional budget allocation. Conversely. where the allocated budget is under-expended at the end of the financial year the Division of the NSW Health Service may apply for the balance to be added to the allocation for the following financial year.5 Reporting Requirements Please use the form at Attachment 4 as a template.6 Travel Allowances (Subsistence) – What is covered Staff members are not paid subsistence during travel time. taxi fares (for personal reasons). buses. gratuities). the Division of the NSW Health Service or the relevant Deputy Director-General of the Department of Health must seek approval in writing from the Chief Financial Officer. private telephone calls. See section 5. the purpose of the travel. • The daily allowance rate and official incidentals are payable from the time of arrival at the destination (and any stopovers where meals are not provided) until the time of leaving the destination. (To cover official business expenses for taxis. The following subsistence is paid to staff members: • • A daily allowance rate. Any additions or changes occurring after the report has been lodged should be reported in the following six-monthly report.13) 5. newspapers and magazines. NSW Department of Health as at 31 December and 30 June each year and are required by 14 January and 14 July. any associated private leave granted.CHAPTER 5 – TRAVEL 5.4. These reports are to be submitted by e-mail in Excel format (Attachment 4) to the Chief Financial Officer. 5. trains. If approval to exceed the budget is granted the amount overspent will be offset from the travel budget for the following financial year and the Area/Division’s allocation in that year will be reduced accordingly. such as expenses to cover personal laundry and dry cleaning. Overseas travel is also subject to audit reporting requirements (refer Section 5. fares or stationery items. An estimated cost of such items should be included with the overseas travel application with reimbursement subject to the production of receipts) The cost of reasonable accommodation (Is paid on the basis of actual reasonable expenses incurred.3 Where the Notional Budget Allocation has been Exceeded 5. For example where dinner is provided. Please refer to the ATO website http://www. Staff members should be paid the full daily allowance for the first 35 days they reside in accommodation in the same city to compensate for the higher costs associated with transitory living arrangements and the costs of settling into long term accommodation. boarding passes.7. they may claim all-inclusive actual expenditure in respect of the entire period of travel overseas.health. you can find these levels on the Department of Premier and Cabinet’s website at http://www.gov.11 Due to taxation implications regarding overseas travel allowances. Where a staff member’s itinerary includes free meals.7 Allowance Rates ECA International sets the overseas allowance rates for this policy.nsw. 5.html 5. Only costs reasonably and properly incurred will be considered for payment. receipts and approvals.nsw. The Department of Premier and Cabinet sets these levels.gov. When a staff member has resided in accommodation in the same city in excess of 35 days his/her allowance for meals and incidentals will be reduced to 70 per cent.CHAPTER 5 – TRAVEL 5. 5.gov.html. 5.7. Alternatively. such as accommodation and official fares etc. Due to copyright provisions these rates can only be accessed on the Department of Health Intranet site at: http://internal. such as air tickets.3 Receipts All staff members travelling overseas are required to produce receipts for all expenses that are claimed outside of those items included within the daily allowance.au/jobs/travel/index-travel.ato.. go to the Department of Health Intranet site at http://internal.health. This is done through a subscription service. seminars. to receive payment of the total of the allowances (meals + incidentals) as currently prescribed by Australian Taxation Office Ruling TR 2004/6. To ascertain the appropriate daily rate for your level of remuneration. a staff member may elect in writing.7. 24(7/09) . such as meals provided at conferences.1 Determining the Appropriate Daily Rate The appropriate allowance rate for an individual staff member undertaking overseas official travel is dependent of their level of remuneration.au/publications/memos_and_circulars. Written substantiation must be provided in respect to accommodation costs claimed. if the total of the allowances is less than the total allowance (meals + incidentals) prescribed by this policy.2 Claims Claims for travel expenses should be submitted as soon as possible. Claims should be supported by all procurable documents. the claim must be adjusted accordingly. Should any staff member consider that they have been disadvantaged by the operation of these allowances. etc.au for further information. a deduction of the appropriate dinner allowance rate must be made.dpc. and no later than one month after the travel has occurred.au/jobs/travel/travel-rates.gov.nsw. 5.000. is provided to approved persons employed by NSW Health against injury or death by accident while travelling overseas in accordance with. The intention of personal accident and m edical expenses cover is to protect the approved agency person for the entire period they are overseas whilst on official business i.8. 24(7/09) . In addition.ato.4 for automatic Tourist and Travellers Protection for official visits of staff members (including Staff Specialists undertaking overseas travel for the purposes of TESL in accordance with the Salaried Medical Practitioners Determination as amended from time to time) travelling overseas. Personal accident and medical expenses cover does not cover pre-arranged or elective treatm or treatment for which there is no im ent. in accordance with Section E 5. medical expenses of up to $1. 24 hours.1 Official Visits of Staff Members Overseas Personal Accident and Medical Expenses Cover Tourist and travellers personal acci dent protection autom atically covers staff m embers and approved persons against injury or death by accident while travelling overseas.e. For the latest information please refer to the ATO website at http://www.12 At the time of issuing this policy.4 of the Contract of Coverage. and equivalent to the benefits payable under. Taxation Ruling 2004/6 prescribes the taxation arrangements for meal and travelling allowances including overtime.000 are provided while outside of Australia. Personal accident and m edical expenses cover covers treatment of any immediately necessary nature. Local regulations in the country being visited should be examined to determine whether local insurance coverage is required. mediate medical necessity. which arises while overseas and requires treatment before returning to Australia. meal allowances and subsistence daily rates. 7 days a week and cover includes medical and dental treatment for accidents and acute episodes of illness (including unexpected acute episodes of pre-existing illnesses) occurring while overseas.CHAPTER 5 – TRAVEL 5.1.gov. The Contract may be found in a booklet entitled "Treasury Managed Fund – Scheme Structure incorporating the TMF Contract of Coverage March 2004" which can be obtained from your Risk Management Coordinator. If you have any questions regarding this service please call your Risk Management Co-ordinator in the first instance. Insurance coverage and its exclusion is as summarised below: 5.8 Travel Insurance The Contract of Coverage with the NSW Treasury Managed Fund provides at Section E. Taxation Determination 2008/18 sets the reasonable limits for taxation purposes for the 2008/2009 financial year. Cover.4 Taxation Arrangements For Meal And Travelling Allowances 5.1. the Workers Compensation Act 1987 and the Workplace Injury Management and Workers Compensation Act 1998.7.au 5. This may be signed by the Director-General or Chief Executive and provided to each staff member travelling overseas. 4.1 Corporate Medical Membership 1. should the Staff Specialist take annualor other non-TESL leave while overseas then TMF over c would be suspended for the tim e of that leave and private arrangements should be m ade to obtain any insurance coverage for that period.3 Personal Accident Exclusions This tourist and travellers personal accident protection shall not apply to any event directly or indirectly attributable to or a consequence of: • • • Intentional self-injury or suicide (whether felonious or not) or any attempt thereof. On resumption of official TESL TMF coverage would again apply.000 – as of December 1998).com 5. The services provided are also detailed on their website http://internationalsos. the NSW Treasury Managed Fund has an agreement with International SOS Australasia Pty Ltd to provide emergency assistance to staff members of Fund members travelling within Australia (in excess of 160km from place of residence) or overseas on official business. 2. facsimile: 61 2 9372 2455 (call charges may be reversed). and can be accessed through a 24-Hour Alarm Centre by contacting SOS Sydney Alarm Centre. 5.8.9.4 Proof of Medical Insurance At Attachment 5 is the pro forma "Statement on Medical Insurance Arrangements Applying to Overseas Travel on Official Business". the cover extends to leisure and recreational periods associated with the conference only while the staff member is overseas (but not private or non-TESL leave). 5. Sexually transmitted diseases that are acquired during approved travel unless the disease was workplace contracted while undertaking approved activities.8. SYDNEY. 5. (It should be noted as per PD2005_305 that the num ber of day s of annual or other leave that can be taken in conjunction with TESL is not to exceed the number of days of TESL being taken).000 is provided for baggage and personal effects in accordance with the Treasurers Directions ($10. telephone: 61 2 9273 2784.CHAPTER 5 – TRAVEL 5.13 In apply ing this cover to Staff Specialists unde rtaking overseas travel for the purposes of TESL the Department advises that the Staff Specialist is c overed whilst on official business 24 hours per day . Emergency and Routine Medical Advice Travel Health Information Medical and Dental Referrals Outpatient Case Management 24(7/09) . However. Note: Subject to the staff member receiving prior approval by the Director-General or Chief Executive. AUSTRALIA. The services provided are detailed below.9 Emergency Assistance In addition to the protection provided. Engaging in professional sport(s). 5.2 Baggage and Personal Effects Coverage Coverage to the value of $10. 3.8. 5. Medical Monitoring Dispatch of Medication and Medical Supplies Repatriation of Mortal Remains Access to International SOS Clinics Legal Referrals Emergency Message Transmission Translations and Interpreters Lost Document Advice and Assistance Arrange Ground Transportation and Accommodation for Accompanying Family Members Companion Ticket Advance of Emergency Personal Cash Return of Dependant Children 5. 20. Details of this assistance can be found on their website http://internationalsos.9. 14. Travel Security Information International SOS Crisis Centre Security Evacuation Assistance and Co-ordination Security Surveys and Emergency Response Planning Other Security Services Arrangements have been m ade for membership cards to be provided by the State Governm ent's Contracted Travel Agents at the time that aeroplane tickets are collected. The Employer should include this in formation in the approval letter provided to the staff member travelling overseas. Cost Review and Payment. 19. 11. Departure from these procedures could create difficulties or disrupt travel. or obtained direct from International SOS on 61 2 9372 2400. 18. 2.10 Pre Travel Arrangement International SOS can also provide other services relating to pre travel assistance on a fee for service basis. 17. Mem Membership Name: bership Number: NSW Treasury Managed Fund 12AMMS000001 5. 10. or the Australian missions in those countries. 21. 5. in the arranging of appointments. Requests for assistance to foreign governmental authorities of other countries for assistance (eg. 24(7/09) . 13. 9. 16.11 Protocol and Other Special Conditions The proper protocol is to be observed at all times in connection with official visits overseas. 6. 4.com with the password being the membership number. 15.CHAPTER 5 – TRAVEL 5. transport. 12. 7. etc) must be made through established diplomatic channels either to the Diplomatic and Consular Missions in Australia of the countries to be visited. 3. In the event that a card is not received the following membership name and number must be quoted whenever contact is m ade with SOS Assistance. 5.2 Corporate Security Program 1.14 Medical Evacuation and Repatriation Convalescence Expenses Return Home after Medical Evacuation Outpatient Medical Expense Guarantee and Payment Arrangement for Inpatient Admission and Identify Receiving Physician Inpatient Medical Expense Guarantee. 8. Department of Premier and Cabinet can offer further advice and assistance together with any updates on changes made by DFAT. On return from official overseas travel.Wood@dfat. the travel is not covered by Award conditions. Note: It is ESSENTIAL that reports are provided in electronic form so that they can be easily uploaded onto the NSW Department of Health Intranet site.smartraveller.13 Audit And Reporting Requirements Occasions of overseas travel needs to be justified and recorded for audit purposes. or the staff member is seeking approval by the Director-General/Chief Executive and the funding requested. Department of Health at
[email protected]. They are prescribed under Department of Premier and Cabinet Circular Review of Meal. the travel is in excess of $2000 from the Special Purposes and Trust Fund.gov.15 From time to time the Commonwealth Department of Foreign Affairs and Trade (DFAT) supplies the Department of Premier and Cabinet with policy on this subject. DOMESTIC TRAVEL The allowances in this section are set by the Department of Premier and Cabinet and apply to NSW Health.3 pages) on the seminar/conference/meeting etc by e-mail to the Workplace Relations and Management Branch. The requirement for disclosure of overseas travel in the Annual Report will continue. Staff members should familiarise themselves with the content of the Travel Health section of the DFAT website called Smart Traveller: http://www.html Staff members are advised to visit the DFAT Smart Traveller website for travel advice about the countries they are planning to visit: http://www.au/tips/travelwell. Travelling and Related Allowances and Circular Australian and Overseas Travelling Allowances. These allowances can be accessed through the Department of Health Intranet site at http://internal.health. 24(7/09) .CHAPTER 5 – TRAVEL 5.html. 6. Records must include the date and duration. Reports must be completed in all circumstances where: • • • • the staff member is not a Staff Specialist utilising TESL. the staff member is to forward a short report (preferably 2 . cost and funding source.gov.nsw. The Office of Protocol and Special Events. purpose and any associated private leave granted.gov. The report will be placed on NSW Health Travel Intranet site. is from the General Fund. The rates as amended from time to time apply from the date they are amended by the Department of Premier and Cabinet.au/zw-cgi/view/Advice/ 5. if any.au.gov. the officer travelling. 5.gov.au The format to be used for the reporting template will be attached to the staff member’s approval letter. Staff members should check the reporting requirements in their Division of the NSW Health Service as they may require a more comprehensive report.smartraveller.health.12 Health and Security Proper medical advice should be sought prior to undertaking any overseas travel.au/jobs/travel/travel-rates. Contact: Sharyn. and Chairpersons of statutory bodies and of Government boards and committees may approve their own official domestic travel.3 of the Delegations Manual outlines the delegations for approving all other domestic official travel for staff members of the Department of Health. However.3 Staff members must complete a Request for Approval to Travel Form (available locally) and have obtained the appropriate approval to travel from the authorised delegate. Chief Executives. A staff member seeking approval for official domestic travel must disclose any funding from a private source for that travel at the time of making the application. Where a staff member undertaking domestic official travel wishes to extend the visit for private purposes. or conversely proposes to extend private travel for official purposes. the Department of Premier and Cabinet’s website contains all Department of Premier and Cabinet Circulars and is located at http://www. Air or Road and Overnight Accommodation 6. members of the Senior or Health Executive Service. whether provided before or after a claim is made. 6. prior to arranging any travel. the Minister's approval should be obtained for any proposed travel arrangements that might attract public concern and the strictest economy should be exercised. The Director-General must approve travel to Norfolk Island. 1st year under the Crown Employees (Senior Officers Salaries 2004) Award (as varied from time to time). and in no instance is NSW Health to be put to any additional expense.16 Alternatively. Means of Travel – Rail. 6. 24(7/09) .au. and staff members with remuneration on or above a cash salary equal to a Senior Officer Grade 1. Section 17. Lord Howe Island or other external Australian territories.dpc. Two exceptions to the above apply and are outlined below: • • The staff member is accompanying the Minister and if required by the Minister.CHAPTER 5 – TRAVEL 5. All requests by staff members must be approved in writing prior to any official travel being undertaken. It should be noted that all travel request forms are to be signed (for both travel and subsistence costs) by an officer delegated with authority to incur expenditure and certify the availability of funds.2 Class of Travel (All Modes Of Transport) Economy class is to be used for all modes of transport for domestic official travel within Australia.1 Delegation of Approval The Director-General. Chief Executives of Divisions of the NSW Health Service. may travel in the same Class as the Minister for the sectors which they travel together. This practice should not be encouraged. prior approval is required. For staff members of Divisions of the NSW Health Service approvals for domestic official travel must be by the relevant Chief Executive or under formal delegation as outlined in their respective Delegations Manual. This requirement also encompasses all private funding which may affect any claim on the administration for leave.gov.nsw. subsistence or travel costs. may use Premium Economy or Business Class for travel to Western Australia and the Northern Territory. statutory office holders reporting directly to the Minister. for the return journey when the return journey commences later than 10 p. Rail travel is to be based on overnight rail travel with sleeper accommodation. cost of air fares. where the urgency of business warrants it. where there is no significant difference in cost between rail and air travel and the staff member is required to maintain close liaison with other parties travelling by air. The need to obtain overnight accommodation shall be determined by the Employer having regard to the safety of the staff member travelling on official business and local conditions applicable in the area. Rail transit should be used for the transport of material and equipment where the Rail Division of the State Rail Authority can provide a reasonable service. for the forward journey where the train arrival time is earlier than 6 a. 6.4 Travelling Time Compensation for travel time should be paid as follows: a) on a non-working day. Air travel may be approved in instances where it can be clearly demonstrated that an overall saving would eventuate. The period for which the compensation is being sought must be 30 minutes or more on any one day. cost of excess travelling time. on the outward journey from Headquarters. and b) on a working day. 24(7/09) . for all additional time spent travelling before or after the staff member's normal hours of duty. Where staff members are required to attend conferences or seminars. that is. cost of subsistence allowance. In other cases Government transport services should be used whenever practicable. where a rail sleeper accommodation is not available. for all time spent travelling on official business. which involve evening sessions or staff members are required to make an early start at work in a location away from their normal workplace.m. including travel by chartered aircraft is to be monitored and wherever practicable. Air travel may also be approved: • • • • • • • for the forward journey where one day or less is involved in order to avoid overnight travel on consecutive nights.CHAPTER 5 – TRAVEL 5. on a working day and air travel at a more suitable time is available. where it is of advantage to have the staff member available at the start of business on the following day and rail travel does not allow this.m.17 Rail and air timetables are to be examined closely to ensure that the most economical arrangement is approved. and/or the train arrives back at point of departure (near headquarters) earlier than 6 a. overnight accommodation shall be appropriately granted. in regard to applications for travel the expected relative costs of travel by air and rail should be considered having regard to the: • • • • cost of rail fares. Use of air travel. arrangements should be made to coordinate travel by staff member using chartered aircraft so that maximum economies can be achieved.m. Compensation for travelling time will only be granted in respect of the time that might reasonably have been taken by the use of the most practical and economic means of transport.m. time from 11. 6.CHAPTER 5 – TRAVEL 5. (The daily allowance cannot be claimed): 24(7/09) . on the following day where the staff member has travelled overnight and sleeping facilities have been provided for the staff member. Staff members must obtain authorisation for all official travel prior to incurring any travel expense. such waiting time shall be treated and compensated in the same manner as travelling time. is always deducted unless the staff member is leaving from or returning to headquarters).6.m. 6.5 Reimbursement of Travel Allowances Any authorised official travel and associated expenses. properly and reasonably incurred by a staff member required to perform duty at a location other than their normal headquarters shall be met by the Employer. Those staff members whose salary is in excess of Clerk Grade 5. It shall exclude the following: a) b) c) d) e) f) g) time normally taken for the periodic journey from home to headquarters and return (the periodic journey.00 p. Payment of any actual expenses is subject to the production of receipts.30 a.Daily Allowances and Actual Expenses 6. Time off in lieu or payment for excess travelling time or waiting time will not be granted or made for more than eight hours in any period of 24 consecutive hours. unless the employer is prepared to accept other evidence from the staff member. working on board ship where meals and accommodation are provided. or. under the Crown Employees (Public Sector Salaries January 2002) Award. travel to new headquarters on permanent transfer. travel not undertaken by the most practical available route.1 Actual Expenses The following staff members can only claim actual expenses (with receipts) up to the indicative upper allowance rates as set out in Categories A and B of Department and Premier and Cabinet Circular Australian and Overseas Travelling Allowances.18 A staff member directed to travel on official business outside their usual hours of duty is entitled to apply and be compensated for such time either by payment at single time in accordance with the provisions contained in this section. if operationally convenient. are to be paid at the Clerk Grade 5 rate + $1. if special leave has been granted for the day or days on which travel is to be undertaken. When a staff member is required to wait for transport in order to commence a journey to another location or to return to headquarters and such time is outside the normal hours of duty. Time off in lieu should be taken within one month of accrual. any periods of excess travel of less than 30 minutes on any one day. both ways. on one day to 7.00. as varied from time to time. by taking equivalent time off in lieu. For Department of Health staff members the rate of payment for travel or waiting time on a nonworking day shall be the same as that applying to a working day. and any travel undertaken by a staff member whose salary includes an "all incidents of employment" component.6 Travel Allowances . As a guide. dry cleaning.health.7). authorising officers must ensure the claim is adjusted accordingly. The daily allowance rate provides for the cost of meals. 24(7/09) .260) Note: Senior Officers in the Department are entitled to have allowances or actuals.gov. the 6. the amount payable for the part day of travel shall be limited to the actual expenses (excluding morning and afternoon teas) incurred (receipts required) up to the allowance levels set for meals.7). e.260) are eligible to claim the daily allowance rate as an alternative to claiming actual expenses.19 Chief Executives. However. Where a staff member's itinerary includes "free meals". a deduction of the dinner allowance must be made (see section 6. staff members are only entitled to claim actuals up to the allowance rate. Where the Employer elects to pay for accommodation.html. private telephone calls. ne wspapers and m agazines. despite the period being less than 24 hours. Indicative upper limits apply when claiming actual expenses.nsw. 6. staff members shall be paid the allowances for meals and incidentals (see 6. Access to Category Level C can also be found at http://internal.g. where some part day travel at the end of the trip is involved.CHAPTER 5 – TRAVEL • • • 5. gratuities.au/jobs/travel/travel-rates. etc. for exam laundry and ple. incidental expenses and accommodation outlined in three categories. The daily allowance rates are prescribed in the Department of Premier and Cabinet Circular Australian and Overseas Travelling Allowances under Column C.gov.au/jobs/travel/travel-rates. taxi fares (for personal reasons). eg meals provided at conferences. 1st year under the Crown Employees (Senior Officers Salaries 2004) Award (as varied from time to time) (as at 30 November 2008 this was amount was $123.html.nsw.8). seminars. where dinner is provided.2 Daily Allowances Senior Officers within the Department of Health and all other staff members on a cash salary below Senior Officer Grade 1. Members of the Senior or Health Executive Service. Where the Employer pays for any accommodation and/or meals as part of the conference fees. staff members shall be paid the allowances for meals and incidentals (see 6. Items in the category of incidental expenses would include.health.30pm times set for payment of day only travel allowances are to be used as the basis for the payment of actual expenses where part day travel is involved at the end of the trip.. Only absences of 24 hours' duration involving an overnight stay attract the daily allowance rate.00am and 6. In other cases. Where the Employer elects to pay for accommodation. etc. expenditure for accommodation and three meals has been incurred. Access to Category Levels A and B can also be found at http://internal. The indicative upper limits levels are the allowance rates under Columns A and B as prescribed in Department of Premier and Cabinet Circular Australian and Overseas Travelling Allowances. payment of the allowance may be made where the staff member satisfies the approving officer that.6. 1st year under the Crown Employees (Senior Officers Salaries 2004) Award (as varied from time to time) (as at 30 November 2008 this amount was $123. and Staff members receiving a cash salary above a Senior Officer Grade 1. The staff member is entitled to claim the appropriate meal allowances during full 24-hour periods and actual meal expenses properly and reasonably incurred (excluding morning and afternoon teas) for any residual part day travel. the claim would consist of all necessary and reasonable expenses actually incurred for meals (excluding morning and afternoon teas) and accommodation. the staff member shall be paid an allowance for the expenses properly and reasonably incurred during the time actually spent away from the staff member’s residence (from time of leaving to time of return) in order to perform that duty or actual costs up to the allowance rates. 6.au for more information on Determination 2008/18 and Australian Taxation Ruling 2004/6. plus the amount per day for incidental expenses (each 24 hours) at all locations specified in Department of Premier and Cabinet Circular Meal.2) Where a staff member performs official duty at or from a temporary work location and is thereby compelled to reside temporarily at a place other than his/her residence. In these circumstances the daily allowance rate is to be treated as an indicative upper limit for travel expenses. to receive payment of the total of the allowances (accommodation + meals + incidentals) as currently prescribed by Australian Taxation Office Determination TD 2008/18. Where a staff member elects to claim actual expenses instead of claiming the daily allowance.7.7.1 Employer Accommodation (see cl.2 Non Employer Accommodation (see cl.Payment of Allowances The following guidelines apply to the payment of domestic travel allowances: The Employer will elect whether to pay the accommodation directly or whether a staff member should pay the accommodation and be reimbursed in accordance with this clause. if the total of the allowances is less than the daily allowance rate. 6. Travelling and Related Allowances.7 Living Allowances . and accommodation is not provided by or paid for by the Employer. referred to generally as three star/three diamond accommodation. Please refer to the ATO website at http://www. Travelling and Related Allowances. If claiming Sydney rate. Where practicable staff members shall obtain prior approval when making their own arrangements for overnight accommodation. and is provided with accommodation by their Employer or paid for by their Employer. 6. the boundary is determined by Sydney Telephone District as defined by the Telstra’s (02) 8 and (02) 9 boundary. referred to generally as three star/three diamond accommodation.2) Where a staff member performs official duty at a temporary work location and is thereby compelled to reside temporarily at a place other than his/her residence. 6. Where possible. the overnight accommodation for staff members travelling on official business should be of the middle of the standard range. Where possible.6.CHAPTER 5 – TRAVEL 5.6. 6. and shall in addition be paid incidental expenses for each 24 hours as prescribed by Department of Premier and Cabinet Circular Review of Meal. 24(7/09) .gov. the staff member shall be reimbursed expenses properly and reasonably incurred (for example for meals) during the time actually spent away from his/her residence in order to perform that duty.ato.20 Due to taxation implications regarding the daily allowance a staff member may elect in writing. the overnight accommodation for staff members travelling on official business should be of the middle of the standard range. and for the return journey from the staff member’s residence to the temporary work location) properly and reasonably incurred (including any allowance for use of private motor vehicle). shall apply to the remainder of the absence. When a staff member has resided in accommodation. or any other period during which the staff member is absent from his/her temporary work location otherwise than on official duty. the allowance payable for the part day of travel shall be limited to the actual expenses incurred. may return to the staff member’s residence on any weekend or public holiday and shall be entitled to be paid the actual expenses of travel (for the journey from the temporary work location to the staff member’s residence. commencing with the time of arrival at that residence and ending at the time of departure from that residence. who is in receipt of an allowance. Unless otherwise determined by the Employer the amount so paid shall not exceed the amount to which the staff member would have been entitled by remaining at his/her temporary work location. and actual expenses for the other part of the period of absence. any period of leave. is entitled to an allowance in respect of the necessary period of travel to return to his/her residence or to take up duty at another temporary work location. A staff member who is in receipt of an allowance. staff members can claim for incidental expenses at all locations as prescribed by Department of Premier and Cabinet Circular Review of Meal.CHAPTER 5 – TRAVEL 5. 6.3 Restrictions of Payment of Allowances Allowances are not payable in respect of: • • • any period during which the staff member returns to his/her residence at weekends or public holidays. up to the respective allowance rates. Travelling and Related Allowances applies to the whole absence.21 Where a staff member proceeds directly to a temporary work location in a capital cityand returns direct. Tier 2 Country Centres and Other CountryCentre . rate as appropriate. Staff members are to be paid the applicable daily allowance rate for the first 35 day (commencing from s the time of arrival at the staff member’s temporary work location and including any public holiday and any period of return to the staff member’s residence at weekends) they reside in accommodation in the same town/city to compensate for the higher costs associated with transitoryliving arrangements and the costs of settling into long term accommodation. 24(7/09) . Any purchase of alcohol or any private telephone calls from the hotel/motel is considered to be the responsibility of the staff member.7. A staff member. provided that the allowance paid to a staff member temporarily located in Broken Hill shall be increased by one-fifth. That is. and upon ceasing to perform duty at or from a temporary work location leaves that location. An exception is where some part day travel at the end of the trip is involved. in the same town/city. Claims must be made on a uniform basis. the Capital City rate shall apply only in respect of the time spent in the capital city the High Cost CountryCentres. except with the approval of the Employer. staff members may not claim daily allowance rates for part of the period of absence. Where actual expenses are claimed. In this case. Where a staff m ember breaks the journey in centres other than a capital city . for over 35 days and up to 6 months their allowance is paid at 50%of the appropriate daily rate. the Capital City rate as prescribed in Departm ent of Premier and Cabinet Circular Review of Meal. Travelling and Related Allowances. 6.CHAPTER 5 – TRAVEL Daily allowances are not to be reduced if one or more meals are taken at health organisation establishments. eg not part of a conference. in exceptional circumstances.10 Adjustment of Allowances 6. may be paid so as to reimburse the staff member for the additional expenses incurred. for dinner when required to work or travel until or beyond 6. 6.3 Actual Expenses – Production of Receipts Payments of actual expenses shall be subject to the production of receipts. is located at a distance of at least 50 kilometres from the staff members normal headquarters at the time of taking the normal lunch break.30 p. as a result.m. by reason of that journey.9.1 Payment in advance: The Employer may approve applications for advance payments of travelling and sustenance allowances.10.9. for lunch only when the staff member is required to travel a total distance on the day of at least 100 kilometres and. prior approval should be obtained. 24(7/09) . a further allowance. Such applications should include a detailed estimate of anticipated expenditure and specify whether the Employer is providing or paying for accommodation and/or meals.m.9. and at least 1 hour before the prescribed starting time. unless the Employer is prepared to accept other evidence from the staff member.00 a. the staff member is to pay for the meal(s). These allowances are prescribed in Department of Premier and Cabinet Circular Review of Meal. Staff members shall check costs prior to travelling and. 6.7 or 6.8 5. 6.2 Time for submitting claims: Claims should be submitted promptly. that is. However. if approved by the delegated officer and receipts are provided.9 Claims for Payment of Allowances 6. if it appears that costs would exceed the allowance rate. 6. Travelling and Related Allowances. within one month from the completion of work or within such reasonable time as the Employer determines in writing.22 Meal Allowances (if not specified by an applicable Award or other industrial instrument) A staff member who is authorised to make a journey on official business and who is not.8 is insufficient to adequately reimburse the staff member for expenses properly and reasonably incurred. The allowance is only payable if the staff member incurred an expense.1 Insufficient Funds Where an allowance under sections 6. required to reside temporarily at a place other than the staff member’s residence shall be paid the following allowances: • • • for breakfast when required to commence travel at or before 6.. Domestic related travel allowances up to the amount the Commissioner for Taxation deems reasonable (Taxation Determination 2008/18).CHAPTER 5 – TRAVEL 6. 24(7/09) .00 per annum. Laundry expense allowances up to the value of $150. Overtime meal allowances up to the prescribed amount per meal paid under an industrial instrument in connection with overtime worked (also prescribed in Department of Premier and Cabinet Circular Review of Meal. 6. Any claim for work-related expenses incurred for travel that does not involve sleeping away from home is subject to the normal substantiation requirements. • • • • Award transport payments paid under an industrial instrument that was in force on 29 October 1986.23 Payment of an allowance is to be refused or the amount of the allowance reduced by the Employer where: a) any expenses in respect of which an allowance is payable were not properly and reasonably incurred by the staff member in the performance of official duties.10. the staff member was paid in excess of the amount which would adequately reimburse him/her for expenses properly and reasonably incurred. Refer to Taxation Ruling 2004/6 for detailed information on the way in which these expenses are to be claimed.11 Part Day Travel Allowance Part-day travel allowances received should be shown as assessable income in the staff member’s tax returns. or any purported expenses in respect of which an allowance is payable were not in fact incurred by the staff member.13 Travel Insurance The NSW Treasury Managed Fund automatically covers staff members travelling by air under the provisions of Workcover and no other official insurance coverage is allowed. D 2008/18 sets the reasonable limits for taxation purposes for the 2008/2009 financial year and TR 2004/6 explains the substantiation exception and the way in which these expenses are able to be claimed. A domestic travel allowance is an allowance paid to cover expenses on accommodation.2 Reimbursement of Funds 5. meals and incidentals to the travel. b) c) 6. where an overnight stay away from home is involved.12 Taxation Arrangements for Meal And Travelling Allowances Refer to Australian Taxation Office Determination 2008/18 and Taxation Ruling 2004/6 for information on the taxation arrangements for meal and travelling allowances including overtime. 