Frequently Asked Questions

1. What is "sustainable procurement"?

Sustainable procurement is technically defined as "a process whereby organisations meet their needs for goods, works and utilities in a way that achieves value for money on a whole of life basis in terms of generating benefits not only to the organisation, but also to society and the economy, whilst minimising damage to the environment".

This means taking into account the environmental, social and economic impacts of the goods and services we purchase.

2. What is the government's Sustainable Government Procurement project?

The Sustainable Government Procurement Project was launched in February 2006 by Prime Minister Helen Clark in conjunction with five other sustainable initiatives: Business Partnerships for Sustainability, Enhanced Eco-verification, Carbon Neutral Public Service, Towards Zero Waste, and the Household Sustainability Programme. For more information about these other initiatives please go to the  Ministry for the Environment website.

The purpose of the Sustainable Government Procurement Project is to make sustainability a core component of government procurement policy and practice. Through sustainable procurement practice, government departments will be encouraged to purchase goods and services that are more water and energy efficient, emit less carbon, produce less waste, and are accredited or environmentally certified where possible.

The Project is led by the Ministry for Economic Development's Government Procurement Development Group (GPDG).

3. How will the Sustainable Government Procurement project make New Zealand more sustainable?

The government is a significant purchaser of goods and services. In some sectors, like ICT, the government is the single largest customer in the domestic market. The total size of the government procurement market is difficult to estimate but OECD averages suggest that procurement in developed economies is typically 10-15 per cent of GDP. On this basis, the value of government procurement in New Zealand would be in the range of $14-20 billion annually.

The Sustainable Government Procurement Project offers a significant opportunity for the government to spend its money in a way that supports sustainable businesses and good environmental practice. It will have a positive effect on the wider market by driving consumer demand, encouraging the supply of innovative, environmentally-friendly goods and services, encouraging the use of cleaner production methods, and improving cost-effectiveness over the lifecycle of goods and services.

4. How is the programme ensuring government departments have sustainable procurement policies in place?

Government departments must now consider the environmental credentials of goods and services they purchase according to new mandated standards, guidelines and targets released in August 2007.

They will help ensure government departments purchase goods and services that are more water and energy efficient, emit less carbon, produce less waste, and are accredited or environmentally certified where possible.

The standards will provide impetus for government departments to improve their sustainable business practice, and, in procuring more environmentally-friendly products, help to drive the market for production of goods with better environmental credentials.

5. What are the new mandates and standards for sustainable procurement?

Government departments' purchase and use of paper and timber products, light fittings, and travel arrangements are considered in the new standards, guidelines and targets released in August 2007. They were compiled by MED with input from and engagement with other government departments.

The new mandated standards, guidelines and targets bring together recommendations by Govt3 – a programme that helps central government agencies become more sustainable – as well as other existing procurement policy.

Highlights include:

• All paper sourced by government departments in future must have a minimum "three-star" rating, which has less impact on the environment than standard paper
• Government departments must not purchase paper and wood products from illegally-logged forests as it poses a serious threat to forests, communities and wildlife
• Government departments must have a workplace travel plan in place by the end of 2010 with the aim of reducing kilometres travelled by 15 per cent, provided that departmental performance is not reduced
• Government departments must only consider purchasing, hiring, or leasing vehicles that have a minimum emissions standard of Euro 4 (or equivalent)
• Energy-efficient lamps should be purchased instead of standard lightbulbs
• Video conferencing and electronic communications should be encouraged.

Further standards and targets for other product categories such as textiles, ICT, cleaning products and buildings will be announced later this year.

For more information on sustainable procurement, or to view the guidelines for government departments, please visit the Procurement website (www.procurement.govt.nz).

6. Who will be expected to follow these new rules?

Public service departments will be the first to adopt the mandated standards, guidelines and targets.

7. By what date do government departments have to comply with the new rules?

The new standards are effective immediately. However, the need for a transition period is recognised to avoid disruption of any procurement already underway. Departments are expected to ensure that all new requests for tenders, requests for proposals, calls for registration of interest, or other similar approaches to the market, specify the new standards and criteria at the outset of procurement in any of the following categories – paper and timber, light fittings and travel.

8. How will government ensure that departments are meeting the standards?

Key performance indicators will be developed to ensure that departments are meeting the standards and putting in place the recommended targets.

They will be supported in this work by the Ministry for Economic Development's Government Procurement Development Group (GPDG) who will provide support, tools and training, and monitor progress. The Govt3 programme will also continue to support departments.

9. What can we expect next from the Sustainable Government Procurement Project?

Additional standards and targets for other product categories such as textiles, ICT, cleaning products and buildings will be announced later this year.

Future deliverables include developing a single procurement policy for all government agencies; rolling out the new mandates, standards and guidelines to the wider state services; encouraging local government participation; setting further sustainability targets for government; and developing carbon costing tools to assist procurement decisions.

To find out more about these deliverables, please see the Cabinet paper Sustainable Business: Government Procurement, Economic Transformation, and Sustainability.

10. Where can I find out more?

You can find out more about the Sustainable Government Procurement Project by visiting www.procurement.govt.nz or by emailing procurement@med.govt.nz.

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