This Direction deals with procurement of services by or for a government agency within the meaning of the Public Works and Procurement Act 1912 (as amended).

Standard Commercial Framework

A Standard Commercial Framework applies to the engagement types 1 to 12 of the Scheme which includes the following elements:

• Standardised resource types

• Capped daily resource rates

• Discount structure

• Expense policy.

Suppliers must accept the Standard Commercial Framework to be prequalified for engagement types 1 to 12 of the Scheme, unless approved as an Outside the Standard Commercial Framework Supplier (see below).

A separate commercial framework and governance requirements apply to engagement type 15 ‘Infrastructure Services’ of the Scheme, as outlined in Procurement Board Direction PBD 2022-02.

The Standard Commercial Framework and additional governance requirements are not applicable to Scheme engagement type 14 ‘Specialised Services’.

 Suppliers outside the Standard Commercial Framework

The following prequalified Scheme suppliers have not accepted, and are therefore outside, the Standard Commercial Framework (“OSCF Suppliers”). All engagements with these suppliers are subject to the additional conditions and governance arrangements described below.

• Bain & Company

• Boston Consulting Group

• Cambridge Economic Policy Associates

• L.E.K. Consulting

• McKinsey & Company

• Partners in Performance

• Port Jackson Partners

Any revision of this list requires approval by the Chair of the Procurement Board and notification to the Procurement Board.

Conditions and governance arrangements for engagements outside the Standard Commercial Framework

Additional conditions and governance arrangements apply for each engagement that is outside the Standard Commercial Framework in the following scenarios:

• from a prequalified P&MS Scheme supplier in engagement type 1 ‘Government & Business Strategy’ that has not accepted the Standard Commercial Framework (ie an OSCF Supplier).

• from any prequalified P&MS Scheme supplier that has accepted the Standard Commercial Framework, but where the engagement proposal is not compliant with any element of the Standard Commercial Framework.

 Limitation on scope of services

• OSCF suppliers are prequalified and permitted to provide business advisory services under engagement type 1 ‘Government & Business Strategy’ only.

• OSCF suppliers are not eligible for prequalification to provide business advisory services under engagement types 2 to12.

• Note: These additional conditions and governance requirements are not applicable to engagement types 14 and 15.

Direct engagement value thresholds

• Where the estimated cost of an engagement type 1 ‘Government & Business Strategy’ engagement is less than or equal to $250,000 (excluding GST), the agency may directly engage the OSCF Supplier following one written quotation.

• In limited circumstances, when a flow-on variation to the engagement becomes necessary, the total value of the first engagement and related flow-on variations is not to exceed three times the initial contract value, or $500,000 (excluding GST), whichever is the lesser amount.

• Where an agency’s financial thresholds are more stringent than the above thresholds of the P&MS Scheme, the agency thresholds take precedence.

• Note: For any competitive tenders under engagement type 1 ‘Government & Business Strategy’, agencies are permitted to invite OSCF suppliers to participate in such competitive tenders.

 Secretary approval

• In addition to agency-specific procurement delegation approval requirements, engagements of OSCF suppliers require Secretary approval (or Secretary’s delegate in cases where the Secretary has a potential or perceived conflict of interest in relation to the OSCF supplier) prior to any contract sign off with the supplier.

• Agencies must seek Secretary (or Secretary’s delegate) approval and keep a record of all engagements approved by the Secretary that do not comply with the Standard Commercial Framework, both from OSCF suppliers and from suppliers who have accepted the Standard Commercial Framework.

 Reporting requirements

• NSW Procurement is required to report annually to the Board and to the Minister for Domestic Manufacturing and Government Procurement. This report will include a comparative analysis across agency groups on trends in the number of engagements, total spend, use of the Standard Commercial Framework (including engagements outside the Standard Commercial Framework), and other insights regarding use of professional services suppliers through the Scheme.

• OSCF suppliers must report all their engagements with NSW government to NSW Procurement. NSW Procurement shall report these engagements at least annually to the Procurement Board.

 Context

The P&MS Scheme is the largest of several whole-of-government procurement arrangements for professional services, including consultancy.

The Scheme has a pool of over 3,500 diverse suppliers prequalified to supply 15 types of professional services, including consultancy, to NSW government. For the P&MS Scheme, suppliers and their respective prequalified service types are listed on the buy.nsw website.

A Standard Commercial Framework for the business advisory services categories 1 to 12 of the Scheme was implemented during 2018 and subsequently refreshed in 2020 and 2022.

A similar commercial framework for Infrastructure Advisory Services of the Scheme, and other related schemes, was implemented in 2022 under Procurement Board Direction PBD2022-02.