The NSW Government has delivered on its commitment to boost government procurement of goods and services from small and medium businesses with a major change to government procurement.
A direction has been signed today, increasing the level at which government departments and agencies can purchase goods and services directly from small and medium businesses from $150,000 to $250,000.
The state's 840,000 small businesses make up 98% of all NSW businesses, employing 1.6 million people in NSW - it's these businesses and jobs that will be turbocharged by this change.
Each year, the NSW Government spends over $9 billion on goods and services obtained directly from 46,000 small and medium businesses in NSW and this change to procurement will deliver more government contracts going to these businesses and a bigger slice of government procurement spend.
This Ministerial Direction was issued to the NSW Procurement Board and requires agencies to implement this policy change no later than 31 December 2023.
It also serves as an important signal to government agencies to directly engage small businesses when procuring goods and services, including for:
- catering, food and beverage services at state-owned museums, galleries, venues and sites
- office supplies and furniture for government offices and buildings
- maintenance and repairs, including ground maintenance and landscaping at government facilities
- the development of training resources, including for health and wellness support.
The Government has also eased procurement requirements for small businesses which will no longer be required to submit proof of insurance when they tender. Instead, proof of insurance will only be required when a contract is awarded.
This is in addition to the NSW Government making a number of other significant changes to support small businesses in NSW, including:
- Launched the Service NSW Business Bureau, which will give small business owners a seat at the table with a commitment to tackling unproductive red tape, helping businesses navigate government and boosting growth opportunities.
- Delivered major upgrades to the Service NSW Business Bureau App.
- Successfully delivered Small Business Month with over 600 events across the state.
- Delivered energy bill relief for more than 300,000 businesses and toll relief for more than 700,000 Western Sydney families and businesses.
- Launched the Service NSW Business Grants and Funding Finder, bringing more than 500 grants across 46 agencies into one place, to make accessing financial support easier for businesses across the state.
These changes do not apply to construction businesses.
The NSW Government has extensive fraud and compliance checks in place to maintain the integrity of government procurement.
For more information visit buy.nsw
Premier of NSW Chris Minns said:
"Small businesses are the backbone of the NSW economy and it's only right that the NSW Government use small businesses to deliver goods and services that the state requires.
"The NSW Government purchases around $40 billion worth of goods and services each year. The bigger we can make the slice that goes to small businesses, the better.
Small and medium businesses have been through a very tough time over the past few years, the very least the government should do is make accessing government contracts simpler and easier."
Minister for Domestic Manufacturing and Government Procurement Courtney Houssos said:
"Small businesses already play an important role as they grow the state's economy and sustain local jobs. By growing their opportunities to engage with the Government we can give them an even bigger boost.
"The previous Liberal-National Government never developed a cohesive policy to support local procurement. Instead of buying local, they sent major projects overseas, costing the state billions of dollars and thousands of jobs.
"This is the first step of the Minns Labor Government's planned reforms to support small businesses, local content and domestic manufacturing.
Minister for Small Business Steve Kamper said:
"Small business plays a vital role in the NSW economy through the products and services they offer but also the many thousands of jobs they support.
"By increasing the direct procurement threshold we are providing small businesses with the most valuable resource in business, greater opportunity.
"As a government, we are committed to getting the policy settings right to ensure that NSW can best harness the expertise and agility of local small businesses, while supporting jobs and investing in NSW."
