In accordance with the Local Government Act 1989 the City of Melbourne has developed a procurement policy encompassing the principles, processes and procedures applied to the purchase of all goods, services and work by the organisation.
Our procurement policy states that in procuring goods, work and services under a contractual arrangement, we will:
support our corporate strategy, aims and objectives
establish and put in place appropriate performance measures
commit to achieving sustainability objectives
provide effective and efficient commercial arrangements.
The policy uses a sustainable approach to procurement to reduce the social, financial and environmental impact of the procurement cycle. As a result we seek to procure environmentally preferred products and services and to do business with contractors and providers who have similar sustainability objectives and policies.
Whenever practicable and relevant, we give preference to the supply of goods, machinery or material manufactured or produced in Australia or New Zealand, and work collaboratively with suppliers to achieve these objectives.
The organisation has a procurement and corporate contract management system that prescribes best practice methodologies in its contract management and processes and is adhered to at all times.
In 2015–16 we carried out a strategic review of our existing procurement model. The City of Melbourne has always operated with a fully decentralised procurement model, allowing employees across the organisation at various locations the authority to purchase goods and services within a set delegation. A cross-organisational working group came together a year ago to investigate the effectiveness of procurement across the organisation with the aim of achieving the following:
As a result of this review, we rolled out Category Management Model in the organisation in 2015–16. This is a contemporary model, which aligns with best procurement practice to achieve our procurement objectives.
During 2015–16, we processed 71 tenders and awarded 48 service and capital contracts.
Contracts were awarded or extended in the following key service categories (not including miscellaneous one-off services):
For large service contracts with a value greater than $150,000, strategic service reviews are carried out to determine whether or not the service is still required, if it should continue to be contracted out or brought in-house and whether the service meets our sustainability objectives. Note: these reviews do not apply to capital works contracts.
During the year, the City of Melbourne did not enter into any contracts valued at $150,000 or more for services or $200,000 or more for works or more of a kind specified in section 186(5)(a) of the Local Government Act 1989. It also did not enter into any other contracts valued at $150,000 or more for goods or services or $200,000 or more for works without engaging in a competitive process.
The City of Melbourne entered into the following contracts in accordance with section 186(5)(c) of Local Government Act 1989. These contracts were entered into in reliance on Ministerial exemption.