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Frequently Asked Questions

Frequently Asked Questions

Click on the categories below to find answers to a range of frequently asked questions. 

Summary and Context

Why is government procurement important to Western Australia's small and medium sized enterprises (SMEs)?

The State Government is one of the largest customers in the Western Australian economy. Over the last financial year, State Government Sector agencies reported spending over $27 billion on procurement of goods, services and works. Government procurement is important to local SMEs because it is generally conducted in an open and transparent fashion and offers a source of regular income with invoices paid within 30 days. Supplying to government is also a good reference site and can be a stepping stone to other markets and supply opportunities.

 

Why are the Western Australian Jobs Act 2017 (WA Jobs Act) and Western Australian Industry Participation Strategy (WAIPS) needed?

The State's economy is adjusting to the transition in resource investment and a relative slowing in the residential building sector. Therefore every opportunity for employment generation and retention, particularly for small and medium sized enterprises, must be maximised. The WA Jobs Act and WAIPS aims to ensure government spending results in more opportunities for local businesses and more jobs for Western Australians.

 

Which states does the government consider to be models for what Western Australia could achieve?

Victoria, South Australia and Queensland have similar local content policies or legislation in place. The Victorian Government has had the legislation in place for over a decade and has reported success in increasing the level of local and intrastate procurement.

Western Australian Jobs Act 2017

What is the purpose of the Western Australian Jobs Act 2017?

The purpose of the Western Australian Jobs Act 2017 (WA Jobs Act) is to use the State Government procurement process to enhance local industry participation in the supply of goods and services to or for agencies or the State, with a particular focus on benefits to small and medium sized enterprises.

The WA Jobs Act is the first piece of procurement related legislation that applies to almost all State Government agencies and forms of procurement. The WA Jobs Act aims to provide potential suppliers with an open, effective and competitive market, with more opportunity for local participation. It also puts a focus on the reporting of economic outcomes of local industry participation.

 

What are the key aspects of the WA Jobs Act?

The key aspects of the WA Jobs Act include:

  • The development of the WAIPS.
  • Obliges all agencies to require participation plans in the procurement of certain supplies, above designated values.
  • Obliges all agencies to assess and consider participation plans in the procurement process, and incorporate supplier commitments into supply contracts which require reports on the progress of these commitments.
  • The determination of strategic projects.
  •  The Minister for Jobs reporting to Parliament on outcomes.  
     

Which Government agencies will the WA Jobs Act apply to?

The WA Jobs Act and Western Australian Industry Participation Strategy will apply to "agencies", which is defined in the WA Jobs Act. Broadly the definition covers:

  • All departments, all sub-departments and all statutory bodies which are "agencies" within the meaning of the Financial Management Act 2006, except universities.
  • Government Trading Entities, including their subsidiaries established by or under the Electricity Corporations Act 2005, Port Authorities Act 1999, the Water Corporations Act 1995, and Western Australian Land Authority Act 1992.
  • Any other person or body, or person or body of a class, prescribed in regulations.

 

Which Government supplies will the WA Jobs Act apply to?

The WA Jobs Act and WAIPS requirements will apply to a range of procurements, including goods, services, housing and works beyond relevant monetary thresholds.

 

Does the WA Jobs Act apply to supplies to Local Government?

No. Local Governments are currently not covered by the WA Jobs Act.

 

Does the WA Jobs Act and WAIPS apply to supplies to universities?

No. Universities are currently not covered by the WA Jobs Act.

 

Are exemptions available?

Yes, agencies may apply to the Minister for Jobs to be exempted from the obligation to require a participation plan.

 

Will every ministerial exemption from a participation plan be published on the respective agency website?

Yes, all ministerial WAIPS exemptions will be published on the WA Industry Link portal and respective agency website.

Key Definitions

Why is "local" defined as it is in the Western Australian Jobs Act 2017?