6. or any purported expenses in respect of which an allowance is payable were not properly and reasonably incurred by the staff member in the performance of official duties. meal allowances and subsistence daily rates. Travelling and Related Allowances). and is in excess of 160 kms from the staff member’s residence. Rates per kilometre according to engine capacity are prescribed in Department of Premier and Cabinet Circular Review of Meal.24 When a staff member is travelling in Australia. See Section 5. and specific prior written approval has been obtained from the Employer for the staff member to use their private m otor vehicle with th e prim ary intention that the vehicle is used for employment purposes. Travelling and Related Allowances.dpc.1 Rates 7. USE OF PRIVATE MOTOR VEHICLES ON OFFICIAL BUSINESS The allowances in this section are set by the Department of Premier and Cabinet and apply from the date issued by the Department of Premier and Cabinet and as amended by Department of Premier and Cabinet from time to time.nsw. 7.nsw. 7. a staff member is unable to use other transport due to disability.gov.au. Please note that where particular awards/determ inations have specific motor vehicle allowance provisions. and use of a private vehicle where such vehicle is a requirement of the position.CHAPTER 5 – TRAVEL 6. These expenses can be accessed through the Department of Health Intranet site at http://internal. Alternatively.au/jobs/travel/travel-rates.html. private vehicles are to be approved for use by staff members in the performance of their duties when the following conditions are met: • • • • • no official vehicle is available. emergency assistance protection is provided by NSW Treasury Managed Fund that has an agreement with International SOS Australasia Pty Ltd. 24(7/09) .health. as an official vehicle should be made available where possible to the staff member if that staff member is required to travel daily in the performance of the required duties during working hours.gov.1 Official Business Rate The official business rate is only payable where the st aff member is directed to use their vehicle for official business. In general.14 Emergency Assistance 5. no public or other transport is available to permit travel within a reasonable time and at a reasonable cost. Travelling and Related Allowances. It should be noted that the vehicles approved for use primarily for official business need to have the appropriate insurance policy endorsed to indemnify the Employer against legal responsibilities (please see Insurance Requirements).1.9 for more information. those awards/determinations are to take precedence. They are prescribed under Circular Meal. the Department of Premier and Cabinet website contains all Department of Premier and Cabinet Circulars and is located at http://www. or necessary for the economic performance of the staff member's duties. the use of the staff member's private motor vehicle is essential to. It is considered that under normal circumstances staff members would not qualify for the payment of the "official business" rate. 24(7/09) . 7. excluding the Ambulance Service of NSW. Travelling and Related Allowances. and the staff member is agreeable to use his/her own vehicle with the approval of the employer. and any distance that is travelled in a private capacity.3 Casual Journey Rate This rate applies to staff members of the Department of Health as defined in this policy and the Ambulance Service of NSW. an official vehicle is not available. The transport rate is usually relevant when a staff member is not normally required to travel on a daily basis as part of his/her work.2.2 Limitations on Payment . the award provisions should be followed.Deduction From Allowance 7. 7. however if an award/determination provides for something different. Travelling and Related Allowances applies in all circumstances.1.1.2 Transport Rate 5. 7.1 Deductions for Private Use Where a staff member uses a private vehicle for official business. subject to the allowance paid for such travel not exceeding the cost of travel by public or other available transport. distance to and from a point determined within the typical work area is to be adopted as the distance to and from the accustomed place of work for the purpose of calculating the daily deduction. a deduction from the allowance payable for private vehicle usage is to be made to take into account the distance that would normally be travelled daily by the staff member from home to accustomed place of work and return.2. The casual rate is the appropriate rate payable in respect of a motor vehicle maintained by the staff member for private purposes but which the staff member has the prior approval of the Employer for occasional travel on official business or other approved travel. The most frequent incidents of staff members using their own motor vehicle occur when staff members are recalled to duty. Travelling and Related Allowances. The current transport rates per kilometre according to engine capacity are prescribed in Department of Premier and Cabinet Circular Review of Meal. This rate is to be paid in accordance with the provisions contained in public hospital awards. 7.2 Point Determined as "Accustomed place of work" Where the accustomed place of work of the staff member is not within the typical work area in which the staff member is required to use the private vehicle on official business.CHAPTER 5 – TRAVEL 7.4 Motor Cycle Allowance The allowance for motor cycles/scooters as prescribed in Department of Premier and Cabinet Circular Review of Meal.25 This rate only applies to staff members employed in the NSW Public Health System. The casual journey rates per kilometre according to engine capacity are prescribed in Department of Premier and Cabinet Circular Review of Meal.1. provide grounds for exemption from deductions provided that: (i) at the time of purchasing the periodical ticket the staff member did not envisage the use of their private motor vehicle on approved official business.7 Exemption from Deduction Deductions are not to be applied in respect of days where: • • • • • staying away from home overnight is involved. 7. the purchase by a staff member of a weekly or other periodical rail or bus ticket shall. 7. the monthly claim voucher shows official use of the vehicle has occurred on one day only in any week.3 Visits to Accustomed Place of Work 5. (ii) the periodical ticket was in fact purchased. whichever is the lesser. Insurance Requirements 7. the staff member uses the vehicle for official business after their normal working hours. a deduction is to be made of the distance usually travelled to and from the accustomed place of work and return. a deduction is to be made from the total distance travelled on the day. the distance for calculating the daily deduction is to be the actual distance to and from the accustomed place of work.2.5 Deduction When Reporting to Accustomed Place of Work Each day that a staff member uses a private motor vehicle on official business and during that day reports to the accustomed place of work.2. The deduction is to equal the distance from the staff member's residence to their accustomed place of work and return. 7.2. Exemption from deduction under this sub-paragraph being exclusive of and not in addition to days referred to in the points above. or.CHAPTER 5 – TRAVEL 7. and (iii) in regard to train travellers. in proper circumstances. no allowance is to be paid in respect of distance between the staff member’s home and the railway station or other intermediate transport stopping place. to and from the point determined in the clause above.26 Where the above usually applies but the staff member is required to attend the accustomed place of work.2.4 Residence Determined as Accustomed Place of Work A staff member's residence may be designated as their accustomed place of work for the purpose of this allowance provided that such recognition does not result in a further amount of allowance being incurred than would otherwise be the case. 24(7/09) . 7.6 Deduction When Not Reporting to Accustomed Place of Work Each day that a staff member uses their private motor vehicle on official business and does not report to their accustomed place of work.3 No motor vehicle allowance is to be paid to a staff member who uses a private motor vehicle on official business unless certain insurance requirements are met.2. the staff member uses the vehicle on official business and returns it to home prior to travelling to their accustomed place of work by other means of transport at their own expense. including the day of return from any itinerary. whichever is the lesser. or the actual cost of repair. whilst that staff member is using their private vehicle on official business does not suffice as an indemnity. or any other vehicle or property. • the accident or damage to the vehicle was incurred while the vehicle was being used on official business. and the staff member must have in force. "Punitive" excess charges imposed by an insurer because of a poor driving record or the type of vehicle insured shall not be reimbursed. at the time the vehicle is being used on official business.CHAPTER 5 – TRAVEL The requirements are: • • 5. Conditions for Reimbursement Reimbursement may be provided where: • the vehicle had been approved for official business. Maximum Reimbursement The maximum amount that may be reimbursed is the "normal excess" prescribed by the insurer at the time that the vehicle is damaged. to an amount and in a form approved by the Health Service. The additional excess imposed by some insurers on inexperienced drivers (or those under 25) is not considered to be a "punitive" excess and shall be reimbursed. a comprehensive policy of insurance or policy of indemnity. providing insurance or indemnity against: (i) liability of the Employer and the staff member to pay for loss or damage to property arising out of the use of the vehicle by the staff member..4 Private Vehicles Damaged on Official Business or Other Approved Travel 7. A written statement by the staff member indicating that the Employer would not be liable to pay for any loss or damage to the staff member’s vehicle. the maximum reimbursement is the prescribed excess that would have been paid had a claim been made. and the charges claimed by the staff member are not the charges prescribed by the insurer as punitive excess charges.4. to avoid loss of a no-claim bonus etc. the Employer is to consider applications from staff members for reimbursement of normal excess insurance charges where prescribed by insurers provided: • • the damage is not due to gross negligence by the staff member. 24(7/09) . or a claim made and the excess paid to the insurer or repairer.27 the motor vehicle must be covered by a policy as required by the Motor Accidents Compensation Act 1999.1 Reimbursement of Insurance Excess (Policy) Where a private vehicle is damaged while being used on official business or other approved travel. and (ii) liability of the Employer to pay for loss or damage to the vehicle. and • receipts have been provided to substantiate the claim. 7. • the damage has been repaired and paid for. If a claim is not made on the insurer eg. Temporary Work Locations (TWL) Where approval is given by the employer for a staff member to proceed to a temporary work location for two days or more. 7.2 and 7. 7.2 Broken Windscreens Conditions for Reimbursement 5. motor vehicle allowances are to be paid in accordance with the schedules outlined below.4. 7.5 Use Of Private Motor Vehicles .1.1. Maximum Reimbursement The maximum amount to be reimbursed is the cost of replacing the broken windscreen with one of the same type as that broken. If approval has been given.1. approval may also be given for the staff member to take their private car to the temporary work location.4. • the costs cannot be met under insurance policies due to excess clauses.3 Replacement Registration Labels The cost of a replacement registration label is not to be refunded where the windscreen of a private motor vehicle is damaged while on official business. as appropriate. and • the damage is not the fault of the staff member.1.3) 24(7/09) RATE PAYABLE Official Business Applicable Transport or Casual Rate (see 7. Official Business Use Required SITUATION 1st journey to. whichever is the lesser.4.3) Official Business .2 and 7.4 Claims for Reimbursement Claims for reimbursement under this part should be accompanied by sufficient detail for the Employer to assess the claim.28 A staff member shall be reimbursed the costs of repairs to a damaged windscreen or replacement of a broken windscreen where: • the use of a private motor vehicle had been approved for official business. or the amount of the prescribed excess. • the damage or breakage was sustained in the course of that official business.CHAPTER 5 – TRAVEL 7. and last journey from TWL Other journeys between home and TWL Official business use at TWL Official Business Use Not Required SITUATION All travel to and from TWL RATE PAYABLE Applicable Transport or Casual Rate (see 7. Bankstown. from secondary metropolitan airports. Where a staff member has been allocated an official vehicle.CHAPTER 5 – TRAVEL 7. which are in excess of insurance cover. 24(7/09) . The approval applies to air travel from Kingsford Smith Airport. use it for the above purpose. no daily deduction to be made. and from country airports including Wollongong and Newcastle. the normal policy in respect of repair costs arising from damage to the vehicle. parking fees incurred at the airport may be reimbursed. The following conditions apply to the use of private vehicles for this purpose: • • • • car allowance is paid at the appropriate specified journey or transport rate for the distance travelled from/to home or headquarters to the airport and return. will apply.29 Private motor vehicles may be used in travelling to and from airports where the air travel has been approved in connection with official business. other than under exceptional circumstances. to and from work. which he/she normally drives.6 Use of Private Motor Vehicles In Connection With Official Air Travel 5. The use of valet parking must only be used in exceptional circumstances. eg where staff member has excessive luggage. Mascot. he/she should not. Official vehicles should not be left unattended for long periods in parking areas where they are subject to increased risk of damage or theft. eg. the insurance policies on the staff member's vehicle are to meet the specified requirements. and which would deprive the Employer from allocating the vehicle for use by other staff members. location/s. 1st year.General Fund.conference/study tour dates. classification etc Role and Benefits . or those other classifications mentioned at section 3.details of the officer who prepared the calculation of leave and costs .7 of this policy).Economy Class should be used for all official travel overseas .This application form checked and certified by an appropriate Manager The Carlson Wagonlit travel (CWT) lowest logical fare quotation.Any proposed private leave (private leave is restricted to 1 – 3 days) Detail of all Travel Costs . . position. .number of working days required for travel and official leave .name of conference/study tour.budget breakdown of all fares.exchange rates .CHAPTER 5 – TRAVEL ATTACHMENT 1 CHECKLIST (Incomplete applications will be returned to the staff member for completion) 5. subsistence (ECA international allowance rates must be used for subsistence based on the appropriate remuneration level of the staff member – see section 5. accommodation. Sponsorship.1 of this policy A detailed travel itinerary (see Attachment 3A for example) Written approval for the official overseas travel from the relevant Deputy Director-General or Area Executive. benefit to the organisation and staff member etc Details of Travel .total cost Source of Funding .Business class may only be used by staff members whose annual salary exceeds a Senior Officer Grade 1. official incidentals .name.total leave dates including dates of departure and return . 24(7/09) .role of staff member. registration.30 Applications for official overseas travel will NOT be considered for approval without all of the below documentation: The completed application form at Attachment 2 of this policy (2 pages) which includes: Staff Member Details . Special Purpose & Trust Fund (AHS only) and/or Personal Recommendation for General Fund Expenditure . and any travel between cities . . attending and/or presenting a paper Conference / Seminar): - Expected benefit to the organisation and staff member’s career development: - How will information be disseminated throughout NSW Health? Details of conferences attended in the last two (2) years (Name of Conference and Date/s): - Please read the following criteria in relation to calculating associated travel costs for official travel days. • Is to be calculated based on the exchange rate applicable to the country in which travel occurs. • Is not paid when the staff member requests to take leisure days (however described) for either week days or weekends at his /her request. Official travel does not include weekends or personal leave (however described) taken at the staff member’s request. Staff members who otherwise work shift work should be considered day workers.31 APPLICATION FOR OFFICIAL OVERSEAS TRAVEL (PAGE 1 OF 2) SECTION 1: Title: STAFF MEMBER DETAILS First Name: Surname: Classification: Department Division / Health Service: SECTION 2: ROLE AND BENEFITS Position: Role of Staff Member on Official Travel (i. • Should be calculated from the time the staff member arrives at the overseas destination to the time of departure of the first available return flight to Australia (having regard to the above exclusions). subsistence and accommodation before completing travel details and associated expenses on the following page: Official Travel: • Relate only to days on which the staff member would otherwise be on duty. including time spent in travelling between official engagements and/or pending official travel arrivals or departures and where accommodation is required pending departure for the return flight to Australia. the applicable exchange rate should be calculated on a proportionate basis. or during periods of personal leave i. and the week day period over which the conference is held.e. • Subsistence: • Is not payable during travel time. Where a staff member is in transit between countries. any normal working day when the staff member is not attending the conference. or when the departure is not arranged for the first available return flight. • Accommodation: • Is payable for the number of nights for which accommodation is actually required while on official travel. • Includes those week days where travel occurs between destinations eg travel between official engagements including travel from one country to any other. 24(7/09) .CHAPTER 5 – TRAVEL ATTACHMENT 2 5. • Costs area not payable where the staff member is taking personal leave or leave without pay during any period of official travel.e. • Is not payable when weekends are taken as leisure days between the time of arrival and the conference commencement. Weekends are not to be counted. Employers will need to consider the time of the return flight to determine if any subsistence is payable on the day of departure. Foreign currency Exchange Number of Rate per Equivalent Type of Expense used Rate nights/days night/day in AUD Fares (Air. of nights @ cost/night) Subsistence (No. study tour. visit etc) 5. Please attach formal quotes for fares. registration and accommodation. Trains) Registration Accommodation (No.32 Name of Conference / Seminar: Location: Conference/Seminar/Study Tour Dates: Total Leave Dates No. of working days required for Travel SECTION 4: (City) From : To: From : (Depart NSW) To: (Arrive NSW) No. Buses. seminar. days @ daily rate) Official Incidentals/expenses Other Calculation of leave and costs prepared by (please print): SECTION 5: SOURCE OF FUNDING ($) General Fund Special Purpose & Trust Fund (AHS only) Sponsorship Personal TOTAL AUD $ Note: Prepayment does not guarantee approval. Subsistence and Official Incidental expenses. of working days required on official travel No. DM 1. days (Country) DETAILS OF ALL TRAVEL COSTS Date of Exchange Rate: (as rate may vary) Conversion in Australian $ Foreign Currency -Exchange rate (eg.CHAPTER 5 – TRAVEL CONTINUED OFFICIAL OVERSEAS TRAVEL APPLICATION FORM (PAGE 2 OF 2) SECTION 3: DETAILS OF TRAVEL (eg conference. SECTION 6: RECOMMENDATION FOR GENERAL FUND EXPENDITURE (Signature) Travel costs checked by delegated officer: (Name) General Fund Expenditure recommended by authorised officer __________________________________ (Name and Position) _____________________ (Signature) 24(7/09) . Even where associated travel costs are being met by sponsorship. of private leave days requested Total No. General Funds may not be available to meet up front expenses.19) Calculation of expenses must include conversion from foreign currency into Australian dollars for Accommodation. ....... Trains........ Official incidentals and other expenses Calculation of leave and costs prepared by (please print): SECTION 5: SOURCE OF FUNDING General Fund $ SECTION 6: Special Purpose & Trust Fund (AHS only) $ Sponsorship $ TOTAL AUD $ Personal $ Amount: $ (Date) _______________ RECOMMENDATION FOR GENERAL FUND EXPENDITURE General Fund Expenditure recommended by authorised officer ______________________________ ___________________________ (Name and Position) (Signature) SECTION 7: APPLICATION APPROVED IN PRINCIPLE ____________________________________________________________________.... TOTAL Estimated cost: All Fares eg Air..... Buses.... Accommodation. seminar.. Registration........ and the scope of the intended paper: Expected benefit to the organisation and staff member’s career development: - SECTION 4: DETAILS OF ALL LEAVE TO BE TAKEN (in working days) AND ESTIMATED TRAVEL COSTS Number of Days Required for Travel to._________________________ Chief Executive/Director-General ... Date 24(7/09) ........ and Attendance at Conference etc..................... visit etc) Name of Conference / Seminar: Location: Conference / Seminar Dates: (City) From: (Country) To: STAFF MEMBER DETAILS First Name: Surname: Position: SECTION 3: ROLE AND BENEFITS (If presenting a paper) Provide all relevant documentation regarding the conference........................... study tour...33 APPLICATION FOR APPROVAL IN PRINCIPLE FOR OFFICIAL OVERSEAS TRAVEL SECTION 1: Title: Classification: Department/Health Service: SECTION 2: DETAILS OF TRAVEL (eg conference.......CHAPTER 5 – TRAVEL ATTACHMENT 3: To be completed by staff members wishing to present a paper 5............ Subsistence....... 10pm 10.15pm Friday 21/9/09 Saturday 22/9/09 In transit/Air Travel Arrive: Sydney 6.55pm 5.51pm Saturday 15/9/09 Sunday 16/9/09 Monday 17/9/09 Weekend Attending Conference Attending Conference Depart: Atlanta Arrive: New Orleans 5.30am 3.34 Day of Week and Date Friday 14/9/09 Details Depart: Sydney Arrive: Los Angeles Depart: Los Angeles Arrive: Atlanta 9.00 pm Tuesday 18/9/09 Wednesday 19/9/09 Thursday 20/9/09 Attending meetings with Medical Oncology Units Annual Leave Depart: New Orleans Arrive: Los Angeles Depart: Los Angeles 12.25pm 6.35am 6.05am 24(7/09) .CHAPTER 5 – TRAVEL Attachment 3A Itinerary for Joe Bloggs 5.10 am 8. .. of days on official leave No............. General Fund................... Sponsorship etc 24(7/09) .e..CHAPTER 5 – TRAVEL ATTACHMENT 4 SIX-MONTHLY REPORT ..... Special Purpose &Trust Fund...... Duration and Purpose of travel (Role of staff member.......APPROVED OVERSEAS TRAVEL DATE _______/_______/_______ HEALTH SERVICE/DIVISION OF DoH: ...... 5........ of days on private leave Total Cost Source of Funds * * i.35 Name and Title of staff member (s) Countries (Include cities) Dates.................. name of conference etc) No.. 000 Inquiries in respect of medical insurance or any other insurance related matter may be referred to: The Fund Manager NSW Treasury Managed Fund Managed Funds Division GIO General Limited GPO Box 2601 Sydney NSW 2000 Australia Telephone Facsimile Yours faithfully. Details of Coverage are as follows: Carrier: Policy No.: MF Expiry Date: Amount: AUD NSW Treasury Managed Fund 050325-1 30 June (Annually) $1. official travel schedule will alter accordingly. will meet (staff member’s name) medical expenses.000. if any.CHAPTER 5 – TRAVEL ATTACHMENT 5 TO WHOM IT MAY CONCERN 5. the Department of Health through its Managed Funds Insurance arrangement.36 STATEMENT ON MEDICAL INSURANCE ARRANGEMENTS APPLYING TO OVERSEAS TRAVEL ON OFFICIAL BUSINESS This is to certify that (name) (designation) (Health Service) is authorised by the Department of Health. During this time. Australia. If delayed. New South Wales. to travel on official business from (date) (staff member’s name) to (date) inclusive. 61 2 8121 3687 61 2 8121 0895 Director-General/Chief Executive 24(7/09) . .........................................................................................3 Managem ent and Maintenance ....................................................................................................... 3...9 Traffic Infringements ......................... Health Executive Service (SES/SES Equivalent.......... 12 7......... MONITORING VEHICLE UTILISATION .............................. SCOPE...................... Fleet Management Information System Minimal Reporting Capability ......................................................3 7........................................8 Health and Safety......1 Fleet Requirements ................................ DISPOSAL OF MOTOR VEHICLES ............... CHIEF EXECUTIVE (CE) RESPONSIBILITIES ........................ 12 12 14 14 15 15 16 16 16 16 18 19 20 22 23 24 22(5/07) ........................2 6.................................................................................................................................... DEFINITIONS...................... RELATED GUIDELINES/POLICIES/INDUSTRIAL INSTRUMENTS..................... 11 7...... 7......... 7.................. 5............................................................................ 7................ Motor Vehicle Records....................................... 13 7................................................................................................................................................................................... 1 1 1 1 2 3 3 3 6 9 10 10 11 GENERAL PROVISIONS......................................................................................................................................7 Tolls.... Award Employees (NSW Health Service Employees Only).. 7................................................................................. MOTOR VEHICLE NUMERICAL PROFILE ........................ REPAIRS AND MAINTENANCE OF MOTOR VEHICLES ......... 2................................................................................................. Official (Pool) Vehicles................................. RUNNING SHEETS ............... 4.............. 7.............12 Removal of V8 Powered Vehicles from Government Contract.................................................................................. 11 7.........6 Written Acceptance of Conditions................................................................... 6.. 1................................................................. 7.....................................................................................MOTOR VEHICLES USE OF MOTOR VEHICLES WITHIN NSW HEALTH ....10 What do to in Case of Accidents................................................................ 6...... 7............................................................................ Parking Fees and Parking Space Levies ........................................................................................ FLEET MANAGEMENT ...........................................................................2 Security of Vehicles (Garaging and Safety) ......................................................TABLE OF CONTENTS CHAPTER 6 ............................................................................5 Accessories .....................................................4 Pool Vehicles ..................................................11 Biofuels and Other Alternate Fuels...................................... 7.... ARRANGEMENTS FOR USE OF MOTOR VEHICLES ....................................................................... PURPOSE......................................... ORDERING OF VEHICLES................... Non-Award Salary Remunerated Employees and DoH Senior Officers)........................................................1 6.............................................................................................. FLEET MANAGEMENT INFORMATION SYSTEM ....... ................................................................................................................................................. NEW VEHICLE INSPECTION RECORD.......................FRINGE BENEFITS TAX – DEPARTMENTAL MOTOR VEHICLES .................................. 55 60 62 63 APPENDIX 2 APPENDIX 3 APPENDIX 4 64 22(5/07) .......................... MOTOR VEHICLE HISTORY SHEET ...... APPENDIX 1 CRITERIA FOR ASSESSING PURCHASE OF ADDITIONAL OR REPLACEMENT VEHICLES ..... TREASURY CIRCULAR 99/13 – ALLOCATION OF POOL CAR FRINGE BENEFITS............. if applicable. NSW Premier’s Motor Vehicle Policy as amended from time to time. Provisions are incorporated in the Department of Health Purchasing & Supply Manual. Health Employees Conditions of Employment (State) Award. Novated Leases” Premier’s Department Circular 2000-70 – “SES Motor Vehicles – Revised Deed of Novation” Purchasing & Supply Manual for NSW Health System (public health organisations) Department of Health Supply Manual (Department of Health & Ambulance Service of NSW) Relevant public health organisation or Ambulance Service of NSW motor vehicle policy. Health Executive Service Determination Environmental Health Officers Determination Legislation Public Sector Employment and Management Act (2002). Industrial Instruments Salaried Senior Medical Practitioners’ Award and Determination. RELATED GUIDELINES/POLICIES/INDUSTRIAL INSTRUMENTS Guidelines Premier’s Department Senior Executive Service Guidelines Policies NSW Health Services Salary Packaging Policy and Procedure Manual as amended from time to time.1 The purpose of this policy is to set down the principles to be observed by NSW Health in relation to the use of NSW Health motor vehicles by employees in line with the commitment by NSW Health to efficient resource management through effective motor vehicle policies and management procedures. 3. and the Ambulance Service of NSW who have access to official motor vehicles for business use. Premier’s Department Circular 99-15 – “SES Motor Vehicles. viz all public health organisations. 2. Public Hospital Nurses’ (State) Award. Public Health Service Employees Skilled Trades (State) Award.MOTOR VEHICLES USE OF MOTOR VEHICLES WITHIN NSW HEALTH (PD2007_029) This Policy Directive rescinds PD2005_403 and PD2006_033. the Department of Health. or who have access to an official motor vehicle for private use. 22(5/07) . the Public Health Support Division. 1. PURPOSE 6. an official motor vehicle on a private/business arrangement. Public Hospital (Professional and Associated Staff) Conditions of Employment (State) Award. SCOPE This policy applies to employees of NSW Health. and who has been given access to a NSW Health fleet vehicle in order to carry out the contract work or as part of the contracted service. “packaged vehicle” is a vehicle that forms part of an employee’s remuneration package (either as part of a total remuneration package. the Ambulance Service of New South Wales. a statutory health corporation. by way of salary sacrifice. but excludes vehicles acquired by individuals through a novated lease. “Goods and Services Tax” (GST) is the broad-based tax (currently 10 percent) on the supply of most goods and services consumed in Australia. the Director-General in his/her capacity as Department Head. It includes those vehicles defined as being in the NSW Health fleet plus those vehicles acquired under the NSW Health leasing facility and packaged on a 100 percent private basis. “NSW Health fleet” is the mixture of motor vehicles. DEFINITIONS 6. an affiliated health organisation. and includes any vehicle owned or leased by NSW Health. and the Department of Health. the Public Health System Support Division. 22(5/07) . “Chief Executive” (CE) is the head of a public health organisation entity established under the Public Health System Support Division or Ambulance Service covered by this policy and for the purpose of this policy. or in accordance with award provisions).MOTOR VEHICLES 4. “garaging” refers to situations where an employee is permitted to take a NSW Health vehicle home to park in his/her garage or carport or on-street. including those packaged for business/private use. that are required to meet the business needs of NSW Health.2 “NSW Health” means public health organisations. SES and SES Equivalent employees) “contractor” is a person engaged by NSW Health to perform a specified project or service within a certain timeframe. “Health Executive Service” (HES) is comprised of the NSW Health SES and SES Equivalent employees. “household” means a family group living in the same domestic dwelling. “Fringe Benefit Tax” (FBT) is the tax levied on benefits obtained by employees in respect of their employment. “parking space levy” is the charge payable under the Parking Service Levy Act 1992 for parking within specified business districts. “public health organisation” (PHO) is an area health service. “NSW Health vehicle” is a vehicle that forms part of the NSW Health fleet. “employee” is a person employed by NSW Health as defined within this policy (including executives. “novated lease” is a 100 percent private use vehicle acquired privately by an executive or employee in a leasing arrangement that is the subject of an approved deed of novation that enables the vehicle to form part of a remuneration packaging arrangement. or the full year in all other cases as determined by the Chief Executive).1 ARRANGEMENTS FOR USE OF MOTOR VEHICLES Health Executive Service (SES/SES Equivalent. It generally includes travel to and from the usual workplace. Employees using motor vehicles for work related purposes are properly licensed.MOTOR VEHICLES 6. Such a vehicle forms part of the NSW Health fleet. “running sheets” are sheets used to log details of all trips undertaken by a pool vehicle and all business trips undertaken by a packaged vehicle (either for a 12-week period if the “representative 12 week period” method is selected. “private/business” refers to a vehicle packaged as part of a remuneration package on a split basis for both private and business use. and that a review of fleet size/utilisation occurs on a regular basis to ensure maximum utilisation. 6. minimisation of changeover costs and minimisation of vehicle numbers for the tasks to be undertaken. Adherence to this policy should contribute significant financial and environmental benefits appropriate monitoring and control exists over vehicle fleets and their use. Employees are made aware of government policies promoting the use of public transport and encouraging car pooling. and to encourage employees to observe safe driving practices. “pool vehicle” is a general business use vehicle that comprises part of a NSW Health fleet which is not allocated for private use. That the vehicle fleet is kept to a minimum necessary to meet operational requirements and that the fleet is managed in accordance with sound energy and environmental principles.6 “Written acceptance of conditions”). Non–Award Salary Remunerated Employees and DoH Senior Officers) Those employees who have been appointed to positions in the Health Executive Service may package a vehicle using one of the following three options: 22(5/07) . All officers allocated vehicles for private or private/business purposes complete a written acceptance of the conditions for use of vehicles including the proviso that they accept any future variations made to either charges or conditions of use of vehicles as may be issued by the Department of Health from time to time (see section 7. as well as the carriage of non-government passengers and/or non-business passengers. Probity.3 “personal use” refers to the use of a NSW Health vehicle for a non-business purpose. Audit and regular review processes should be put in place to ensure compliance. accountability and transparency of procedures must be accorded the highest priority. 6. 5. CHIEF EXECUTIVE (CE) RESPONSIBILITIES Chief Executives are responsible for ensuring that: This policy is implemented within their NSW Health organisation and observed by employees. unless a novated lease option is chosen. A vehicle acquired under a novated lease is not part of the NSW Health fleet. Subject to funding requirements the fleet may contain the mixture of vehicles appropriate for the purposes of the NSW Health organisation.gov. make and model of vehicle is to be determined according to fleet needs and any relevant local policy. 22(5/07) . Salary packaging of motor vehicles must be calculated using the statutory fraction method (determined by the Australian Taxation Office) for calculating the Fringe Benefit Tax (FBT) liability and using rates (standing charges and running costs) issued annually by Premier’s Department Circular. Fleet needs of the individual NSW Health organisation and whether there is a genuine business need will determine whether it is appropriate to allocate a vehicle on a business/private basis to each Health Executive.au/pubs_dload_part4/prem_circs_memos/prem_circs/circ99/c99-15.g.4 a 100% private use vehicle through the NSW Health fleet in accordance with Senior Executive Service guidelines. a vehicle acquired for 100% private use is not to be subsequently changed to a business/private election unless there is a sound and evident need for the vehicle to be utilised for official business. The packaging option elected by a Health Executive is to apply for the life of a vehicle. There has to be a genuine business need for a vehicle to be allocated under a business/private arrangement. e. or a novated lease vehicle. Details regarding novated leases are contained in Premiers Circular 99-15 available at: http://www.g. No Health Executive Service employee is to be allocated a vehicle for commuting purposes unless the cost is charged to his/her package.e. When duty requires that a health service executive needs to use a pool vehicle overnight or at weekends. make and model of the vehicle. NSW Health staff are not able to provide advice to employees due to legal considerations. Executive must undertake to package the vehicle for the full term of the election (i.MOTOR VEHICLES 6. Vehicles forming part of remuneration packages for the Health Executive Service must be chosen from within the current State Contracts Control Board (SCCB) contract and comply with any local fleet profile or preferred vehicle policy. Some industrial instruments allow NSW Health employees the option of accessing a motor vehicle for 100% private use under a novated lease arrangement through salary packaging.premiers. e. Where this cannot be justified. Officers changing election from 100% private use to a business/private split simply to be provided with free parking is not to be condoned. The size. It is the employee’s responsibility to make their own transport arrangements to and/or from duty each day where an election to take a vehicle is not made. occurrences are to be reported to the NSW Health organisation Audit Committee. The grade or classification of the Health Executive has no influence on the selection of size. fleet profile.g. e. a change of position role/responsibilities. a vehicle is leased for two years must be packaged for two years).html Employees considering a novated motor vehicle lease should obtain their own professional advice in relation to taxation. A vehicle acquired under a novated lease is not part of the NSW Health fleet. a business/private vehicle in Government contract at the time of purchase in accordance with the Senior Executive Service Guidelines. financial and other aspects of such an arrangement.nsw. Employees should contact the designated salary packaging contact person of the NSW Health organisation to ascertain whether this option is available and to obtain a copy of the Novated Motor Vehicle Leases: Detailed Information for Interested Officers document. the HES employee is entitled to package a vehicle on a 100% private usage basis (either through the NSW Health fleet or on a novated lease basis). package types available. the useful life/lease term of a vehicle packaged by a Health Executive is to be determined by the NSW Health organisation Fleet Manager taking into account past usage patterns where applicable.e.5 The estimated number of annual kilometres a vehicle is expected to travel is a crucial factor in determining the useful life of the vehicle. for example. and an estimated total distance that the vehicle is expected to travel during the ensuing period. and does not maintain running sheets. or has been given the private use of a motor vehicle. Any overpayments are returned to the officer. In other words. Where a Health Executive Service employee has packaged a vehicle on a private/business basis.1 Calculation of Charge Rate Where a NSW Health vehicle is packaged on a private/business basis. The initial cost to the employee’s package. drivers must record details of all occasions when the vehicle is used for official purposes. The costs to the employee’s package. the estimated proportion of private/business usage.2 Trip Recording All vehicles must carry a trip record to monitor usage. For further information regarding motor vehicles. costing. 