Department of Finance

Buy Local Reporting: Frequently Asked Questions

What is the definition of a value for money decision?

What impact does a value for money decision have on Buy Local reporting?

Does it include vehicle hire?

Does the Buy Local report include rent and utilities paid via the Department of Housing and Works?

Does my agency have to submit a Buy Local return?

What sort of information is excluded from the Buy Local report?

What agency is responsible for the Buy Local policy?

What is the definition of a value for money decision?

Value for money does not mean you should simply select a successful bidder because they have the lowest price. Instead, value for money is an assessment that considers non-cost factors, including:

  • Fitness for purpose;
  • Technical and economic issues, such as technical performance, reliability and economic life;
  • Supplier capability;
  • Exposure to risk;
  • Availability of maintenance and support; and
  • Compliance with specifications.

Cost factors include:

  • Whole of life costs, e.g.:
    • Acquisition costs – price, freight, legal fees, warehousing and training;
    • Operating costs – fuel, safety, performance monitoring and cleaning;
    • Maintenance costs – consumables, spare parts, repair labour, loss of productivity or revenue during maintenance;
    • Alteration and/or refurbishment costs – upgrade, modification and re-training;
    • Support costs – insurance, rates, taxes and management fees; and
    • Disposal – asset residual valuation and method of disposal.
  • Transaction costs: all internal public authority costs arising from the procurement process.

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What impact does a value for money decision have on Buy Local reporting?

If two compliant bids are received from businesses within the prescribed distance and a value for money decision is made, then the purchase is classified as local and included in your Buy Local return.

If a compliant bid is received from within the prescribed distance and a value for money decision to purchase from a business outside the prescribed distance is made, it cannot be reported as a Buy Local return.

If there are no compliant bids from within the prescribed distance but a compliant bid is received from a WA business but a value for money decision is made to purchase from a business outside the state, the purchase cannot be reported as a Buy Local return.

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Does it include vehicle hire?

Most vehicle hire is coordinated through the Motor Vehicle Rental Common Use Arrangement. It is this contract that should be reported on(during the period of award), not the lease payments that are made.

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Does the Buy Local reporting include rent and utilities paid via the Department of Housing and Works?

No, they are exempt from the Buy Local reporting process.

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Does my agency have to submit a Buy Local return?

Yes.

The Buy Local Policy is a cabinet endorsed policy that applies to all state government agencies, including:

  • public authorities within the meaning of the SSC Act 1991;
  • government trading enterprises, such as the Water Corporation; and
  • any other state government authority or entity, unless specifically exempted by the State Cabinet.

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What sort of information is excluded from the Buy Local report?

In your Buy Local return you should report your agency’s commercial purchasing and contracting activities only. This excludes all ‘non-supply’ activity.

‘Non-supply’ expenditure that is not included in the Buy Local report includes:

  • salaries and wages paid to employees;
  • statutory and involuntary payments;
  • payments to utilities;
  • grants and subsidies allocated by one state government agency to another;
  • finance and capital charges; and
  • rent.  

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What agency is responsible for the Buy Local Policy?

The State Supply Commission is responsible for the administration of the Buy Local Policy.
Government Procurement is responsible for managing the Buy Local reporting process and the compilation of agency returns into the Who Buys What and How report.

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