The Western Australian Jobs Act 2017 (WA Jobs Act) defines local industry as suppliers of goods produced, or services provided, in Western Australia, another Australian State or Territory or New Zealand. This definition ensures the WA Jobs Act is consistent with both Section 92 of the Australian Constitution and the Australia and New Zealand Government Procurement Agreement (ANZGPA).

 

What is local content?

Local content is the portion of the contracted value of a product or service generated within a jurisdiction. Local content is generally expressed as a percentage of the total contract value.

 

Why does the WA Jobs Act specify a particular focus on small and medium sized enterprises?

The WA Jobs Act defines a small or medium enterprise (SME) as a business or undertaking that has less than 200 full time equivalent employees. SMEs make up 97% of industry in Western Australia. There are various free trade agreements (FTAs) that apply to Western Australian Government procurement which prevent discrimination against suppliers on the basis of their origin or the origin of their goods or services. However, these FTAs also preserve government preferences to benefit local SMEs in the context of government procurement, as is occurring in this case.

 

What is the definition of a strategic project?

The WA Jobs Act gives the Minister for Jobs power to determine that a supply which meets the required criteria is a strategic project where the Minister for Jobs considers it to be of strategic significance to the Western Australian economy. In practice, focus will be on supplies which have the potential to generate a significant amount of economic activity and jobs within Western Australia.

The Minister must make a determination in writing for all strategic projects and give that to the procurement agency responsible for the supply
.

 

What is the purpose of the 'strategic project' framework in the WA Jobs Act?

The strategic project framework allows the Minister for Jobs to:

  • Specify particular matters for potential suppliers to address in participation plans.
  • Identify matters which differ from those contained in a normal participation plan and may relate to specific aspects of local participation.
  • Invite commitments in relation to those matters, rather than imposing requirements for local industry participation on strategic projects or the supplier.

 

Will there be differentiation between existing local firms and firms locating here from overseas?

If an overseas business comes to Australia, establishes an Australian entity and employs Australians, their business would be considered local. All businesses from Australia and New Zealand are considered to be local.

 

What is meant by “Value for Money” and how is it calculated?

Value for money continues to be a key principle for selecting government suppliers. Historically, ‘value for money’ is a balanced judgement of a range of financial and non-financial factors, taking into account the mix of quality, cost and resources; fitness for purpose; total cost of ownership and risk.

The Western Australian Industry Participation Strategy introduces a new factor that will be weighted in the overall tender score and form part of the overall value for money equation. This will be the participation plan score which will represent either 10% or 20% of the overall tender score. The plan will commit the bidder to report on a plan to maximise participation of local industry and quantify the number of jobs, apprenticeships & traineeships employed as a direct result of being awarded the contract.

Properly applied, the inclusion of participation plans in the value for money calculation should add value by benefiting local suppliers through additional work or supply contracts. This in turn should intrinsically create jobs achieving the objectives of the WA Jobs Act.

 

If employment is a key measurement of the success of the WA Jobs Act 2017, how is ‘employment’ defined for reporting purposes?

Employment is defined by both the Australian Bureau of Statistics and the International Labour Organisation as a minimum of one hour’s paid work per week. Employed persons are defined as all persons aged 15 years and over, who during the reference week worked for one hour or more for pay. 
In the context of the WA Jobs Act 2017 and the WAIPS, measuring jobs will be achieved using the concept of the workforce directly employed (including by sub-contractors) as a result of a contract, including full-time / part-time / casual employees, apprentices, trainees and cadets.

 

What is the difference between Goods & Services procurement and Housing & Works procurement?

Housing and Works procurement is the supply of goods or services for or in connection with a public work as defined in the Public Works Act 1902 section 2. All supplies not defined in the Public Works Act 1902 section 2 fall into the Goods and Services procurement type. View Public Works Act 1902 here.

 

Participation plans ask about 'workforce'. How is workforce defined?