22(5/07) . NSW Health owned or leased vehicles that are the subject of approved remuneration packaging arrangements for private/business use are to form part of the NSW Health fleet during normal business hours.nsw. tax implications.gov. after being adjusted for PAYG taxation. and any underpayments are recovered from the officer.au/our_library/ses/ses_guidelines 6. or contribution will then be adjusted at the end of each review year (or more frequently. ensuring also that the officer’s PAYG tax liability is adjusted accordingly. For this reason. Any proposed adjustments are to be agreed with the employee. total kilometres travelled and actual private kilometres.1. Officers nominating longer terms or lower annual kilometres than reflected in past usage patterns is not to be condoned as this practice will result in additional costs to the NSW Health organisation. Officers allocated a vehicle under a 100% private or private/business arrangement are required to meet the cost of cleaning the vehicle. and consequently. or contribution will be calculated based upon the estimated figures. if appropriate) following reconciliation between estimated and actual usage i. the cost of the employee’s motor vehicle contribution is to be calculated on a 100% private basis. For reconciliation purposes.MOTOR VEHICLES 6. This means both provisional and learner drivers.1. Monthly lease charges applicable to a vehicle leased for a period of two years would generally be higher than those for a similar vehicle leased for three years. 6. payment. and novated leases please refer to the SES Guidelines at http://www. the useful life of a replacement vehicle for a Health Executive must accurately reflect past usage. the cost to a Health Executive’s salary package (in lease charges or equivalents). the employee is to nominate at the start of any 12 month period.premiers. Health Executive officers allocated vehicles for private use are to ensure other persons authorised by them to use the vehicle are properly licensed and display appropriate plates on the vehicle. 1. 6. All instances of usage by employees other than the employee to whom the vehicle is allocated are to be recorded.4 Access to Vehicle While on Leave 100% private use vehicles are available and costed for the entire year and automatically available during periods of leave. Running sheets are not required to be submitted. 6. As charges for use of vehicles is on a final year reconciliation for total private kilometres travelled basis. Running sheets are to be submitted within 5 working days of the end of the month. 22(5/07) . Health Executive Service employees with a business/private benefit will be able to have access to the vehicle on approved leave up to six weeks per annum (subject to NSW Health requirements for these vehicles to be available for business use by other employees in that period) with the approval of the Chief Executive or delegate. Where employees do not wish to use their vehicles during periods of leave they are to advise the Transport Section that the vehicle is available for use. Travel during periods of leave. it must clearly indicate whether the private use extends to: Travel to and from place of work.1 Access to an Official Vehicle for Business/Private Use Award-covered employees of the NSW Health Services who require the use of an official motor vehicle for official purposes during the normal course of their duties may be offered the allocation of a motor vehicle for private use. or otherwise provided for under an industrial instrument or in this policy.2 Award Employees (NSW Health Service employees only) 6. Other after hours and general weekend running. Business/Private vehicles.6 100 % private vehicles. Novated lease.2. If running sheets are not forthcoming consideration will be given to adjusting the employee’s business/private split to 100 % private. running sheets are to be maintained for all business journeys undertaken throughout the entire year.3 Running Sheets 6. When the offer is made. Private use of a NSW Health vehicle is not permitted unless such use is authorised by the Chief Executive or delegate. Employees are to submit monthly running sheets detailing start and finish kilometre readings and fuel and oil purchases (dockets to be attached) for each month.1. In the case of NSW Health vehicles that are packaged on a private/business basis.MOTOR VEHICLES 6. Private use includes the carriage of non-government passengers and/or non-business passengers. Employees are required to record all business (official) travel together with details of all fuel and oil purchases (dockets to be attached .dockets do not have to be attached if the NSW Health organisation has a system in place to capture all details on the fleet management system and identify any instance of possible inappropriate use). officers can utilise the official petrol cards during periods of leave. insurance.000 private kilometres per annum $2. 22(5/07) .MOTOR VEHICLES 6. and the employee proceeding to their home after completing duty in preference to returning to their normal place of work. Annual registration.200 p. $4.2. or Kilometres travelled when the employee proceeds to duty directly from home on the following day to a location away from their normal place of work.000 kms times the applicable running cost rate per kilometre. roadside service arrangements.520 p.000 private kilometres per annum Over 15. in general. Fleets are not to be expanded to cover allocations under this clause. or Kilometres travelled that are associated with an employee performing duties in the field. being another member of the employee’s household. Fleet needs will determine whether a vehicle will be allocated on a business/private basis. Cost for cleaning of vehicles is to be met by the officer and is not to form a charge against the organisation. Written acceptance of this must be provided by the employee (refer to Section 7. where specific methods of charging for motor vehicle use for particular classifications of employees have been determined by the Health Administration Corporation prior to November 1997. Rates effective from 1 July 2007 are as follows: Up to and including 15. maintenance and running costs including fuel will be paid by NSW Health. This nominee must have a current State driver’s licence which can include Learner or Provisional licensed drivers. but does not include: Kilometres travelled which are associated with emergency on call arrangements.000 or 25. When an official vehicle is allocated to an award employee for business/private purposes. to the normal place of work.7 Private travel. those approved arrangements and methods of charging for the particular classifications of employees will prevail over the charges and methodology specified in this policy. 6.a. Note: Notwithstanding the above.2 Contribution Rate (for Private Usage) Award-covered employees of the NSW Health Service permitted private use of a NSW Health vehicle are required to contribute at a rate determined by the Director-General from time to time.6 of this policy). includes travel to and from home. or the security garaging of the vehicle. Vehicles cannot be allocated on a 100% private basis under this arrangement. The rates are reviewed each year and advised separately by Information Bulletin. The rates are currently based on the SES running cost rates for six cylinder motor vehicles as determined by Premier’s Department. it is subject to the following restrictions: The car is not to be driven by any person other than the employee or his/her nominee. The formula for assessment of the rate will be 15.a. 22(5/07) . or his/her delegate. Officers are responsible for the payment of any insurance excess if damage occurs whilst the vehicle is being used for private purposes. employees who have been granted approval to have private use of a NSW Health motor vehicle. i. A pro rata calculation as follows is to be applied: Annual Rate x Number of days used 365. ceases the arrangement after 3 months after travelling 5000 private kms . tyres. are to nominate an estimated proportion of private travel. subject to a limit of six (6) weeks per annum for annual leave or other type of leave. Running sheets are to be submitted monthly with month end odometer readings specified. The payment by the employee to the public health organisation is payment for a taxable supply. e. All fuel purchases are to be recorded with dockets being attached.25 Reconciliation is required on an annual basis to establish that the appropriate contribution rate has been paid. If an employee ceases the arrangement no adjustment is to be made to the rate of charge.g. The public health organisation can claim input tax credits on actual running costs (i. the employee must pay the additional contribution or receive a refund. must be satisfied the business needs of the NSW Health organisation will be met during the period the motor vehicle is unavailable. i.000 or 25.520 or $4.2. Where it is evident during the year that an employee has nominated an inappropriate annual total kilometre level.MOTOR VEHICLES 6.000km.80 cents per kilometre used to determine these rates is inclusive of GST.80 cents = $2.000 kms. the Chief Executive. or greater than 15. or his/her delegate. fuel.200 rate. employee nominates the over 15000 kms.000 kms x 16. 6. The organisation is to determine the most appropriate method of ensuring that employees pay for all fuel used during leave. e. the employee is to be contacted with a view to amending the contribution rate during the annual period so that the employee does not have to pay or receive a large adjustment at year’s end.e. as appropriate.3 Access to Vehicles During Leave Approval must be given by the Chief Executive. recoup petrol card expenditure from employee or inform the employee they are not to use the official fuel card during the period of leave. In granting such approval.e. less than.2. At the start of any 12 month period. Officers are required to pay for all fuel used during periods of leave greater than four (4) days. Charges are to be levied each pay cycle.000 kms. and if necessary.e. for the car to be used by an employee during any leave period over four (4) working days.200. The rates are not to be grossed up as the running cost rate of 16. Petrol dockets do not have to be attached to running sheets if the NSW Health organisation has a system in place whereby all particulars are captured on the fleet management system and any instances of possible inappropriate use identified.g.this employee would be required to pay 3 months worth of the $4. the assessment of the rate on and from 1 July 2007 is 15. The applicable annual rate is not to be adjusted when the vehicle is returned to the pool during periods of leave. less than 15.8 For indicative purposes only. or greater than 15. servicing and repair costs).4 Running Sheets Running sheets must be kept for all official business journeys undertaken in NSW Health vehicles. 6. and as such 1/11th is payable by the public health organisation as GST. Employees who utilise vehicles under these arrangements are not charged. consideration is to be made as to whether by giving permission will result in reduced vehicle usage or more effective use of the employee’s time on duty. where the travel is considered to be private. A register of such approvals authorising employees to garage NSW Health vehicles at their home on an on-going basis.3 Official (Pool) Vehicles 6. prior to the next ordinary working day. Where on-going approval is required in an individual (e. Employees should be made aware of any FBT liability that they may incur through the use of official (pool) vehicles. home to headquarters. Only in those circumstances where a NSW Health vehicle is required to carry out the contracted work or as part of the contracted service. Medicare levy. Under no circumstances is transport to and from work to be offered as an inducement to. is to be maintained and reviewed quarterly by the Audit Committee of the NSW Health organisation. (In these circumstances employees who reside in close proximity to the NSW Health facility should be allocated the vehicle. During out of hours use no person. at a location away from their normal place of work. emergency) or group (eg community nurses) circumstance the Chief Executive or delegated person is to approve.2 Contractors – Access to Pool Vehicles Contractors are not employees of NSW Health. or when they will proceed to duty directly from their home on the following day. Employees should contact the Australian Taxation Office (ATO) for further information regarding specific benefits which may be affected by reportable fringe benefits. other than the authorised employee is to use the vehicle and the vehicle cannot be used for private purposes other than the authorised travel to and from the employee’s residence. This amount is not included in the employee’s assessable income. 6. employment. or when their duties require them to undertake. 22(5/07) . Ad hoc use of vehicles on official business. superannuation. or the continuation of.g.MOTOR VEHICLES 6. All travel is to be recorded.000 over the FBT year (known as a reportable fringe benefit). may approval be given to a contractor to use an official pool vehicle. however it may be included in a number of income tests relating to Commonwealth government benefits eg family allowances. and generally speaking. under the provisions of the Fringe Benefits Act 1986 the travel is a reportable fringe benefit. is to be approved in writing by the Chief Executive or delegated person. however. agencies are required to report the grossed-up taxable value of reportable fringe benefits on the group certificate of each employee whose aggregate taxable value exceeds $1. are not entitled to the same access to NSW Health facilities and resources.) In respect of (b) and (c) above. where NSW Health lacks suitable overnight secure parking. including motor vehicles. Under no circumstances are contractors permitted to use an official vehicle for private purposes. viz.9 Employees may garage a vehicle at their homes: (a) (b) (c) (d) when their duties include a requirement to provide a service in an emergency.g.3. e. other official duties which require the use of a motor vehicle. where overnight garaging is required. g. management may consider that return of the vehicle is not warranted.10 Pool vehicles are to be returned to the fleet for any periods of planned leave. Vehicles are to be available for use by other employees of NSW Health on a daily basis.3.MOTOR VEHICLES 6.pdf The size of the pool vehicle fleet will not generally be large enough to meet peak periods of demand. or his/her delegate. emergency on call are integrated as part of the organisation’s fleet. 6. In instances of unplanned leave e. Decisions made should be fully documented. Decisions in relation to fleet needs. In these instances the employee is to contact their supervisor to determine whether arrangements are to be made to return the vehicle. one (1) day. sick leave. Petrol dockets do not have to be attached to running sheets if the NSW Health organisation has a system in place to capture all particulars on its fleet management system and identify any instances of possible inappropriate acquisition of petrol etc.3. Chief Executives must ensure that vehicles packaged on a private/business basis. Employees are not to approve their own request forms. which must be approved by an officer of Clerk Grade 9/10 level or above and be submitted to the Transport Officer. Running sheets are to be submitted monthly. Also refer to Section 7. and vehicle type are the responsibility of the Chief Executive.5 Department of Health Central Administration .4 Running Sheets Full details of all travel and fuel purchases (dockets attached) are to be recorded. 22(5/07) . e.12 Removal of V8 Powered Vehicles from Government Contract.gov. and retained on an appropriate file for review by internal audit. This availability takes precedence over private use. and those vehicles approved for allocation to employees for private use at no direct charge to the employee e. These vehicles are to be parked at the official premises each day unless the officer is on approved leave.health. 7.nsw.Pool Vehicles Employees requiring a vehicle for business use are required to prepare a Request for Motor Vehicle form. access to a vehicle for private purposes. 7. Careful consideration of this requirement should precede any decision to acquire four-wheel drive vehicles.3 Return of Vehicle During Leave 6. NSW Health has the right to require any NSW Health vehicle to be available for use by other staff for official purposes. therefore employees should consider alternative methods of transport and car pooling options prior to requesting a pool vehicle. Each fleet shall consist of the most efficient and effective vehicles in Government contract necessary for NSW Health to fulfil its purpose. and meet a genuine business need.g.3.g.au/ecsd/ssc/forms/motoreq. 6. Request for Motor Vehicle forms are available at the following site (DoH only): http://internal. or where the period of planned leave is short.1 GENERAL PROVISIONS Fleet Requirements Each NSW Health organisation is responsible for the composition of its motor vehicle fleet. to ensure the vehicle is properly maintained. Service and maintenance should be arranged through the fleet manager. Pool vehicle cleaning costs may be charged to fuel cards with those outlets with vehicle washing facilities. fuel tanks are not over-filled. street parking or public parking areas are not considered as secure locations to leave vehicles overnight or on weekends. including minor damage. emission performance and return on investment. wheels are correctly aligned. Making arrangements for proper garaging of the vehicle or other suitable protection. The fleet manager shall report to the Chief Executive cases where vehicles are returned at the end of use or at the end of the lease period in an unsatisfactory or unclean state. An employee holding a position for which a car is provided has a responsibility. a system is to be instituted so that a full record of petrol usage is input into the fleet management system. e. Employees are responsible for: Ensuring that the vehicle is regularly serviced and maintained. The Government Fuel and Associated Products Contract (no. When taking vehicles home. 7. in association with the NSW Health organisation Fleet Manager. employees are to provide secure parking. The vehicle being kept clean and tidy (inside and outside).2 Security of Vehicles – (Garaging and Safety) 6.g.3 Management and Maintenance Identification stickers are to be affixed to all vehicles except where those vehicles are under a 100% private arrangement. bulk and packaged fuel (drums).MOTOR VEHICLES 7. remove all rubbish etc. to ensure repairs are effected at the earliest opportunity. and that good/safe driving habits are observed. Employees are responsible for returning pool vehicles in a reasonably clean condition. In general. Vehicle maintenance should be undertaken according to the manufacturer’s recommendations to help ensure optimum fuel efficiency. 7. All vehicles are to be returned with at least 30% fuel remaining. 22(5/07) . NSW Health is required to use this contract. vehicles are not used to carry unnecessary loads. If NSW Health organisations have petrol tanks themselves. Employees are required to optimise fuel efficiency and emission performance by ensuring tyres are maintained at recommended pressures. Immediately reporting to the responsible officer of the NSW Health organisation any damage.366) covers fuel card supply from specified service stations directly to vehicle.11 The following applies to NSW Health vehicles being utilised for business purposes (pool cars and business/private mix): During official use vehicles shall be parked at a location convenient to the needs of NSW Health.4 Pool Vehicles Fleet Managers will arrange cleaning of pool vehicles when required. on a private /business basis or where the Chief Executive (or delegate) determines otherwise due to unusual circumstances. Parking Fees and Parking Space Levies 7.1 Accessories Not Charged to Employee Accessories on vehicles are to be limited to those necessary for the safety of the vehicles and/or the reasonable comfort of the occupants with due regard being had to the particular conditions under which the vehicles operate. Written acceptance is to include an express acknowledgement by the employee that continued access to a NSW Health vehicle for private use is conditional upon any future variations made to either charges or conditions of use of vehicles determined by the Department of Health from time to time.MOTOR VEHICLES 7. towbars (not required for official purposes). 6. 22(5/07) . 7. the 100% cost of such alterations. Personalised number plates are not permitted on NSW Health fleet vehicles including 100% private vehicles (except those vehicles under novated lease).5. and for those employees approved on an ongoing basis under 6.1 (Health Service Executives). sunroofs. e.6 Written Acceptance of Conditions There must be a suitable written acceptance by the employee acknowledging receipt of the relevant policy statement(s). Unless a strong business cases exists there is no place for a vehicle with non-standard accessories in a fleet. Written acceptances are required for employees under arrangements 6.7 Tolls.7. windscreen guards. Payment of tolls is not part of the calculated annual contribution by employees. may be installed in 100% private vehicles and those allocated on a private/business basis.5. 7. additions will be at the employee’s expense and the employee will forfeit any right to either remove or receive compensation for the non-essential accessory prior to disposal.g.2 Accessories Charged to Employee All accessories (optional extras) such as optional sound systems. and accepting the conditions and obligations under the terms of the policy. however. Any tolls incurred during private travel must be met by the employee concerned. Purchase of non-standard accessories for pool vehicles or those allocated on a business/private basis are to be approved by the Chief Executive or delegate.2 (Award Employees of the NSW Health Service).3 (Official Pool Vehicles).General All fitted accessory items must comply with and be used in accordance with the vehicle manufacturer’s recommendations. sports packs etc. satellite navigation systems.5 Accessories 6. The fitting of such accessories are to be expressly approved by the Chief Executive or delegate. 7. All station wagons are to be fitted with steel cargo safety barriers or barriers that comply with Standard AS/NZS 4034-1992.1 Tolls Tolls incurred on business/official travel can be claimed back by the employee. baby seats.12 7. 7.5.3 Accessories . vehicle to be used regularly for country travel could be fitted with driving lights (fog lights). MOTOR VEHICLES 7.7. Each NSW Health organisation must also provide such information. 22(5/07) .2 Parking Fees 6. 7.13 For all 100 % private use vehicles (this includes vehicles leased under a novated lease and privately owned vehicles). This includes an obligation on NSW Health to maintain plant and systems of work that are safe and without risk to health.7. The Parking Space Levy is exempt from the Goods and Services Tax (GST). employees will remain personally responsible for meeting the cost of the Parking Space Levy (where applicable). This means the election to salary sacrifice should be arranged before the employee uses the parking space for personal advantage. This includes disability. training and supervision necessary to ensure the health and safety of employees. 7. occupational health and safety issues and other matters that the Chief Executive determines are relevant. The following points should be noted: The levy can be met by executives or other eligible employees on a salary sacrifice basis provided the arrangement is made prospectively. Should an exceptional circumstance arise where a non-NSW Health executive employee is provided with the use of a parking space that gives rise to a personal liability for the Parking Space Levy. payment by the employee should be made from post-tax salary. A vehicle used for business is considered a work place. Smoking is not permitted in NSW Health vehicles. and must at all times comply with relevant road transport legislation. All NSW Health vehicles are to carry a First Aid Kit. A Chief Executive has the discretion to waive this requirement on a case-by-case basis taking into account particular working requirements and conditions.8 Health and Safety Employers have a duty of care to provide and supervise a safe system of work under the Occupational Health and Safety Act 2000. This payment can be treated as an employee contribution for the purpose of reducing the FBT taxable value in situations where a non-executive has a packaged vehicle. the cost of parking on a public health organisation leased premises will generally be fully recovered from the employee. where applicable. Vehicles are to be maintained in accordance with the manufacturer’s requirements. However. instruction. The cost of the parking space used by a NSW Health fleet vehicle that is packaged on a private/ business basis is an expense borne by NSW Health. This is because the vehicle is available for business use during the normal business hours in which it is parked on business premises.3 Parking Space Levy Employees who have access to a parking space (whether the vehicle is 100% private or split on a private/business basis) are required to meet the cost of the Parking Space Levy where it applies. This means the employee should not pay GST on the amount of the levy even where it is treated as an employee contribution for the purpose of calculating the FBT taxable value. Under no circumstances should NSW Health vehicles be used to transport hitchhikers. regardless of whether on official business or not. 7.MOTOR VEHICLES 6. 7. Any of the drivers involved in the accident appear to be under the influence of alcohol or drugs. It is illegal for a driver to use a mobile telephone when driving unless a hands-free device is being used. Any of the drivers involved in the accident fail to stop after the accident. the driver’s details must be obtained from the vehicle running records and the Statutory Declaration provided on the reverse side of the fine should be completed and returned promptly to the State Debt Recovery Office.14 Drivers must not use mobile telephones unless a hands-free device is fitted. Attempt to make the scene as safe as possible. The driver in control of a vehicle at the time of any offence must pay for all traffic and parking infringements promptly. or A vehicle involved in the accident has to be towed. The Police Advice Line for reporting accidents is 131 444. This should ensure that the driver of the vehicle and not the NSW Health organisation is fined. Arrange emergency services as required. The Police must be called to the scene of the accident where the following occurs: A person is injured or killed. Exchange vehicle and licence information with the other driver(s). and Not admit liability. will make the employee who has packaged the vehicle liable for any financial and/or points penalties imposed.10 What To Do in Case of Accidents A driver involved in an accident is required to stop and render assistance.9 Traffic Infringements NSW Health should take appropriate steps to record the identity of a driver of a vehicle in case of accident or where financial and/or points penalties are imposed. Employees involved in accidents must comply with all legal and insurance requirements such as obtaining particulars of parties involved and notification of police and the appropriate officer in the NSW Health organisation. the absence of running sheets or other appropriate measures to record business use of such vehicles. The use of running sheets meets this requirement. 22(5/07) . In the case of vehicles packaged on a private/business basis. Render assistance to any person injured. If NSW Police notifications or reminders are issued in the organisation’s name. The fine will then be reissued in the nominated driver’s name. The driver must: Stop at the scene. Each NSW Health organisation is to monitor fines and incidents to ensure drivers continue to be appropriately licenced. of which a key element is a commitment to improve the environmental performance of the NSW Government fleet. All requests for a V8 powered vehicle for exempt categories must be authorised by the General Manager.nowwhere.pdf http://www. and should not be used if the vehicle manufacturer has stated that the E10 will void vehicle warranties or damage the vehicle.premiers. 2006-05 and Department of Health Purchasing and Supply Manual at page 6. As at March 2007.1206.gov.au in the ‘Publications’ section under ‘Travel’. are required to use E10 blends (or other alternative fuels) where this is practicable. StateFleet.nsw.11 Biofuels and Other Alternative Fuels (Premier’s Memorandum No 2006-05 refers) 6. ‘Emergency vehicles’ used by an ambulance service are exempted from this policy. All employees (and contractors) who drive Government-owned vehicles. are encouraged to replace the existing vehicles at the due replacement time with a hybrid vehicle. the NSW Government has determined that public service staff or executive officers will not be permitted to obtain a V8 powered vehicle under a novated lease arrangement.aspx 7. and cost-effective.au/media_files/PressItem. 22(5/07) .12 Removal of V8 Powered Vehicles from Government Contract (Premier’s Memorandum No. (Note: E10 may be not be suitable for all Government-owned vehicles.caltex. the following links can be used: http://www. animal fats or cooking oils.876. All government vehicles are to be issued with fuel cards specifically providing for the consumption of E10. This decision is in line with the NSW Government’s Cleaner Vehicles Action Plan.com.26 refer) In keeping with the decision to remove V8 powered vehicles from the Government contract for the acquisition of Motor Vehicles.au/caltex/austlocator/search.) The location of fuel outlets that sell E10 blended petrol can be found at the NSW Department of Commerce web site.MOTOR VEHICLES 7. Chief Executives therefore are not to enter into any novated lease arrangement for V8 powered vehicles with their staff. available. Public sector officials who currently have Government-owned vehicles as part of their remuneration package. Biofuels such as 10% ethanol blended petrol (E10) and biodiesel are considered a renewable fuel source when produced from agricultural crops.com. Clarifying definitions of ‘emergency vehicle’ and exemptions to this policy appear in Premier’s Department Motor Vehicle Policy which can be accessed via Premier’s Department website at http://www.15 The NSW Government is committed to the use of biofuels and other alternative fuels as part of the Government’s overall Cleaner NSW Government Fleet Policy. Where areas have implemented a fleet management information system.16 Each area must establish a fleet management system to monitor the usage of each motor vehicle in its fleet with the objective of maximising utilisation. organisations should include in their assessment the criteria listed at Appendix 1. be negotiated directly with StateFleet (without the need to call tenders) or outsourced to a private sector fleet manager (subject to normal tendering requirements). This will generally be the smallest vehicle able to accommodate the people and goods to be carried in safety and reasonable comfort. at least. Purchased motor vehicles must be depreciated over their estimated total useful life in accordance with AAS4 “Depreciation of Non-Current Assets” subject to materiality. Fleet Management Information System Minimal Reporting Capability 1. minimising change-over costs and minimising vehicle numbers. A fundamental element of the Treasury Managed Fund is the adoption of risk management practices by participating agencies. It may be undertaken in-house. the system will be capable of providing reports which include. those information items listed hereunder. If an area funded purchase and/or operating costs from external sources and that funding has ceased. Drivers and Fleet Managers must ensure that the most economically practicable vehicle among those available is selected for each journey. any vehicle replacing the original externally funded vehicle should be assessed on the basis of an additional vehicle. Agencies are responsible the development of programs that best fit their exposures.MOTOR VEHICLES FLEET MANAGEMENT Monitoring Vehicle Utilisation 6. Number of vehicles in the fleet for each of the following categories: Sedans Station Sedans Utilities Four-Wheel-Drive Vehicles Panel Vans Passenger Vans Buses 22(5/07) . Fleet Management Information System Organisations with 10 or more vehicles in their light passenger motor vehicle fleet for a continuous period of six months are to implement a fleet management information system for this fleet. The system needs to ensure that input tax credits for recouping the GST feeds into the organisation’s business activity statement (BAS). When considering purchase of an additional vehicle or replacement of an existing vehicle. showing model . cost centre Individual vehicles outside set utilisation limits Fleet utilisation rate (kms/week) 6. The processes followed need to be consistent with Treasurer’s Direction 89/2. including a system of automatically cancelling cards when vehicles are disposed of. 3 months ahead) Listing of vehicles overdue for disposal Listing of vehicles in order of forecast disposal date Listing of out-of-service vehicles awaiting disposal Historical information on motor vehicle disposal (e. 5. 22(5/07) . Management information reports on the fleet asset register will include: Listing of outstanding vehicle orders Listing of vehicles due for disposal within a time limit (e. There is to be a system to record fuel cards issued and cancelled.) 4.g. Individual vehicle information for the asset register will include: Registration No.MOTOR VEHICLES 6. Small) Make Model Body Type Engine Capacity Number of Cylinders Tank Capacity Allocation to Branch (if applicable) Insurance Classification Forecast Replacement Date Purchase Date Purchase Price 3. Management of Leased Vehicles Lease details A system of lease management that ensures the organisation avoids penalties and efficiently ensures that delivery of new vehicles is aligned with the disposal of old vehicles.showing location/program. Management information on fuel utilisation will include: Listing vehicles outside fuel consumption limits Listing fills between dates by supplier Listing fills between dates by registration number Listing all fills for a specified vehicle Listing fuel purchase credit cards by registration number Listing total fuel consumption for selected period by fuel type. Class (either Large.17 2. Management information on fleet utilisation will include: Individual vehicle utilisation rate (kms/week) . etc.g. date. sale price. Medium. e.g.18 7. 22(5/07) . it is to be thoroughly inspected. All papers.. etc. damage repairs. The file will usually commence with the authority to order and a copy of the order. but are not essential. etc. Information on whole-of-life and/or period costs will include: Maintenance and other costs (e. etc. 8. are to be attached to the file. services. scheduled maintenance. oil. and road tested at least to the extent of the items listed in the inspection sheet. opportunity cost (interest costs). the vehicle is to be returned to the supplier for repair and the sheet noted accordingly. etc. include the following: Budget estimates of replacement schedule for current and/or next financial year(s) Listing of fuel fills between dates by model Listing of average fuel consumption for selected period by model Average life-to-date cost per km for each model in the fleet * ** Life-to-date costs include all operating costs incurred since acquisition of vehicles.) Running costs (fuel. maintenance accounts. Motor Vehicle Records Vehicle History File A separate vehicle history file is to be maintained in respect of each vehicle. or copies of papers. insurance. i. tyres. depreciation. The Vehicle History File will be a valuable source of management information where no fleet management information system is maintained. The new vehicle inspection sheet is to be attached to the vehicle history file. New Vehicle Inspection Sheet All areas are to complete a new vehicle inspection sheet (the format of which is shown at the end of this section (Appendix 2) for each new vehicle received. pertinent to the vehicle.) Itemised costs for a specified vehicle Summary of life-to-date costs* for the fleet Whole-of-life costs ** (after sale) for a specified vehicle Life-to-date cost per km for a specified vehicle FBT and value of reportable fringe benefits provided to employees It also needs to take into account any requirements of the Government Energy Management Policy (GEMP). breakdown repairs.MOTOR VEHICLES 6. Upon delivery of a new vehicle. registration. Whole-of-life costs (after sale) include all costs incurred during vehicle operation. accident reports. Additional information items which areas would find useful. Any defects are to be recorded and if necessary. inside and out. Where the Statutory Formula method is used to calculate the value of a car fringe benefit or the prescribed period has elapsed for keeping a log under the Cost Basis method. RUNNING SHEETS Fringe Benefits Tax For the purposes of assessing the taxable value of car fringe benefits as required by the Fringe Benefits Tax Assessment Act 1986. as long as details of all relevant payments are attached to the individual motor vehicle file so that information regarding total costs may be extracted if necessary. information to be recorded must include the following: 22(5/07) . a motor vehicle history sheet must be kept for each vehicle and updated on a monthly basis from information obtained from the motor vehicle running sheet.19 Where no fleet management information system is maintained. certain information is to be recorded on running sheets. The history sheet should be kept at the front of the vehicle history file.) order number cost received (date) disposed of (date) disposal price number of receipt (issued to auctioneer etc. Note that it is no longer a requirement to complete the columns from “Insurance” to “Total Costs” inclusive. Centre etc. Motor Vehicle History Sheet Where a fleet management information system is not maintained due to the fleet size. a register should be kept in each area listing every vehicle in the current fleet and showing: registration number make and type engine number chassis number location (Branch.MOTOR VEHICLES Motor Vehicle Register 6. paying for vehicle) replaced by (registration number) total kilometres travelled on disposal remarks Where a fleet management information system is maintained only the following need be recorded in the register: registration number replaced by (registration number) total kilometres travelled on disposal The register eliminates the need for motor vehicles to be placed on inventory sheets. The format of the history sheet is shown at the end of this section (Appendix 3). e. The leasing facility is managed by StateFleet Services. issue docket number.MOTOR VEHICLES 6. model and colour Journeys time the journey began and ended date the journey began and ended odometer reading at the start and end of the journey distance travelled in the course of the journey places where the journey began and ended purpose or purposes of the journey name of the driver (by whom entries MUST be made) signature of driver date on which the entry is made. Ordering of Vehicles NSW Health must lease all standard passenger and standard light commercial vehicles through the New South Wales Government leasing facility unless exempted by Treasury. a business unit of the Department of Commerce. Where the Cost Basis method is used to calculate the taxable value of a car fringe benefit. petro-credit card. cash. the driver must record the following: Vehicle registration number make. for a continuous period of 12 weeks at any time in the first year that fringe benefits tax is payable. etc.20 Vehicle registration number make. model and colour Journeys date of the journey name of the driver times the journey began and ended odometer reading at the end of the journey destination of journey purpose or purposes of the journey place where garaged overnight (if not at base) Petrol and Oil date of issue odometer reading at the time number of litres of fuel received type of fuel brand of fuel cost of oil received place of issue means of payment. 22(5/07) .g. fuel and disposal services are also available through SCCB contracts. (Any other operational requirement exception can be approved by the General Manager.21 Should any vehicles be purchased (not leased) they must be included on the agency’s asset register. When the vehicle is available for collection. NSW Health should seek advice from StateFleet or NSW Supply on alternative procurement options.) Orders are to be placed on contractors for the type of vehicles required. The following information is to be obtained from the dealer/agent: name and model of vehicle body classification and colour 22(5/07) . In areas outside the Sydney metropolitan area. Standard passenger. including accessories. Motor vehicle associated goods and services. In light of expensive fuel and running costs and increased greenhouse gas emission levels. Vehicles that exceed the luxury car tax threshold set by the Australian Taxation Office cannot be procured through the leasing facility. V8’s are not to be leased/purchased for staff etc and Chief Executives are not to enter into any novated lease arrangements for V8 powered vehicles for their staff.MOTOR VEHICLES 6. NSW Health may request to either lease or purchase outright heavy or non standard commercial vehicles (over one tonne capacity) through StateFleet. lubricating oils and greases. NSW Health must purchase associated goods and services through contracts. Where there is an operational need backed by a business case. StateFleet. for financial statement purposes. Leased motor vehicles must be accounted for. Orders should show the name and telephone number of the officers at the Division who may be contacted in regard to enquiries. If an appropriate vehicle for a specific work-related application is not available in contract. The exception in respect to NSW Health is where a vehicle is used by an ambulance service and is visibly marked on its exterior for that use and is fitted with a flashing warning light and a variable horn. arranged by the NSW State Contracts Control Board (SCCB) unless a specific exemption is approved by Treasury. 