Commonwealth Procurement Rules Explanatory Statement
The Commonwealth Procurement Rules (CPRs) are issued by the Minister for Finance under s105B(1) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act). As per s105B(2) of the PGPA Act, the instrument is not subject to section 42 (disallowance) of the Legislative Instruments Act 2003. This instrument commences on 1 January 2018 and repeals the Commonwealth Procurement Rules (F201L00136).
The updated CPRs incorporate the requirements of Australia’s international trade obligations and government policy in procurement into a set of rules, which apply to Commonwealth procurement. The CPRs apply to procurement conducted by non-corporate Commonwealth entities and certain procurements conducted by prescribed corporate Commonwealth entities as listed in section 30 of the PGPA Act.
Procurement encompasses the whole process of acquiring goods or services. It begins when an agency has identified a need and decided on its procurement requirement. Procurement continues through the processes of risk assessment, seeking and evaluating alternative solutions, the awarding of a contract, the delivery of and payment for goods and services and, where relevant, the ongoing management of the contract and consideration of disposal of goods.
Division 1 of the CPRs contains rules applying to all procurements regardless of their value or whether an exemption applies. Division 2 of CPRs contains additional rules applying to procurements valued at or above the relevant procurement threshold.
The updates to the CPRs reflect Australia’s international obligations on government procurement. This includes necessary changes to provisions on prequalified tender, limited tender and minimum time limits.
The CPRs are supported by guidance available at http://www.finance.gov.au/procurement/.
Consultation
The Minister for Finance approved the updated CPRs.
The Department of Finance consulted with the Department of Foreign Affairs and Trade and the Attorney-General’s Department in relation to international obligations incorporated in the CPRs. All entities subject to the CPRs were consulted on the key change to prequalified tender and the removal of one condition for limited tender.
Overview
The Commonwealth Procurement Rules (CPRs) were enacted in 2018 to provide a unified set of procurement rules for the Commonwealth, ensuring that government procurement practices align with Australia's international trade obligations and government policy. These rules, issued by the Minister for Finance under section 105B(1) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act), apply to non-corporate Commonwealth entities and specific corporate Commonwealth entities as outlined in section 30 of the PGPA Act. The CPRs encompass the entire procurement process, from identifying a need and determining the procurement requirement to the delivery of goods and services and ongoing contract management. The rules are designed to incorporate necessary updates reflecting Australia's international obligations on government procurement, such as modifications to provisions on prequalified tender, limited tender, and minimum time limits. The policy objective is to ensure that procurement processes are efficient, transparent, and consistent with international standards, thereby enhancing the value for money obtained by the Commonwealth.
Scope and Application
The Commonwealth Procurement Rules (CPRs) apply to procurement conducted by non-corporate Commonwealth entities and to certain procurements carried out by prescribed corporate Commonwealth entities as listed in section 30 of the Public Governance, Performance and Accountability Act 2013 (PGPA Act). The CPRs cover the entire procurement process, from identifying a need to the delivery, payment, and ongoing management of goods and services, and the disposal of goods. These rules integrate Australia’s international trade obligations and government procurement policy into a comprehensive regulatory framework. Division 1 of the CPRs sets out rules applicable to all procurements irrespective of their value or whether an exemption applies, while Division 2 outlines additional rules for procurements valued at or above the relevant threshold. The updated CPRs reflect the necessary changes to provisions on prequalified tender, limited tender, and minimum time limits in accordance with Australia's international obligations. The rules are supported by guidance available online, and the Minister for Finance, having approved the updated CPRs, ensured consultation with relevant departments and entities regarding the key changes and the removal of certain conditions for limited tenders.
Key Provisions
The Commonwealth Procurement Rules (CPRs), as detailed in F2017L01634, are governed by section 105B(1) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act) and apply to procurement by non-corporate Commonwealth entities and specified corporate Commonwealth entities. The CPRs were issued by the Minister for Finance and commenced on 1 January 2018, repealing the previous Commonwealth Procurement Rules (F2017L00136). These rules encompass the entire procurement process, from identifying a need to managing and disposing of goods and services. They include rules applicable to all procurements (Division 1) and additional rules for procurements valued at or above certain thresholds (Division 2).
Under the CPRs, all procurements must comply with the rules outlined in Division 1, regardless of value or any applicable exemptions. These rules apply uniformly to all Commonwealth entities subject to the CPRs, ensuring consistency and compliance across all procurement activities. Division 2 introduces additional requirements for procurements that meet or exceed the relevant threshold, such as enhanced transparency and competition measures. The CPRs are designed to align with Australia's international trade obligations and government policy, ensuring that procurement practices are fair, open, and competitive.
Entities subject to the CPRs must adhere to specific obligations and requirements, including adhering to the principles of fairness, openness, and transparency in procurement processes. This involves conducting thorough risk assessments, seeking and evaluating alternative solutions, and ensuring that contracts are awarded fairly and competitively. The rules also mandate the use of prequalified tender and limited tender processes where appropriate, with specific conditions and time limits for these processes. The Department of Finance consulted extensively with relevant departments to ensure the CPRs reflect Australia's international obligations and policy requirements.
Failure to comply with the CPRs can result in significant consequences. While the specific offences, penalties, and consequences are not detailed in the explanatory statement, non-compliance with procurement rules can generally lead to civil or criminal penalties under the PGPA Act. The PGPA Act provides for various sanctions, including fines and imprisonment for serious breaches. The CPRs are supported by additional guidance available on the Department of Finance website, which can assist entities in understanding and complying with the rules. The updated CPRs aim to enhance the integrity and efficiency of Commonwealth procurement processes.