Government e-procurement gets go-ahead

State Services Minister Trevor Mallard announced today that GoProcure, the whole-of-government e-procurement system, will go live in early 2003, at an estimated annual cost saving to government agencies of at least $6.5 million.

Government departments, and many Crown entities, will use GoProcure to buy goods and services from on-line catalogues with orders being automatically sent to suppliers.

Trevor Mallard says GoProcure will mean suppliers will find it easier and cheaper to deal with government.

“Only one catalogue needs to be maintained, and only one interface established, to sell electronically to all government agencies. That compares to the alternative approach of suppliers building links to many government agencies individually. This will reduce costs for many small and medium-sized businesses.

“Benefits to government agencies will come from automating their procurement processes, and from using GoProcure information to collaborate with other agencies for purchasing. GoProcure will be funded by annual subscriptions paid by departments and many Crown entities,” Trevor Mallard said.

“The State Services Commission’s E-government Unit estimates benefits of at least $6.5 million per annum to government agencies as a result of GoProcure. The annual spend likely through the e-procurement system is about $250 million.”

The GoProcure first phase will run through to October 2003 and is likely to involve five departments and Crown entities. From November 2003 GoProcure will be progressively rolled out to all other departments and large Crown entities.

“GoProcure is a good example of government agencies working collaboratively to achieve whole-of-government efficiency benefits, which will make it easier for business to deal with government,” Trevor Mallard said.

The adoption of e-commerce by Government will encourage New Zealand businesses to go “on-line”, and thus compete for other e-commerce business opportunities in New Zealand and overseas, Trevor Mallard said.

Questions and Answers

What is GoProcure? GoProcure is an online "transaction hub". It holds supplier catalogues and passes transactions electronically between government agencies and suppliers.

smaller agencies will access catalogues and send orders directly through the hub; some agencies will use GoProcure workflow systems for their internal requisitioning processes; and other (mainly large) agencies have their own internal requisitioning systems which they will continue to use, and integrate to the GoProcure hub.

What is the timeframe for the rollout? November 2002 – January 2003: Operational system built February - March 2003: implementation in five first phase agencies April - September 2003: first phase operations in those five agencies November 2003: start of progressive rollout to all departments and large Crown entities

What are the benefits for government agencies from e-procurement? Streamlining the procurement process from order through to payment will reduce process costs. Better procurement information will allow better purchasing decisions, and supports syndicated procurement (where group of agencies come together to improve purchasing power with suppliers and reduce the costs of tendering

What are the benefits to suppliers? Greater visibility of government procurement will lead to more opportunities for a range of businesses to supply to government agencies. The transaction hub allows suppliers to only update catalogues and map electronic transactions to one place in order to deal with many government agencies. Suppliers should also achieve net efficiencies from the automation of their supply processes. What goods will be bought via GoProcure? The system is best suited to a proportion of the spending of departments and agencies. It's unlikely that specialised services, like consultancy for example, can be bought on-line, or that large capital items will be bought on-line. But it could be used for office supplies or furniture, for example.

More information about the e-government programme, including The Request For Proposal documentation is available at http://www.e-government.govt.nz

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