653) and the Treasury leasing arrangements. repair and servicing. contact will be made by the dealer (agent) with the officer named in the order requesting that arrangements be made regarding “Third Party” insurance and registration. in accordance with AAS17 “Accounting for Leases. motor vehicles leased through StateFleet constitute operating leases and must be accounted for as such under AAS17. In particular. Agencies are required to use these contracts. orders are to be placed with dealers who are agents for the company producing the type of vehicle required. V8 powered vehicles are no longer available under the Motor Vehicle Acquisitions contract. as shown in the contract arranged by the State Contracts Control Board and StateFleet. bell or alarm that can give audible warning of approach. standard light commercial and 4-wheel drive general purpose motor vehicles must be replaced in accordance with the requirements of the SCCB Motor Vehicle Contract (no. where available. service. including accessories.MOTOR VEHICLES horsepower and weight of vehicle engine and chassis numbers number of cylinders class of tyres and wheel base) trucks only number of axles ) It should be noted that the only persons authorised to approve the purchase of motor vehicles are those officers with a specific delegation to do so. Full detail is provided in the Treasury Managed Fund Contract of Coverage at Section E2. labour and material costs entered on the pink copy and the pink copy attached to the vehicle history file 22(5/07) . Registration is to be in the name of the Health Administration Corporation. repair and servicing. Registration is payable on Government vehicles. Orders for Repairs and Processing of Accounts The Transport Officer or other officer fulfilling that role is to prepare an order for repairs.22 NSW Health must effect compulsory Third Party insurance with the commercial insurer contracted through the Treasury or in accordance with contract arrangements applicable to vehicles subject to novated leases. The $300 limit is a TMF franchise and claims up to that amount will not be accepted by TMF with the responsible body to meet the cost of that claim.original (white copy) to repairer. Registration Two copies of the registration form must be completed. made by third parties for damage to property caused by the operation of NSW Health vehicles and all own damage claims. The original of the registration form. Form 1 is to be used for motor cars and Form 4 for motor lorries and utilities. exceeding $300. fuel and disposal services are also available through SCCB contracts. etc. “Third Party” Insurance 6. Agencies are required to use these contracts. Repairs and Maintenance of Motor Vehicles Motor vehicle associated goods and services. When the vehicle has been serviced to the satisfaction of the driver. The following information is to be provided: engine number where the vehicle is to be garaged Comprehensive Insurance The Treasury Managed Fund (TMF) will meet in full all claims. plus the duplicate and triplicate of the Third Party policy are to be taken to the dealer who will arrange for the vehicle to be registered and advise when the vehicle is ready for collection. When the invoice is received it is to be checked with the pink and yellow copies of the order. duplicate (pink copy) to the driver and the yellow copy to remain in book. the pink copy of the order is to be signed by the driver and returned to the Transport Officer to await receipt of the invoice. in triplicate . lubricating oils and greases. Vehicles are generally to be sold registered. running costs and use of such vehicles should be reviewed annually. This includes compliance with any instructions issued by StateFleet relating to the condition of vehicles at time of sale. Vehicles disposed by insurance company write-off may be subject to a registration rebate. Tenders An advertisement giving details of the car. The law requires all registered vehicles that are offered for sale at auction have a RTA Safety Inspection Report (“pink slip”). On receipt of a new vehicle the replaced vehicle must be submitted promptly for sale. The condition.Credit Cards Details of the system of using credit cards for fuel purchases are included in the Accounting Procedures Manual.MOTOR VEHICLES 6. Disposal of Motor Vehicles It is mandatory that standard passenger. the minimum acceptable lease term for vehicles acquired through StateFleet Services is the period in which the vehicle is expected to travel 40. Agencies are required to dispose of leased vehicles in accordance with any policies and procedures as determined by the leasing facility. Fuel Supplies . The voucher is to be forwarded to the accounts section for payment. light commercial and four wheel drive general purpose motor vehicles (under one tonne capacity) are retained for a minimum of nine months or 15. The replacement criteria for other vehicles are to be aimed at achieving the best long-term return on investment for each vehicle type. total cost and date voucher passed for payment entered thereon. Commercial vehicles of seven tonnes or greater capacity may be retained until the end of their useful economic life. On no account are replaced vehicles to continue in service as additional vehicles unless specifically authorised by State Health.23 (or a copy of the invoice may be attached to the file). 22(5/07) . Payment is to be accepted only in the form of cash or a bank cheque and paid to the local Public Moneys Account for transmission to the Treasury.000 kilometres (provided the period is not less than nine months). but in some cases there may be a need to sell a vehicle unregistered. Vehicles sold at auction without a pink slip must be sold unregistered. Notwithstanding. The yellow copy is retained in the order book and invoice number. debit code.000 kilometres and replaced in accordance with lease terms and operational needs. Appropriate economic analysis should be regularly undertaken to determine when non-standard passenger and four wheel drive and commercial vehicles above one tonne but less than seven tonne capacity should be replaced. where and when it can be inspected and how and when tenders will be accepted is to be placed for two consecutive weeks in the local newspaper and the papers in surrounding districts. IDENTIFICATION STICKERS ETC. Equity in Vehicles The change-over charge on an individual car will not be charged to the individual’s package. Number plates are to be returned promptly to the Roads and Traffic Authority. Auction Advertisements giving details of the vehicle. This policy will remain in force until otherwise revised based on commissioned studies of optimal holding periods. OFFICERS ARE TO ENSURE THAT NRMA MEMBERSHIP CARDS. PETROL CARDS. please contact the Corporate Governance and Risk Management Branch of the Department of Health. training and accreditation and future issues.MOTOR VEHICLES 6. where and when it can be inspected and how and when it will be auctioned are to be placed two weeks running in the local newspaper and the papers in surrounding districts. Payment and delivery to be as in section on tenders. What does the Numerical Profile measure and how is it used? A Motor Vehicle audit using the Numerical Profile measures the existence of motor vehicle policies. If you have any queries regarding the attached information. having regard to current prices for vehicles. procedures and systems in five main areas of the workplace: 22(5/07) . Holding Period (now lease period and penalties apply in some cases) The current holding period of Government vehicles is two years or until the vehicle has travelled forty thousand kilometres.24 On receipt of payment in full the vehicle is to be handed over to the purchaser after the number plates and registration label have been removed. recommendations on the timing of audits. if the holding period is served. Acceptance of the highest bid to be authorised by the Tender Committee. ARE REMOVED FROM VEHICLES BEFORE DISPOSAL. audit. The advertisements are only to be placed after arrangements have been made with a local auctioneer to auction the vehicle. Auction to be on the basis that the highest bid will not necessarily be accepted but will be submitted for acceptance on completion of the auction. Motor Vehicle Numerical Profile Introduction The information in this section provides those with responsibility for Motor Vehicles in public health organisations with specific directions on the implementation of the Numerical Profile. MOTOR VEHICLE RUNNING SHEETS. whichever occurs sooner. When should Numerical Profile audits be conducted? All health care facilities in NSW Health should. A Numerical Profile at a health facility will provide management with a report showing percentage scores for each area evaluated. How is the Numerical Profile Implemented? The Department recommends that wherever possible.25 The Numerical Profile does not measure motor vehicle management in minute detail under these main areas. trained surveyors conduct Numerical Profile audits. one audit per year is considered adequate for these purposes. as well as a percentage score for the facility as a whole. Acquisition and Disposal 6. but is focused on best practice. Meeting Service Needs 3. 22(5/07) . at minimum. the DoH in conjunction with representatives of the health system has developed the Motor Vehicle Numerical Profile. be audited yearly. Who is responsible for ensuring the Implementation of the Numerical Profile? The profile is a guide for management to use if they want to assess the adequacy of the management of their vehicle fleet. the Numerical Profile provides management with clear steps for improvement in order to achieve an improved score.MOTOR VEHICLES 1. Occupational Health. THE NSW DoH MOTOR VEHICLE NUMERICAL PROFILE CONDUCTING THE AUDIT In order to uniformly measure motor vehicle management performance. Vehicle Utilisation 5. however. Safety & Security 4. it is a tool for Chief Executives to use in achieving best practice. This will ensure that both the auditor and management are assured of an objective approach to the measurement of motor vehicle management in a health care facility. It is not compulsory. Additional workload for practitioners: It is important for Chief Executives to recognise the additional workload that the practice of assisted auditing will incur. In addition. Management may conduct as many audits required to monitor improvements and increase standards and scores. Adm inistration 2. Who can conduct a Numerical Profile audit? The Numeric Profile audits may be conducted by a local survey team selected either from the facility under review or another facility within the area health service or under any other arrangement that is considered appropriate. The conduct of audits will incur expenditure that is to be borne by the area being audited. However. POINTS IN CONDUCTING THE NUMERIC PROFILE 1. procedures and systems in the workplace. e. Promote and conduct the audit as a positive.26 The Profile delivers: a simple. consisting of five sections. The Overall Assessment Sheet provides a graphic indication of performance by section. 6.MOTOR VEHICLES The Numerical Profile measures three aspects: 1. where a criteria for a grade is not absolutely attained. management. a health care facility with a good motor vehicle management program should score above 65%. 4. Each section comprises a number of parts relevant to that particular topic. C. 4. transport staff. The delivery of reasonable outcomes as to best practice in motor vehicle management. Allow sufficient time to complete the audit. The parts are each rated separately as either A. The awareness of such policies. The existence of motor vehicle: Policies Procedures Systems 2. Do not rush or take short cuts as this will result in an inaccurate numeric profile. Accordingly. Assessors have been instructed to determine gradings on a “hard but fair” basis. Do not take people’s word for functions that have to be or are undertaken. 3. etc. pro-active exercise wherein there is an exchange of ideas to develop strategies for improvement. This ensures a consistent approach to grading throughout the Department. Verify where possible with formal documentation and discussion with relevant personnel. B. Complete notes progressively so as to provide a comprehensive assessment and guide to future improvement strategies. comprehensive measure of motor vehicle management performance feedback to managers the identification of critical areas for improved performance the identification of specific improvement plans. or D and are weighted relative to other parts of the profile in each section. As a guide. 22(5/07) . each worth varying points that are weighted according to their relevance to providing best motor vehicle management. 2. 3. The Numerical Profile has a possible score of 530 points. The Profile is not designed so that a health care facility passes or fails should it achieve a score above or below 50%. Their application in the workplace.g. the lower grading is assigned. A straight score basis with no attachments assessment criteria. 6.g.g. no patient transport) then the overall total points score (530) should be reduced by that part that is not applicable. The numeric profile may be used to demonstrate improved performance and outcomes as part of the EQUIP program. 6. MEETING SERVICE NEEDS III Service Provision Standard Achieved and Score D-0 C-5 B-25 A-40 D C B A No evidence of fleet configuration having been assessed to meet service needs. the fleet configuration meets all requirements of the Motor Vehicle Fleet Policy regarding utilisation for business use. There is evidence that the number and type of vehicles reflect the current services provided and that there are monitored and reviewed when there is a change in service provision. (e. e. As well as B. 1 month and findings discussed with management.g.MOTOR VEHICLES 5. Strategies should be developed to implement improvements and determine target dates and follow-up audit timings. Some evidence of fleet configuration meeting service needs and reviews apparent. PARTS NOT APPLICABLE Where parts of the numerical profile are not applicable due to particular local circumstances. 22(5/07) . How to Score The Numeric Profile incorporates a base method for scoring viz. 1. e.27 Reports should be completed as soon as possible. 28 OTHER COMMENTS The officer undertaking the audit should prepare comments for management in respect to matters that whilst not necessarily pertinent to conducting the numeric profile do have an effect on the efficient running of the cleaning service in a health care facility. A page is included titled “Other Comments” at the back of the numeric profile package. 22(5/07) .MOTOR VEHICLES 6. 29 MOTOR VEHICLE FLEET NUMERICAL PROFILE REPORT FOR SCORE: ASSESSMENT NUMBER: % 22(5/07) .MOTOR VEHICLES 6. 30 MOTOR VEHICLE FLEET NUMERICAL PROFILE REPORT HOSPITAL LOCATION DATE OF ASSESSMENT ASSESSMENT CONDUCTED BY TELEPHONE NUMBER PRINCIPAL CONTACTS Should you have any queries regarding this Report please do not hesitate to contact Assessor at the Area Commercial Services Department on (02) 22(5/07) .MOTOR VEHICLES 6. ASSESSMENT CRITERIA 6. STANDARD QUESTIONS FOR CONDUCTING REVIEWS 22(5/07) .31 2.MOTOR VEHICLES CONTENTS 1. OVERALL ASSESSMENT SHEET 4. INDIVIDUAL SECTION FINDINGS TABLES 3. 50 Standard Achieved and Score D-0 C-5 B . In addition to C records are up to date.0 I D C B A 6. e.20 III ALLOCATION D C B A There is no policy on the allocation of vehicles. Managers. In addition to B. /95 % Administration Score % Score for Administration 22(5/07) . All required records exist. Standard Achieved and Score D-0 C-5 B . In addition to C regular reviews are undertaken to ensure that only officers authorised to be allocated vehicles have been. supervisors and employees are emphasised.10 B . inspection sheets. RECORDS No evidence that required motor vehicle records are being maintained. A policy exists for the allocation of vehicles. the Motor Vehicle Fleet Policy has been distributed to departments. supervisors and employees are aware of their responsibilities within the policy. In addition to B rates of charge are verified regularly for private usage. Responsibilities of managers. In addition to B records are regularly reviewed and action taken on anomalies identified. In addition to C.MOTOR VEHICLES RISK MANAGEMENT NUMERIC PROFILE MOTOR VEHICLE FLEET POLICY SECTOR LEVEL NB: 1. There is a written Motor Vehicle Fleet Policy that conforms with DoH policy. A system is in place to monitor compliance with the policy.10 A .25 II D C B A Standard Achieved and Score D-0 C .32 “DEFINITION OF DRIVER” = Any employee required to drive a health service vehicle.30 A . history sheet. ADMINISTRATION MOTOR VEHICLE FLEET POLICY No written statement of Motor Vehicle Fleet Policy.g. the policy is reviewed annually and any changes implemented.10 A . register. history file. 45 A A . findings of the reviews are documented and follow up action is taken and noted. safety.45 A A . Standard Achieved and Score D-0 C .30 B As well as C. transport equipment and running costs. regular reviews are conducted regarding utilisation against service and client needs. safety. communications and running costs and there is evidence that assessments have taken place. Courier timetables are widely published and available to all staff. safety. As well as B. As well as B. findings of the review are documented and follow up action is taken and noted. Courier and cartage vehicles meet service needs regarding size. All patient transport vehicles are uniformly identified as per Area policy. infection control.33 I D C PATIENT TRANSPORT No criteria or assessment of vehicles to meet patient transport needs.30 B As well as C. communications. B . Regular maintenance safety checks are carried out by the drivers. These checks are documented and follow up action is noted. C C . communications and running costs. Regular maintenance safety checks are carried out by drivers. infection control. These checks are documented and follow up action is noted. infection control.0 MEETING SERVICE NEEDS 6.65 22(5/07) .65 II COURIER SERVICES (includes Group Services) Standard Achieved and Score D-0 D There is no evidence that courier and cartage vehicles meet service needs regarding size. B .MOTOR VEHICLES 2. regular reviews are conducted regarding service provision and timetables to ensure the highest level of efficiency in keeping with the total Area courier service. There is a set criteria or assessment made to determine that patient transport vehicles meet client and service needs regarding size. with services already provided by other Sectors being considered. 25 D C B No evidence of fleet configuration having been assessed to meet service needs.40 Meeting Service Needs /170 % Score for Meeting Service Needs % 22(5/07) . the fleet configuration meets all requirements of the Motor Vehicle Fleet Policy regarding utilisation for business use. There is evidence that the number and type of vehicles reflect the current services provided and that these are monitored and reviewed when there is a change in service provision. Some evidence of fleet configuration meeting service needs and reviews apparent.34 III SERVICE PROVISION Standard Achieved and Score D-0 C-5 B . As well as B. A A .MOTOR VEHICLES 6. distributed and reinforced. defects and service details of all vehicles. investigated. i. C.MOTOR VEHICLES 3. MOTOR FLEET DRIVER SAFETY Little attention is given to OH&S aspects of motor vehicle activity. Written safety rules/instructions given to all drivers. In addition to B. All vehicles carry instructions to drivers in the case of an accident. recorded. /70 % B .20 A A . Inspections include cleanliness of interior and exterior of the vehicle.10 D C No regular inspections of vehicles and service details. Some vehicles serviced regularly over the warranty period by the dealer. All drivers have a current driver’s licence and a check is undertaken at least annually to ensure currency. All heavy vehicle drivers given an annual driving check by appropriate check driver.35 I D.e. a documented system is in place for recording of regular inspections. Some inspections of vehicles and service details but not regular and not documented. In addition to B. Defensive driver training provided.0 OCCUPATIONAL HEALTH & SAFETY 6. B In addition to C.40 II CONDITION/CARE OF VEHICLE FLEET Standard Achieved and Score D-0 C .10 B. All vehicles carry identification stickers. In addition to C. Defects are fixed within a reasonable time from the date of reporting. All new vehicles inspected in and new Vehicle Inspection Sheet used. fleet loss control activity is integrated into OH&S program. remedial action identified and implemented. a system of recording follow up action taken after each inspection or report of defect is in place. All vehicles regularly serviced over the full warranty period by the dealer. All accident insurance matters are referred to the Area Commercial Services Department on the required claim form and within a reasonable time from the date of accident. D-0 C . B . efforts are made to regularly check the competency of all drivers.g.30 A.30 Occupational Health & Safety % Score for Occupational Health 22(5/07) . e. motor vehicle accidents should be treated as any other work accident. Responsibilities of drivers are clearly written. A . vehicle if required to be driven home because of no secure overnight parking are only driven by those persons who live closest to the centre.45 II D C B A III RUNNING SHEETS D Running sheets not completed. In addition to B. There is evidence that the driver’s licence status is checked on a regular basis.20 B .36 Standard Achieved and Score D-0 C . A system is in place to review vehicle utilisation and on a time basis (see example methodology attached).60 Standard Achieved and Score D-0 C . Vehicles are garaged in secure off street areas. A system for control and daily use of vehicles is in place but not utilised for all vehicles. A system for control and daily use of vehicles is in place and used for all vehicles.60 Vehicle Utilisation % Score for Vehicle Utilisation 22(5/07) . follow up action is taken with drivers regarding compliance with the policy and follow up action is documented. In addition to B. Running sheets are regularly reviewed to identify areas of abuse. regular checks of running sheet data for compliance with policy. In addition to B. In addition to B. 6. A notation is made for vehicles garaged overnight away from the unit. Vehicles are rotated regularly from high to low kilometre usage areas.10 B . the regular utilisation reviews are acted upon and reported to Senior Management.25 A . all vehicles managed by the unit are available for pool use.30 B . C B A Running sheets in approved format are completed. In addition to C. MOTOR VEHICLE POOL SYSTEM Vehicles are not pooled and there is no system for recording daily vehicle usage. Supervisor or designated officer signs all running sheets as evidence of checking.40 A .MOTOR VEHICLES 4.40 A A .0 VEHICLE UTILISATION I D C B USE OF VEHICLES There is no system for review of vehicle utilisation. /165 % Standard Achieved and Score D-0 C . not used at all. % of half days vehicles used on official business. however. i) ii) iii) used on official business.MOTOR VEHICLES METHODOLOGY 1. 6. the officer used the vehicle the following morning or previous evening directly in the field on official business the occasion would not be included in the percentages of purely office to home private usage. but used as transport from the office to the officer’s home and vice a versa. Utilisation rates of vehicles to be tallied and divided by a standard of 70% to determine number of vehicles that should comprise a particular area’s fleet size. 3. used on official business 31 half days out of possible 44 in a standard month or 32 days in a 5 day week. but would be included in point (i) above. NB Home to office or office to home is not to be counted as official usage. % of half days vehicles used as transport to and from officers’ residences as purely private usage.e. even if only for 2 hour. Vehicles to be separated into personal allocation and pool vehicles. Seventy percent is considered a conservative standard to use as the basis for the allocation of an official vehicle. however. i.37 Sample period of two months motor vehicle running sheets to be examined by dividing each day in half and determining how each vehicle was used for that half day. 70% official usage has been used over the past ten years during audits and also in a previous Statewide motor vehicle survey conducted in the mid seventies. with percentages being calculated as to: A. If. 22(5/07) . B. Limitations to Methodology Motor vehicle running sheets possibly not assessable due to unsatisfactory completion. viz. not used in the half day. the vehicle is to be shown as being utilised for the half day. 2. There exists no standard measure to determine when a vehicle should be allocated. B .000 klms or 2 years.g. trade-ins. there is evidence that vehicles approved for replacement have been assessed on a utilisation basis as to whether they warrant replacement..15 A A . Use of trucks and buses is reviewed regularly for economy and appropriateness to service needs. The local policy states which officer can approve acquisition and disposal of vehicles.30 Acquisition & Disposal /30 % Score for Acquisition & Disposal % 22(5/07) . i) a report outlining the reasons for approval for replacement.38 I ACQUISITION AND DISPOSAL Standard Achieved and Score D-0 C .10 D C There is no policy as to who can approve the acquisition and disposal of vehicles. iii) accessories are purchased in line with DoH policy.0 ACQUISITION AND DISPOSAL 6. ii) evidence that disposals and acquisitions are performed on a best value basis in line with Departmental policy.MOTOR VEHICLES 5. B In addition to C. All light commercial vehicles are monitored for usage and recommended for replacement at 40. which fall outside the policy. detailing etc. is provided with the request for replacement. whichever occurs first. e. In addition to B. MOTOR VEHICLES 6.39 NUMERICAL PROFILE ASSESSMENT FINDINGS TABLE LOCATION: DATE: MOTOR VEHICLE FLEET ISSUE 1) Adm inistration FINDING RATING AND COMMENT 2) Meeting Needs Service 3) Occupational Health & Safety 4) Vehicle Utilisation 5) Acquisition Disposal and 22(5/07) . 0 ADMINISTRATION ISSUE 1.3 Allocation 22(5/07) .MOTOR VEHICLES NUMERICAL PROFILE ASSESSMENT 6.1 Motor Vehicle Fleet Policy FINDING RATING AND COMMENT 1.2 Records 1.40 FINDINGS TABLE LOCATION: DATE: 1. 1 Patient Transport FINDING RATING AND COMMENT 2.41 FINDINGS TABLE LOCATION: DATE: 2.0 MEETING SERVICE NEEDS ISSUE 2.2 Courier Services 2.MOTOR VEHICLES NUMERICAL PROFILE ASSESSMENT 6.3 Service Provision 22(5/07) . MOTOR VEHICLES NUMERICAL PROFILE ASSESSMENT 6.2 Condition/Care of Vehicle Fleet 22(5/07) .42 FINDINGS TABLE LOCATION: DATE: 3.0 OCCUPATIONAL HEALTH & SAFETY ISSUE 3.1 Motor fleet driver safety FINDING RATING AND COMMENT 3. 43 FINDINGS TABLE LOCATION: DATE: 4.MOTOR VEHICLES NUMERICAL PROFILE ASSESSMENT 6.2 Motor Vehicle Pool System 4.1 Use of Vehicles FINDING RATING AND COMMENT 4.0 VEHICLE UTILISATION ISSUE 4.3 Running Sheets 22(5/07) . 0 ACQUISITION & DISPOSAL ISSUE 5.1 Acquisition & Disposal FINDING RATING AND COMMENT 22(5/07) .MOTOR VEHICLES NUMERICAL PROFILE ASSESSMENT FINDINGS TABLE 6.44 LOCATION: DATE: 5. 45 MOTOR VEHICLE FLEET NUMERICAL PROFILE OVERALL ASSESSMENT SCORE SHEET ADMINISTRATION Motor Vehicle Fleet Policy Records Allocation Percentage score % D C B A MEETING SERVICE NEEDS Patient Transport Courier Services Service Provision Percentage score % D C B A OCCUPATIONAL HEALTH & SAFETY Motor Fleet Driver Safety Condition/Care of Vehicle Fleet Percentage score % D C B A VEHICLE UTILISATION Use of Vehicles Motor Vehicle Pool System Running Sheets Percentage score % D C B A ACQUISITION AND DISPOSAL Acquisition And Disposal Percentage score % D C B A Overall Percentage Score % 22(5/07) .MOTOR VEHICLES 6. 0 ADMINISTRATION 1. and employees emphasised when the reviewed policy is distributed - How does the Organisation monitor compliance with the policy 22(5/07) .MOTOR VEHICLES STANDARD QUESTIONS FOR FLEET AUDITS Practitioners Guide 6.1 MOTOR VEHICLE FLEET POLICY issues Does your Organisation have a Motor Vehicle Fleet Policy which includes local - Has the policy been distributed to all Departments - How are staff made aware of the policy and their responsibilities within the policy - Is the policy reviewed and redistributed annually - Are responsibilities of managers.46 1. supervisors. low kilometres . 1. high repair costs. e.3 ALLOCATION Is there an established policy as to who can be allocated vehicles for: i) private ii) needs iii) garaging usage basis - Are current rates of charge being levied for personal allocation. - Does anyone review records to identify possible abuse and/or anomalies.MOTOR VEHICLES 1. 22(5/07) .g.47 - How up to date are records. - Are officers paying for petrol and oil during periods of leave and is there a system in place to ensure such usage is detected.high litres.2 RECORDS Does the organisation have: i) ii) iii) New Vehicle Inspection Sheets (Attached “A”) History sheets or a computer system that provides same information (Attached “B”) Motor Vehicle Register with required information (Attached “C”) 6. MOTOR VEHICLES 2.0 SPECIAL SERVICES 6.1 PATIENT TRANSPORT/DESIGNATED COURIER SERVICES How does the Organisation determine what is the most suitable vehicle to meet the needs of the particular service (eg how are reviews of the service conducted) - How are patient transport vehicles identified (eg what signage is used and is it consistent with the Area Policy requirements) - Are regular maintenance safety checks of vehicles and equipment (such as fire extinguishers. These must be documented and show evidence of follow up action with the driver. - Is utilisation of vehicles assessed against service needs (how is this done eg documented reviews) 22(5/07) . seat belts. stretchers etc.48 2. indicator lights.) carried out by drivers or other responsible staff. 49 3.1 MOTOR FLEET DRIVER SAFETY Is a register maintained of all approved drivers.MOTOR VEHICLES 3. showing licence details - Is the register reviewed and updated annually - Are written instructions or a handbook provided to drivers - Is there a formal driver orientation programme in place - Do performance appraisals include a declaration from drivers regarding the current status of their licence - Have all patient transport drivers attended a driver training course - Have skills and experience of patient transport drivers been checked (eg has the supervisor accompanied the employee in the respective vehicle/s prior to that employee being required to transport patients/clients) - Are patient transport driver’s skills checked when a new vehicle is purchased (eg to ensure that the driver is familiar with the new vehicle) - What percentage of registered drivers have attended and passed a defensive driver training course 22(5/07) .0 OCCUPATIONAL HEALTH & SAFETY 6. oil etc (must be written evidence ie checklist signed by Senior Management) - Do all your vehicles carry identification stickers - Do all vehicles carry instructions to drivers in case of accidents - Are all vehicles serviced over the warranty period by the Dealer - What system is in place to follow up on reported defects (ie from checklists) - What system is in place for notifying the Area regarding insurance claims - Does your policy contain a statement regarding the care of vehicles by employees and action to be taken for non compliance 22(5/07) .2 CONDITION/CARE OF VEHICLE FLEET - 6.50 Do you conduct formal. water. cleanliness.MOTOR VEHICLES 3. regular checks of vehicles regarding service details. damage. 0 VEHICLE UTILISATION 4.51 - Does the system include monitoring of occasions of service.1 UTILISATION AND SERVICE PROVISION What system is in place for recording vehicle usage 6. reasons for use. several vehicles travelling simultaneously to the same location.g.MOTOR VEHICLES 4. - How is this information used (eg to check utilisation and service provision and rotation of vehicles) - What criteria is used to determine where pool vehicles are garaged (eg given to an employee living closest to the centre) - Are Area guidelines for utilisation used when considering approval for replacement vehicles 22(5/07) . business and private klms. e.. destinations etc. who) - Are all vehicles available for pool use (if not which ones are not and why) - Are random checks of the status of a driver’s licence checked (eg when a vehicle is picked up) 22(5/07) . software package . software programme etc) 6.2 MOTOR VEHICLE POOL SYSTEM What system is in place to monitor daily use of vehicles (eg diary.52 - Where are on site vehicles garaged (eg locked compound) - Where is it noted that a vehicle is garaged away from the unit (eg in diary.MOTOR VEHICLES 4.what information is noted eg suburb. 53 - Are all running sheets checked for compliance with the Area policy (eg completed in full. maintained in a clean and tidy condition.MOTOR VEHICLES 4. they are legible and evidence of checking such as supervisors signature) - Is follow up action taken with drivers who do not complete running sheets fully and correctly (is this action documented) - Is the data entered onto the computer/manual system - Are running sheets forwarded timely 22(5/07) .3 RUNNING SHEETS Are Area approved running sheets used for all vehicles 6. is there a report outlining the reasons for replacement provided with the request for replacement 22(5/07) .0 FLEET CONFIGURATION 6. review of business use etc) - Are all vehicles (except trucks) recommended for replacement at 40.54 5.MOTOR VEHICLES 5.000 klms or two years - What system is in place for reviewing the use and appropriateness of trucks and buses (ie service needs analysis) - Are vehicles assessed against the utilisation criteria (in the policy) prior to recommendation and approval to replace/purchase - Has the Area an evaluation sheet to determine whether vehicles should be replaced - If a vehicle’s utilisation falls outside the policy.1 ACQUISITION AND DISPOSAL What system is in place for acquiring and disposing of vehicles (eg approval. alerted all employees of the implications to the changes to the fringe benefits tax (FBT) arrangements. The Premier’s Department Circular No. it is in the best interests of all officers who use pool vehicles. Reportable fringe benefits include. As the definition of “private use” has been considerably extended by the Australian Taxation Office. employers are required to distribute certain fringe benefits on an individual employee basis and record the “grossed up” value on employee’s Group Certificates where the aggregate taxable value exceeds $1. 22(5/07) . private use of pool vehicles. to refer to the attachment headed “Instances where use of a vehicle is considered private”. The amount on Group Certificates is known as the “Reportable Fringe Benefits Amount”. Any queries in relation to private usage of pool vehicles should be directed to your local Transport Officer. Officers should contact the Australian Tax Office or consult their tax consultant for advice on their personal circumstances.MOTOR VEHICLES 3. amongst other things.000. dated 20 July 1999.55 See Appendix 4 of this section for details of Treasury Circular 99/13 re Allocation of Pool Car Fringe Benefits. FRINGE BENEFITS TAX – MOTOR VEHICLES (PD2005_531) 6. As from 1 April 1999. 99-29. if an IT employee is on-call and is called in . 5. but is somewhere they are travelling as a business trip. However. However. the trip from home to clinic Y (and return) will be considered business travel. The use of a vehicle to make deliveries or collections on the way to or from work is considered private travel. then the travel from home to the work site will be private travel. however. if the “alternate workplace” is not actually a place of work of an employee. Travel from work to home (and return in the morning or for the regular work hours) will be considered to be private travel notwithstanding the only reason the employee has the car is that they are on-call or stand-by. an employee has approval to work at home 4 days out of every week and then attends an office the remaining day of every week then the travel to the office on that one day will be private in nature. This would be business travel. is ordinarily private travel. eg the use of a vehicle after working overtime. carrying the keys with him/her. If. 3. This is also the case whether a person has one or more work places. both the travel from home to Hospital X and home to clinic Y will be considered to be private travel on the basis that it is home to work travel. 6. To clarify this point further. 2.MOTOR VEHICLES INSTANCES WHERE USE OF A VEHICLE IS CONSIDERED PRIVATE EXAMPLES – CAR AVAILABLE FOR PRIVATE USE 1. eg pick-up or drop-off mail or take a vehicle to be cleaned. An employee takes a car and parks it at the airport and travels interstate. if an employee performs substantial duties on the way to or from work (for example attends a meeting) rather than just deliveries or collections. 4. To show the difference. the travel will be considered to be business travel. if another Doctor generally works at Hospital X 5 days per week but travels to Clinic Y irregularly on an as-needed basis or only once per month for a specialist clinic. 22(5/07) . The ATO in a ruling cites as an example a Doctor who is on-call and is called in and commences to issue instructions and “take charge” at the time of receiving the call. is deemed to be in his/her control and is hence private use. The travel from home to work when a person is called in is only considered to be business travel if the employee commences duty at the time they receive the call. Where an employee has approval to work at home and has to travel to an office/workplace which is not his/her place of work then travel from home to the office will be business travel. The car.56 The travel between home and work is generally private travel (as indicated in Example 1). Travel between home and a person’s regular place of employment or business. and they do not “take charge” until they arrive at the work site. assume a Doctor works at hospital X 3 days each week and clinic Y 2 days each week. This would also apply to the trip from the office to the place of performance of substantial duties and onto home would also be considered to be business travel. 6. the ATO have accepted that the entire journey from home to the meeting and then onto the office will be considered to be business travel. However. Further clarification for establishing where an employee is an itinerant worker can be gleaned in more exact detail from ATO Taxation Ruling 95/34. Home is a base of operations. Home to work – when the only reason the car was provided was to enable the employee to use the car for business travel and the car is returned the morning after the completion of the business travel (and the employee does not usually have access to a car). There may be uncertainty of location. The employee has no fixed place of work or has a “web” of work places. An employee cannot be construed to be itinerant unless they meet all of these requirements. NOTE . When the employee is considered to be an Itinerant Worker: Travel is a fundamental part of the employees work. 22(5/07) . The employees work involves continued travel from one work site to another. During a business trip for business related travel.57 This is the case even if the distance travelled does not increase over what would have been the distance travelled if they had travelled directly from home to work. 8.This list is not conclusive and other travel will be considered on the circumstances. Further examples of when taking a vehicle for travel would be considered business travel would be: Work to home – when the only reason the car was provided was to enable the employee to use the car for business travel the next day (and the employee does not usually have access to a car). A deduction may be allowable for the cost of transport between home and work if an employee’s home is a base of operations or the transport expenses are attributable to carrying bulky equipment. Where an employee takes a vehicle to travel to a country location for work purposes and travel to a restaurant for dinner would be considered as business travel. including travel to obtain meals etc. 7.MOTOR VEHICLES 6. MOTOR VEHICLES 6.58 22(5/07) . MOTOR VEHICLES 6.59 22(5/07) . cost of garaging the vehicle during working hours. Government Courier Services. Fringe Benefits Tax.g. servicing. tyres. what areas of work/activities are involved? How regularly will the vehicle be used to convey an officer (or officers) to and/or from home and workplace? Where is the vehicle to be garaged? If cost savings are submitted as an argument for supply of an additional vehicle or replacement with a different type of vehicle.g. cost of replacement parts outside warranty. public transport.g. hire vehicles? If vehicles are to be used for transportation of documents/materials. How many kilometres are expected to be travelled annually? On how many days per year and for how many trips per year might the vehicle be used? On what basis were these assessed? What alternative methods of transport or conveyance have been considered. e. in the event that the area uses resale value as part of its assessment.MOTOR VEHICLES 6. cost of insurance (comprehensive and third party). (Note: It is the net return. i. the value should be based on information provided by the Government Supply Department. 