Workforce means the total number of workers directly employed on a contract. This encompasses full-time, part-time, casual employees, apprentices and trainees, workers engaged through labour hire arrangements and other employer supported employment initiatives such as cadetships and internships.

Requirements for Businesses and State Government Agencies

What does the Western Australian Jobs Act 2017 and Western Australian Industry Participation Strategy require of State agencies?

The Western Australian Jobs Act 2017 (WA Jobs Act) and the Western Australian Industry Participation Strategy (WAIPS) obliges all State agencies to:

  • Require each prospective supplier to submit a participation plan during the procurement process for all contracts above designated thresholds.
  • Assess and consider the participation plan when evaluating the prospective supplier's offer to supply, in accordance with the WAIPS.
  • Incorporate relevant participation plan commitments in the supply contract, in accordance with the WAIPS.
  • Include reporting requirements in the supply contract, in accordance with the WAIPS.
  • On request, provide information to the Minister for Jobs to assist with reporting to Parliament.

 

What does the WA Jobs Act require of prospective suppliers?

While most of the requirements of WA Jobs Act relate to agencies, there are some requirements that will impact on prospective suppliers. These include:  

  • Providing a participation plan when required during the procurement process.
  • Including relevant participation plan contents within the supply contract.
  • Including a reporting clause within their supply contract.
  • Reporting on participation plan commitments.

 How will suppliers be held accountable for the commitments they make in participation plans?

Agencies are required to ensure that a reporting clause is included within the supply contract. Agencies will be responsible for deciding the appropriate course of action if commitments are not fulfilled. It is expected that this will occur through normal contract management and referee activities.

How will agencies be held to account?

Agencies must provide the Minister for Jobs with any information required for preparing an annual report for Parliament on the implementation of the WA Jobs Act and the WAIPS. Independent auditors will undertake random audits on agencies to ensure they are implementing WAIPS correctly.

Western Australian Industry Participation Strategy

What is the Western Australian Industry Participation Strategy (WAIPS)?

The WAIPS was developed as a requirement of the Western Australian Jobs Act 2017 (WA Jobs Act).  The WAIPS is designed to increase participation by local industry in the delivery of State Government agency contracts. The WAIPS aims to enhance the opportunity for local industry, particularly small and medium enterprises to compete for State Government agency work.

The WAIPS applies to all forms of procurement (goods, services, housing and works) above designated values, subject to specified exemptions. The WAIPS applies to departments, agencies, statutory authorities and government trading enterprises. The WAIPS does not apply to universities, local government procurement and grants.

 

What are the key components of the WAIPS?

There are five key components of WAIPS: procurement related principles and policies; value for money; participation plans, strategic projects, and regional procurement.

Procurement related principles and policies

The principles of accountability and probity, open and effective competition, transparency in decision making and value for money are key considerations in the development of the WAIPS. The WAIPS also includes elements from the existing Buy Local Policy and Building Local Policy that support fair and reasonable opportunity for regional industry and businesses. As required by the WA Jobs Act, the WAIPS is consistent with State Supply Commission procurement principles and policies and Section 92 of the Australian Constitution.

Value for money

Value for money continues to be a key principle for selecting government suppliers. Value for money is a balanced judgement of a range of financial and non-financial factors, taking into account the mix of quality, cost and resources; fitness for purpose; total cost of ownership and risk. Properly applied, the value for money principle should benefit local suppliers due to its inclusion of risk management issues.

Participation plans
 
The WA Jobs Act requires agencies ot ensure that prospective suppliers for a qualifying supply complete and submit a participation plan in connection with their offer to supply.  Depending on the value of the supply contract, they may need to prepare either a “core” or “full” participation plan. Participation plans will be used as part of the evaluation, award and contracting process.

Strategic projects

Qualifying supplies with a contract value of $25 million or more that the Minister for Jobs considers of strategic significance to the Western Australian economy may be determined by the Minister for Jobs to be a strategic project. A participation plan with additional local commitments will be required for strategic projects. For strategic projects, the approval of the Minister for Jobs must be obtained for the qualitative assessment weighting given to participation plans in evaluation of offers.

