Context
Introduction
The policy provides guidance for Victorian government departments on how to embed environmental considerations into procurement decisions for goods and services consistent with the purchasing principles outlined in the Victorian Government Purchasing Board Procurement Policies, namely value for money, open and fair competition, accountability, risk management, probity and transparency.
Other government agencies are encouraged to incorporate environmental sustainability into their procurement processes for goods and services in line with the Framework.
The development of the Environmental Procurement Framework will comprise the following components:
Procurement Policy and Principles – the policy statement provides overarching direction to the framework and includes principles that provide high level direction for implementing policy.
Procurement Guidelines – the guidelines provide detail to assist in the implementation of the principles.
Tools – a series of tools and reference materials to be developed that support the guidelines.
Policy Statement
The Victorian Government seeks to purchase goods and services that are aligned with the objectives of environmental sustainability.
Policy Principles
1. Environmental Procurement is a Consideration
Principle 1: Departments are to purchase goods and services that have reduced impacts on the environment compared with competing products and services that achieve the same function and value for money outcomes.
Departments are required to consider environmental impacts and opportunities during the procurement process with attention given to the early stages of the procurement process when defining business needs, market analysis, tender and quotation strategy, leading to market engagement.
Related Links:
- Environmental Purchasing Guideline - Environmental Purchasing is a Consideration (117 KB DOC)
- Strategic Sourcing Policy
- Strategic Procurement Planning (SPP) Policy
2. Department Responsibilities
Principle 2: Departments are responsible for addressing environmental procurement considerations and reporting on implementation.
Departments are responsible for developing their approach to environmental procurement. Departments may be required to report on their environmental related actions through reporting systems established by Government resulting from the implementation of Victoria's Environmental Sustainability Framework.
Related Links:
3. Assessing Risk and Influence in Defining Environmental Procurement Priorities
Principle 3: Departments should define their environmental procurement priorities based on an assessment of environmental risk and their ability to influence environmental outcomes.
Different goods and services have different environmental impacts and opportunities associated with them. The approach to environmental procurement should be scaled based on an assessment of the level of adverse environmental impact (risk) and an assessment of the department’s ability to effect environmental outcomes (influence), including the capacity of suppliers to respond to the department’s functional requirements on a value for money basis. Where the market is limited in its environmental capacity, where appropriate, departments may wish to cooperate with businesses to develop the market.
Related Links:
4. Value for Money
Principle 4: Departments are to purchase based on the principle of Value for Money and should therefore consider the total cost of ownership in meeting the department’s business needs and procurement budgets.
Value for money is a foundation principle that underpins Victorian Government procurement. Value for money is the optimum combination of quality, quantity, risk, timeliness and cost for government on a whole-of-life basis.
A procurement specification and the evaluation of tenders or quotations is to proceed on a total cost of ownership basis where the environmental values are considered alongside other matters related to acquisition, operation, maintenance, disposal and retirement.
Related Links:
5. Environmental Specifications
Principle 5: Departments should consider where appropriate the inclusion of minimum environmental requirements in specifications.
The outcome of the value for money consideration may support the inclusion of environmental requirements in the request for tender or quotation. These can be presented as mandatory criteria only if the department is confident that the market is able to meet the requirements in line with the department’s value for money analysis.
Alternatively, the environmental requirements can be noted as desirable criteria or suppliers can be required to provide information about their current environmental management practices.
Mandatory criteria must be based on identifiable technical standards or quantifiable data. Alternatively minimum environmental requirements can be defined in relation to the impact of the good or service on the environment.
Government can mandate minimum environmental requirements to be included in procurement of specific goods or services.
Related Links:
6. Environmental Evaluation Criteria
Principle 6: Departments should consider the inclusion of environmental criteria in the selection of suppliers where appropriate.
Where a department considers it appropriate to include environmental evaluation criteria in the selection process this needs to be published as part of the quotation or tender process.
Environmental requirements can be defined in relation to performance standards, the impact of the good or service on the environment and/or in relation to supplier’s environmental management practices. In setting evaluation criteria, consideration is to be given to alignment with the procurement specifications, VGPB policies and the market’s capacity to respond.
As the environmental procurement framework develops, more standardised evaluation criteria may be developed for specific products and services.
Related Links:
7. Continuous Improvement
Principle 7: Department relationships with suppliers should include the principle of continuous environmental improvement.
Improvements in environmental impact of products or services can be achieved over time as a result of improved mutual understanding of desired outcomes and opportunities between departments and suppliers. Contracts for the purchase of products and services over a multi-year period should include the principle of continuous environmental improvement.
Related Links:
Other Requirements
Nil
Related VGPB Policy and DTF Guidelines
Environmental Procurement Guidelines (117 KB DOC)
Related DTF Templates and Forms
Environmental - Gap (Continuous Improvement) Template (58 KB DOC)
Environmental - Gap (Value for Money) Template (53 KB DOC)
Links to relevant Policy websites
Nil
Version Control Information
 Version Number | 2 |
Release Date | December 2002 |
Further Information | Strategy and Policy, Government Services Division, Department of Treasury and Finance |
Phone | (+613) 868 32944 |
| vgpb@dtf.vic.gov.au |