4. etc.e. e. will the vehicle be required indefinitely? If not.60 APPENDIX 1 CRITERIA FOR ASSESSING PURCHASE OF ADDITIONAL OR REPLACEMENT VEHICLES 1. 5.) 22(5/07) . 8. 2. consider the following: current contract price of new vehicle plus any operational accessories required. for how long? fuel cost based on consumption figures available from Department of Energy and NRMA. pool vehicles. etc. has the case been referred to the Government Courier Service? What was the result? What is the normal load expected to be carried in the vehicle in terms of personnel and equipment? Is the vehicle to be pooled? If not to be pooled. 3. after sale price less detailing and auction fee which should be compared with replacement cost. e. 7. taxis. maintenance after warranty. outside working hours. 9.. battery.. 6. 16. will private vehicles be utilised with payment of an allowance is an official vehicle is not provided? If the vehicle is for an existing activity.g. not the average distance travelled. is relevant policy documentation available to verify approval of the activity? Have any activities of the organisation been made redundant and. what kilometrage has been travelled annually? If no. 12. pool vehicles. 17. 6. Are private vehicles currently being used and an appropriate kilometrage allowance being paid in relation to this activity? If yes. what became of any vehicles used in connection therewith? When was the last time the organisation reappraised its overall vehicle situation? What methodology was used? Is the organisation’s funds allocation sufficient to meet purchase and operational costs of additional or replacement vehicles? 11. if so. the total distance travelled each year for each existing vehicle should be considered.MOTOR VEHICLES 10. e. 14. The number of trips made per year and number of days used per year is also required (for each vehicle) to enable assessment of the correct use of the entire pool. how was the work for which it is intended carried out previously? If the additional vehicle is required for a new activity. 22(5/07) . 13. 15.61 If the additional or replacement vehicle is required to supplement existing vehicles used in similar circumstances. 18. c. petrol cap Engine Blinkers cancel Remarks Footbrake Tools Brake Paint Sun Other Gearbox visor Handbrake Jack Battery Glass Weather shield Clutch Spare wheel Radiator Chrome Mud flaps Seat belts Fluid levels General condition Vehicle supplied as ordered W/Washers Trim Prot. fan Other Electrical Horn Wipers/washers Dash warning lights Mechanical Steering Door/boot locks Oil Body Fire extinguisher Lock. strips Road test Brake Clutch Speedo Inspected by: 22(5/07) .) DETAILS Make/Model Engine No Vehicle replaced Lights Head Blinkers Tail Reverse CHECK LIST Stop Dash Radio Park Interior Access High/low beam Heater/Air cond.62 APPENDIX 2 NEW VEHICLE INSPECTION RECORD Reg.c Chassis No Keys (nos. No Engine Size .MOTOR VEHICLES 6. MOTOR VEHICLES 6. Km.for month Petrol .litres Av.63 APPENDIX 3 MOTOR VEHICLE HISTORY SHEET Registration no Vehicle Project Appropriation no Location Purchased Disposed of Month Speedo reading Total km. Per litre Comprehensive insurance Third Party insurance NRMA no Petrol voucher books Insur. $ Repairs or service including tyres and batteries Cost of repairs/ service $ Operating costs $ Cost per month $ Total costs $ 22(5/07) . 64 APPENDIX 4 TREASURY CIRCULAR 99/13 ALLOCATION OF POOL CAR FRINGE BENEFITS Summary: As part of the Commonwealth Government’s overall tax reform program “A New Tax System” amendments were made to the Fringe Benefits Tax (FBT) Act 1986 and the Income Tax Assessment Act 1936 to give effect to the reporting of certain fringe benefits on group certificates. Where a reportable fringe benefit is provided exclusively to a single employee. However. The policies and procedures established in the Guide are supported by an Add-In Module for the FBT Software implemented for the 1998/99 FBT Annual Return. Following consultation with major agencies.POLICY AND GUIDELINES PAPER PREFACE The Policy and Guidelines Paper for Reportable Fringe Benefits Applicable to Use of Pool Cars has been developed to assist agencies in complying with the additional requirements imposed by the Commonwealth for providers and recipients of fringe benefits.MOTOR VEHICLES 6. This Guide may be adopted by other Government agencies. especially from an industrial relations perspective. any shared benefit requires special treatment. 22(5/07) .OFFICE OF FINANCIAL MANAGEMENT . The purpose of this Policy and Guidelines Paper is to define a policy for the allocation of shared car benefits to be adopted by those agencies lodging their FBT return through NSW Treasury. The allocation of pool cars to the recipients of the benefit raises quite complex issues. the allocation of the benefit is straightforward. the attached Policy and Guidelines Paper. applicable for the current and subsequent FBT years. raises quite complex issues and has been a matter of significant concern to agencies. The 1999 amendments to the Fringe Benefits Tax (FBT) and Income Tax legislation require that certain reportable fringe benefits amounts must be disclosed on individual employees’ group certificates. This policy may be adopted by other Government agencies. Reportable Fringe Benefits Applicable to use of Pool Cars has been developed. REPORTABLE FRINGE BENEFITS APPLICABLE TO USE OF POOL CARS . This Guide is to be adopted by those agencies lodging their FBT Return through Treasury applicable for the current and subsequent FBT years. The allocation of shared benefits such as pool cars. amendments were made to the Fringe Benefits Tax Act 1986 and the Income Tax Assessment Act 1936 to give effect to the reporting of fringe benefits on group certificates. the allocation of the benefit is straightforward. including State Government agencies. The allocation of pool cars to the recipients of the benefit raises quite complex issues and has been a matter of significant concern to agencies. any shared benefit requires special treatment. From the year ended 30 June 2000.000. a specific add-on module has been commissioned to provide agencies with an effective and efficient means of complying with the legislative requirement to allocate 100% of the taxable value to recipients of the benefit provided.MOTOR VEHICLES CONTENTS Preface Executive Summary Transferred Vehicles Pool Vehicles Introduction Policy Logbook Records Request Procedure Add-on Software Module Software Procedure Reducing the Allocated Value Appendices A B C D E Sy Cents per kilometre ranges and rates New minimum standard logbook Vehicle Request form Fuel expenses declaration stem Diagram 6. all employers. especially from an industrial relations perspective. Following research of options for the reasonable and equitable sharing of pool cars taxable values.65 EXECUTIVE SUMMARY As part of the Commonwealth Government’s overall tax reform program “A New Tax System”. Where a benefit is provided exclusively to a single employee. The threshold amount applies to the FBT year 1 April 1999 to 31 March 2000. 22(5/07) . However. The recently introduced FBT software provides considerable assistance in complying with this legislative requirement for single user items. are required to report the grossed-up taxable value of reportable fringe benefits on the group certificate of each employee whose aggregate taxable value exceeds $1. The purpose of this Policy and Guidelines Paper is to define a policy for the allocation of shared car benefits to be adopted by those agencies lodging their FBT return through Treasury. The complexity of this issue arises from the interaction of the FBT and Income Tax legislation with potential penalties for non-compliance in either regime. an equalisation factor will be applied to all benefit allocations to eliminate any variance between the amount calculated for pool car benefits in the annual FBT return and the amounts allocated to individual employees. The policy to be adopted by NSW Government agencies is based on a cents-per-kilometre allocation throughout the FBT year. 22(5/07) . which documents the policy and procedures to be followed by agencies for the allocation of pool car benefits. This amount is then to be allocated to individual employees.where the aggregate taxable value per employee/employer exceeds $1. This policy may be adopted by other agencies.MOTOR VEHICLES 6. which results in the lower tax liability. However. has facilitated this process by collating each category of benefit on a per employee basis. the allocation of shared benefits to employees raises many issues. 3. 2. The legislation provides little guidance beyond requiring 100 per cent allocation on a ‘fair and reasonable’ basis. Shared car benefits can occur through three fundamental events: 1.66 The software initiative supports this Policy and Guidelines Paper. At year end. The introduction of FBT software for those agencies lodging their Annual Return through NSW Treasury. Where a ‘pool’ car is provided to two or more employees for intermittent usage which may have a private use component. is used for the Annual FBT Return. it is appropriate to ensure the valuation method. Where a packaged vehicle is returned to the agency by one employee and is then transferred to another employee as part of a package. applicable for the current and subsequent FBT years. Where a packaged vehicle is used as a ‘pool’ vehicle by other employees of an agency. In each instance. INTRODUCTION Recent amendments to the Fringe Benefits Tax (FBT) legislation require employers to report the grossed up taxable value of the aggregate fringe benefits provided to each employee or associate of that employee on the employee’s group certificate .000. Agencies will find these procedures of benefit as a least cost method of making a ‘fair and reasonable’ allocation of the taxable value of pool cars to recipients of benefits and ensuring the appropriate group certificate disclosure. MOTOR VEHICLES 6.for operating cost method. enter one row for each user of the vehicle. equal to the total had there been only one user of the vehicle. Thus the appropriate allocation method includes only those employees who have benefited from the use of a car.67 Many methods have been advanced to allocate the taxable value of pool cars to individual employees. The resulting taxable value is then to be allocated based on the individual private use percentage: days available for private use . The taxable value of a shared fringe benefit must be allocated to those employees to whom the benefit has been provided. Where a vehicle is transferred from one employee to another during the FBT year or transferred between agencies (for example in the case of a restructure) the taxable value must be calculated for the whole year using the valuation method yielding the lower taxable value. often 100 percent. Actual private/business use must be substantiated by statutory record keeping. If the selected method is operating cost. SOFTWARE PROCEDURE In the agency entity car benefit workpaper. Note: the correct ratio equals (private kilometres of individual) / (total kilometres of vehicle) This process will result in the same aggregate taxable value for the shared benefits that would have resulted from a single entry for the vehicle. based on the odometer readings applicable to each user and the log of business kilometres provided by that user. The calculation of FBT liability for packaged cars must be based on actual data as distinct from the estimates used in establishing the package. OR private kilometres travelled .for statutory formula method. In some cases methods advanced do not fully allocate the taxable value or allow for unfair allocation results. If the selected method is statutory formula. An assumed private/business ratio is not applicable when calculating the taxable value. The software will then calculate separate components of the taxable value. TRANSFERRED VEHICLES POLICY Car benefits associated with salary packages essentially have a high private use percentage. 22(5/07) . enter the days applicable to each user of the vehicle in the ‘DAYS FOR PRIVATE USE’ column. pro-rata the private kilometres travelled between the users of the vehicle. 66 * 0. The frequency of use by alternate employees would define the method of allocation. there would be a private benefit to be allocated. and that vehicle is used as a ‘pool car’ the fringe benefits tax legislation requires that the ‘Shares of different employees must total 100% of taxable value’. Where the agency uses a packaged vehicle as a pool car during the day. For multiple occurrences/users the method described below for POOL VEHICLES should be applied.000 Taxable value 9.409.70 783. For one off occurrences. This would align with the business/private split concept used in estimating the salary package. 22(5/07) . b. They also apply to packaged vehicles used as pool cars.68 Example: Total kilometres = User A (1/4 . where there is significant private use by alternate employees. if the vehicle is used by another employee overnight.000 8.53 Note: the correct ratio equals (private kilometres of individual) / (total kilometres of vehicle).30/11) User B (1/12 . the sum of those shares must equal the taxable value of the fringe benefit. However. This process will result in the same aggregate taxable value for the shared benefits that would have resulted from a single entry for the vehicle.132.31/3) Total costs = 3. the method described under TRANSFERRED VEHICLES should be used. The policy and procedures prescribed below generally refer to a pool of cars held by an agency which are not allocated to an individual employee.25) User B (3132.17 626.2) 20.000 4. Subsection 5F (5) states: If: a.000 5.000 1. the fringe benefit was provided in respect of the employment of 2 or more employees.000 private 12. POOL VEHICLES INTRODUCTION Where an agency holds a motor vehicle that is a car for FBT purposes. Therefore if vehicle moves between agency only one annual value should be calculated.MOTOR VEHICLES 6.66 * 0. and each of those employees has an employee’s share of the taxable value of the fringe benefit. Remember that all agencies lodging return with NSW Treasury are part of the same employer.66 User A (3132. it is assumed that any such use should be business. In the case of pool cars. will form the basis of an equalisation factor to be applied to all benefit allocations.MOTOR VEHICLES 6. the purpose of the journey. defined from time to time by schedule. See Appendix 4. Allocating proportional shares of individual employee usages of many vehicles becomes more manageable if the requirement to allocate 100% of the taxable value of the benefits provided applies to the total pool rather than each vehicle. However. Even where the Statutory Formula method yields a lower taxable value. the taxable value on which the agency pays fringe benefits tax must be calculated for the whole year using the valuation method yielding the lower taxable value. even where no private kilometres are travelled. While some consideration must be had for allocating according to the method adopted for the annual return. 22(5/07) . the variance at year end. this can only reduce the total allocation across all employees under a cents per kilometre basis. this concept is rejected on the basis of the differential treatment of employees between methods. LOGBOOK RECORDS For FBT years up to and including 31 March 1999. The content and maintenance of logbook recordings are essential aspects to full compliance with legislative requirements and to ensuring that a reasonable and equitable allocation of benefits across recipient employees is achieved. the Statutory Formula method may yield a lower taxable value where total kilometres travelled is high. This is significant because in many government agencies. the kilometres travelled.000. As application of such a method would not precisely allocate 100% of the taxable value. Data is to be collected on private kilometres and days available for private use in the short term. While generally the Operating Cost method (which relates only to private kilometres travelled) is expected to yield the lower taxable value and allocation to employees. private usage per employee will be allocated on the basis of private kilometres travelled. the Statutory Formula method results in higher allocation to employees because under this method two day’s benefits are deemed to be provided when the vehicle is parked overnight at or near the employee’s residence. each agency must record detailed log entries to enable this requirement to be met. The rate per kilometre will vary across a range based on vehicle size. the odometer readings at the start and end of each journey. POLICY For each pool car. the ATO’s view was that logbook records must include the following details for each business journey: the date(s) on which the journey began and ended. using a separate software procedure. increase or decrease. an individual employee may access a wide range of vehicles during the FBT year. rather than incurring a benefit where an employee takes a vehicle home but no private kilometres are travelled. This greater emphasis on keeping log book records necessarily implies that the Operating Cost method can be calculated for every vehicle. Given the emphasis placed on allocating pool car benefits to employees. say over 40.1.69 The ATO have recently confirmed that it will accept that 100% of the total taxable value of the ‘pool of cars’ being attributed between the various recipients of car benefits provided by an agency to its employees. ADD-ON SOFTWARE MODULE To facilitate an efficient and effective allocation of pool car usage.MOTOR VEHICLES 6. On an annual basis. The module allows each employee usage of each pool vehicle to be aggregated and valued progressively through the FBT year. All agencies are required to have a Vehicle Request procedure in place to regulate access to pool cars. 22(5/07) .70 The standard logbook in your Fringe Benefits Tax Manual has no scope to record details of private journeys. Agencies will also be able to obtain progress reports to assist in managing some aspects of pool car usage. The new minimum standard logbook is at Appendix 4. The value allocated during the year is based on a cents-per-kilometre rate and accordingly is only indicative of the final value for the FBT year.3. REQUEST PROCEDURE The legislative requirement for disclosure of reportable fringe benefits on employees’ group certificates places additional significance in fully documenting the process of usage of pool cars.2. This form is the basis of an agreement between the employer and employee regarding each use of a pool car and ensures the employee acknowledges the potential group certificate impact of using a pool car. It may be appropriate also to have some form of coded entry for regular forms of business travel. A sample Vehicle Request form is provided at Appendix 4. It is imperative that accurate and complete logbook records in a consistent format are maintained to substantiate the procedures adopted. and the purpose of the journey will relate to the business journey. to maintain a single page logbook. Failure to do so will incur additional tax liability for the agency and increased allocation to group certificates for the employee. an equalisation factor is to be applied across all benefit allocations. The equalisation factor is derived from the year-end variance between total taxable value for the pool cars and total allocated to employees. monthly entry of logbook records is required. the standard logbook format will be expanded and must include the following additional information: days available for private use private kilometres business kilometres. Assigning cents-per-kilometre values to usage in this manner cannot precisely allocate 100% of the actual taxable value of the pool cars. For years 1 April 1999 to 31 March 2000 and forward. the reporting facility will allow year to date values to be provided to employees. Once the software is implemented. However. increase or decrease. a specific module has been developed as an add-on for the FBT Software implemented in the 1998/99 FBT year. This module is to record each usage incident. MOTOR VEHICLES 6.71 While FBT Simplifier maintains the ability to produce a single grossed-up taxable value per employee for group certificate reporting purposes, the pool car data is recorded and processed under a separate “pool car entity” inside the existing software and a “pool car calculator” sitting outside Simplifier. The employee and vehicle data may be imported to the add-on module or entered manually. Usage incident data is entered via a dialog box as below. In some agencies, it is anticipated that there will be a very large volume of data to be entered in this new module. A copy of the external software module can be distributed to the fleet administration area for input of logged usage and later imported back to the main system. This does not constitute an additional ‘entity’ for licence agreement purposes. SOFTWARE PROCEDURE When first accessing the Pool Car Module, additional set up procedures are required. With the original implementation of FBT Simplifier, users established each entity they required by importing the ‘treasury.fbt’ entity - not adding a new entity. This entity is a template with specific public sector customisation. In the same way users will need to import an additional entity for each existing entity using the template ‘poolcar.fbt’, naming the pairs of entities appropriately to allow ease of identification. From this point, all benefit categories, except for pool cars, will be entered into the major entity. Pool car details for calculating each car’s taxable value and grossed-up taxable value will be entered into the pool car entity. The external Pool Car Calculator is set up using the following functions: 1. im 2. im 3. 4. port/add employees port/add cars set up vehicle categories assign a category to each car. 22(5/07) MOTOR VEHICLES 6.72 Pool car usage is entered through the dialog box shown on page xx. Usage details required include: Employee identity (can be selected from drop down list) Car registration No. (can be selected from drop down list) Assign the dates over which the employee has use of the car Enter private kilometres travelled and private use days from logbooks. An additional function will accommodate entering employee contributions to reduce the taxable value recorded. As indicated, the external Pool Car Calculator can be distributed to fleet operations in several locations. The data from distributed regions can then be consolidated into the Pool Car Calculator at the agency’s head office. Year end reporting requires three steps as follows: 1. At the end of the year (or whenever reporting is required) the pooled car entity is activated and the “Total Pool Data” report selected from the standard reports in the car workpaper. The output data is then fed into the Pool Car Calculator. In the Pool Car Calculator, the “Create FBT Simplifier report” option is selected and data from step 1 entered. A file will be created for importing in the next step. In the Major entity, import the file created in step 2. From this entity the FBT Return and the Report file for export to Payroll can be produced. 2. 3. Interim reporting can be obtained in the Pool Car Calculator for private kilometres and values per car/per employee. REDUCING THE ALLOCATED VALUE The legislative amendments requiring employers to report the grossed up taxable value of benefits provided, on an employee’s group certificate will impact each employee differently depending on his/her personal circumstances. Where an employee is likely to be adversely affected by the reportable fringe benefit amount on his/her group certificate, one avenue available to reduce the taxable value of the benefit, especially car benefits, is to make an employee contribution out of after tax dollars towards the running costs of the vehicle. A ‘recipients contribution’ is defined in the Act, in relation to a range of benefit types, to mean the amount of any consideration paid to the provider or to the employer by the recipient or by the employee in respect of the provision of the recipients benefit, reduced by the amount of any reimbursement paid to the recipient in respect of that consideration. 22(5/07) MOTOR VEHICLES 6.73 This means that should an employee make a cash contribution, or pay for some of the costs associated with running the vehicle, for example petrol, tyres, etc, provided the employee is not reimbursed for these costs, the contribution can be deducted from the taxable value of the specific benefit provided to that employee. The employee must supply documentary evidence of the expenditure, such as a receipt, to the employer. In the case of petrol and oil costs a declaration from the employee will be sufficient for this purpose. An approved format for this declaration is provided at Appendix 4.4. Note: A recipient’s contribution must be out of after-tax dollars. Therefore, the FBT salary sacrifice amount included in packaged arrangements is NOT an employee contribution because it is paid out of pre-tax dollars. 22(5/07) MOTOR VEHICLES 6.74 APPENDIX 4.1 In arriving at a cents-per-kilometre rate for a range of vehicles, reference was made to the rates applied by the ATO in allowing deductions to taxpayers, and the rates applicable to public sector package arrangements. A mean position has been adopted with consideration for simplicity of application. Category 1 Category 2 Category 3 4 Cylinder Cars 6 Cylinder Cars 8 Cylinder Cars 4WD - 1 Executive Cars 4WD - 2 30 cents per kilometre 33 cents per kilometre 36 cents per kilometre Category 4 40 cents per kilometre As indicated in the policy document, these rates are set to give an indicative value to pool car usage. Applying a range of rates across various capacity of vehicles is in line with ATO expectations. At year end the application of an equalisation factor will adjust the benefit allocations to reflect a 100 per cent allocation of the total pool value to recipients of benefits. 22(5/07) MOTOR VEHICLES 6.75 APPENDIX 4.2 22(5/07) MOTOR VEHICLES 6.76 APPENDIX 4.3 VEHICLE REQUEST FORM - page 1 I request the use of a departmental motor vehicle to undertake official duties in behalf of (AGENCY NAME) Driver Details: (COST CENTRE) (NAME) REQUIRED Official duties (DESTINATION) Call-out/Stand-by Duties (DESTINATION) Employee Certification I am aware of and agree to abide by departmental policy in regard to overnight use of this vehicle. I am aware that by taking a vehicle overnight that the FBT payable for this trip will be recorded by Administration Services against my name and may also be recorded on my group certificate. I hold a current motor vehicle driver’s licence. The vehicle will be used for official departmental use only. The vehicle will only be driven by the nominated officer. All necessary steps will be taken to protect the vehicle from damage and theft. Any variation to details in this request form will be reported to Administration Services as soon as possible. Employee’s signature Date Manager’s Approval I certify that this Motor Vehicle request is for official business only and the information contained herein is accurate. Manager’s signature Date FROM - time UNTIL - time am/pm - date am/pm - date (PHONE) 22(5/07) MOTOR VEHICLES 6.77 APPENDIX 4.4 Fuel expenses declaration I, (Employee’s full name) expenses of $ declare that (amount in figures) were incurred by me during the period from ....../....../ in respect of Signed Date registration number If the employee is responsible for all fuel and/or oil costs, a declaration based on a reasonable estimate derived from the total kilometres travelled, average fuel costs and fuel consumption will be acceptable. In these cases the declaration should be extended as follows: I also declare that the total kilometres travelled during the period was 22(5/07) TABLE OF CONTENTS CHAPTER 7 – RECEIPT, CUSTODY, AND ISSUE OF STORES 7.0 Introduction .............................................................................................................. 7.1 Inspection prior to unloading ................................................................................... 7.2 Unloading ................................................................................................................. 7.3 Inspection after unloading........................................................................................ 7.4 Receipt .................................................................................................................... 7.5 Receiving of Sterile Consumables ........................................................................... 7.6 Pharm aceuticals ....................................................................................................... 7.7 Perishable ................................................................................................................. 7.8 Equipm ent................................................................................................................ 7.9 Consignm ent/Loan Stock......................................................................................... 7.10 Goods Found Damaged After Acceptance............................................................... 7.11 Short or Incorrect Supply......................................................................................... 7.12 Sy stem Receipt ........................................................................................................ 7.13 Storage .................................................................................................................... 7.13.1 Warehouse ............................................................................................... 7.13.2 Stock Rotation.......................................................................................... 7.13.3 Stock Level............................................................................................... 7.14 Environment – Warehouse ...................................................................................... 7.14.1 Receiving Dock ........................................................................................ 7.14.2 Receiving Dock Signage .......................................................................... 7.14.3 Storage Area ............................................................................................ 7.14.4 Storage Area Signage .............................................................................. 7.14.5 Floors Storage Area Signage .................................................................. 7.14.6 Containers ............................................................................................... 7.14.7 Shelving ................................................................................................... 7.15 Environment – Hospital Ward................................................................................. 7.15.1 Storage facilities ...................................................................................... 7.15.2 Containers and Shelves ........................................................................... 7.16 Returns .................................................................................................................... 7.17 Issue of Stores.......................................................................................................... 7.17.1 General issuing arrangements................................................................. 7.17.2 Picking ..................................................................................................... 7.17.3 Issue of Stores Which May be Harmful ................................................... 7.17.4 Issue of Sterile Stores through Community Nurses ................................. 7.17.5 Issue of Sterile Stores Directly by Company Representations................. 7.17.6 Issue of Sterile Stores by Engaging Courier Services ............................. 7.17.7 Issue of Uniforms and Protective Clothing ............................................. 7.17.8 Materials Safety Data Sheets................................................................... 7.18 Delivery ................................................................................................................... 7.18.1 Transportation ......................................................................................... 7.18.2 Containers and Trolleys .......................................................................... 7.18.3 Condition of Equipment........................................................................... 7.18.4 Outer Shippers......................................................................................... 7.18.5 Small Packages........................................................................................ 7.18.6 Vehicle Conditions................................................................................... 7.18.7 Sterile Consumables in Transport ........................................................... 7.19 Occupational Health & Safety................................................................................. 7.20 Security .................................................................................................................... 7.20.1 Access to the Warehouse ......................................................................... 7.20.2 In and Around the Warehouse ................................................................. 7.1 7.1 7.1 7.1 7.2 7.3 7.3 7.4 7.4 7.4 7.6 7.6 7.7 7.7 7.7 7.7 7.8 7.8 7.8 7.8 7.8 7.8 7.9 7.9 7.9 7.9 7.9 7.10 7.10 7.11 7.11 7.11 7.12 7.12 7.13 7.13 7.13 7.14 7.14 7.14 7.14 7.14 7.15 7.15 7.15 7.15 7.15 7.16 7.16 7.16 21(1/06) ...........22 7........3 Protecting People and Property Manual.......19 7......20 7.......... 7.... Risks and Controls ......................... 7............................................................ 7.......................... 7........... 7.........................23..25 7...........21 Reporting ....23 7....8 Task: To ensure that vendor........23.....................24............................12 Task: Maintaining safe working conditions and storage of hazardous materials .21 7.......................................................23 7. 7................ 7......23..........23.. 7.......3 Certification of the existence and good order and condition of all stock held................ 7............................24................23.. ........11 Task: Appropriately requisition all goods to be transferred ..............2 Stocktaking ......................................20 7..................................................................................... 7................................................22 Asset Register................18 7...23......................................... ...........22 7..... 7........................7 Task: To safeguard goods received....21 7......9 Task: Notify service providers promptly of substandard performance or return rejected items promptly...... 7.....17 7....1 Internal Spot check of Stock Balances..........................................20 7.......19 7........... 7.7............19 7............. 7....... inventory and purchase order information is accurately updated to reflect receipts ............ 7...............23.................10 Task: Completely and accurately document all transfers to and from storage..... 7.............................23...............24.............. 7......................................23....................................23...............16 7............4 Task: To accept only items or services that were properly ordered.........................6 Task: To ensure that all materials transferred from the receiving activity to other activities are recorded ..................25 Recommended Receipt of Stores Flow Chart . 7............21 7.........3 Task: To completely and accurately document goods received and goods returned........20 7................22 7.............................. 7....23................. 7..1 Task: To ensure that services and materials received and related information are processed and promptly made available to appropriate sections or stores .23 7.................. 7....................................................................................2 Task: To ensure purchase or service orders not filled on a timely basis are investigated..........26 Guidelines for Consignment Stock .......5 Task: To accept only services and materials that meet purchase order specifications ...........20.24 Stock Balances..........................23 Receipt of Goods and Services – Tasks...........................................26 21(1/06) .... 7.......................................................23 7..........23........ g. 7. e. the form of receipt should be endorsed appropriately (e. and Delivery dockets are to be noted with findings.CHAPTER 7 – RECEIPT.1 Inspection prior to unloading Prior to unloading. Risks and Controls. or on racking.3 proper unloading mechanisms must be used in line with Occupational Health & Safety guidelines applying to or applied within the Public Health Organisation.1 Inspection prior to unloading).1 Included in this section are policies and procedures to be followed in the receipt and issue of stores procured by facilities.2 Unloading During unloading: a) b) c) d) 7. all goods are to be inspected to ensure integrity and condition of shipper/cartons by: a) b) c) Checking for watermarks and carton swelling which could indicate that a non-waterproof container has been wet. documentation and containers should be checked thoroughly to ensure items/cartons listed on the acknowledgement of receipt correspond with those actually received. In accepting or rejecting goods. perishables. A Recommended Receipt of Stores Flow Chart based on these policies and procedures is provided at Section 7. on a dedicated clean pallet. 7.25.23 Receipt of Goods and Services – Tasks. sterile. or on a dedicated clean trolley. 21(1/06) . one carton damaged – subject to check) if the packages were damaged in transit but not rejected (see 7. Inspection after unloading After unloading goods are to be: e) f) segregated into appropriate categories. CUSTODY AND DELIVERY OF STORES 7. chemicals.g. general.0 Introduction 7. If goods are rejected then: d) e) Evidence is to be gathered to support findings. Checking the package seals of sterile consumables to ensure that the seals are intact and the contents not contaminated. placed in a manner that ensures safe processing and avoids cross-contamination: and • • • • off the ground. etc. Goods are to be rejected if they do not satisfy this inspection. and any differences between documentation and goods delivered or indications of damage to those goods should be brought to the attention of the appropriate officer. Of particular note for all staff are the control tasks and risks associated with receipt of stores as detailed at Section 7. and Close inspection of all goods if there is reason to suspect that transport was unsatisfactory. care should be taken during their inspection since damaged or contaminated goods and packages may create an occupational health and safety issue. however. gather and document evidence (eg register onto NSW Health Procurement (HP) Quality Reporting System). treated as provided in the Guidelines for Storage and Handling of Sterile Consumables (available at http://www. the items are: a) b) c) d) unloaded and placed in appropriate holding areas. replacement or re-order.au .e.nsw.g.g.hp. sterile or chemical.CHAPTER 7 – RECEIPT. box or carton. CUSTODY AND DELIVERY OF STORES c) 7. Stock Item (Goods stored in the Warehouse) . it is understood that some requirements may not be immediately achievable. the container should be clearly marked to indicate the mixture.Following the Initial Inspection Following the initial inspection. This document reflects the coordinated efforts of the NSW Health Working Party for the Implementation of Section 9 Australian/New Zealand Standards 4187 (AS/NZ 4187). it is highly recommended that this document be utilised as a guide by those responsible for the handling and storage of sterile consumables to work towards compliance with AS/NZ 4187. Physical Receipt . 