Yesterday, Wednesday 16th February 2022, we held the second in our four part series of events covering different aspects of the Australia-United Kingdom Free Trade Agreement in partnership with the UK Department for International Trade and the Australian Department of Foreign Affairs and Trade.
We heard from Juliana Reed, Lead Government Procurement Trade Negotiator for DIT, and Alan McGuinness, Assistant Director of Goods and Government Procurement for DFAT.
The webinar is available below in full with subtitles available, along with a transcript and copy of the presentation given.
Joanne Holland
Good morning in the UK and good evening in Australia. Welcome from the Australian UK Chamber of Commerce. This is the second in a four part series on the FTA. Today we’ll be discussing the benefits of the FTA on government procurement. General principle for governments to procure outside their domestic markets is that opening up to foreign markets creates greater efficiency and pricing and more opportunities for suppliers in foreign markets.
An agreement of government procurement already exists under the WTO framework and the FTA between Australia and the UK goes beyond the WTO Government Procurement Agreement. To discuss the differences and how the procurement under the FTA builds on the WTO procurement agreements and the opportunities that lie ahead for both countries, are the two leads on the recent FTA procurement. They are Juliana Reed and Alan McGuinness.
Juliana is the co-head of Government Procurement Trade Policy at the Department of International Trade, and she’s acted as lead government procurement negotiator in the UK, Australia and UK Japan FTAs. Prior to negotiating procurement FTA chapters, Juliana supported the UK’s accession to the WTO agreement on government procurement, ensuring UK businesses maintained legally guaranteed access to the 1.3 trillion worth of procurement opportunities post EU exit.
In addition, Juliana’s worked on several other issues across government, including EU exit strategy and small business strategy. And our second speaker today is Alan McGuinness. Welcome Alan. He is the Assistant Director Goods and Government Procurement for the Australian Department of Foreign Affairs and Trade. Alan was the lead government procurement negotiator for the Australia UK FTA and is leading government procurement negotiations with a range of other partners, including the EU and India.
Alan is also Australia’s current representative to the WTO Agreement on Government Procurement and its committee. Welcome, Juliana and Alan and over to you, Juliana.
Juliana Reed
Hi, Jo. Thank you for that introduction. It’s nice to hopefully see you all and get some questions later and as Jo mentioned, I was the chapter lead for the on the UK side for the UK Australia procurement chapter. Alan is also on the call and we’ll be doing a brief introduction into government procurement and taking some of your questions afterwards.
So if there’s anything you’ve ever wanted to know about government procurement and how it’s covered in trade deals, now is your time to ask. And so I will just run you through the contents. And so we’ll be covering what is government procurement, why it’s important, the WTO GPA which Jo’s mentioned that both Alan and I have worked on before, the UK Australia procurement rules specifically, and the market access commitments in the FTA chapter, how you can benefit and also what you should do if you experience a barrier to procurement, which you believe is covered by this trade agreement.
So first things first. What is procurement? Starting completely from the basics. So it’s anything and everything the government and public bodies purchase. So not sector specific, it can cut across many different areas. So things like building schools or even supplying catering services to a prison. And why is it important? Well, on average, about 13% of GDP is spent on government procurement in OECD countries.
So that’s a huge amount of money that’s going into procurement But different countries have different rules on who can access these contracts and how they’re governed. So procurement chapters in FTAs aim to level the playing field and ensure that businesses can access procurement and tap into that huge amount of GDP that’s being spent on procurement all over the globe.
So how is this covered in FTAs? The main aim of procurement of procurement chapters and FTAs is to ensure that procurement systems are open, they’re transparent and accessible on a nondiscriminatory basis. So this would mean that UK and Australian businesses have the same right to access government procurement in each other’s markets as a local business. So for example, if an Australian business were to bid for government contracts in the UK, which is covered by the UK Australia agreement, it can be sure that it won’t be discriminated against in favor of a UK supplier.
So we wouldn’t say, oh, actually we want to give this contract to a UK supplier to support the local industry. We would treat Australian and UK suppliers in exactly the same way. So what we really try and do in a procurement chapter is ensure that the rules which countries apply to procurement are a high standard and also ensure that these rules apply to as many different types of procurement as possible.
So that quite neatly splits up into how procurement commitments are structured in an FTA. And hopefully this will be helpful for you if you ever want to look at what types of procurement are covered by an FTA to see where you can be sure that you will not be discriminated against if you bid for those procurements. So there are two parts of a procurement chapter in an FTA.
