BENEFITS TO COUNCILS OF LOCAL BUY ARRANGEMENTS

For the last six years the Local Government Association of Queensland (LGAQ) has operated a program called CAPS (Contracts and Purchasing Services) that provided Queensland Local Government the option of using contractual arrangements that had been set up by the LGAQ through a full tendering process. The Local Government Act allows Queensland Local Governments to purchase goods and services through these contracts without having to go through the laborious and costly exercise of calling tenders themselves. It was resolved to transform this CAPS program into an all-encompassing procurement service that is called Local Buy Pty Ltd. The relevant sections of the Local Government Finance Standard and Local Government Act are listed below.

Local Buy provides a number of benefits to councils purchasing through a Local Buy Tendered Arrangement.

1. Exemption from requirement to seek tenders or quotes.
a) Reduced time, effort and expenditure for Councils in not having to call tenders. Quotes, evaluations and appointments.
b) Immediate access to suppliers' products and services.
c) Common terms and conditions
d)Improved efficiencies associated with purchasing and contracting.

2. Best offer/terms provided by suppliers - achieved through the aggregation of purchasing and negotiating power.
3. Supports local industry and business - arrangements created through the local supplier where possible.
4. Reduction in costs for suppliers means a lower cost for products and services through simplified documentation preparation and evaluation process.
5. Contracts designed specifically for Queensland Local Governments' specific needs and requirements including product specifications, local business component, delivery and payment processes.
6. Streamlined purchasing processes.
7. Standardized terms and conditions, product specifications and purchasing procedures.
8. Open competition across a much wider market place.
9. Detailed contract and purchasing information from LGAQNet includes company details, product specifications through to pricing and delivery.
10. Ease of use via LGAQNet. List suppliers locally and statewide.
11. Hard copy of contract supplied by contracted suppliers on request.
12. A completed Contract Access Request Form is not a mandatory requirement for a Council. This is however effective for our auditing purposes. Suppliers on the LGAQNet Local Buy database are obliged to report to Local Buy all transactions to councils through any Local Buy contract.
13.Participation in Better/Best Practice employed through collaboration with Member Councils.

PREFERRED SUPPLIER ARRANGEMENT

This Contract is an LGA arrangement as defined in the Local Government Finance Standard (1994) - ie. 'LGA arrangement' means

(a) an arrangement entered into by -
i the Local Government Association;
ii a company registered under the Corporations Act if the Association is its only shareholder;
(b) that would be a purchasing arrangement if entered into by a local government; and
(c) for which the procedure set out in section 14 1 has been followed by the Association as if it were a local government.

The Finance Standard defines purchasing arrangements as:
(a) a standing offer arrangement; or
(b) a preferred supplier arrangement; or
(c) a register of pre-qualified suppliers.

Accordingly, this contract is a Preferred Supplier Arrangement that Local Buy has established via a public tendering process. The Finance Standard defines preferred supplier arrangements as,

"preferred supplier arrangement" for a local government means an arrangement by the local government with a supplier for the supply of goods or services under agreed pricing conditions for a stated period".

BECAUSE THIS CONTRACT IS ESTABLISHED AS AN LGA ARRANGEMENT, COUNCILS MAY USE IT TO MAKE PURCHASES THAT ARE EXEMPT FROM ANY FURTHER REQUIREMENTS TO SEEK TENDERS OR QUOTES.

The Local Government Act (1993), in Part 3 - Contracts and Tendering, states:

486(1) A local government may enter into a contract without complying with section 484 (When tenders are required) or 485 (When quotations are required) if -
(a) it resolves that it is satisfied that there is only 1 supplier reasonably available to it; or
(b) it resolves that a genuine emergency exists; or
(c) it resolves to obtain second-hand goods; or
(d) it resolves to purchase goods at an auction; or

(e) the contract is made under an exemption to open competition in the Local Government Finance Standards; or
(f) the contract is made with, or under an arrangement with or made by -
i. the State, a government entity, the Brisbane City Council or another local government; or
ii. another Australian government, an entity of another Australian government or a local government of another State or a Territory.
486.(1) (e) refers to Section 11 of the Finance Standard, which states the following;
A contract is made under an exemption to open competition if the contract is entered into

(a) under a standing offer or a preferred supplier arrangement; or
(b) with a supplier from a register of pre-qualified suppliers; or
(c) under an LGA arrangement.