Regional procurement

A key element of the WAIPS is to ensure regional industry has increased opportunity to access State Agency contracts. Initiatives to improve regional outcomes include the introduction of Local Content Advisers (LCAs), encouraging agencies to increase delegated regional spend, and considering changes to buying rules for Common Use Agreements and the regional price preference.

What value thresholds will be applied for WAIPS supplies?

Thresholds that trigger the WAIPS requirements are as follows. These value are for the total life of the contract including GST. 

WAIPS%20table%20-%2014%20March.jpg

Are there different types of participation plans?

Yes, there are two types of participation plans: core participation plans and full participation plans.

A core participation plan is a simple plan that requires a potential supplier to outline local economic benefits should a contract be awarded.A full participation plan is a more detailed plan that requires a potential supplier to identify how fulfilment of a contract will generate designated economic benefits and demonstrate the means for provision of full, fair and reasonable opportunity to local industry.

Strategic projects may require a tailored participation plan that includes additional or varied requirements. The exact participation plans requirements for strategic projects will be determined on a case-by-case basis by the Minister for Jobs.

The following table demonstrates which participation plan will be applicable: 

Participation%20Plan%20table_March%2014.jpg

 

Will a supplier who provides a better participation plan have more likelihood of winning a Government contract than a supplier who has a lesser participation plan?

If all other factors within a tender bid are equal, a supplier with a better participation plan will have a higher likelihood of being awarded the contract.

Other Agreements, Policies and Legislation

What is the relationship between the Western Australian Jobs Act 2017, Western Australian Industry Participation Strategy and other procurement legislation and policies?

 The Western Australian Industry Participation Strategy (WAIPS) is consistent with the existing State Supply Commission Act 1991, and the related policies. These are:

  • Value for Money
  • Probity and Accountability
  • Open and Effective Competition
  • Common Use Arrangements
  • Procurement Planning, Evaluation Reports and Contract Management

Will the State Government’s Buy Local & Building Local Industry Policies be retained?

The WAIPS will include a number of elements and principles of the Buy Local Policy and Building Local Industry Policy. From 1 October 2018, the Buy Local Policy and Building Local Industry Policy will become redundant and be replaced by WAIPS. Those aspects of the Building Local Industry Policy that are applicable to the private sector will, however, remain until the proposed Skilled Local Jobs Bill is considered by and passes through both Houses of State Parliament. For example, all private projects where the WA Government makes a significant contribution will be required to submit a participation plan, execute the plan and report on progress.

The Government will continue to enhance industry capability by encouraging industry to meet world’s best practice, remove or reduce impediments to competitiveness and encourage companies to seek pre-qualification with on vendor databases.

Strategic Projects

What are strategic projects?

The WA Jobs Act gives the Minister for Jobs power to determine that a supply which meets the required criteria is a strategic project where the Minister for Jobs considers it to be of strategic significance to the Western Australian economy. Projects that have a contract value of $25 million of more may be considered as a strategic project.

In practice, focus will be on supplies which have the potential to generate a significant amount of economic activity and jobs within Western Australia. The Minister must make a determination in writing for all strategic projects and give that to the procurement agency responsible for the supply.

  

How will the WA Jobs Act apply to METRONET projects?

It is anticipated that the WA Jobs Act will be used for a range of projects under the METRONET program, as the procurement process commences. However, for some projects the procurement process will have already commenced by the time the WA Jobs Act has come in to force in full. These projects will proceed under current arrangements.

Participation Plans

How will participation plans be assessed and evaluated?

The assessment will focus on the likelihood of commitments being fulfilled, the application of full, fair and reasonable opportunity and willingness of the supplier to work with Government in improving supply chain performance.

Who will assess and evaluate the participation plans?

