VGPB Conduct of Commercial Engagements Policy
Context
The Victorian Government seeks to observe high ethical standards and conduct in commercial engagements. Government and public officials must be able to demonstrate high levels of integrity in processes while pursuing value-for-money outcomes for the Victorian Government and meeting the public interest.
Key Requirements
Commercial engagements by departments(1) for procuring goods and services must be consistent with the following process requirements:
1. General requirements
Government’s commercial engagements usually involve a bidding process, resulting in successful and unsuccessful bidders. Engagement processes are governed by laws as well as by State policies. In carrying out such processes, Government and public officials must abide by the Public Administration Act 2004, other relevant State and Commonwealth legislation, the Code of Conduct for Victorian Public Sector Employees, Victorian Government Purchasing Board (VGPB) policies and other applicable Victorian Government and statutory directions. Public officials should also be mindful of relevant Victorian Government and Department of Treasury and Finance (DTF) guidelines and standards, including any companion guidelines to this policy.
DTF has developed a general procurement conduct plan that may be used by departmental officers, with or without changes. The responsible departmental officer must determine whether the complexities and risks of a particular process require a different, engagement-specific procurement conduct plan. In any case, a specific procurement conduct plan is required for any transaction worth $10 million or more.
2. Integrity and impartiality
Consistent with the public sector values in the Public Administration Act 2004, public officials need to treat bids and potential bidders in a fair and even handed way, providing bidders with the same information and avoiding preferential treatment, consistent with the approved procurement process and tender evaluation criteria.
3. Effective competition
Consistent with government procurement policy, the procurement process should optimise effective competitive tension to maximise value-for-money opportunities for government.
In the event that the responsible departmental officer has the reasonable expectation, in accordance with the published selection process, that a bid has no likelihood of being successful, it is not necessary for that bid to continue to be engaged in the competitive process.
4. The procurement process
The procurement process for a commercial engagement should be considered and settled before the competitive process starts. The strategy and planning for the procurement process must be commensurate with the level of risk to government arising from the engagement. Where relevant, documentation for the procurement process should address how the following are dealt with:
(i) the tender strategy
- stages of tender
- tender documentation
- consideration of the market’s capability and capacity to respond
- completeness, security and confidentiality of information and documentation
- declaration and management of conflicts of interest
- communication processes during the engagement process
- any process audit requirements and the requirement to appoint a probity adviser
- where required by the responsible departmental officer or by this policy, development of a project specific procurement conduct plan
- variations to process, including changes made in the scope of the purchase
- conditions of the tender, including the tender evaluation criteria and defining how late and non conforming bids may be managed
5. Consistency and transparency of process
Each commercial engagement must be conducted in a transparent and fair manner, consistent with a documented selection process to be made available to all potential bidders. While the responsible departmental officer may make changes to the documented process, and the terms and conditions of tender documentation may provide for such changes, any changes or variations to the process must be made in a way which:
- is not likely to provide (or be perceived to provide) corrupt or non-meritorious preference to any bidder; and
- is cognisant (and is seen to be cognisant) of the need to minimise unwarranted additional costs for a bidder.
6. Security and confidentiality
Where relevant, the department should specify a process for both government and the private sector for receiving and managing information. The process should ensure the security and confidentiality of intellectual property and proprietary information, to the extent allowed by law and government policy.
7. Identification and resolution of conflicts of interest
The department must ensure that processes are adopted to identify, declare and address any actual or perceived conflict of interest throughout a process.
8. Accountability
The Accountable Officer (or delegate) must ensure that an officer is appointed with direct accountability for ensuring that the policy is adhered to. Further, where relevant, the department may identify a responsible departmental officer to make project-specific decisions in relation to this policy.
The procurement team for a procurement project will have responsibility for ensuring that government requirements for probity outcomes are met.
9. Use of probity practitioners
Where the risk and complexity associated with a procurement process is considered high, the responsible departmental officer has the option of appointing a designated probity auditor and/or probity adviser to provide one or more of the following:
- independent assessment and/or advice throughout the procurement process as to whether processes are:
- (i) developed according to relevant government policies (including this policy) and State and Commonwealth legislation;
(ii) managed according to the procurement process and the procurement conduct plan; and
(iii) completed according to the tender requirements.
- ongoing independent advice on probity issues; and
- an independent and appropriate sign-off, at designated milestones in the process, on probity requirements.
Where the procurement process is very large and/or involves highly complex risks, the responsible departmental officer may consider it necessary to engage more than one probity practitioner to either ensure an adequate breadth of probity experience or to undertake different roles.
10. Training
The Victorian Government seeks to observe high ethical standards and conduct in its commercial engagements. Government and public officers must be able to demonstrate high levels of integrity in processes while pursuing value-for-money outcomes for the Victorian government and meeting the public interest.
Other Requirements
Nil
Related VGPB Policy and DTF Guidelines
Conduct of Commercial Engagements (449 KB DOC)
Related DTF Templates and Forms
Procurement Conduct Plan (Low complexity) Template (301 KB DOC)
Procurement Conduct Plan (High complexity) Template (230 KB DOC)
Probity Risk Assessment Tool (77 KB XLS)
Confidentiality Deed Poll Template (50 KB DOC)
Conflict of Interest Declaration (Public Officials) Template (64 KB DOC)
Conflict of Interest Declaration (Non Public Officials) Template (74 KB DOC)
Probity Report Template (33 KB DOC)
Links to relevant websites
Nil
Version Control Information
 Version Number | 1 |
Release Date | September 2005 |
Further Information | Strategy and Policy, Government Services Division, Department of Treasury and Finance |
Phone | (+613) 868 32944 |
| vgpb@dtf.vic.gov.au |
