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Procurement during a national emergency

Public entities may need to determine whether they can use the “emergency procurement” procedures while New Zealand is at COVID-19 alert level 4 and in a declared state of national emergency.

While a state of emergency has been declared, not all procurement during this period falls under the definition of an “emergency procurement”.

The Ministry of Business, Innovation and Employment’s Guide to Emergency Procurement states:

In a genuine emergency, agencies will need to be flexible in how they procure the goods and services that are required for their response[emphasis added]. Agencies are permitted to forego routine procurement procedures. In adopting a more flexible procurement process, agencies should consider what is reasonable and justifiable given the facts of the circumstances they have to hand.

Agencies are permitted to purchase direct from a supplier if the delay involved in conducting a routine procurement (i.e. which involves advertising and competitive tendering) will prevent them from delivering the goods or services in time to bring relief.

Agencies are to balance the need to act without delay (for example to save or preserve life, or safeguard buildings or repair critical infrastructure) against their overarching public sector obligations (act lawfully, reasonably and with integrity).

It is important that you read the information about emergency procurement on the Ministry’s website.

It’s essential that entities appropriately document any use of the emergency procurement procedures. That documentation needs to include the justification for declaring that the procurement fits the circumstances for the use of these procedures, and authorisation under an appropriate delegated financial authority.

If you have any questions about the application of your organisation’s emergency procurement procedures, please contact us at assurance@auditnz.parliament.nz.

Page created: 27 March 2020

Martin Richardson, Acting Director, Specialist Audit and Assurance Services

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