For the first time in NSW, local workers and businesses will be prioritised for Government tenders, under the Local Jobs First Commission legislation being introduced this week by the Minns Labor Government.
The reform puts three priorities at the centre of every government purchase: locally produced goods and services, local jobs and skills, and support for local small and medium sized businesses.
It is the most significant reform to NSW Government procurement in a generation, and realises an important election commitment.
The Bill has been developed following extensive consultation with unions, businesses and industry groups, which showed strong, broad-based support for reform. During the consultation period, more than half of respondents were small and medium businesses, reflecting the demand for a more level playing field.
The Bill delivers on those priorities by:
- introducing a Local Procurement Policy, prioritising local workers and businesses with a 30 per cent tender weighting for local jobs and skills, local content, and small and medium business participation,
- embedding training requirements for apprentices and workers learning new skills on major Government projects, helping to re-build the state's skills base,
- establishing a Local Jobs First Advisory Board to inform policy that will boost local supplier competitiveness,
- requiring Local Procurement Plans for major contracts to lock in commitments to local jobs and local content, and
- establishing a Local Jobs First Commissioner to champion and monitor local content, local jobs and skills and small and medium business participation across government procurement.
The Bill will also enable a supplier debarment scheme to remove suppliers found to have committed serious misconduct from the government supply chain.
The debarment scheme responds directly to the Independent Commission Against Corruption's Operation Hector report. It will protect honest businesses and ensure public money is spent responsibly and with integrity.
The Bill builds on reforms already established by the Minns Labor Government, including the 'If not, why not' rules requiring agencies to actively consider NSW-based suppliers for major procurements, and changes to make it easier for small and medium businesses to work with government through simpler processes, higher direct engagement thresholds, faster payment times and improved access to opportunities through the buy NSW platform.
The Minns Labor Government has also made progress in supporting local jobs and businesses across NSW, including committing to build the Tangara replacement trains in NSW, with at least 50% local content, and purchasing hundreds of much-needed new buses from local suppliers, after the previous Government failed to procure any in their final two years in office.
With the significant economic pressures facing families, households and businesses, the Local Jobs First Bill is a critical opportunity to activate new support and investment.
With wide stakeholder support from unions, industry groups and small businesses. the Government is calling on the Parliament to consider and debate the Bill without delay.
Minister for Domestic Manufacturing and Government Procurement, Courtney Houssos said:
"This Bill delivers on an important election commitment, putting local businesses, local workers and local communities at the centre of how government spends its valuable procurement dollars.
"We are backing local industry, supporting small businesses, strengthening local supply chains and building workforce capability.
"This is a significant reform, made even more important in a time of global economic uncertainty.
"We have consulted widely on this Bill. It is clear there is a strong level of agreement between unions, business and industry on these important measures.
"Local businesses that invest here deserve the opportunity to compete for government work on fair terms."
Secretary of Unions NSW, Mark Morey said:
"This Bill moves to put local workers and communities at the front of the queue when government contracts are awarded and that is an important turning point. It means when the government spends a dollar, it is more likely to circulate in our suburbs and towns rather than being siphoned offshore.
"It's also an important investment in young workers. The Government spends billions of dollars a year and now more of that will be directed to training the next generation of carpenters, plumbers, fitters, engineers and electricians.
"Workers in manufacturing have watched jobs disappear when contracts went offshore. The Local Jobs First Commission is the mechanism to turn that around, by making local content, local skills and local jobs a condition of winning government work. We urge the Parliament to pass the Bill without delay."
Business NSW CEO Daniel Hunter said:
"Small and medium businesses should have better access to government contracts. This bill is a positive step toward lifting local procurement ambition by prioritising local businesses via better tender weightings and targets.
"It is critical that we make it easier for local suppliers, particularly SMEs, to participate and compete. That means cutting red tape, reducing the time and cost of bidding, and focusing on the real barriers our members consistently raise.
"Done right, these reforms will open more doors for local businesses and ensure taxpayer dollars deliver stronger outcomes for the NSW economy."