There is the text of the agreement and also the coverage schedules. So the text of the agreement establishes a set of rules to ensure that procurement is done in a particular way. So following particular principles and if parties deviate from these rules, they face disciplinary action from other parties. So some of the core rules that you’ll be most interested in,
the very, very main one is the principle of national treatment and not discrimination. So this means that foreign suppliers will receive exactly the same treatments as domestic ones. There are also a large amount of provisions on the procurement process. So, for example, the length of time that a procurement should be advertised for and how long after the procurement has been run should suppliers be told about the outcomes as well as many other things.
And also importantly, most procurement chapters, including the procurement chapter between the UK and Australia, include provisions on domestic review. So what this means is that if you think the agreement has been breached, you can challenge it. So if you bid for procurement and you feel you’ve been discriminated against or the agreement has been breached in some way, for example, the procurement has not been advertised for as long as it should have been,
according to the agreement, then you are able to either ask for some compensation or potentially ask the procurement to be rerun. And so there are provisions in place so that if you feel that you have not been treated in accordance with the agreement, you are able to challenge that. The second part of the procurement chapter is the coverage schedules, and this outlines the market access that is covered by the agreement and therefore the market, the types of procurement that is subject to the rules and the terms of the agreement.
And it’s worth noting the only types of procurement that are covered by in these schedules these annexes is subject to the rules in the main text of the agreements. So what would be included is a list of bodies and activities covered by the agreement, which we can go into in a little bit more detail now. So when you think of what is in a procurement chapter, you kind of always have to think of a kind of matrix system.
So on what access you’ve got, the fact that there’s two types of entities that are covered. So you’ve got three different annexes. So you’ve got central government entities, sub-central, so for Australia that might mean state and territory level. For the UK that could mean local governments. And then you have what is broadly termed other entities. And that really varies by country.
Different countries structure their entities in different ways. For the UK, that probably means utility companies or utility entities that are in the public domain, whereas for Australia that might be more federal level entities. However, we’ve also got to think not just is the department that is procuring, is that covered, but also is the thing that they are procuring covered?
So the goods and the services for example, goods generally in most procurement chapters, certainly in the GPA and the UK, Australia FTA tend to be covered unless they are defense-related. So generally speaking a good will be covered. There are exemptions and different rules apply when it relates to defense procurement and the UK and Australia apply those exemptions slightly differently.
But broadly speaking, if it’s anything related to defense, it won’t be covered. But if it is any other goods then it should be covered. You’d expect and services as well is the service that the department is procuring covered. And I will get on to in a moment how that might differ across the UK and Australia. And finally, if it’s construction services, slightly different rules apply.
So you would have to look in the relevant annex to see what applies. And again, we’ll touch on that later. Finally, in the final annex, Annex seven, you would have the general notes and that’s a place for parties to list out any other exemptions they might have. So the UK, for example, often takes exemptions to state that procurement for broadcasting content is not covered until a UK stakeholder is on the line.
You understand very well that’s kind of protection for the BBC to ensure that the BBC can procure the kind of broadcasting material that it wants to without having to be subject to the requirements of this agreement. And the other thing to bear in mind is not just is the entity covered and is the type of procurement covered, but also is the procurement above a certain threshold.
So this threshold can vary slightly depending on the type of procurement. And it’s all if you were to ever feel you wanted to have a look at the market access annexes, which perhaps you don’t, I wouldn’t blame you, they’re quite technical. You will see that across the different annexes, they’re slightly different. So they range from the numbers that are displayed on the screen, which I won’t run through and bore you.
But what we hope you will see is actually that those thresholds are relatively low given the distance between our respective countries and the logistical challenges that the distance can bring. We imagine that you kind of only really be interested in contracts above that value anyway. So hopefully that suggests to you that contracts above the value, the ones you’re interested in and the thresholds are not something you need to be too concerned with.
So everything above the threshold is covered, provided it’s elsewhere in the market access schedules, unless there are specific exemptions, for example, around defense, as I mentioned, So what we can start to think about now is how does all this apply to the UK and Australia respectively, and what actually existed before this FTA? So both the UK and Australia are members of the WTO Government Procurement Agreement, which was mentioned earlier. The UK has been a member for a considerable time previously through the EU.