Assessment of participation plans will be undertaken by the issuing agency with assistance from the Industry Link Advisory Service and Local Content Advisers if required.

Prospective suppliers will be notified of their success or otherwise by the procuring agency. If desired, unsuccessful bidders can request to be debriefed on areas where their offer was deemed deficient or less competitive than the awarded supplier.

 

What will prospective suppliers need to outline in their participation plans?
 

To complete a participation plan, prospective suppliers will need to provide details on some or all of the following depending on the type of Plan required:

  • Supplier / Head contractor and business contact details
  • Project scope and delivery
  • The direct workforce of employees, apprentices and trainees
  • Sub-contracting and supply arrangements
  • List information on packages externally sourced 
  • Other benefits to local and/or regional industry
  • Commitment to working with Government.
  • How they plan to demonstrate full, fair & reasonable opportunity.
     

Will templates be provided for each type of participation plan?

Participation plan templates will be supplied by the procuring agency. Templates will also be available for download on the WA Inudstry Link portal.

 

Who can I call if I have trouble completing the plan template?

The Industry Link Advisory Service (ILAS) is available to assist you in completing a participation plan. Or in regional areas, you contact your nearest Local Content Adviser.  You can also access supplier guidelines on the WA Industry Link portal.

Implementation and Assistance

When will the Western Australian Industry Participation Strategy (WAIPS) become fully operational?

The WAIPS will become fully operational on 1 October 2018. 

 

How is ‘local industry’ defined?

Under the WAIPS, the term “local industry” means suppliers of goods produced, or services provided, in Western Australia, another State, a Territory or New Zealand. This is necessary to be consistent with both section 92 of the Australian Constitution and the Australia and New Zealand Government Procurement Agreement (ANZGPA). 

 

What is the Industry Link Advisory Service?

The Industry Link Advisory Service (ILAS) has been established to provide a range of services to both head contractors, sub-contractors and government agencies. ILAS will operate from within the Department of Jobs, Tourism, Science and Innovation.

 

What support will be provided to businesses to help with the implementation of the Western Australian Jobs Act 2017?

There will be a number of support services available to industry, these include:

  • The Industry Link Advisory Service (ILAS) will offer a range of assistance and advisory services to industry and business, including guidance on completing a participation plan, finding and accessing government procurement opportunities and support programs, and how to pursue import replacement potential.
     
  • Local Content Advisers will perform similar services to ILAS in the regional areas of WA. The nine advisers will be located in the various Regional Development Commissions across the State.
     
  • The WA Industry Link portal is the central source of information on the WAIPS and the WA Jobs Act. You can also find participation plan information and links to Tenders WA and other supply opportunities.
     
  • The Local Capability Fund (LCF) is available to help local small and medium sized enterprises (SMEs) improve their capacity, capability and competitiveness to access major domestic and international market opportunities. Funding can be used to assist SMEs to meet pre-qualification requirements, purchase and upgrade equipment, improve business or manufacturing systems and employee training and development. Funding rounds are announced periodically and widely promoted.

What support will be provided to State Government agencies to help with the implementation of the WAIPS?

The ILAS and the regional Local Content Advisers (LCAs) will be able to provide assistance to State Agencies. Training will be held during the period leading up to the WAIPS becoming fully operational to make sure agencies understand the new processes to integrate Industry Participation Plans into their procurement process and how to assess Value for Money under WAIPS.

 

Where can prospective suppliers go for advice and assistance?

The ILAS has been established to provide a range of services to assist prospective suppliers. These services include:

  • Advice on how to access opportunities to sell to government.
  • Advice on how to develop and complete participation plans more effectively.
  • Assistance to access State and Federal Government supply opportunities, industry support and financial assistance programs.
  • Information about the WAIPS.

 

Is the government going to put resources in place to monitor and measure the implementation of the WAIPS?

