Procurement Reboot Backs Kiwi Business

The Government’s announced changes to procurement rules should give local and small businesses an edge in winning valuable contracts and further boost the economy, BusinessNZ says.

Chief Executive Katherine Rich says government spending and procurement can be a powerful economic lever.

"Each year, government agencies spend more than $50 billion on goods and services. In a country of five million people, where most of our businesses are small to medium-sized enterprises, winning a government contract can make a big difference. That's because the projects tend to be larger, and the impact local contracts can have on our economy is equally as significant.

"For a long time now, BusinessNZ has advocated for procurement rules that emphasise greater economic value to New Zealand, as well as the value provided over the lifetime of a contract, rather than simply a lowest-cost procurement model.

"Starting December, the introduction of an economic benefit test should result in more kiwi bidders winning contracts, and will ensure international companies have considered the wider value they provide to New Zealand as part of the application process.

"If local companies can more easily participate in bigger contracts, either directly or via subcontracting to an international lead supplier, then New Zealand will be growing larger companies, employing more people, paying more tax and potentially having more products to export."

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