22(5/07) . e. and details of the receipt are recorded in the appropriate Computer System. Note: The Guidelines for Storage and Handling of Sterile Consumables provides detailed information concerning the storage of sterile consumables. signs the paperwork and returns the paperwork to the “Receivals Area”. It is intended that these guidelines be adopted uniformly. checked in detail to ensure that the quantity and description match those recorded on the Delivery Docket or form of receipt and Official Order (this checking usually requires boxes/cartons/packages to be opened and the contents individually checked). e. and monitor progress until matter is resolved. item is physically transferred into that location within the warehouse. placed in a separate area (ie quarantine) and their condition reported to an appropriate officer.health.Following identification as Stock Item If items are identified as Stock Items then the: e) f) g) h) item location in the warehouse is noted from the Official Order or Computer System. officer accepting the items records that the quantity has been received.for further details see the note immediately below).4 Receipt Receipt of Mixed Clinical Items When a variety of clinical items are ordered and delivered in a single container. notify the customer and/or the Purchasing Department of the outcome of these actions.2 the goods are sterile consumables. 7. Therefore. i. the officer is to: • • • • • examine the condition of the damaged goods. d) the goods have been damaged. matched against the attached paperwork (eg the delivery Docket). contact the Supplier and determine appropriate action. and Identified as Stock or Non-stock. specifically Section 9.gov. e. the signed copy is returned to warehouse to be utilised for confirmation of receipt and filing. if damage exists.g. The following areas are to be established if space is available: x) an inspection area . cross contamination is prevented. Stores/warehouse personnel should avoid damaging inner packaging that maintains the sterile status of sterile consumables. sterile.a space in or adjacent to receiving areas for the temporary storage of received sterile consumables whilst they are recorded. painted lines on floor.6 Managers responsible for pharmaceuticals must ensure that: d) e) an Authorised Person takes receipt of delivery from the Supplier. e.6 Pharmaceutical). the pharmaceuticals are to be immediately transferred to the Pharmacy or other designated Pharmaceuticals storage area (see section 7. The quarantine area is to be signed as such and have a simple visible demarcation line if possible.CHAPTER 7 – RECEIPT. 21(1/06) . a temporary storage area . the Authorised Person ensures that all drug deliveries are accompanied by an invoice or delivery advice and the goods received are checked against both the facility order form and delivery documentation by name and quantity (to ensure the received pharmaceuticals were actually ordered).3 the Recipient/Cost Centre is identified from the Official Order. Receiving of Sterile Consumables Sterile consumables are to be separated from used linen. examined and when necessary. CUSTODY AND DELIVERY OF STORES Non-stock Item (All other goods received but not stocked in the Warehouse) If items are identified as Non-Stock Items then: q) r) s) t) u) v) w) 7. externally cleaned. and a quarantine area .5 7. eg when using Stanley knives to open packaging. Pharmaceutical c) 7. Inspection should be conducted in such a way that. to check the integrity and condition of boxes. subject to the notes immediately below: Notes: i) ii) iii) b) If sterile consumables are delivered with excessive dust or dirt on the containers. and pharmaceuticals.g. the item is delivered to Recipient/Cost Centre.g. and after identification. with Computer System delivery paperwork attached.a space dedicated as a quarantine area to separate damaged consumables where possible that will enable the isolation of all faulty/damaged sterile consumables. pending delivery to the appropriate site the items are quarantined by the type. these consumables are to be rejected and the supplier notified. garbage and other perishable consumables.a space dedicated for inspections to check the condition of deliveries prior to unloading. the details of the receipt are recorded in the appropriate Computer System and delivery paperwork printed. the delivery paperwork is signed as received by an authorised person in the Dept/Cost Centre. e. chemicals. 7 Perishable Authorised Personnel: h) i) j) 7. Equipment Authorised Personnel: k) l) m) take receipt of delivery of equipment from Supplier.” • 7.8 take receipt of delivery of perishable stores from Supplier. If equipment is delivered direct to site for installation or weight/size reasons. the pharmacist who is employed at the hospital and countersigned by either the chief nurse or the medical superintendent of the hospital. the project manager or department head responsible for the equipment: n) o) 7.9 Takes responsibility for correct delivery and sign delivery paperwork to be returned to receiving dock. 23(9/08) . a registered nurse in charge of a ward of the hospital and countersigned by either the chief nurse or the medical superintendent of the hospital.CHAPTER 7 – RECEIPT. and If necessary calls for an expert technician to carry out installation and testing. The Public Health Organisation supply manager and the manager of the unit wanting the supply should both sign the Agreement unless the Agreement is signed at a higher level. Consignment/Loan Stock (see Guidelines at Supplement 1) Consignment (ie loan) stock may only be accepted if the stock is under an appropriately signed and stamped written Agreement between the supplier (the consignor) and the Public Health Organisation. check all items listed on the delivery documentation against goods received.4 a record system that is compliant with PD2007_077 Policy On The Handling of Medication In New South Wales Public Hospitals is maintained for all pharmaceuticals received by the pharmacy and that any deficiencies in the Schedule 8 and Schedule 4 Appendix D drugs register are reported in accordance with that Policy Directive. or • g) if only one pharmacist is employed. or if no pharmacist is employed. whoever is determined to have this responsibility by the hospital’s chief executive. whoever is determined to have this responsibility by the hospital’s chief executive. CUSTODY AND DELIVERY OF STORES f) 7. and orders for drugs of addiction are signed by: • a pharmacist who is employed at the hospital and countersigned by the chief pharmacist of the hospital or his or her nominee who is a pharmacist employed at the hospital. check all items listed on the delivery documentation against goods received. A copy of the Agreement should be available to staff receiving the stock. and store the perishables into proper location/storage. and deliver equipment from receiving dock department in original packaging (where possible). (m) 21(1/06) . eg by written imprest schedules that that may be changed by written agreement the Public Health Organisation and the supplier. specify the period of retention of the consignment stock. cost. expense or tax incurred in connection with or suffered by the supplier as a result of loss. CUSTODY AND DELIVERY OF STORES The Agreement must in relation to stock levels: (a) 7.CHAPTER 7 – RECEIPT. in relation to termination (l) specify that the supplier shall have the right to withdraw any consignment stock at any time.g. (j) in relation to indemnities (k) specify that the supplier indemnifies the Public Health Organisation and the NSW Department of Health (under a continuing indemnity that shall survive the termination of the Agreement) against liability.3 Inspection after unloading. eg damaged or old goods. 7 days after written notification is provided to the Public Health Organisation’s Authorised officer. (b) (c) (d) (e) (f) (g) in relation to inspections (h) (i) specify the right of the supplier to regularly audit consignment stock with oversight by an authorised officer(s) of the Public Health Organisation. eg within 48 hours by an official purchase order for that used stock. specify arrangements in relation to ordering or returning goods. 7.g. oversighted by an authorised officer(s) of the Public Health Organisation. that it is to be charged for all such shortages at the agreed list price of the date on which the storage is notified. specify that the Public Health Organisation shall allow the supplier’s insurance representative(s) to make inspections. specify how the supplier is be notified of the use or sale of any consignment stock. specify the responsibility of the Public Health Organisation for stock shortages. e. as provided in sections 7.2 Unloading and 7. damage. etc. and as set out on product packaging. and specify that the supplier may terminate the consignment arrangement at any time. and specify that the Public Health Organisation may not accept goods it would not accept following inspections if it were buying directly. loss. specify the storage conditions. damaged packages. damage. in a clean and secure environment . to consignment stock. and specify that the consignment stock remains the property of the supplier and shall be insured by the supplier.5 specify the level of stock of the consignment and its maintenance.1 Inspection prior to unloading. e. 6 specify the manner of stocktakes. (c) advise supplier of details. 22(5/07) . etc which on receipt appears to be undamaged is opened and found to have damaged contents. Supply Manager) must: (a) (b) (c) (d) take receipt of directly delivered consignment stock from the supplier.11 Short or Incorrect Supply When delivery is incorrect: (a) docum ent evidence. then invoice and arrange replacement by the supplier. and (e) advise supplier of details.9 Consignment/Loan Stock). the Authorised Personnel is to: (a) examine the package and contents for evidence to identify how damage may have occurred. or invoice and arrange the return of unused items to the supplier (Specific arrangements may vary at each site . 7.e. document used items. Follow-up actions may include: (a) (b) (c) further documentation of evidence (eg register onto the HP Health Quality Reporting System). Note: Procedures for the receipt of consignment and sterile loan stock may vary and are currently dependent on individual “Public Health Facilities” guidelines and policies. The Public Health Organisation must take responsibility for the application of terms and conditions of consignment Agreements in the supply of stores. i.refer note at the end of section 7. (c) hold package pending further investigation (sterile consumables are to be quarantined). (b) report to the appropriate officer. with stocktake counts being notified to the other party and any discrepancies resolved by recount and/or by implementation of relevant terms and conditions of the Agreement.CHAPTER 7 – RECEIPT. The receiving Authorised Personnel (e. and ensure that the goods are accepted and treated within the terms of the Agreement. CUSTODY AND DELIVERY OF STORES in relation to stocktakes (n) 7. (d) report to the appropriate officer. check all items listed on the delivery documentation against goods received. eg that Authorised Personnel of the Public Health Organisation and the supplier shall conduct stocktakes of consignment stocks at least three times per annum. notification to the customer and/or the Purchasing Department of outcome.g. 7. (b) docum ent evidence. existing structures and arrangement/agreement with Suppliers. replacement or re-order. package.10 Goods Found Damaged After Acceptance When a carton. and monitoring of progress until matter is resolved. CHAPTER 7 – RECEIPT. processed according to existing Public Health barcode systems.1 Warehouse Goods received into a warehouse shall: (a) (b) be stored off the ground. be stored in a dust-controlled environment at health care facilities.13 Storage 7. Further information on this Guideline is available as a note to section 7.13. 21(1/06) . CUSTODY AND DELIVERY OF STORES (d) (e) 7. 7.12 System Receipt Receipts are to be: (a) (b) entered into material management systems according to existing Public Health system protocols.d of this document.3.7 hold package pending further investigation (sterile/patient consumables are to be quarantined).c Inspection after Unloading. 7. and if sterile consumables (a) in accordance with AS/NZ 4187 – Section 9 (For further information on this standard see 7. (a) stored under the higher standards discussed in the Guidelines for Storage and Handling of Sterile Consumables.3. and hold and wait for the replacement or the balance of the short supply or its return as per supplier instructions. Further information on this Guideline is available as a note to section 7.c Inspection after Unloading.2 Stock Rotation Stock is to be rotated: (a) on a “first in first out basis” to ensure stock held does not reach “use by” or “expiry date” limits. and if sterile consumables. In “Hospital Wards” & “Community Nurse Vehicles” goods are to be: (a) stored according to manufacturer’s storage recommendations.13. and if sterile consumables. (a) be stored under the higher standards discussed in the Guidelines for Storage and Handling of Sterile Consumables. and if bar code receipts.3. 7. 14.3. 7. to be kept free from insects and vermin. (For further information. including direction boards/arrows addressing access throughout the site. and to reduce the incidence of incorrect deliveries.14. CUSTODY AND DELIVERY OF STORES 7. and clear notice(s) for delivery vehicle engines to be turned off immediately upon arrival at the receiving dock area. preferably on dedicated clean pallets or racking. Dedicated areas for segregation of goods shall be allocated (where space is available).13. clear statement(s) waiving responsibilities for dumped deliveries and the consequences. refer to the Guidelines for Storage and Handling of Sterile Consumables. clear warning(s) discouraging the leaving/dumping of deliveries without proper receiving by stores/warehouse personnel. Such areas must be clearly marked and maintained according to standards. electrical motors or air conditioning units. ensure that there are: (a) (b) (c) (d) notices on the dock area about delivery and receipt times. e.) 7.3 Stock Level 7. rain.14 Environment – Warehouse 7. direct sunlight. such as caused by direct sunlight.2 Receiving Dock Signage So that all goods are delivered and received intact and undamaged. to provide for the separation of sterile items from non-sterile items.g.14.d of this document. if space is available. and receiving of sterile and patient care consumables must be separate from used linen.14.3 Storage Area The storage area is: (a) (b) (c) (d) to protect goods from (or minimise exposure to) dust. protected from all weather conditions.4 Storage Area Signage Shelves are to be: (a) clearly marked with goods details/barcode labels to promote easy/accurate picking and eliminate unnecessary handling or wrong picking. kept clean and maintained in such a way as to protect deliveries from all possible elements that may the integrity of deliveries. extreme heat conditions.1 Receiving Dock The following conditions must apply at receiving docks: (a) (b) docks are to be undercover. dirt. stock shortages or obsolescence. Further information on this Guideline is available as a note to section 7. 7.8 Stock levels are to be constantly monitored and revised as required to prevent overstocking.CHAPTER 7 – RECEIPT. garbage and other perishable consumables. and to be arranged so that goods are stored off the ground. 21(1/06) . 7. they be replaced with open dust-free shelves/baskets.9 Note: the use of brooms or blowers are to be discouraged as their use spreads dust in the warehouse. i. 7.1 Storage facilities Storage facilities in the hospital ward environment should: (a) (b) be specifically dedicated for patient supplies only and not located with cleaning materials or food items or adjacent to a hand basin. 21(1/06) . be temperature and humidity controlled to maintain the internal environment. and. with relative humidity from 35% to 68% (advise should be sought if temperature ranges falls under and/or exceed the recommended range.Hospital Ward 7. if available.15. Note: the use of dusters is to be discouraged since dusters spread dust through the warehouse.14. 250 mm off the ground and 440 mm from the ceiling.6 Containers To reduce the risk of contamination: (a) (b) (c) cartons/shipper packaging are to be in a clean undamaged state prior to delivery to the ward area.5 Floors Storage Area Signage Floors are to be: (a) (b) kept clean and tidy on a daily basis. if available. racking/shelves to be used are in good condition and burr free.e. 7. well ventilated and with a constant temperature of between 22 degrees to 24 degrees Celsius. and if possible. and outer cartons/shippers should not be used for dispensing individual items since they are a source of contamination. 7. to enable stores/warehouse personnel to move freely between racks to enable stacking and picking.e. if available.CHAPTER 7 – RECEIPT. shelves to be used should be open freestanding racks with walkways of sufficient width between them.14. accessibility and maintenance of goods in usable condition: (a) (b) (c) (d) (e) shelves should be regularly maintained to ensure that dust and other materials/elements that may affect goods integrity are minimised. when shelving needs replacement. i.14. racking/shelves should keep sterile consumables off the ground and not too close to the ceiling.7 Shelving To ensure safety. filter vacuumed or damp mopped.). CUSTODY AND DELIVERY OF STORES 7. 7.15 Environment . inner cartons when used for dispensing in the ward area should be discarded when empty and not refilled. have lighting flush with the ceiling to prevent accumulation of dust wherever possible. containers and shelving should be clearly identified to ensure: (a) (b) (c) regular cleaning of bins. CUSTODY AND DELIVERY OF STORES (c) (d) (e) (f) 7.2 Containers and Shelves To ensure safety. and regulation of supply quantities and identification of slow moving. An authorised stores/warehouse officer is to review and accept or reject the return according to the Notice or Document. Previous storage and handling condition of the returned sterile consumables is to be established prior to acceptance. 21(1/06) . 7.15. out of date or damaged sterile consumables. appropriate dividers must be utilised.16 Returns (a) Return of Goods Official Notice or approved Request to Return to Stores/Warehouse Document is to be forwarded to the stores department prior to or with the return of goods. 7. rotation of sterile consumables. and be arranged so that sterile and non-sterile consumables are kept separated (although they may be stored within the one area).10 have the temperature in the Ward storage area regularly monitored. Responsibility for storage bins. (b) Return of Sterile Consumables Returned sterile consumables must be in original unopened packaging and clearly displaying manufacture dates with no evidence of exposure to adverse conditions. accessibility and maintenance of goods in usable condition: (a) (b) (c) (d) containers should be made of a non-porous smooth surface material able to withstand regular washing. storage shelves and bins should be at a minimum of 250mm from the floor and 440 mm from the ceiling. If approved the MMS is to be updated accordingly. and inner cartons when used for dispensing in the ward area should be discarded when empty and not refilled.CHAPTER 7 – RECEIPT. if more than one type of item is kept in one container. have sealed windows (ie cannot be opened) and tinted to block direct sunlight on consumable items. (c) Quarantine Area Returned sterile consumables are to be kept in a quarantine area until inspected or approved for return/credit by the authorised Stores Officer. 17. For drugs of addiction. This automated system usually produces picking lists that separate sterile from non-sterile consumables and/or orders items according to item locations. Form 9 books to record receipt and issue of those drugs. are so bound that they cannot be removed or replaced without trace.11 a correctly approved requisition or appropriate picking slip should be obtained for all stores issued (irrespective of whether the stores are issued directly after receipt from supplier or from stock). details of all issues from stock should be entered onto the MMS. identification and repacking. and for each form and strength of the drug. dust and draught minimized. (a) (b) Stores personnel are to pick the correct items/correct quantity of items from the storage locations in the order as listed on the picking slip (Where possible a double-checking mechanism should be in place for Quality Control). including drugs of addiction.1 General issuing arrangements When issuing stores: (a) 7. separation. sealed/labelled/labelled sterile stock). etc. these conditions are met generally by the use of Form 8 books and. picking procedures should be documented for: • the utilisation of clear plastic bags and other accessories used in picking (e.17 Issue Of Stores 7. within wards. CUSTODY AND DELIVERY OF STORES 7.e. containers.8 of the Accounts and Audit Determination provides further information concerning stores. The drug register is to be in the form of a book whose pages are consecutively numbered. signed and despatched to the customer.CHAPTER 7 – RECEIPT. picking spaces should be adequate and organised to permit suitable and effective picking. Separate pages of the register must be used for each drug of addiction. restricted substances. trolleys. (b) (c) Note: clause 5.2 Picking Picking should be conducted under suitable conditions. Containers should be cleaned and dried before every use. 7. • the regular cleaning of picking equipment. shelves. a person who has possession of drugs of addiction at any place must keep a separate register (a “drug register”) at that place. 21(1/06) . should be correctly accounted for as required by the Poisons and Therapeutic Goods Act 1966 and regulations. dated. and contain provision for the inclusion of the particulars required to be entered in it. In particular: (a) (b) (c) picking areas are to be kept clean. Upon completion of the picking process. • separate picking and packing of sterile consumables. In particular. Picking slips are produced via the Material Management System (MMS).g. i.17. documentation is marked as “completed”. cornflour etc. foodstuffs must be not be issued together with cleaning agents. e. putting disinfectant into cordial bottles). where there are visible sign of loss of integrity. (a) Disinfectants. Empty plastic jars and containers that may later be returned to suppliers must not be used to store such items. powders for the destruction of vermin.12 Items should be packed appropriately to ensure safety and deliverability. laundry issues. overnight or weekends. c Inspection after Unloading for further information). (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) Storage temperature and humidity requirements should be as stipulated in section 9. Note: if quantities picked are not consistent with quantities stipulated on the pick slip. Sterile consumables should never be left where they can be exposed to direct sunlight.4 of AS/NZ 4187 – 2003 (see section 7. etc. Work practices and stock control should enable the segregation of clean and dirty items.CHAPTER 7 – RECEIPT. fly sprays. Sterile consumables should not be left in motor vehicles for an extended period. to avoid affecting their integrity. If storage of sterile consumables at home becomes necessary.17.g. soap powders.g.4 Issue Of Sterile Stores Through Community Nurses Community Nurses issued with stores for patients that they visit should be aware that the Department considers as best practice the following matters when transporting and storing sterile consumables. broken bags and containers should be distinctly labeled. Measures to reduce overstocking. e. salt. e. Sterile consumables left in patients home and no longer required must be discarded and not returned to stores. As some cleaning agents. Where deliveries are carried to wards and kitchens.17.g. easily cleanable impermeable containers with fitted lids.g. In particular. CUSTODY AND DELIVERY OF STORES (c) 7. and some cleaning agents should be issued only to a responsible person and care taken to correctly label the containers in which the issue is made. appropriate containers that maintain product integrity should be used. (b) (c) (d) 7. 7. Damaged stock should not be used. Vehicles should be maintained in a clean and dry state and in accordance to the Public Health Organisation’s Vehicle policy.3 Issue Of Stores Which May Be Harmful Some stores may be potentially harmful or injurious to persons and care should be taken when these are issued. in particular. Potentially harmful stores are never to be put into inappropriate containers (e. Regular reviews of best practice should be conducted. cake and pudding mixtures. the following matters require attention. 21(1/06) . etc.3. resemble in appearance such foodstuffs as baking powder. Appropriate carrying devices that maintain the integrity of sterile consumables and that can be easily maintained and cleaned should be used when transferring sterile consumables from the motor vehicle to the patient’s home. care should be taken to ensure that sterile consumables are not be packed with items that may affect their integrity. disinfectants. wastage and poor stock rotation should be determined and reviewed as necessary. the Stores personnel are to note the discrepancy and to advise the appropriate Authorised Stores Officer before delivery is confirmed on the MMS. Correct hand hygiene should be maintained. such as soda ash. if replacement of a missing article is sought. and any samples presented should be clearly identified as “sample only . Suppliers should ensure that courier agencies selected are involved in the achievement of overall best practice. 7.7 Issue Of Uniforms And Protective Clothing The issue of uniforms and protective clothing for male and female staff is the responsibility of the delegated officers.CHAPTER 7 – RECEIPT. briefcases or similar items should not be used.4 Issue Of Sterile Stores Directly By Company Representatives. company representatives should be made aware of the following elements for consideration as part of the delivery process: (a) (b) (c) (d) (e) storage temperature and humidity requirements as stipulated in section 9.17. the issuing officer should ensure that: (a) (b) (c) (d) all replacements will be on a one-for-one basis. excessive exposure to direct sunlight should be avoided. the old article is rendered unusable and converted to rags (which should if practical be disposed of using an existing contract for the collection of clean used rags) or otherwise disposed of.5 Issue Of Sterile Stores Directly By Company Representatives 7.17. 7. the use of impermeable containers preferably with fitted lids that can be easily cleaned is recommended: handbags. Upon the old article being presented to the issuing officer. CUSTODY AND DELIVERY OF STORES 7. Cessation of employment The Public Health Organisation should ensure that processes are in place to enable the return of uniforms when employment ceases.6 Issue Of Sterile Stores By Engaging Courier Services Courier companies should be clearly advised of the importance of maintaining integrity of sterile consumables during transport as listed in Section 7.17. correct hand hygiene should be maintained. (a) (b) It is recommended that agreements with agencies include the above as Key Performance Indicators.not for patient use”. 21(1/06) . Note: Although most issued clothing may have a life of at least twelve months under normal wearing conditions.13 In instances where stores are ordered and requested to be delivered direct. some items such as footwear may need to be replaced more frequently. as applicable. unless the Public Health Organisation adopts a policy of “standard uniform issue”. the officer concerned has given a written statement regarding the loss to the appropriate Officer and that appropriate Officer has approved the issue of the replacement.17.4 of AS/NZ 4187 – 2003. and an individual record of issues of uniforms and protective clothing is maintained. The requirements of the Regulation in relation to MSDS are that: (a) (b) (c) (d) a separate MSDS must be obtained for each substance supplied.CHAPTER 7 – RECEIPT.18.18 Delivery 7. all relevant MSDS must be included in the Public Health Organisation’s register of hazardous substances. containers or bins must be used to prevent dust or damage to packages. If transporting sterile consumables: (a) (b) suitable sealable plastic bags. Contacting the HP on this matter is recommended. and cleaned as required but at least weekly. 7. to prevent use for other purposes.18. 7. any MSDS must not be altered. CUSTODY AND DELIVERY OF STORES 7. and sterile consumables may be repacked into clean undamaged cardboard boxes/containers.3 Condition of Equipment Containers and trolleys should be: (a) (b) regularly cleaned with warm water and neutral detergent and allowed to dry before re-use.4 (Use of Hazardous Substance) must be strictly followed. In parti0cular. each MSDS must be readily accessible to an employee.1 Transportation When transporting within a health care facility or to another establishment: (a) (b) special consideration must be given to maintain the integrity of goods coming from stores. and sterile consumables must be treated with utmost care to ensure that their sterile state is not compromised. 22(5/07) . 7. and trolleys/tubs/containers/bins specifically labelled as belonging to the specific Public Health Organisation . provided a new clean sealable plastic liner is used for each load.Supply Section. Note: At the time of printing of this section. the Occupational Health and Safety Regulation 2001 Part 6.8 Materials Safety Data Sheets 7.2 Containers and Trolleys Delivery of supplies should use: (a) (b) dedicated containers and trolleys. the requirements for Materials Safety Data Sheets (MSDS) must be followed.14 In receiving and issuing stores that are/have hazardous substances.17. Health Procurement (HP) is progressing the acquisition of a central licence for the use of software to access the MSDS. as determined by the Department’s Infection Control policy and the Domestic Services Cleaning policy of the public Health Organisation.18. 4 Outer Shippers 7.7 Sterile Consumables in Transport Sterile consumables when picked or being transported are not to be: (a) (b) exposed to the elements (e. 21(1/06) . 7. should be regularly cleaned (utilising the recommended neutral detergent with warm water) under a documented cleaning program.18. or • placed directly on the floor of the trucks or vans.g. training and supervision for employees to ensure health and safety at work.19 Occupational Health & Safety Under the Occupational Health And Safety Act 2000 and the Occupational Health And Safety Regulation 2001. CUSTODY. should be subject to an environmental check at least monthly with adequate records kept. left in trucks..5 Small Packages Small packages of should be given special care to prevent damage. storage and transport of all products and substances.18.6 Vehicle Conditions Transportation vehicles for transporting supplies: (a) (b) (c) (d) (e) should be well maintained to prevent weather damage. stationery and fresh and perishable food items etc. • items that may penetrate and contaminate them. etc overnight or for prolonged periods). instruction. vans. AND ISSUE OF STORES 7. nor exposed to contamination and/or mixed with: • detergents. not for the transportation of contaminated materials. cleaning agents. batteries.15 Consumable items may be transported to the requester in a sealed outer shipping container provided it is clean and undamaged.18. but placed in dedicated clean pallets or trolleys. the Department seeks: (a) (b) (c) to ensure a safe and healthy working environment (an environment that includes work practices and equipment maintenance and use). 7. 7. Should a vehicle be carrying sterile consumables be involved in an accident. 7. and should not be used for purposes other than transporting clean items. In particular. handling. employers and employees have a responsibility to ensure a safe and healthy working environment. then the integrity of the sterile consumables should be reviewed. to ensure effective arrangements for the use. and to provide information. e.g. used to transport sterile consumables between facilities be covered or enclosed and kept free of debris. prevent dust and be able to protect and maintain the integrity of goods.CHAPTER 7 – RECEIPT. The Department of Health is strongly committed to its responsibilities in relation to Occupational Health And Safety (OH&S) and actively promotes initiatives in relation to the objects of the NSW Occupational Health And Safety Act 2000.18. and the proximity of change rooms and staff parking facilities to store areas. and the issue of stores in commercial sizes.6) should be adhered to that addresses: (a) (b) staff access to stores.CHAPTER 7 – RECEIPT.3 Protecting People and Property Manual The section of the Protecting People and Property Manual (see pages 20. Note: Any suspicious items should not be touched or opened and be immediately reported to Security for appropriate handling. ensure that emergency exit doors only open from the inside and have an alarm that activates when opened. 21(1/06) . and using protective clothing and equipment in the manner specified in the work procedures.20. 7. hazardous situations or accidents to a supervisor. reporting any hazards. ensure that stocks are stored in secure areas that are not easily accessible to unauthorised persons. and conduct regular cyclic counts of stocks.20 Security 7.5 & 20.2 In and around the warehouse The warehouse is a secure area. and ensure that only authorised persons are allowed in the store areas. OH&S committee member or OH&S representative. store personnel should: (a) (b) (c) (d) (e) (f) examine garbage removal devices to prevent stock articles being transported from the warehouse area. lock ward goods so that they only accessible to the Nurses or Unit Manager or their delegate(s). To ensure security. These responsibilities include: (a) (b) (c) (d) cooperating with the employer in relation to the development and implementation of a safe and healthy workplace. being aware of emergency procedures. 7. 7.1 Access to the Warehouse Access to the Warehouse should: (a) (b) (c) restrict normal entry and exit to the store to only one door that the Supply Officer is able to see the door from his/her office. immediately place goods received into a secure area. CUSTODY AND DELIVERY OF STORES 7.20.20.16 Employees of the Public Health Facilities also have responsibilities in relation to ensuring a safe and healthy workplace. ensure goods delivered to facility areas are not left in accessible places or in vehicles left unattended. in training or by the supplier. 22(5/07) . as stipulated in section 7. (a) Access to the HQRS is restricted to Authorised Users only.b Reporting immediately above. The HQRS may be used to forward quality concerns/reports to the following organisations.21. (c) Health Procurement (NSW Health) Quality issues reported are those referred to in section 7. The central system that is accessible via the HP Website http://internal. the matter should be lodged onto NSW Health Procurement Health Quality Reporting System (HQRS). CUSTODY AND DELIVERY OF STORES 7. (a) The Health Service advise their Suppliers at all times that the Quality Reporting details that they supply are to be entered onto the statewide system.21 Reporting 7. with full consideration of the fact that information is shared with all NSW Health sites.21. These factors may or may not be consistent in other sites. Authorised Users should acknowledge that events or activities that result in Quality Reports being submitted might be directly relevant to specific Health Service/Supplier environments or to the specific use of the product. Information or advice from the HQRS should not be used as the sole reason for conducting or not conducting business with Suppliers.CHAPTER 7 – RECEIPT. (b) State Procurement (Department of Commerce) Quality issues reported are those concerning state contract items that require the attention and action of State Procurement. (b) (c) Special note: Information entered onto the HQRS is confidential and specific for internal NSW Health use only.e State Procurement (Department of Commerce) immediately above and any other quality issues and concerns. Authorised Users are required to either be a member of the Clinical Product Managers Networking Group or the Clinical Equipment Procurement Working Party or complete an extensive training session provided by the NSW Health Procurement – Supply Infrastructure Team. Authorised Users should use the HQRS as a guide or for reference. Users are expected to take reasonable care and responsibly report concerns. Because of possible inconsistencies.au/business/HP/ is provided for the exclusive internal use of health services with the following conditions.gov. a system that is accessible by all Health Services and subject to all of the above conditions.nsw.health. State Procurement attention or action is required after an attempt to satisfactorily address the matter with the supplier has failed. Authorised Users accessing the HQRS to view entries do so as a guide/reference only.17 When quality issues or product concerns are encountered at each Public Health Facility and after it has been appropriately dealt with in accordance to the Public Health Facility local guidelines/ procedures. At the same time the TGA aims to ensure that the Australian community has access. labelling. ensure that the statement describing the alert conveys a true and accurate description of the product concern. Some provisions such as the scheduling of substances and the safe storage of therapeutic goods are covered by relevant NSW legislation. Note: The Therapeutic Goods Administration (TGA) is a unit of the Australian Government’s Department of Health and Ageing and is responsible for administering the provisions of the legislation. finance Department Staff. CUSTODY AND DELIVERY OF STORES (d) Therapeutics Goods Authority 7. and maintenance/biomedical staff at time of delivery 21(1/06) . to therapeutic advances. ensure care is taken when describing such an incident to ensure that there are no ambiguities or possibilities of reader misinterpretation. The HQRS may also be used to: (e) (f) alert other Health Services of potential difficulty with a product. the sender of the alert should: (g) (h) (i) (j) ensure that the HQRS conditions of use are fully noted prior to initialising a product alert. particularly in reference to points covered under section 7.21.18 Quality issues reported are those determined as in contravention of the Therapeutic Goods Act 1989.CHAPTER 7 – RECEIPT. including the description of the incident that led to the event or encounter. Note: As a duty of care. and remind recipients of the alert about the conditions of use of the system.c Reporting. The Therapeutic Goods Act 1989 and related Regulations and Orders set out the requirements for inclusion of therapeutic goods in the Australian Register of Therapeutic Goods (ARTG). This registration can be performed by: • • • • receiving Dock staff at time of receipt. within a reasonable time.22 Asset Register Asset Registers maintained by Finance Departments and Equipment Registers maintained by Support Departments (such as Facilities or Biomedical Engineering Departments) serve differing purposes. Since the HQRS provides these reporting capacities. it is the responsibility of product users within the Health Service to utilise the mechanisms available to alert others (users or potential users) to product concerns that may bring harm and/or expose patients and Health Service personnel to risk or injury. and forward urgent alerts/notices of a product concern to other sites (system users). The TGA carries out a range of assessment and monitoring activities to ensure therapeutic goods available in Australia are of an acceptable standard. product appearance and appeal guidelines. (a) Financial Asset Register Items considered to be “Assets” as defined by the Finance Department should have details entered into the financial Asset Register. 