Now we are independent members and Australia joined a few years ago. The WTO GPA is a plurilateral agreement between 21 parties or 48 WTO members If you break up the EU and the combined total of opportunities within this agreement is estimated to be £1.3 trillion or 2.5 trillion AUD. So you can see that there’s a huge amount of opportunities within this agreement and there are some major world economies within this agreement.
For example, the US, the EU, Japan, Canada, as well as obviously the UK and Australia. So there’s a huge amount of opportunities within that and that already applied to the UK and Australia. But what we’ve done within our FTA is really build on that and so I’ll run through some of the main elements of the GPA just so you can understand the basis on which this FTA builds.
So again, the main one, as I mentioned, before, is national treatment and nondiscrimination. So suppliers from, let’s say one party will not be discriminated against if they bid for a coverted contract in another party in another party’s territory. There are also provisions on the procurement process to make sure it’s transparent and it says open competition And again, there is a domestic review clause.
So you can challenge if you think that the agreement has been breached and this can lead to compensation or procurement, procurement being rerun But remember, this only applies to procurement, which is covered by the agreement. So if a party or country has decided not to cover a certain type of procurement these rules will not apply. So I’m sure, as you can imagine, when a country decides to join the GPA, there are a huge amount of negotiations because countries want them to cover as much procurement as possible.
But they obviously want to give a competitive offer. And potentially some countries want to retain space for domestic policy reform and want to retain space to be able to award certain contracts to local suppliers, depending on the policy of that country. But broadly speaking, it’s worth saying that the UK and Australia already have pretty open procurement systems. So, for example, the UK government’s policy is not to discriminate against foreign suppliers anyway, but instead to focus on value for money.
So we would always look at the tender, the bid which has the lowest cost rather than focusing on where the bid has come from. So particularly for procurements being run in the UK, the main benefit of the GPA and also of the UK Australia procurement chapter is the legal certainty that it provides and the fact that suppliers can challenge the outcome of a contract award.
So even if procurements, UK procurements aren’t covered by the GPA, chances are you’re not going to be discriminated against if you bid for it. But you will not have the legal certainty that you absolutely won’t be discriminated against. And if you feel that you have been there is not there are not those kind of international legal remedies that you have at your disposal.
So the main point of the GPA is that it provides that real legal certainty. Alan would you like to come in?
Alan McGuinness
Yes, thank you, Juliana. And thanks. Thanks for all of all the information you’ve helpfully run through thus far. I just really wanted to echo what you’ve been talking to on this slide. Obviously, Australia was very pleased to complete its accession to the GPA in 2019, so just under three years ago.
And you know, it was for the reasons you’ve outlined all of those mutual benefits and access to all the collective procurement opportunities and like the UK, Australia, you know, as the default setting already has an open procurement system, very much like the UK looking to the principles of value for money nondiscrimination and competition But I couldn’t agree with you more that it’s absolutely in guarantee in getting that guaranteed a sort of treaty level, legally bound access under the GPA and our bilateral FTA that that makes it so worthwhile.
Thanks, Juliana.
Juliana Reed
Thanks, Alan. So those are the sort of chapter commitments that apply in the GPA. And now we can take a bit of a look at the market access which the UK and Australia offer under the GPA. So the UK to Australia offers comprehensive central government access. So those are the main government departments like my department, for example, for international trade.
And there will be things like schools, universities, hospitals, police forces, a wide range of sort of central government access. To Australia we do not offer any local government procurement. We do offer it to other parties, but most parties tend to make sure that offer reflects what the other party offers in return for it. We’ll speak in a moment about what Australia offers and we offer some services in the GPA.
However, we don’t offer quite as many as, for example, Australia offers to other parties. So while we have a very comprehensive offer in terms of the government departments that would be covered, the services are perhaps more limited and we do not cover what are called works concessions for Australia. So works concessions are a sort of type of public-private partnership whereby you might have something like a department decides that it wants a, let’s say the department of transport wants a road to be built. They say, okay, we’ll give you the contract of the road, but in the meantime we’ll say you were able to exploit the contract for a period of ten years by building a toll road toll tolling station and on the road. So you are able to take all the profits from drivers going past that road. But that means that you assume the risk. So if there are no drivers and you don’t get any profit, that’s your problem basically, it’s not the government’s problem. So that type of contract, which is generally used for very large infrastructure, construction projects, is not something that we cover for Australia.
Looking now at the Australian offer. Alan, would you like to come through this?
