- streamlining and simplifying the Rules and making them easier to understand and apply in practice;
- promoting economic growth in New Zealand; and
- increasing the accountability of agencies for their procurement performance.
The proposed changes to the Rules are consistent with the Government’s current focus on public sector delivery and accountability, and commitment to driving economic growth in New Zealand.
The Rules were last updated in October 2019.
Government Procurement Rules (5th) edition – Summary of the key changes
Reduction in the number of rules and otherwise streamlining the Rules
The proposed new edition of the Rules reduces the number of rules from 71 to 47. This reduction has been achieved by removing (and/or merging) rules that duplicate content, repeat statutory or regulatory requirements, have not been applied in practice, or have otherwise been determined by the Government as being “unnecessary”.
The proposed new edition of the Rules also involves a restructuring to the layout of the rules. The previous seven sections have been now consolidated into the following four parts:
| Part One: |  Core values |
| Part Two: |  Procurement lifecycle steps (including planning, approaching the market and awarding the contract) |
| Part Three: |  Procurement System Requirements |
| Part Four: |  General information |
The key objective of the Government with these changes is to streamline and simplify the Rules, and make them easier to understand, navigate and apply in practice.
New economic benefit rule
One of the most significant changes in the proposed new edition of the Rules is the introduction of a new “economic benefit” rule (Rule 8). Rule 8 effectively replaces the concept of “broader outcomes”, which is no longer a feature in the proposed new edition of the Rules.
Rule 8 requires that:
- For contracts above the specified value threshold (being NZ$100,000 for goods and services, and NZ$9 million for construction works) agencies must require that suppliers demonstrate in their tender proposals how they will deliver economic benefits to New Zealand. Rule 8 also goes further to provide that agencies must include as part of their evaluation criteria a minimum 10 per cent weighting for the evaluation of economic benefits. This approach of prescribing the weighting that must be given to a particular evaluation criterion was not included in the previous edition of the Rules and agencies will need to be particularly cognisant of this from a procurement process perspective if Rule 8 is included in the finalised Rules.
- For contracts below the specified value threshold, agencies are expected to award such contracts to New Zealand businesses that are capable and have the capacity to deliver the contract. While this rule is not mandatory, it may have the effect of placing additional process requirements on agencies for lower-value contracts.
Rule 8 also provides a list of the factors that agencies must consider when determining whether the proposal delivers economic benefit to New Zealand. Alongside factors such as employing New Zealand workers, using New Zealand businesses, and developing New Zealand industry capabilities, “the environmental benefit of the proposed solution to New Zealand” as well as the contribution to “positive social and cultural outcomes in New Zealand communities” are also noted as relevant factors that deliver economic benefit.
Rule 8 will create an increased emphasis and requirement for agencies to ensure that their procurement processes deliver demonstratable economic benefits to New Zealand.
Increased accountability
The proposed new edition of the Rules also seeks to increase the accountability of agencies for their procurement performance and the responsible use of public funds. This increased accountability is reflected in a new Rule 3, which explicitly provides that agencies must be accountable for their procurement performance. The theme of accountability is also reflected in other areas of the new edition of the Rules, including a new section of the Rules which explicitly states the potential consequences and accountability measures for agencies if the Rules are not followed.
Other noteworthy changes
Other examples of noteworthy changes in the new edition of the Rules include:
- Increased planning obligations – the existing procurement planning rules have been enhanced, with a now expanded list of factors that agencies must consider as part of their procurement planning process, including economic benefits (Rule 6).
- Increased focus on contract management – new rules have been introduced requiring agencies to create a contract management system and contract management plan (Rules 34 and 35). These new rules require agencies to create a systematic approach to identifying the contracts they hold, and to implement processes for the ongoing monitoring and management of contracts, to ensure contractual commitments are actually delivered.
- New requirement to consult NIFF on infrastructure procurements – a new rule has been introduced requiring that agencies considering the procurement of infrastructure with a total capital value of more than NZ$100 million, where the project may involve private finance (including Public Private Partnerships), must consult with National Infrastructure Funding and Financing early in the development of the project’s business case (Rule 41). This replaces the previous requirement to consult the Infrastructure Commission on infrastructure projects over NZ$50 million.
- New procurement guidelines on market-led proposals – while there has not been a change to the rule in relation to unsolicited unique proposals, the new Market-led proposals guideline released by the Government in November 2024 has been referenced in the new edition of the Rules.
Next steps
Submissions on the proposed new edition of the Rules are now open, and close on Friday 8 April 2025 at 5pm.
Bell Gully’s Government and Procurement Team will be closely monitoring the developments relating to the proposed new edition of the Rules and will provide a further update as more information is available.
If you would like assistance to put together a submission, or if you would like more information about the proposed changes to the Rules, please get in touch with the contacts listed or your usual Bell Gully adviser.