Government agencies are already aware of obligations set out in s176 of the Public Works and Procurement Act 1912.

In addition to legislative compliance, the NSW Procurement Board is also concerned to ensure that government agencies test, on a regular basis, compliance with the Goods and Services Procurement Policy Framework. This concern arises having regard to the very significant expenditure of valuable public funds on procuring goods and services, the level of probity risk traditionally associated with procurement and the new legislative and policy requirements for procurement.

The NSW Procurement Board also has a statutory function to monitor government agency compliance with the requirements of Part 11 of the Public Works and Procurement Act 1912, including Board directions.

The manner in which government agencies do this is a matter for the government agency, having regard to the totality and complexity of its operations and audit arrangements.

To that end, the NSW Procurement Board requests government agencies to:

1. By 31 August 2014, develop an audit plan, overseen by the agency’s Audit and Risk Committee, from which the agency can undertake regular assessment of compliance with the Goods and Services Procurement Policy Framework
2. As part of this plan, identify areas of compliance risk and to report these risks to the Procurement Board for the purposes of informing the further development of NSW procurement policy
3. As part of this plan, develop mechanisms which provides the Procurement Board and the agency head assurance that systems are established to enhance compliance with procurement laws and policies
4. Any other matters considered relevant by the agency insofar as compliance and audit is concerned.

The information is to be provided at least annually from 31 August 2014, or as requested by that Board from time to time.

Agencies accredited under the Accreditation Scheme for Goods and Services will not be required to report under this direction as a separate obligation exists to report annually (by 31 August each year) on compliance with the terms of the agency’s accreditation.

Further detail is set out in the Guidance Note below.

This Direction takes effect from 1 July 2013 until it is withdrawn.