7. eg the Poisons and Therapeutic Goods Act 1966 and regulations. and advertising. an Asset Manager. inspections.CHAPTER 7 – RECEIPT. communicating all plans and schedules to those performing the receiving activities. or do not clearly identify when or where services or materials are needed. (b) Risk . and monitoring. Finance may tag a whole system whereas Support Department may tag all the subassemblies. on plans and schedules.1 Task: To ensure that services and materials received and related information are processed and promptly made available to appropriate sections or stores (a) Risk . recording and reporting service delivery problems.Information on services or materials received is not entered into the information system accurately or on a timely basis. This risk may be controlled by the following procedures: • • • maintaining procedures for promptly updating payables and stores records. Risks and Controls The receiving function relates to the physical receiving of goods or services. (c) Tagging (bar-coding) Tagging (bar-coding) requirements vary between Finance and Support departments.Purchase or service orders are lost or not forwarded to assist receiving activities. submitting summarised service and material requirements periodically to those managing the receiving activities.23.2 Task: To ensure purchase or service orders not filled on a timely basis are investigated (a) Risk . CUSTODY AND DELIVERY OF STORES (b) 7. matching dates on receiving information and stores information and follow up as appropriate. Should there be any tasks. risks and associated control procedures are examined below. and their locations. 7.23.23 Receipt of Goods and Services – Tasks. risks and control procedures not addressed below. 21(1/06) . providing non-routine service or material routing instructions to those performing the receiving activities. This risk may be controlled by the following procedures: • • • • • • specifying the services and materials needed. maintaining material routing instructions for received items. Efforts should be made to avoid duplicate tags. 7.Plans and schedules are not communicated to those performing receiving activities. these should be considered at a senior level within the organisation. 7. If single tags are not possible then the Finance and Support Departments must use differing number ranges or identifiers.19 Maintenance/Biomedical Equipment Register Items requiring tracking or maintenance should have details entered in the relevant database by the Support Department’s staff at the time of request. and the collection and passing on of relevant information for the payment of accounts. and periodically verifying that prenumbered receiving documents have been entered in the information system. Various tasks. Due date information is not available.Loss of receiving reports or lost shipping records This risk may be controlled by the following procedures: • • using prenumbered purchase and service orders.23. and verifying specifications or requirements with purchasing or other appropriate personnel.4 Task: To accept only items or services that were properly ordered (a) Risk .23. and monitoring.5 Task: To accept only services and materials that meet purchase order specifications (a) Risk . This risk may be controlled by the following procedures: • • comparing services and materials received to properly approved service or purchase orders and rejecting services or materials not properly ordered. (a) Transfer procedures do not require preparation of supporting documentation.23. 7. This risk may be controlled by the following procedures: • • maintaining current lists of specifications for inspecting and testing goods or evaluating service requirements.CHAPTER 7 – RECEIPT. 7.6 Task: To ensure that all materials transferred from the receiving activity to other activities are recorded.23. and investigating missing documents.3 Task: To completely and accurately document goods received and goods returned (a) Risk .Purchase order information is not made available to receiving activities. 7. 21(1/06) . (b) Risk .Purchase order specifications are unclear. This risk may be controlled by the following procedure: • maintaining open purchase order information in a manner that facilitates identification of purchase orders remaining unfilled past the due date. and investigating missing documents. 7. CUSTODY AND DELIVERY OF STORES This risk may be controlled by the following procedures: • • 7.20 using prenumbered purchase and service orders. recording and reporting instances of invoices presented for payment when services or materials were accepted without a valid service or purchase order. This risk may be controlled by the following procedure: • requiring documentation of transfer of materials from receiving to other activity areas (eg stores). such as ensuring only one door is available for access. and monitoring. (a) Receiving information may be lost.9 Task: Notify service providers promptly of sub standard performance or return rejected items promptly. inventory and purchase order information is accurately updated to reflect receipts. and periodically identifying and investigating open service or purchase orders.23.23. (a) Inadequate physical security over goods received. This risk may be controlled by the following procedures: • • • periodically verifying accuracy of vendor. This risk may be controlled by the following procedures: • • • 7.8 Task: To ensure that vendor. inventory and open service or purchase order information. periodically ensuring information is being entered into the information system on a timely basis. (b) Receiving information may be entered inaccurately in the information system. This risk may be controlled by the following procedures: • • • prenumbering documents to assist in identification during searches.CHAPTER 7 – RECEIPT. CUSTODY AND DELIVERY OF STORES (b) Transfer documentation may be lost.23. 7. (a) Inadequate or untimely inspection or review of service or items received. and advising higher management of any need for better security and necessary security procedure improvements if appropriate. 21(1/06) .7 Task: To safeguard goods received. investigating the reasons for missing documents. comparing the counts with stores or materials records and investigating any differences. investigating the reasons for missing documents. This risk may be controlled by the following procedures: • • • placing goods in secure areas maintaining facilities and following security processes. or may not be timely. and counting periodically stores or materials on hand. recording and reporting accuracy and timing problems. 7.21 prenumbering documents to assist in identification during searches. 7. recording and reporting problems arising through transfer or requisition processes. and ensuring that stores or other activities personnel verify materials and quantities received.23. (a) Inadequate consideration of safety and storage arrangements 21(1/06) . reconciling with stores records. CUSTODY AND DELIVERY OF STORES This risk may be controlled by the following procedures: • • • 7. periodically counting materials. (b) Transfer documents may be lost.23. This risk may be controlled by the following procedures: • • • • using prenumbered transfer documents to assist in identification if lost. ensuring that transfer documentation accompanies all transfers. and adhering to appropriate procedures for inspection and review.CHAPTER 7 – RECEIPT. These risks may be controlled by the following procedure: • ensuring that the locations of goods are documented. and reviewing and revising processes to ensure that inspections and reviews are adequate. 7. This risk may be controlled by the following procedures: • • transfer materials only on the basis of a properly approved requisition.10 Task: Completely and accurately document all transfers to and from storage.23. enabling rapid location in the event of safety issues being detected.11 Task: Appropriately requisition all goods to be transferred (a) Theft. and investigating differences between counts of material and stores records. investigating missing documents. 7.12 Task: Maintaining safe working conditions and storage of hazardous materials. 7. (a) Incomplete or inaccurate information regarding materials transferred to or from storage. loss or mislaying due to inadequate transfer or requisition procedures. and monitoring. (b) Safety and accountability issues arising through inadequate transfer or requisition procedures. recording and reporting inspection and review problems determining reasons for any inadequacies/untimeliness.22 monitoring. This risk may be controlled by the following procedures: • • • refusing transfer without complete and accurate documentation and using software that requires complete data. those stocks recognised as brought into use by various Public Health Organisation cost centres. i. eg as indicated by manufacturers’ instructions. policies consistent with Occupational Health and Safety (OHS) and other pertinent laws and regulations. dated and signed by the appropriate Officer in the following terms: 21(1/06) . ensuring correct procedures are maintained. and monitoring compliance with. a cyclical monthly check of about ten (10) percent of stores by the facilities Management.2 Stocktaking Because it reveals what is actually in a store. CUSTODY AND DELIVERY OF STORES These risks may be controlled by the following procedure: • 7. such as those conducted for management. 7. stocktaking is an important aspect of stores management. These checks should be performed weekly or fortnightly and be limited to a sample of the store contents. implementing. if discrepancies are excessive or recurrent or where circumstances warrant the matter is to be referred to the facilities Management. It is recommended that the following should be performed: (a) (b) (c) (d) (e) (f) (g) (h) spot checks as specified in section 7.24. a complete stocktake is to be undertaken near the end (ie 30 June) of each financial year unless external audit agrees that other measures of effective stock control exist. or arranging for. if found. and ensuring adequate training is provided to employees on the handling of hazardous materials or working in a hazardous environment.1 Internal Spot Check Of Stock Balances Cyclical spot-check of a percentage of stock should be performed by store staff in addition to other stock checks. 7. initialing and dating of relevant computer printouts or stock cards by the checking officer and recordings maintained of the items checked and. a thorough investigation of the discrepancies. and if an item shows consistent discrepancies.24. 7. and the complete stocktake includes all stock in stores except expensed stores issued. discrepancies.24 Stock Balances 7. following up reported safety concerns. maintaining appropriate procedures for handling and storing hazardous materials.24. any approvals given to adjust stock balances are to be noted on records/stocksheets.1 Internal Spot Check Of Stock Balances. (c) conducting. The stores officer checking the stock balances should: (a) (b) record that the check has occurred (eg by initialing computer printouts or stock cards) maintaining a spot check register in the store.CHAPTER 7 – RECEIPT.23 • • • developing. reviewing.3 Certification of the existence and good order and condition of all stock held At 30 June each year a certificate is to be completed. if a discrepancy is discovered or where circumstances warrant it.e.24. an investigation is to be made. 21(1/06) .” The certificate is to be retained for audit/inspection. CUSTODY AND DELIVERY OF STORES 7.CHAPTER 7 – RECEIPT.24 “I certify to the existence and good order and condition of all stock held within the store. CHAPTER 7 – RECEIPT.25 GOODS DELIVERED INSPECT PRIOR TO UNLOADING VISIBLE DAMAGE? Yes REJECT DELIVERY CONTACT SUPPLIER TO DETERMINE ACTION No INSPECT AFTER UNLOADING VISIBLE DAMAGE? Yes No DETAILED INSPECTION IF APPROPRIATE QUARANTINE ITEMS OK? No Yes ITEMS INTO STORAGE FOR PICKING Yes STOCK ITEMS? DETERMINE IF STOCK ITEMS No PLACE IN DESIGNATED HOLDING AREA DELIVERY TO REQUESTING DEPT INSPECTION BY END USER ITEMS OK? No RETURN TO STORES Yes ACCEPT ITEMS FOR USE 21(1/06) .25 Recommended Receipt of Stores Flow Chart 7. CUSTODY AND DELIVERY OF STORES 7. health.3 [Draft] 19 December 2005 NSW Health Procurement PO Box 1770 Chatswood NSW 2057 Web: http://www.26 SUPPLEMENT 1 HEALTH PROCUREMENT A Division of Health Support GUIDELINES For CONSIGNMENT STOCK Version 0.pp.au 22(5/07) .nsw.CHAPTER 7 – RECEIPT. CUSTODY AND DELIVERY OF STORES 7.gov. 1 0.bulaon@hsupport. Sydney South West AHS Wayne Davis. Sydney South West AHS Maureen Kable.3 Version Description Consignment Stock Guidelines Draft Consignment Stock Guidelines – Draft 2 Consignment Stock Guidelines – Draft 2 Author Date HPPC 21 HPPC Health Procurement July 05 28 July 05 19 Dec 05 Document Distribution Tenders & Contracts Officers / Managers Networking Group [TCNG] Clinical Product Managers Networking Group [CPMNG] Clinical Equipment Procurement Working Party Supply Chain Reform Project Managers Acknowledgements Bruce Cornwell.27 For additional information or comment please contact Valentino Bulaon: valentino. Department of Health NSW Treasury Managed Fund 22(5/07) . Northern Sydney Central Coast AHS Gary Sly.nsw. CUSTODY AND DELIVERY OF STORES Authorisation NSW Health Peak Purchasing Council Secretariat prepared this report on behalf of Tenders & Contracts Officers / Managers Networking Group [TCNG] Clinical Product Managers Networking Group [CPMNG] 7.health.2 0. Department of Health David Wilkinson.CHAPTER 7 – RECEIPT.gov.au Document Control 0. 3. CUSTODY AND DELIVERY OF STORES SECTION 1 – GENERAL INFORMATION 1.2 4.28 5.2 Staff Processing 5. 2.3 5.1 4.CHAPTER 7 – RECEIPT. 4. INTRODUCTION DEFINITION SHARED RISKS & BENEFITS AGREEMENT CONSIDERATIONS The Terms & Conditions of the Agreement Responsibilities of the PHO Responsibilities of the Supplier OTHER CONSIDERATIONS 7.1 Inventor y Systems 5. 4.3 When Consignment Agreement is Not Recommended SECTION B – APPENDICES Appendix 1 – Terms and Conditions Appendix 2 – Sample Indemnity Form (Revised) 21/1/06 . Notes: All PHO should ensure that consignment agreements are in accordance with policies and procedures as stipulated in the “Purchasing and Supply Manual for Area Health Services. this guideline attempts to list the key elements to consider when establishing such agreement. District Health Services and Public Hospitals” Procedures for the receipt of consignment and sterile load inventory may vary from one PHO to another.1 AGREEMENT CONSIDERATIONS The Terms & Conditions of the Agreement Both the Supplier and the PHO need to clearly understand the terms of the agreement [Refer to appendix 1]. This information may be integrated into the Supplier’s production planning systems. the next consignment order is placed or on the passing of a pre-determined period after delivery. but is still owned by the supplier. CUSTODY AND DELIVERY OF STORES SECTION A – GENERAL INFORMATION 1. Consignment creates a condition of shared risk whereby the supplier risks the capital investment associated with the inventory. SHARED RISKS & BENEFITS The key benefit to the PHO is that capital is not tied up in inventory. Other elements that should be considered but are not limited to: 21/1/06 . INTRODUCTION 7. 3. as costs related to storing and managing the inventory are to be accounted for. This also creates a condition of shared benefit because neither the supplier nor the customer will benefit until the inventory is consumed. and may be dependent on local policies and existing business practices.29 The purpose of this guideline is to assist Public Health Organisations [PHO] in the establishment of consignment agreements. Although agreements in place may vary in accordance to Supplier offers. 4. In other words. This shared-risk / shared-benefit condition will often be enough to convince a PHO to stock the inventory. DEFINITION Consignment stock is inventory that is in the possession of the PHO. The PHO purchase the inventory only as the inventory is consumed. this does not mean that there is no inventory carrying costs. 2. There is a potential side benefit to consignment inventory in that some shared information that results from the consignment process could be useful to the supplier in their inventory management. the supplier provides inventory to the PHO (in their ward storage facility or central supply stores) and allows the PHO to consume directly from that stock of inventories. while the PHO risks dedicating storage space for the inventory. However. 4.CHAPTER 7 – RECEIPT. f. all inventory listed on the delivery documentation are checked against inventory received.e. including credit from supplier on return of goods? Confirmation of responsibility for damage or loss while in customer’s possession. [Refer to appendix 1 and appendix 2] 4. in such a way that it facilitates easy crosschecking by the PHO against the list of inventory per the agreement. Consignment inventory delivered is fully documented. e.3 a. c. storage and handling policies/ procedures/guidelines. CUSTODY AND DELIVERY OF STORES 7. Delivery is to be in accordance with the PHO preferred methods. In other arrangements. e.g. Responsibilities of the PHO Ensure that the Terms & Conditions of the agreement are fully understood by both the PHO and the Supplier Maintain the integrity of consignment inventory as specified by the manufacturer while stored at the PHO storage facility. c. In either case the Supplier will no longer be responsible for indemnifying the PHO. Only Supplier Authorised representatives are assigned to deliver consignment inventory to the PHO. Only the PHO authorised personnel may take receipt of direct delivery of consignment inventory from the Supplier. Arrangements may vary at each site. unused inventory is returned to the Supplier and used inventory is invoiced accordingly. Receipts of consignment deliveries are in accordance with PHO policies. Obsolete inventory 4.2 a. Ensure that consignment inventory is supplied in accordance with manufacturer’s recommended transport. b. Note: at the completion of the agreement the inventory may [depending on the terms of the agreement] either be returned to the Supplier or will be paid for and owned by the PHO. This will enable replacement and invoicing by the Supplier. i.CHAPTER 7 – RECEIPT. e. d. in reference to NSW Health policy What are the Insurance implications? How and when is data exchanged? What data is exchanged? How are miscellaneous transactions processed? Cycle count adjustments. This is normally arranged through the central Supply Department. Departments within PHO (who normally hold consignment inventory) should ensure that an “official agreement” with the consignor is in place before accepting consignment inventory. Responsibilities of the Supplier Ensure that the Terms & Conditions of the agreement are fully understood by both the PHO and the Supplier Agrees to indemnify the PHO and the NSW Department of Health per the agreed terms and conditions. 21/1/06 . d. b.30 Real-time sales or period-end sales Time limit (must be purchased or returned within specified period) What is the freight policy? What is the return policy. Consignment inventory used is documented by an PHO Authorised Officer. The inherent manual process will then be addressed. If this process is not monitored closely. State build of Oracle or use of systems such as Supply Scan.e. 5. 21/1/06 .31 The nature of consignment inventory is that “change of ownership” is unrelated to the shipment / receipt processes. 5. Because of this. i. most inventory systems do not handle consignment inventory very well. 5. CUSTODY AND DELIVERY OF STORES 5.1 OTHER CONSIDERATIONS Inventory Systems 7.3 When Consignment Agreement is Not Recommended When demand is reasonably known and stable. Not only is this time consuming. but it also creates opportunities for errors as the additional transactions necessary for consignment inventory can be complicated and are highly dependant on accurate information sharing. reconciliation of consignment inventory can be a difficult exercise.CHAPTER 7 – RECEIPT.2 Staff Processing There needs to be detailed documentation and training for staff in the management of consignment inventory. This is contrary to the basic design of most inventory / accounting system’s transactional processes. This forces some PHO to manage consignment inventory with manual off-line processes. Note: as systems improve the facility to handle consignment inventory may improve in time. consignment inventory is not recommended. CUSTODY AND DELIVERY OF STORES SECTION B – APPENDICES Appendix 1 – Terms and Conditions Level of Consignment Inventory 7. Any inspections should be effected under appropriate supervision. Storage The consignment inventory must be stored in a secure and clean environment and within the guidelines as set out on the product packaging. or within a period as determined between the PHO and the Supplier. Consumption The PHO must notify the Supplier of consignment inventory usage within 48 hours. [Quantities are normally listed as Imprest schedules] A stocktake of the consignments inventory is to be carried out at least three (3) times annually by the Supplier.CHAPTER 7 – RECEIPT. and Provide the Supplier an official purchase order to facilitate replacement of used consignment inventory. The PHO shall allow the Supplier’s insurance representatives to make periodic inspections at a mutually convenient time. the Supplier may request to audit the consignment inventory on a regular basis at a time convenient to the PHO.32 The level of consignment inventory is to be maintained as per the formal pre-determined quantities. The PHO must pay accounts in accordance with the terms and conditions of the agreement. the PHO may retain the consignment for a period of one year or for a period as determined between the Supplier and the PHO. Outside the scheduled stocktake. 21/1/06 . Ownership The consignment inventory remains the property of the Supplier and shall be insured by the Supplier. Any changes to quantities must be agreed between the PHO and Supplier in writing. Period In general. The PHO and the Supplier must sign off the resulting count and records kept for year-end reporting and audit purposes. cost.CHAPTER 7 – RECEIPT. in connection with or suffered by the Supplier as a result of damage to consignment inventories. CUSTODY AND DELIVERY OF STORES Insurance and Indemnity 7. Withdrawal from the agreement The Supplier may withdraw the consignment inventory seven (7) days after a written notice is provided and officially received by the PHO Authorised Officer. Deliveries of Consignment Inventory must be in accordance with the PHO policies and procedures. The above indemnity may not be applicable if the following conditions are established: a. The PHO may terminate the consignment agreement with no penalty incurred. Breakages to consignment inventory resulting from storage in environmental conditions outside those noted in the packaging and / or as per the recommended storage conditions stipulated by the manufacturer Breakages to consignment inventory resulting from deliberate misuse or mishandling by PHO staff.33 The Supplier agrees to indemnify the PHO and the NSW Department of Health against liability. loss. This indemnity shall be a continuing indemnity and shall survive the termination of the agreement. expense or tax incurred. 21/1/06 . This advice may vary for some specialist items. Variations to pricing The Supplier must advise price variations at a minimum (30) thirty days before any increase / decrease is to be effective. fourteen (14) days after a written notice is provided and officially received by the Supplier’s Authorised representative. damage. b. Terms & Conditions: 1. CUSTODY AND DELIVERY OF STORES 7. and successors and permitted assigns. The PHO may direct the Supplier to remove the goods at any time. as the case may be.CHAPTER 7 – RECEIPT. administrators. 21/1/06 . Public Health Organisation [PHO] – any NSW Health body corporate. The PHO and Supplier may agree in writing to extend the loan period or complete another Indemnity Agreement. department or body into which it may be merged or subsumed or which may replace it and its successors and assigns. Supplier – means the party whose details are specified in the schedule and his/her/its executors.34 Appendix 2 – Sample Indemnity Form [Revised] [Original copy courtesy of Sydney South West Area Health Service] HEALTH PROCUREMENT A Division of Health Support This “SCHEDULE TO INDEMNITY AGREEMENT FOR CONSIGNMENT STOCK ON LOAN” made on___/___/___ between_________________________________Public Health Organisation] and_ __________________________________________ [Supplier] Background Information: The Public Health Organisation [PHO] has agreed to accept consignment inventory of the goods as supplied by the Supplier on the terms and conditions stipulated below: Definitions: Goods – means the goods specified in the schedule and any other property supplied by the Supplier on loan to the Health Service under this agreement. 3. The supplier shall deliver and install “with reasonable care” (where needed / required) the goods at the PHO premises at the beginning of the loan period and to remove the goods from the PHO premises at the end of the period. 2. This indemnity shall be a continuing indemnity and shall survive the termination of the agreement. The PHO shall notify the Supplier of use of any consignment goods within 48 hours. During the loan period. The PHO shall supply an official purchase order for replacement of the consignment goods used. 10.35 If the Supplier does not remove the goods at the end of the said period. the PHO shall give the Supplier reasonable access to the goods for the purpose of audit of goods held on consignment. Subject to point 7. after the expiration of 28 days from the end of the loan period. 12. handling and use of the goods on loan. The PHO shall store the goods in a secure and clean environment. have the goods removed from the PHO premises and returned to the Supplier’s premises. the PHO may. 9. The count shall be agreed with the PHO Authorised representative. damage. The above indemnity may not be applicable if the following conditions are established: Breakages to consignment inventory resulting from storage in environmental conditions outside those noted in the packaging and / or as per the recommended storage conditions stipulated by the manufacturer Breakages to consignment inventory resulting from deliberate misuse or mishandling by PHO staff. the PHO shall utilise the goods with reasonable care. Any changes to these schedules shall be agreed between the parties. The level of inventory of the consignment shall be maintained as per formal schedules (sample form attached). CUSTODY AND DELIVERY OF STORES 4. in connection with or suffered by the Supplier as a result of damage to consignment inventories. The Supplier agrees to indemnify the PHO and the NSW Department of Health against liability. The PHO reserves the right to deny access if deemed appropriate. 6. 13. 11. The Supplier shall advise any price variations thirty days before implementation. The Supplier shall carry out a stocktake of the consignment inventory at least three times annually. expense or tax incurred. 14. Accounts shall be paid in accordance with the normal terms and conditions of the PHO. The initial Consignment inventory delivered shall be jointly checked and agreed by representatives of the Supplier and the PHO. The Supplier shall provide training for PHO staff and all information necessary for the safe storage. and at the Supplier’s expense. 7. loss.CHAPTER 7 – RECEIPT. 5. or such other period as determined between the PHO and Supplier. 21/1/06 . 8. 15. cost. The Supplier reserves the right to withdraw the consignment inventory at any time subject to 14 (fourteen) days notice. 7. c. CUSTODY AND DELIVERY OF STORES 16. c. The Supplier shall remain the owner of the Goods throughout the term of this agreement and shall keep the goods insured on an industrial Special Risk basis or better during the period of the loan. Treat the Supplier favourably or give the Supplier any advantage or credit in any expression of interest. servicing. tender or other procurement procedure. e. The Goods are fit for the purpose for which they are to be used by the PHO. Purchase goods similar to the Goods from the Supplier or any other seller or to request expressions of interest or tenders for the purchase of such goods. b. The Goods.36 The Supplier shall indemnify the PHO in regards to any claims. shall not cause injury or death to any person and shall not damage or destroy any property of the PHO or any person. or any other negligence of the Supplier. d. 7. Provide any information concerning the PHO or its procurement procedures to the Supplier. if used according to the manufacturer's or Supplier's specifications. The Supplier warrants and agrees that: a. 21/1/06 . the Goods comply with all relevant quality and safety standards and are approved for use by all necessary authorities. transport. 19. during the life of the agreement a Broad Form Contractual Third Party Limited Insurance in the amount of not less than $20 million in respect to each and every occurrence and unlimited in the aggregate for any one period of cover. Include the Supplier in any selective tender for acquisition of any product.CHAPTER 7 – RECEIPT. The PHO shall allow the Supplier’s insurer reasonable access to inspect the goods. or installation of the goods. A certificate of currency(s) for the policy(s) shall be made available to the PHO on demand. 18. The Supplier acknowledges and agrees that nothing in this agreement creates any obligation on the part of the PHO to: a. 21. The Supplier shall keep accurate details of the serial and other identification markings on the Goods. b. 20. The Supplier shall take out and keep in force. which arise as a result of negligence for any injury to persons (including death) or any damage to any property that may arise from manufacture. Purchase the Goods from the Supplier or any distributor of the Supplier. 17. The PHO may attach additional requirements to this generic form if / when deemed appropriate. CHAPTER 7 – RECEIPT. CUSTODY AND DELIVERY OF STORES 7.37 HEALTH PROCUREMENT A Division of Health Support SCHEDULE TO INDEMNITY AGREEMENT FOR CONSIGNMENT STOCK ON LOAN Loan start date: Description of Consignment Stock: Loan end date: Manufacturer Supplier Item Number/s: SUPPLIER: Signed on behalf of the Supplier: _______________________________ Name: Position: Supplier: Date: Address: ABN Contact Details Phone: Fax: Email: PUBLIC HEALTH ORGANISATION [PHO] Signed on behalf of the PHO: ___________________________ Name: Position: Health Service: Date: Contact Details Phone: Fax: Email: Signed by Witness: ___________________________ Name: Position: Date: 21/1/06 . .............................................. OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) 8....................9 GENERAL..8 8.......................... 8.................................................... PREPARING GOODS FOR DISPOSAL .DISPOSAL OF SURPLUS... SUPPLEMENT 3 – Authorisation...............................................7 8...................................3 8......................................................... ENGAGING INTHESHED ASSET MANAGEMENT P/L......................................................................7 8...............14 22(5/07) ............4 8.............500 but not exceeding $150...................................................................................... SCOPE OF ENGAGEMENT (By Third Party Provider).................6 8.......................................................1 8............... 8................... 8.........................12 8...............................................................2 8............. 8..5......... 8............................................. ESTIMATE THE VALUE .................6 8.....1 8...............................................TABLE OF CONTENTS CHAPTER 8 ..... 8....5 8.........................................................6 APPENDICES 8-A 8-B 8-C AUCTION.............9 8.................................................000. 8......000) ..................5 DISPOSAL BY A THIRD PARTY ....................................................................................................3 Goods or Groups of Like Items (valued at over $1..............................2 Goods with No Value................................................... 8......................................5..........5 8......................................................10 SUPPLEMENT 1 – Management of Surplus Equipment ............................. 8..................5....3 8............................................................... 8....... DECISION TO DISPOSE.... 2 Goods valued at up to $1500 ...2 8.......2 8............................4 8......................................... GENERAL............................1 8.. APPROVAL OF DISPOSAL.......11 SUPPLEMENT 2 – Non-Disclosure Agreement........... METHOD OF DISPOSAL....................................1 8......5............13 SUPPLEMENT 4 – Sample Letter Seeking/Accepting Quote ......5 8..........1 8............... DISCLAIMER POINTS...............................................3 Goods Valued Over $150. (* note section on Trade In) ESTIMATE THE VALUE An accurate valuation of the goods assists in selecting the most appropriate method of disposal. Although the use of this third party is not mandatory at this stage. and part of an asset replacement program.2 DECISION TO DISPOSE Goods identified as potentially suitable for disposal should be assessed by the responsible officer to determine that the goods are appropriate for disposal.1 GENERAL 8. and recommends the most appropriate means of disposal for any goods that may have a high sale value. effective and transparent manner to ensure probity and fairness. Common criteria used for this purpose include: • • • • • 8. the disposal of goods must achieve value for money. This service includes redeployment/re-use through-out the Health system. The use of the abovementioned third party satisfies the requirements stipulated in section 8.1 As with the acquisition of goods or services. health organisations are encouraged to explore this option where there is likely to be benefits.3 no longer required. The value of a good is dependent on the market. Access to the above third party eliminates the need for each facility to individually release a tender for this service if the use of a third party is the option chosen to dispose of surplus stores/equipment – refer section 8. donation to registered missions and appropriate disposal/destruction in accordance to Health waste management policies. The use of the above third party may be the most cost effective means of dealing with surplus stores and is subject to the terms and conditions set by the State Contract Control Board and any additional conditions that may be set individually by each facility.5. surplus to current or immediately foreseeable needs. 8.CHAPTER 8 – DISPOSAL OF SURPLUS. and identifying the necessary level of approval.6. unserviceable or beyond economic repair. Note: Health Support has established a State Contract through the State Contract Control Board that enables Health facilities to access the services of a third party for the disposal of surplus and unserviceable stores/equipment. All disposal actions require an assessment and certification of the value of the goods by an appropriately skilled person. It is recommended that a registered valuer independently assesses. as the said requirements will be managed by the third party on behalf of the engaging Public Health Organisation. The disposal process is to be conducted in an efficient. sale. 22(5/07) . technologically obsolete and operationally inefficient. OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) 8. and the perceived advantages of the good to buyers in the market. asp?CAT=805&ID=1001 22(5/07) . The disposal method chosen must be appropriate to the nature.4 APPROVAL OF DISPOSAL 8. Disposal of Obsolete Working Computers The NSW Government’s ReConnect. All Public Health Organisation identification marks are to be removed. and promote fair and effective competition to the greatest extent possible.CHAPTER 8 – DISPOSAL OF SURPLUS. Note: All approvals must be retained on file for audit purposes. All officers involved in the disposal process should be aware of their obligations under the Code of Conduct to act impartially.1 Goods with No Value Any item deemed to have no value or unserviceable stores and equipment beyond economical repair may be destroyed. effectiveness and efficiency of the proposed use of the items by the recipients in making decisions to donate. Public Health Organisation’s are to offer equal opportunity to charities to benefit from the donation of obsolete/unserviceable goods.nsw.5. The Chief Executive or delegated officer can approve the donation of obsolete and unserviceable/expired stores (including medical supplies) and equipment to charitable organisation’s in both Australia and overseas provided all other avenues for disposal have proven unsuccessful. Guidelines for participation in this program are available through the Agency Resource Centre of the OIT website http://www. ethically and to avoid any conflict of interest.nsw Computer Program as the preferred option in the disposal of owned redundant computers. The business case should include: • • • Reasons for disposal Estimation of realisable value Consideration and recommendation of the best method of disposal The approving officer must be satisfied that the chosen method of disposal is commensurate with the value of the goods.au/pages. It is reasonable for the donor to consider the relative economy. quantity and location of the goods.2 A business case for disposal action should be prepared for consideration and approval by the Chief Executive or his/her delegated officer. recycled or disposed of in an appropriate and environmentally friendly manner.gov. Unserviceable equipment beyond economical repair and having no scrap value should be certified as such and then disposed of in the most efficient manner given the nature of the goods and environmental aspects.nsw Computer Program exists to enable the donation of redundant government Agency computers to not-for–profit organisations and disadvantaged individuals. equipment etc.oit. Verification is required of the organisation’s charitable status.5 METHOD OF DISPOSAL The optimum method of disposal is influenced by the estimated value of the goods/equipment as shown in the following categories: 8. OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) 8. 8. and that it reflects the appropriate level of competition. Public Health Organisations are to consider the ReConnect. to ensure equity. This may be by way of “For Sales” notices placed on notice boards visible to both staff and visitors to the Hospital. a Public Health Organisation may advertise for their need to obtain certain good from other Public Health Organisation’s surpluses.2 Goods Valued at up to $3. Public Health Organisations can also contact and negotiate direct with other prospective recipient Public Health Organisations. a reserve price should be set as the minimum offer that will be accepted. Where reserve prices are established or where items are priced for sale.health. should remain independent of and apart from the bidding process. an email notification is sent to all registered users. Once new entries are lodged.g.000 per item or group of items** must initially advise all Public Health Organisations through Health Procurement Bulletin Board system located at http://internal.gov. The HP Bulletin Board was established to allow a Public Health Organisation to advertise full details of surplus goods across NSW.au/business/hp . The approving officer is to certify that values determined and prices obtained.000 but not exceeding $250.000 limit the individual making the offer is to be advised that the procedures applying to goods valued over $3. the availability of the items being disposed of should be advertised as widely as possible. The low value of the items being disposed of generally does not allow expensive advertising. within the limit of funds available for that purpose.5.000 are to be followed. However.000 attracts an offer in excess of ten (10) per cent of the $3. Notices should show that enquiries and applications to purchase are welcomed from the general public. the officers determining the prices.5. e. Conversely. 24(7/09) . OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) 8.3 Goods valued at up to $3. if any and that the vendor will not be responsible for any defect. Assets should not be disposed of in a way that excludes participation of members of the public or which provides an unfair advantage to staff.nsw. In all cases individuals purchasing items are to be made aware that items are for purchase and removal with all faults.3 Goods or Groups of Like Items **Valued At Over $3. Such officers should be aware of the Organisation’s Code of Conduct concerning impartiality and conflict of interest. If an item or group of items which has been valued at under $3.000 per item or group of items **where the low value does not warrant the expense of extensive advertising should be disposed of by either : • • Acceptance of written proposals Negotiated sale Where considered prudent.000 but not exceeding $250. for items or groups of items are fair and reasonable. 8. 