What is the NPN?
The National Procurement Network (NPN) is the name given to the collective of all Australian State and Territory Local Government Association procurement arms. It is an informal, non-registered group that operates under a Memorandum of Understanding. The aim is to coordinate a combined tendering approach in order to leverage the buying power of the entire Australian Local Government sector. The successful tenderer/s do not contract with the NPN. They contract with each individual State entity separately, but using the same contract conditions. If a NSW Council use’s an NPN contract, LGP will always be the Principal to that contract. The other NPN members have no involvement in the operation of the final contract in NSW and LGP has ensured that the entire process meets the needs of councils in NSW.
Each State and Territory of Australia has a Local Government peak body member organisation (the equivalent of Local Government NSW and LGP). These organisations provide a series of services to its member councils, including the provision of bulk procurement services, via a business arm or a wholly owned business. The purpose of such a procurement service is to harness the collective purchasing power of the local government sector, delivering savings in time and cost to its member councils. The NPN is not unlike a ROC where constituents with similar needs combine resources to reduce red tape on industry and leverage greater results.
The NPN comprises the following peak body member organisations and their business units:
- MAV Procurement – the business arm of the Municipal Association of Victoria
- Local Government Procurement Pty Ltd – a wholly owned company of the Local Government New South Wales
- Local Buy Pty Ltd – a wholly owned company of the Local Government Association of Queensland
- Western Australian Local Government Association
- LGA Procurement a business arm of the Local Government Association of South Australia
- Local Government Association of the Northern Territory
- Local Government Association of Tasmania
Is the NPN a legal entity?
The group remains an informal network. It is not a registered business entity nor a registered trading name. The NPN term is simply used to help identify the fact that the various State entities are running a request for tender using the same documentation and contracts. The authority of any member of the network does not extend beyond their own State or Territory. An individual staff member might represent the group as a nominated spokesperson.
When tenders are invited as NPN, who invites the tenders and who awards the subsequent contract(s)?
One of the State entities will take the role of project manager, but each participating State will be represented on the tender panel. In the case of NSW, LGP awards the contract.
Members may choose to advertise collectively for goods and/or services, but are not compelled to enter contracts in such projects unless they so choose. Each project contract will be developed to meet the needs of the participating entities and therefore will usually have a common contract document. The NPN appoints individual representatives to be involved in the tender evaluation and in the case of NSW, LGP presents a tender evaluation report to its Directors and enters contracts with the successful panel members in its own right and in accordance with its Prescription. The other State entities are not a party to LGP’s contract.
How does the tender process for a NPN contract satisfy LGP’s prescription status under s55 of the NSW Local Government Act?
LGP, along with the other states, is a participant in the development and review of all RFT and contract documents. Each State entity has slightly different legislative requirements to work under. The process is conducted so that all State legislative requirements are met whilst using one common RFT document and contract. Whilst the NPN aims to reach a joint consensus on the preferred tenderer, the acceptance of a tender is done by LGP on its own letterhead and in only its name. On acceptance of a tender, LGP becomes a signatory to the contract document in its own name. None of the other State entities are listed as Principals in the contract document that LGP signs.