Cabinet casts shared contracts net wider

Government agencies could soon be required to buy mobile phones and voice and data services for staff under pre-negotiated contracts.

Labour says local firms will miss out in the lucrative government-wide deals.

Economic Development Minister Gerry Brownlee is due to announce the winners of computer hardware and office equipment contracts together worth tens of millions of dollars in the next few weeks, as well as which suppliers have won contracts to supply vehicles to Government.

The all-of-government contracts are designed to cut tendering costs for agencies, and save more than $115 million over the next five years, Mr Brownlee says.

"The New Zealand government spends about $30 billion a year on goods and services. We're harnessing the collective buying power of the whole state sector for the first time, and the benefit to government and taxpayers will be significant."

Cabinet is now looking to widen the range of goods that can be purchased under government-wide contracts and has asked the Economic Development Ministry to assess a range of potential categories, including ICT products – such as mobile phones and services and data servers, and utility services, for example, electricity.

Hardware suppliers have bid to supply desktop computers, laptops, tablet notebooks, multifunctional devices and laser printers to agencies.

Labour communications spokeswoman Clare Curran says the Government is awarding the contracts to "a cosy club of multinational suppliers" when it should be maximising opportunities for local businesses.

Mr Brownlee says he is confident the Government's tendering processes gave New Zealand firms a "fair go".

"But if [Ms Curran] can show me that she uses New Zealand-manufactured computers, laptops, multifunctional printing devices, photocopiers [and] printers... which, I understand, have not been produced in New Zealand for some years now, then I would be interested to know."

Government departments are required to move to the new contract arrangements as soon as possible and before July 2012. Agencies in the wider state sector such as school boards of trustees will be encouraged to purchase through the contracts.

Corporate Express and OfficeMax have together won the government-wide stationery contract.

About $58m will be spend on the computer hardware contract in the first year, and $18.5m on multifunctional devices, according to Cabinet.

Brett O'Riley, chief executive of industry group NZICT says some firms fear Government moves to introduce "shared services" will create a closed shop for multinationals, but NZICT and government officials are looking to set up an "open" cloud computing model through which smaller, local firms could provide their software and services to agencies.

"The shared services environment will be different but if executed properly it should provide more opportunities for smaller players."

- © Fairfax NZ News