3 quotes required etc.CHAPTER 8 – DISPOSAL OF SURPLUS.000 8.000 Transfer to another Public Health Organisation or Ambulance Service Public Health Organisations having surplus or obsolete stores exceeding an estimated realisable value of $3. By undertaking complete tendering procedures as described in Chapter 3 of this Manual. 22(5/07) . the purchase price may have been inflated to offset the trade-in value offered by the supplier.4 The Public Health Organisations with the surplus stores shall deal directly with interested Public Health Organisations wishing to obtain such stores to negotiate a mutually agreed cost to transfer the stores. the stores shall be disposed of by either: • Obtaining 3 written quotes . Alternately stores may be destroyed. seven (7) days. stores have not been acquired by another Health Service. Examples of letters to be used when seeking or accepting quotes are shown as Supplement 4 of this Chapter. if any and that the vendor will not be responsible for any defect. Public Health Organisations should contact these companies in addition to advertising the availability of goods for disposal in local media. OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) 8. this method may not provide the best financial return to the Health Service. goods should also be collected by the purchaser within a reasonable time. If this option is used the procedures described in Appendix 8-A should be adhered to.1 Stores with No Value. In country areas local dealers. Auction . tenders or bids are received. The Chief Executive or his/her delegate. The NSW Department of Commerce will from time to time provide lists in its monthly circular.g. white goods.If no quotations. e.Trading in surplus goods can be an efficient means of disposal.. is to certify that prices obtained for items or groups of items are fair and reasonable. fo 2. unless undertaken appropriately. known interested parties. • • • Tender Action . An officer who is authorised to make purchases to the gross value of the transaction must approve the trade-in and purchase strategy. should be canvassed. However. etc. of parties interested in quoting for used items in a variety of categories such as furniture. • Unsuccessful Disposal Action . and payment is to be made by cash or bank cheque on or before collection. r purchase and removal with all faults. Often. Explore the option of separately selling the surplus goods and using the revenue to offset the purchase cost of the new equipment. as the net cost for the upgrade may be lower than the trade-in and purchase offer. surplus stores may be disposed of in accordance with Section 5. prospective buyers are to be informed that goods/stores are: 1. etc. In all cases.CHAPTER 8 – DISPOSAL OF SURPLUS. where practicable. Trade In . recycled or disposed of in an appropriate and environmentally friendly matter under the supervision of a responsible officer who must certify the performance of the action. whether offers are written or oral. If after 3 months listing with Health Procurement. and a convenient way to upgrade equipment.Goods may be disposed of by auction.The procedures described in Chapter 2 of this manual should be followed. If goods are of a hazardous or polluting nature the disposal must be undertaken in a responsible manner.5.By undertaking complete tendering procedures as described in Chapter 3 of this Manual. OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) 8. Note that although the provider’s name denotes the provision of asset management. A “Guide to Engaging INTHESHED Asset Management P/L” and the copy of the SCCB agreement is available from the Health Support (Procurement) website located at http://internal. such as land and buildings) up to a value of $100 million without reference to the Department of Commerce. if disclosed. the disposal must be referred to Department of Commerce (NSW Procurement Contracting Services) for the invitation of tenders/auction approval action.001. Records. and/or cause embarrassment or problems for the disposing organisation. or Auction . Children’s Hospital Westmead and Ambulance Service of NSW have been granted interim accreditation and may undertake disposal activities of goods (excluding real property. DISPOSAL BY A THIRD PARTY 8. Reference should be made to the Waste management Guidelines in Section 4 of the Occupational Health. The service is available through a “Standing Offer Agreement” for a period of three years.2 “Services that may be offered – Scope of Engagement”. • • Tendering . In these cases the delegations detailed above apply. which could be misused. Appendix 8-B.health. the above engagement is limited to the scope as stipulated in section 4. Affiliated health organisations can tender to dispose of surplus or unserviceable goods themselves.5 If the estimated value of the goods exceeds $250. Safety and Rehabilitation Guide or contact can be made with the NSW Environmental Protection Authority.000 8.CHAPTER 8 – DISPOSAL OF SURPLUS. Area Health Services. Examples of material that should be removed before disposal include: • • • • • Stationery – particularly printed stationery. Classified information contained in hard or floppy disks. Environmentally sensitive or hazardous stores. Neglecting to check may result in legal liability and embarrassment to the public health organisation. which is consistent with the relevant regulations and procedures.au/business/hp.unauthorized transfer could breach license agreements.6 Health Support has established a State Contract through the State Contract Control Board that enables Health facilities to access the services of a third party called “InTheShed Asset Management Pty Limited” [“InTheShed”].nsw. If this option is used the procedures described in Appendix 8-A should be adhered to. and Public Health Organisation identification marks e. The public health organisations must refer proposed disposal of goods of this value to the Procurement and Contract Services. 24(7/09) • . from November 2006 to November 2009. Software . 8. name. logo.g. with an option to extend up to 2011 through twelve months extensions subject to performance & needs reviews.4 Goods Valued Over $250. (click the link to the library) While it is expected that all disposals will be arranged through the service provider there may be circumstances where disposals are undertaken directly.7 PREPARING GOODS FOR DISPOSAL A check is to be undertaken that goods to be disposed of do not contain material that is not intended for disposal. files papers or whiteboards containing information which. Asset and Contract Services Branch.gov. Department of Health for advice prior to the invitation of tenders or auction. could breach privacy legislation.Goods may be disposed of by auction. etc. terms or conditions must be communicated to all potential participating parties as soon as possible. The contract should include a statement to the effect that . OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) 8. viz. Receipts from the disposal of assets assigned a monetary value within the Statement of Financial Position are to be offset against the written down value with the difference formally recognised as a Gain/Loss on Disposal.9 • • • • . If goods are to be disposed of as a job lot. stock cards. medical goods (including consumables).8 • GENERAL 8. Defects should be brought to the buyer’s notice before entering into the contract. video recorders.e. suits. (ie multiple items of a dissimilar nature) the value of the lot is the relevant figure. if any and that the vendor will not be responsible for any faults. white goods. including outboard motors). The file number or reference number is to be cited on all records where adjustments are made due to disposals. Use of the moneys is to be locally determined unless expressly advised otherwise by the Department.6 **For the purpose of this section like items are those broadly grouped into a similar category. DISCLAIMER POINTS In all cases. marine (boats. common law or otherwise are excluded.” A disclaimer in the form of the undermentioned is to be completed and signed by the recipient: “The RECIPIENT by accepting the goods listed in the attached Schedule releases and indemnifies the Health Service against all actions.). electronic goods (televisions. This should be evidenced in writing. furniture. liabilities or demands whatsoever arising out of or in connection with the acceptance of the goods by the RECIPIENT or by the subsequent use of the goods by any third party. asset registers. 22(5/07) • • • • • • 8. computers. i.CHAPTER 8 – DISPOSAL OF SURPLUS. All details regarding disposals are to be held on file pending audit. warranties and liabilities implied by statute. Any changes to the disposal process. tool/ machinery. then the value of each item is the limit used to determine the appropriate method of disposal. If the goods are to be disposed of as individual items. office equipment. All proceeds from sale other than as shown in paragraph 4 are to be recognised in the General Fund. prospective purchasers are to be made aware that items are for purchase and removal with all faults.“All conditions.000/useful life exceeding two years” policy are to be recognised as Other Revenues. etc.” In lieu of “RECIPIENT” the name of the recipient is to be substituted. Receipts for the sale of assets (excluding inventory items) that do not qualify for formal accounting recognition in terms of the “$5. whether offers are written or oral. inventory sheets. claims. tender) may realise higher returns. OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) 8. (i) One copy to the carter. receipted by the Auctioneer.7 APPENDIX 8-A AUCTION Sale by public auction should be considered for surplus goods and equipment where it is anticipated a public demand exists for the items. Courier. by: (i) (ii) (iii) (iv) Area health services or hospitals own transport if available/appropriate. Deciding on an Auctioneer Competitive quotes should be obtained from auctioneers on a commission basis. is returned to the health service as proof of delivery to auction and for reconciliation of proceeds. cost of premises. The auctioneer provides an undertaking that the auction will be conducted in accordance with the provisions of the Auctioneers and Agents Act 1941 and regulations thereof.g. insurance. to arrange transport of goods to the auctioneers premises. This may be done. The auctioneer has a suitable premises. cataloguing. or Private Furniture Removalist. The auctioneers premises is suitable located. (see contract 630). The auctioneer operates in a professional manner and has a good reputation. (iii) One copy.g.CHAPTER 8 – DISPOSAL OF SURPLUS. competitive rates should be obtained from at least three firms for transport of furniture items under these circumstances. 22(5/07) . When selecting an auctioneer the following issues should be considered: (A) (B) (C) (D) (E) The auctioneer is properly licensed under the Auctioneers and Agents Act of 1941. No charges above the agreed commission should be paid. Further considerations are the costs associated with sale at auction (e. Documentation Itemised lists or dockets should be prepared in quadruplicate. administrative fees and miscellaneous charges (including financial transaction fees). It must be clearly conveyed to the auctioneer the commission must cover all charges such as auctioneers fees. Cartage contractor (see contract 616). advertising. all labour. Transfer of Goods to the Auctioneers Premises Under normal circumstances it is the responsibility of the area health service or hospital etc. Auction sales may be held at auctioneers premises or on site where reasonable quantities of goods exist. transport) in relation to the expected realisable revenue and whether alternative disposal methods (e. (ii) One copy to the Auctioneer as his record of items for sale. (iv) One copy remains with the health service as a permanent office record. given the size/number or value of the items. OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) Auctioneers Responsibilities The auctioneer will be required to: (i) 8.8 Attach labels/stickers to the items identifying the area health service or hospital to which each piece of equipment belongs. (ii) Assist the area health service or hospital to set reserves for each or any item if required. (This may be appropriate if large receipts are anticipated. 22(5/07) . (v) Advise of items passed in and provide advice as to whether to re-list the items or dispose of the equipment in some other manner.CHAPTER 8 – DISPOSAL OF SURPLUS.) (iv) Within 7 days of the auction provide an itemised account of all items sold or passed in. The Area Health Service/hospital/Ambulance Service then reconciles the proceeds schedule with their records to ensure all items are accounted for. Transaction advice should include the realised sale price for each item. commission deducted (in accordance with agreed figure) and cheque. (iii) Allow a representative of an area health service or hospital to attend the auction to oversight the process and record bids. total realised sale figure. OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) 8. sales and/or auction of equipment suitable for resale Transfer of equipment deemed unsuitable for resale or transfer to approved charities Indemnification Note: “InTheShed” has been authorised by Health Procurement.CHAPTER 8 – DISPOSAL OF SURPLUS.9 APPENDIX 8-B SCOPE OF ENGAGEMENT (By Third Party Provider) “InTheShed” when engaged for the disposal of surplus equipment may offer the following services: a) b) c) d) e) Storage/warehousing of surplus equipment [temporary and/or long term] Survey of equipment [Serviceability management] Repair of unserviceable equipment Cataloguing of surplus equipment Management of equipment disposal in accordance to agreed Public Health Organisation policies. this includes: • • • • Redistribution to other NSW Health Public Health Organisation Marketing. 22(5/07) . Health Support to utilise the existing “Health Procurement Bulletin Board System” to advertise surpluses identified at each project. NSW 2456 Email:
[email protected] 8 – DISPOSAL OF SURPLUS.net. c) Storage utilising central warehousing will be costed at current commercial rates. destruction of equipment and hazardous waste disposal will be the Public Health Organisation’s expense and will be costed at current commercial rates.au Authority/Agreement The Standing Offer Agreement enables each Public Health Organisation to establish individual agreements with “InTheShed” based on internal requirements but limited to the scope of the above engagement. This agreement should include the following: Scope of the project Service fees – each Public Health Organisation that engages “InTheShed” is to negotiate and agree on service fees/cost structure.O. Notes on fees: a) Estimation of “cubic metres” may not be accurate where department opt to utilise the project as an opportunity to “spring clean” b) Tip fees. 22(5/07) . OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) 8.BOX 16 RED ROCK.10 APPENDIX 8-C ENGAGING INTHESHED ASSET MANAGEMENT P/L “InTheShed” may be engaged by contacting: Phil Clare InTheShed Asset Management P/L Mobile Number 0438 524747 P. If none is listed or attached.11 SUPPLEMENT 1 MANAGEMENT OF SURPLUS EQUIPMENT This agreement is to cover the period ………….Health Service/Public Health Organisation This agreement is governed by the terms of agreement between InTheShed Asset Management Pty Ltd. it denotes that both parties agreed that additional terms and conditions are not required. SIGNED.and …………………… between: InTheShed Asset Management Pty LTD. On behalf of _________________________Public Health Organisation/Health Service Print Name:__________________________________ Date: __/__/__ 22(5/07) . Additional terms & conditions as agreed by both parties are listed below or attached on a separate sheet and signed by both parties.. And ……………………………………………. On behalf of InTheShed Pty Ltd Signature____________________________________ Print Name:__________________________________ Date: __/__/__ SIGNED.CHAPTER 8 – DISPOSAL OF SURPLUS. and the State Contract Control Board. OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) 8. In consideration of the disclosure of Confidential Information.” Upon completion of the Purpose or upon request by the Public Health Organisation the receiving party shall: Return to the Public Health Organisation promptly all documents and materials (and al l copies thereof) containing the Confidential Information and certify in writing to the Public Health Organisation that it has complied with this Agreement. The Public Health Organisation is willing to disclose/expose such information on the basis that the information is protected in the manner set out below. Signed for and on behalf “Intheshed” SIGNATURE NAME [please print] _________________________ TITLE TI _________________________ WITNESS-SIGNATURE _________________________ WITNESS -NAME (print) DATE ___/___/___ 22(5/07) 1 Original document provided by Central Coast Health .CHAPTER 8 – DISPOSAL OF SURPLUS. 2. The "Purpose" shall include all discussions between the Public Health Organisation and “Inthe shed” in connection with the Purpose shown above. Signed for and on behalf of the NSW Health Public Health Organisation SIGNATURE NAME [please print] _________________________ TLE (B) 1. "Confidential Information" sh all mean all information disclosed/exposed b y the Public Health Organisatio n t o “Intheshed” in connection with the Purpose. Definitions In this Agreement the following expressions shall have the following meanings: The “Public Health Organisation” refers to the NSW Health Service/Organisation as identif ied in the first part of this agreement. OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) 8.12 SUPPLEMENT 2 NON-DISCLOSURE AGREEMENT1 THIS AGREEMENT IS BETWEEN _________________________________ AND Intheshed Asset Management P/L (“Intheshed”) IT IS AGREED AS FOLLOWS: (A) Whilst “Intheshed” is in the process of managing surplus equipment in accordance to the agreement with the Public Health Organisation. 3. intheshed Australia Pty Ltd undertakes in relation to Confidential Information received from the Public Health Organisation or from a third party on behalf of the Health Service: “To treat the Confidential Information in confidence and to use only for the purpose defined above and in particular not to use the Confidential Information for any commercial purpose. whether before or after the date of this Agreement. which is designated by the Public Health Organisation as confidential. certain information of a confidential nature may need to be disclos ed or exposed in order that “Inthes hed” may use such information to complete the scope of the agreement. sell and transfer equipment to other Public Health Organisations subject to an agreement being established/ negotiations being conducted by “InTheShed” for and on behalf of the abovementioned Public Health Organisation. transfer or sale of equipment is to benefit both organisations. in accordance with the requirements as stipulated in the NSW Health Purchasing & Supply Manual section 8. Authorised PHO Representative Name: ___ _______________________ Position: ________________________ Signature: _______________________ Date: ___ / ___ / ____ PHO Contact for this engagement: _______________________ Phone:________________ E-Mail:_____________________________________________ “InTheShed” Contact for this engagement:___________________ Phone:________________ E-Mail: _____________________________________________ 22(5/07) .13 SUPPLEMENT 3 AUTHORISATION This is to confirm that InTheShed Asset Management Pty Ltd [InTheShed] has been engaged by the ________________________________________________Health Service/Public Health Organisation for the disposal of surplus.6 Chapter 8 and in accordance to the Standing Offer Agreement between the State Contract Control Board and “InTheShed”. This engagement authorises “InTheShed” specifically its authorised representatives to redistribute. It is understood that redistribution. obsolete and unserviceable equipment.CHAPTER 8 – DISPOSAL OF SURPLUS. OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) 8. 22(5/07) .m. The highest. will not necessarily be accepted. SIGNATURE……………………………………………………………(PLEASE PRINT NAME) ADDRESS………………………………………………………………………………………………..30 a. or any offer. TELEPHONE NO………………………………………………………………………………………. are invited for the purchase and removal with all faults of any of the undermentioned items. For CHIEF EXECUTIVE Quantity Description Price Offered DATED THIS………………………………………………………………………………… DAY OF ………………………………………………………………………………………………….14 SUPPLEMENT 4 Sample Letter Seeking Quote RFQ No. For further information: Telephone No.20…….___________________________________________________________________________ Hospital:_____________________________________________________________________________ Offers closing at the above address not later than 9. OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) 8. Inspection of the undermentioned may be arranged between the hours of________________________ The submission of an offer will be taken as conclusive evidence that the tenderer has inspected the item/s.CHAPTER 8 – DISPOSAL OF SURPLUS.. 8. The price quoted includes both purchase and removal of items with all faults. and it is to be noted that the vendor will not be responsible for any defect. 22(5/07) . OBSOLETE AND UNSERVICEABLE STORES (EXCLUDING MOTOR VEHICLES) Sample Letter Accepting Quote Dear Sir/Madam. An official receipt will be issued when payment is made and this will be the only authority recognised to enable collection of the goods. prior to the removal of goods. if any.15 Your offer has been accepted for the purchase of goods set out hereunder. Payment must be made as shown below. Yours faithfully. Private cheques will not be accepted. for CHIEF EXECUTIVE GOODS ACCEPTED PRICE LOCATION PAYMENT TO BE MADE TO: ADDRESS: MEANS OF PAYMENT: Cash or Bank Cheque.CHAPTER 8 – DISPOSAL OF SURPLUS. The goods must be collected within fourteen days of the date of this letter. ................................................................................................. 9... Government Telecommunications Policy.7 21(1/06) ..................................7 Telecommunications Infrastructure Ownership..6 G.......................... 9. Points of Contact ..............4 E............ 9....... 9................................... Telecommunications Infrastructure and Asset Commercialisation .....2 C..... 9............. Benefit to the Government.......... Mobile Telephone and Other Contracted Services ...1 B............................................................. 9............................. 9.GUIDELINES FOR THE ADMINISTRATION OF NSW GOVERNMENT TELECOMMUNICATIONS A...................................................... The Government Radio Network............... 9.........................4 D.....TABLE OF CONTENTS CHAPTER 9 ... Provision of Telephone and Data Telecommunications Services to Agencies..6 F....................................................... eligible service providers. The Telecommunications Unit will co-ordinate the progressive transfer of existing Agency contracts to BT and monitor their administration. Where a new telephone or data service or a service determined by the TCU to be an equivalent service.CHAPTER 9 . radio and other telecommunications services which will provide it with direct savings of more than $280 million over the next ten years. the Government has entered into contracts for telephone. (ii) (iii) 21(1/06) . To ensure the orderly administration of these contracts and to meet the Government’s Strategic Partnership Agreement contractual obligations with Telecom and to rationalise billing and ordering. including departments. A. To ensure these benefits are realised. Provision of Telephone and Data Telecommunications Services to Agencies In November 1992 the Government executed a whole-of-Government ten year Telephone and Data Network (“TDN”) Agreement with BT Australasia Ltd (“BT”). Optus. This agreement requires BT to establish the TDN and to be the provider of telephone and data services to the Agencies. The establishment of the TDN and the connection of Agency sites to the TDN will involve a rearrangement of each Agency’s telecommunications service contracts. Accordingly: (i) Each Agency shall use the TDN for telephone and data services in accordance with the TDN Agreement and shall (if H has not already done so) enter into an Agency Service Agreement with BT within two weeks of receipt of these guidelines. then an Agency shall use that service in preference to that offered by any other provider.GUIDELINES FOR THE ADMINISTRATION OF NSW GOVERNMENT TELECOMMUNICATIONS 9. 93/45) As part of the Government’s telecommunication strategy. electricity county councils and all other public and proclaimed authorities including any state-owned corporation (“Agencies”). data services. statutory bodies representing the Crown. leased lines and bearers) without the prior approval of the Telecommunications Unit. satellite services. data. is provided by BT in accordance with the TDN Agreement.1 GUIDELINES FOR THE ADMINISTRATION OF NSW GOVERNMENT TELECOMMUNICATIONS (Premier’s Memo. These contracts are administered by the Commercial Services Group’s Telecommunications Unit (the “Telecommunications Unit”). BT shall progressively take over the administration of these contracts for each agency site. intelligent network. administrative offices. resellers or any other licensed carriers for telecommunications services (being typically telephony. the following guidelines apply to all NSW Government agencies. Agencies shall not enter into or renew or extend any existing contracts with Telecom. In addition the Government’s strategic initiatives will gain major state development and industry benefits valued at over $2 billion. 2 Therefore. must (within two months of establishment) enter into an Agency Service Agreement with BT. OrangePenrith and Muswellbrook-Newcastle population corridors.CHAPTER 9 . Agencies shall within 60 days of receiving notice from the Telecommunications Unit provide to BT all carrier and related contracts for the telecommunications services specified in the notice. An agency shall not participate in any pre-selection ballot by Austel for mobile or other basic carriage services. Agencies shall ensure that the telecommunications interface of any customer switching systems (including customer premises equipment and networks) such as: • • • • • • • PABXs local area networks network terminating units modems multiplexers voice compression devices encryption devices for which they are responsible or which is on their premises is compatible and capable of inter-working with the TDN and is compliant with all Australian and international standards as required by Australian law.and the Queanbeyan-Camden. All ballot responses by Agencies will be co-ordinated by the Telecommunications Unit. The GRN is capable of supporting both mobile and other radio applications and may be expanded to cover additional areas. the Agency must inform the consultant or contractor of these guidelines and ensure that any subsequent implementation of that external advice is consistent with the Government’s strategies and contractual obligations for telephone and data telecommunications as notified to the Agency by these guidelines or by the Telecommunications Unit from time to time. 21(1/06) . depending on Agency requirements and capital funds availability. (viii) (ix) B. Each Agency shall use its best endeavours to connect to the TDN without any undue delay. (vii) The Telecommunications Unit will issue TDN technical interface and operational guidelines from time to time and each Agency shall ensure that all Agency equipment acquired thereafter meets the specifications set out in those guidelines.GUIDELINES FOR THE ADMINISTRATION OF NSW GOVERNMENT TELECOMMUNICATIONS 9. BT will take responsibility for administration and payment of and Agency billing for those contracts immediately it accepts them. to effect the overall co-ordination of each Agency’s telephone and data communications. however established or incorporated. The Government Radio Network In February 1993 the Government entered into an agreement with Telecom for the installation and operation of a Government owned radio communications network (“GRN”) to cover the greater Newcastle/Sydney/Wollongong region . (iv) (v) (vi) Any new Agency. Where an Agency appoints an external telecommunications consultant or contractor to consult on or to establish or install the Agency’s telecommunications requirements. supervise the structure and efficiency of radio networks used (or to be used by Agencies.CHAPTER 9 . b) c) (ii) Agencies shall ensure that any customer switching systems (including customer premise equipment. The Joint Management Board (which includes representatives from the major user agencies) will work closely with the New South Wales Government Telecommunications Authority and the Telecommunications Unit to: (i) (ii) (iii) administer the GRN’s infrastructure. networks or devices) such as: • • • • • • radio transceivers computer aided despatchers data terminating equipment meter monitors encryption devices radio base stations and repeaters for which they are responsible or which are on their premises and which are required for or will be used in radio applications. the Agency shall use its best endeavours to connect to the GRN without undue delay and in accordance with Agency migration plans. any Agency radio network technical or commercial matters should be referred to the Joint Management Board. Accordingly: (i) where any Agency wishes to use radio services within the area of the GRN then: a) the Agency shall use the GRN for radio applications (both mobile and nonmobile) and shall enter into an Agency Service Agreement for the provision of radio network services and products with Telecom or such other suppliers or operators as notified to the Agency by the Telecommunications Unit.3 A Joint Management Board has been established to oversee the operation of the GRN. (iv) 21(1/06) . Agencies shall not enter into any contracts or renew or extend any existing contracts for radio network services without the prior approval of the Telecommunications Unit. (iii) The Telecommunications Unit will issue technical interfaces and operational guidelines for the GRN from time to time and each Agency shall ensure that Agency equipment acquired thereafter meets the specifications set out in those guidelines. ensure no unnecessary duplication of radio systems. are compatible and capable of inter-working with the GRN and comply with all Australian (such as Austel) and international standards as required by Australian law.GUIDELINES FOR THE ADMINISTRATION OF NSW GOVERNMENT TELECOMMUNICATIONS 9. Vodafone. but excluding customer premise equipment maintenance) The Government regularly reviews and allocates its cellular telephone and other telecommunications network services to achieve cost savings and to encourage and stimulate the telecommunications industry in New South Wales.GUIDELINES FOR THE ADMINISTRATION OF NSW GOVERNMENT TELECOMMUNICATIONS 9. Telecommunications Infrastructure and Telecommunications Asset Commercialisation The objectives of the New South Wales Government Telecommunications Authority (Section 4 of the Government Telecommunications Act 1991 (NSW)) (the “Act”) are as follows: (i) to integrate the various telecommunications networks of Agencies and to provide for the common carriage of Agencies’ communications (the “Integrated Telecommunications Network”). (ii) D. Optus. Mobile Telephone and Other Contracted Services (including cellular telephone and paging networks. other eligible service providers. Any new Agency. the Telecommunications Unit will review annually the Government’s contracts with Telecom. As part of this process. must (within two months of establishment) enter into an Agency Service Agreement which has been notified under i) above. enter into an Agency Service Agreement for the provision of cellular telephone and other services with the suppliers or operators as notified to the Agencies by the Telecommunications Unit. These guidelines apply to the Government’s general radio requirements and are not intended to apply to microwave bearer systems.CHAPTER 9 . however established or incorporated. Agencies shall not enter into or renew or extend any existing contracts with these or any other organisations for such services without the prior approval of the Telecommunications Unit Accordingly: (i) On receiving notice from the Telecommunications Unit and subject to any existing contractual arrangements. within two months of that receipt.4 (v) Where an Agency appoints an external radio network consultant or contractor to consult on or establish or install the Agency’s radio network requirements. to establish a New South Wales Government Telecommunications Authority (the “Authority”) and to vest in that Authority as agent for the Government the Integrated Telecommunications Network and its control and management. (vi) C. all Agencies shall. resellers and other organisations for cellular telephone and other services. the Agency must inform the consultant or contractor of these guidelines and ensure that any subsequent implementation of that external advice is consistent with the Government’s strategies and contractual obligations for the GRN as notified to the Agency by these guidelines or by the Telecommunications Unit from time to time. relationships with commercial broadcasters or scientific or research applications. (ii) 21(1/06) . and in accordance with Section 24 of the Act.CHAPTER 9 . ensures that the proposed project complies with the relevant Commonwealth and NSW Government Telecommunications Acts. and (c) whether it is able to share the capital cost of the proposal with another Agency (including the Authority). at a cost greater than $20. GRN and Government cellular telephone service arrangements.5 (iii) (iv) (v) to enable the Government (through the Authority) to operate and maintain the Integrated Telecommunications Network in an efficient and economical manner.GUIDELINES FOR THE ADMINISTRATION OF NSW GOVERNMENT TELECOMMUNICATIONS 9. lease or rent those services and the Agency shall provide complete details of any such proposal prior to the commencement of contractual negotiations (refer to Sections 49 to 54 of the Act). and demonstrates that the Agency has evaluated: (a) the extent of Government telecommunications network services available to it in connection with its proposal and the possibility of using those services. Those costings must be sustained and supported by either quotation/ tender or expert consultant assessment. The Agency shall provide a statement of the standards applied by it to assess that compatibility and capability. leasing or renting those services). each Agency shall inform the Authority of its intention to sell. equipment. provides comprehensive network details (including location information). Government cellular telephone or any other telecommunications service arrangements which may arise from time to time cannot support the Agency’s requirements. the Authority requires that the Agency’s submission seeking the Minister’s approval to proceed with that proposal: (i) demonstrates that the TDN. Australian (Austel or Standards Australia) and/or international.000 (or in the case of a radio or microwave network. (b) whether it is able to use telecommunications infrastructure controlled by another Agency.000). Austel’s regulations and requirements and such other regulatory standards as notified to the Agency by these guidelines or by the Telecommunications Unit from time to time. where appropriate. ensures that the proposed telecommunications systems. Regulations. renew or extend a telephone or data service network at a cost greater than $500. to enable Agencies to obtain the best possible commercial advantage from any infrastructure or facilities of the Integrated Telecommunications Network required by operators of the public telecommunications networks and other licensees. networks and infrastructure are compatible and capable of inter-working with the TDN. GRN. provides total costing details based on Australian Accounting Standards Principles and Practices and Treasury requirements or any other requirements as notified by these guidelines or by the Telecommunications Unit from time to time. 21(1/06) (ii) (iii) (iv) (v) (v) . Subject to Section 23 of the Act. where an Agency intends to establish. Directives and Directions. To ensure overall co-ordination of the commercialisation of the Government’s telecommunications network services (whether through an Agency selling. to enable the best commercial advantage to be obtained from any excess capacity of the Integrated Telecommunications Network. liaising with telecommunications standards organisations including Standards Australia. telephone. Government Telecommunications Policy (Regulatory and Radio Spectrum) The Telecommunications Unit is also responsible for representing the following aspects of telecommunications on behalf of the Government: liaising with the Commonwealth Department of Transport and Communications. legal and general radio matters: Mr Robert Wheeler Director Commercial Operations. data and radio network matters: Mr Gary Donald Director Telecommunications Unit (Commercial Services Group) Level 11 1 Francis Street Darlinghurst. Agencies wishing to make representations. Telecommunications Unit Telephone: (02) 339 7759 21(1/06) . liaising with Austel regarding regulatory matters and technical standards.CHAPTER 9 . E. liaising with the Spectrum Management Authority regarding radio spectrum licensing and other radio telecommunications regulatory matters. regulatory matters and strategy issues relating (but not limited) to infrastructure. application or submission. The Telecommunications Unit. applications and other submissions to the above organisations shall consult with the Telecommunications Unit prior to making any such representation. 2010 New South Wales Telephone: (02) 339 7701 (ii) For technical and engineering enquiries: Mr Stephen Smith Director Engineering.GUIDELINES FOR THE ADMINISTRATION OF NSW GOVERNMENT TELECOMMUNICATIONS 9.6 Copies of the Act are available from the NSW Government Information Service. liaising with organisations representing the telecommunications industry including the Australian Telecommunications User Group and Radio Communications Consultative Council. Telecommunications Unit Telephone: (02) 339 7771 (iii) For Joint Management Board commercial. F. Joint Management Board and the New South Wales Telecommunications Authority points of contact are as follows: (i) For telecommunications policy. pits and pillars unless a Transfer of Ownership has been negotiated. Under Section 90 and 91 of the Telecommunications Act 1991. only Telecom staff are authorised to carry out work within them.CHAPTER 9 . This agreement sets out the extent and limitations of Telecom’s responsibility for the servicing of the properties occupants. and places access to cable infrastructure on a landlord/tenant basis. The cost of transfer is individually negotiated on a site by site basis. Consequently if any member of staff. Benefit to the Government The initiatives outlined in these guidelines and your efforts in ensuring the co-operation of your Agency will contribute to the New South Wales Government achieving the savings and state development benefits provided for in the Government’s telecommunications contracts. Large complexes. A Deregulation of Customer Cabling took place on 1 January 1989. (Note: These guidelines replace previous Directives 90-66 and 91-22. or a third party contractor interferes with this cable plant. At that time ownership of all cables within buildings beyond the Network Boundary (Main Distribution Frame or first socket) passed to the property owner. has brought to the Department’s attention the problems of infrastructure ownership and internal cable installations within the hospital campus. It does not matter that the infrastructure was paid for in a commercial agreement or that the sites are paying maintenance on the cable plant.7 (iv) New South Wales Government Telecommunications Authority: Mr Gary Donald Level 11 1 Francis Street Darlinghurst. 2010 New South Wales Telephone: (02) 339 7771 Facsimile: (02) 339 7700 G. 21(1/06) . such as hospitals. is a different matter. Whilst Telecom retains ownership of these external facilities. It is therefore essential that the Transfer of Ownership agreement be formally completed for each of the hospital sites in the Area/District. External cabling on private property. installed after 1/1/89). then that person is liable to prosecution under Section 95 of the Telecommunications Act 1991.e.GUIDELINES FOR THE ADMINISTRATION OF NSW GOVERNMENT TELECOMMUNICATIONS 9. Telecom continues to own these cables and the associated ducts.) TELECOMMUNICATIONS INFRASTRUCTURE OWNERSHIP A recent discussion with Austel. The cost of transfer is generally a token amount. installed prior to 1 January 1989. the Australian Telecommunications Authority. may have a number of separate properties and each of these sites may need a separate transfer agreement. even though some cables may be owned by the site (i.