Alan McGuinness
Yes, absolutely. So thanks, Juliana. So under the, under the GPA on our accession to the agreement in 2019, we pulled together a very up-to-date and comprehensive market access offer for the GPA parties including the UK. So we cover all of our main Federal or Commonwealth Government entities of the Australian Government as well as the primary agencies and departments of our State and territory governments at the sub central government level.
So, you know, very similar, it’s, it’s key government departments and agencies that are subject to each government’s procurement framework and procurement rules and in Australia, each state and territory. And then the Federal Government have their own jurisdiction, their own control over those procurement frameworks. So, so each state and territory had to agree to be part of our offer and came, came to be part of our comprehensive package.
We don’t cover what in the Australian context we call local governments. So that’s the level below our state governments and it’s really the local government areas. So sort of councils and things like that. And that really is, is a factor of the fact that they don’t, they don’t do much procurement that would fall above the procurement thresholds in the GPA
Those that Juliana spoke to earlier, it’s not what we believe is commercially meaningful opportunities in the main for our for the GPA partners and it’s very consistent across our trade agreements and including the GPA that we we don’t offer that coverage. As Juliana mentioned, we have a very broad services offer in the GPA because we only we have what’s called a negative list which means we cover everything unless it’s on a very short list of services that we that we specifically don’t cover.
And a lot of them relates to blood and plasma products as some sort of medical specific services. And what we do cover as a default of the subjects of negotiation is what we call build, operate, transfer or public works concession contracts. So very similar to what Juliana mentioned at the end of her list there, those types of public-private partnerships.
Thanks, Juliana, back to you.
Juliana Reed
Great. Thank you. And so the next question is, how do you establish that baseline of opportunities and of rules that apply between the UK and Australia under the WTO GPA? How does the UK, Australia FTA build on this? And there are a few different ways that we do so. We have improved nondiscrimination provisions. So we’ve really tried to strengthen those provisions that mean that the suppliers are not discriminated against based on where they come from.
So, for example, we’ve clarified some areas of ambiguity in the GPA around pre procurement engagement. So we said that any market research that is done before procurement is run, any consultations with suppliers that are done must be done in a way that is not discriminatory. We also really beefed up the electronic procurement requirements. So the GPA was negotiated back in 2012 and there’s a number of different members, some of whom have differing levels of electronic procurement.
The UK and Australia have very high standards when it comes to electronic procurement and so we have a requirement that all procurement must be conducted electronically, so they must be advertised procurements must be advertised importers online. So it’s not a case that you go to your local department and get a piece of paper and then you can bid for procurement based on that.
But suppliers overseas don’t have access that piece of paper. It’s very much all the opportunities online. So suppliers all over the globe and suppliers in their respective countries can access them. Tenders must be, or bids must be accepted electronically unless in exceptional circumstances. For example, if you have to submit a model for some sort of architectural procurement and supplier registration systems must be available electronically.
So if you need to, if there’s a system whereby you need to register to become a supplier, that registration must be something that is available to do electronically. And we also have improved anti-corruption text. And so we have put in place we have we have tax which puts in place measures encourages you, Australia, to put in place measures to eliminate corruption in the procurement process.
This is something that’s very important to both of our countries and also is something that sets a very high standard. And so in future is going forward, having such an ambitious anti-corruption provision suggests to all our future trade in partnership with the UK and Australia the corruption in procurement is something that we just absolutely want to eliminate as much as is absolutely possible.
We also have some provisions around sustainability and procurement. So again, this clarifies the slight ambiguity in the GPA and to suggest that contracting authorities can consider environmental, social and labour impacts of the procurement when selecting the supplier provided that this is done in a nondiscriminatory way. And that’s absolutely key. We do. This is not a backdoor for any kind of discrimination.
It’s just about ensuring that given the times we live in, that these considerations can be taken into account if they non-discriminatory. And finally, we have GPA plus tax. So tax that goes above the GPA with regards to facilitating SME participation. So we have an article about how we are going to help SMEs get into our respective procurement markets.
So, for example, tender documents must be free and procuring entities must provide prompt payments when it comes to procurement And in terms of the additional market access, so we’ve established the baseline market access that exists between the UK and Australia and the GPA How does the UK FTA build on that? And so, for example, we offer some additional, well, so we don’t offer any local government coverage to Australia in the GPA, but we do offer some larger local governments to Australia in the FTA and we offer transport entities and some additional services And finally, there’s what concessions which I mentioned are not covered to Australia in the GPA, all of it in the FTA.