Yes. The Department of Jobs, Tourism, Science and Innovation will monitor the implementation of the WAIPS and provide progress reports to the Minister for Jobs.

 

How will WAIPS apply to existing Common User Arrangements (CUAs) and Standing Offers (Panel Arrangements)?

WAIPS will not retrospectively apply for CUAs or Panel contracts in effect before 1 October 2018.

 

How will WAIPS apply to new CUAs and Standing Offers (Panel Arrangements)?

Agencies from 1 October will be required to seek an exemption for new CUAs and Standing Offers (Panel Arrangements).  This will provide an exemption from the Participation Plan requirement but reporting on the economic outcomes of the contracts will be a condition of the exemption.

Reporting will be required to be submitted within 2 months of the conclusion of a CUA or Panel Arrangement or annually and at the conclusion of the contract on contracts longer than 12 months.

 

What happens to tenders already in progress on October 1?

WAIPS requirements will not apply to tenders advertised, under evaluation or not awarded on October 1 2018.

 

What can agencies do if suppliers are not fulfilling their participation plan commitments?

Agencies should be make suppliers aware that their unfulfilled commitment will be considered in the assessment of their future bids.

 

Is there a grace period for agencies to incorporate and implement WAIPS in their procurement processes?

No. The transition (grace) period to full implementation started March 16 2018 and will end September 30 2018. WAIPS commences full implementation on 1 October 2018.

All RFPs issued from 1 Oct that trigger the WAIPS requirements will need to include standard clauses on WAIPS requirements or have an Exemption in place.

 

What if a supplier is delivering services in both regional and metro areas?  Which Goods and Services threshold would apply?

The highest threshold would apply.

Compliance and Reporting

Will the Western Australian Industry Participation Strategy supply contracts have penalty clauses to impose financial or other penalties if contractor does not achieve the outcome outlined in the participation plan?

Compliance with relevant parts of a participation plan will be an obligation imposed on the supplier under the supply contract. If a contractor does not comply with their participation plan commitments, it may be taken into account when evaluating risk in future tender bids..

 

Will contractors need to report on progress against their participation plan commitments?

Yes, contracted suppliers will be required to report upon the implementation of their participation plan. They will also be required to use a reporting template to demonstrate how they have achieved participation outcomes at practical completion of the contract. Reporting intervals may vary with the duration of the contract.

 

What checks and balances will be introduced to ensure conformance?

An independent audit program will be introduced to ensure agency and supplier conformance.

Practical Questions

Does the Western Australian Jobs Act 2017 require State Government agencies to preference Western Australian suppliers?

No. The Western Australian Jobs Act 2017 (WA Jobs Act) does not require agencies to select a Western Australian supplier or a supplier which commits to using more Western Australian content. Instead, the WA Jobs Act provides for a process to require local industry participation to be taken into account in a structured and consistent way across Government when agencies evaluate offers to supply. The evaluation of participation plans will be only one component of the evaluation of an offer to supply.

 

How will regional procurement be treated under the WA Jobs Act and Western Australian Industry Participation Strategy?

The State Government's aim is to ensure regional industry has a full, fair and reasonable opportunity to access and win government contracts.  The Western Australian Industry Participation Strategy (WAIPS) will introduce a number of initiatives to improve economic outcomes for regional industry and businesses.

These include:

  •  Local Content Advisers (LCAs) will be located in each Regional Development Commission to provide assistance to local industry and businesses.
  • Agencies will be encouraged to increase their delegated spend in regional areas.
  • Changes will be made to buying rules for Common Use Agreements and state wide contracts to provide greater opportunities for regional sourcing.  

Additionally, there will be a lower financial threshold for the participation plan requirement for regional contracts than financial thresholds for contracts in the metropolitan area.
 

How will the WA Jobs Act affect subcontractors?

The WA Jobs Act does not place any direct obligations on subcontractors. However, subcontractors may be required by the head contractor to report on participation plan commitments.

 

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