This Direction deals with procurement of human services from non-government organisations (NGOs) by a government agency within the meaning of Public Works and Procurement Act 1912 (“Government Agency"). 

From 1 May 2017, Government Agencies may use the prescribed template NSW Human Services Agreement (Prescribed Template) when procuring human services from NGOs.

From 1 August 2017, the Procurement Board requires all Government Agencies to use the Prescribed Template when procuring human services from NGOs. Agencies will use the Prescribed Template as existing contracts expire.

The Prescribed Template must be utilised for NGOs engaged to deliver human services. It is designed to:

• make it easier for NGOs to do business with NSW government agencies by streamlining contracting arrangements
• promote consistency across NSW government
• be simple, user friendly and fit for purpose
• reflect the partnership needed by NGOs and agencies to deliver better human services outcomes.

In this Direction:

• NGOs means a non-profit organisation that is independent from government. A non-profit organisation is one which ‘is not operating for the profit or gain of its individual members, whether these gains would have been direct or indirect. A non-profit organisation can still make a profit, but this profit must be used to carry out its purposes and must not be distributed to owners, members or other private people’[1].
• Human Services means ‘the programs, facilities or services provided to meet the health, welfare and social needs of individuals, families and communities. This may include, for example, education, health, and community services provided across NSW’ or defined by the Human Services Data Hub Taxonomy.

Exclusions

The Prescribed Template and this Direction do not apply to:

• funding arrangements that are in place before 1 August 2017
• grant funding
• funding arrangements that are transitioning to the National Disability Insurance Scheme
• asset-based contracts or contracts with a significant asset-based component (i.e. housing, fleet, ICT)
• social impact investment transactions (e.g. social benefit bonds).

Amendments must be approved by your agency’s General Counsel and its Chief Procurement Officer.

Agencies must seek approval to amend the Prescribed Template from its General Counsel (or external legal counsel) and its Chief Procurement Officer. Amendments are limited to those required to ensure the contract is fit-for-purpose for the contracted human services. 

Agencies are required to report amendments to the Human Services Category Management Working Group (CMWG) annually

The CMWG is responsible for the ongoing administration of the Prescribed Template. Each year, the CMWG will require agencies to provide a list of amendments made in the previous 12 months. The CMWG will review the amendments and in consultation with Department of Education, Department of Family and Community Services and the Ministry of Health, these agencies will develop the Prescribed Template and recommend any changes to the Procurement Board. The Procurement Board will be responsible for approving the recommended changes.

Agencies are required to provide service delivery and service user location data to the Human Services Data Hub

The Department of Customer Service (DCS), in conjunction with agencies that fund NGOs to deliver human services, will develop a new location-based reporting process to enhance service planning across NSW. NGOs will be consulted on the new reporting process.

The location-based reporting process will be developed whilst the Prescribed Template is implemented from 1 August 2017. Once the reporting process is established, agencies will require NGO service providers to report the:

• service delivery location – this is the Local Government Area (LGA) where the service is delivered to the service user. It may not be the registered address of the service provider.
• service user location – this is the LGA where the service user resides at the time the service is provided.

This information will be provided to DCS as an LGA Report as part of the quarterly reporting process for the Human Services Data Hub.

Agencies may on a case by case basis seek an exemption from this requirement from the Procurement Leadership Group, based on the nature of the services or the target group/service users. A clear basis must be established for an exemption to be considered, noting the fundamental importance of the reporting obligations to assist in the effective management of the State’s significant Human Services expenditure.

Agencies are responsible for monitoring NGO compliance with this requirement.

The Agreement is suitable for procurements involving a mix of NGOs and for-profit organisations

The Board recognises that increasingly procurements involve a mix of non-profit and for-profit providers. Whilst the Prescribed Template is for procurements by Government Agencies with non-profit organisations only, it may be used for human services procurement activities involving a mix of NGOs and for-profit organisations.

Agencies are required to source information on NGOs from the NGO Registration Scheme – human services

Agencies are required to use the NGO Registration Scheme – human services to source information from NGOs when preparing the Agreement (see PBD-2016-04-Accessing information about non-government organisations delivering human services).

The Direction will be reviewed after two years of operation.

[1] http://www.dpc.nsw.gov.au/about/publications/grants_administration/definition_of_a_non-profit_organisation