Alan do you want to run through Australia’s additional offer.
Alan McGuinness
Absolutely. Thanks again, Juliana. So, you know, very similar in a very similar vein. So what we did is we went away and consulted all of our state and territory governments and across the Australian Government and did our absolute best to bring forward additional entities at both of those levels. So going beyond what the UK already has guaranteed access to under the GPA.
So for example, at the Australian Government level, our offer under the FTA includes all of Australia, the Australian Government’s top ten procuring entities for the two most recent financial years for example, which alone accounted for 84% by value of the Australian Government’s total procurement contracts and included the addition of the Australian Digital Health Agency, which, which became a top ten entity in the 2019-20 financial year.
We also, as I said, added state and territory entities, including adding additional transport and infrastructure functions for several of our largest states such as New South Wales and Victoria. And we agreed to sort of carve back in for want of a better word, to cover that wide range of services that we’re able to cover and weren’t previously covering for the UK except for that very short list that Australia has as a so-called negative list, just around five categories that apply to others.
So the UK now has access at both the national and state and territory level to the full range of Australia’s possible services coverage. Thanks, Juliana.
Juliana Reed
Thanks, Alan. And one other thing that it’s worth mentioning is in the revised, well, the new FTA is a commitment to negotiate local government market access, if Australia ever offers it to another FTA.
So you might have seen this referred to in the press as this sort of local government side letter that sits alongside the FTA procurement chapter. So what will that you see here is that technically not every single type of procurement is covered for either the UK or Australia in this agreement. But the a very large percentage, the majority of meaty procurements are now covered between the UK and Australia, whether under the GPA or this new revised agreement. So there’s a huge amount of opportunities on offer for both UK and Australian businesses.
And so you might be asking yourself how can you access these opportunities? I’m sure many of you will be aware already that there are portals online. So the UK has a find a tender service which we launched post EU Exit as obviously we did not have access to the EU system anymore and Australia has AusTender and there are also state and territory level portals for states, state and territory specific procurement. To see information about upcoming procurements, we suggest looking at departmental pipeline documents. So for the UK government, if you type in any major government departments, let me put the lights back on If you look at any major government department website, so for example, you type in DIT Department of International trade procurement pipeline you will get a list of all the sort of upcoming procurement opportunities for the next year or so.
There are other resources as well. So Alan I don’t know I don’t know if maybe you want to talk to the infrastructure pipeline. The UK also has a national infrastructure outlook and pipeline we can send you we can make sure the slides sent to you afterwards so you can access all the links within them and see all the opportunities available on offer.
Alan, did you want to comment.
Alan McGuinness
Only very briefly. I think you’ve you’ve covered that very well. So like the UK’s Find A Tender, our AusTender and state and territory level e-tendering portals are the best One-Stop Shop points to go to and often also you know they include that forward procurement pipeline. Juliana was alluding to directly or through easy-to-find cross-links and that includes yes the upcoming unplanned procurements foreshadowed as well as the current tenders open right now.
And the only other thing I was going to add is that we still see the UK published links on the WTO GPAs as called the eGPA portal. I think one of these links actually goes there on the slide which has all of those individual government portals, you know, collated into a single page. Thanks, Juliana.
Juliana Reed
Thank you. And so on the next slide, we have a few sort of high level information about opportunities coming up and that you might be interested in. So one in the UK which I’m sure UK businesses will be very aware of is high speed two, otherwise known as HS2, which is a massive, very, very long railway that is being built in the UK between London and the North, which has many contracts, whether they’re construction, project management, many services contracts as well, many of which are multi-million pound.
And so may be of interest to you as well as that. There’s also many central government opportunities particularly around procurement of services, which I’m sure will be of interest to you because getting goods across the globe can sometimes be challenging given the distance between our countries, whereas some of those services, I imagine the things that you are able to provide remotely.
So you could get around some of the logistical different difficulties of getting things between our two countries. Alan, did you want to run through Australia opportunities?
Alan McGuinness
Absolutely. Thanks, Juliana. So, you know, along a similar vein of obviously we don’t have the high speed 2 but an excellent opportunity there. We have on the AusTender portal these can be found, but you know, a wide range of Australian government departments such as Services Australia, which, which is going to be looking for financial intelligence and investigations, software services, our Department of Home Affairs, a very large portfolio, you know, has mail and cargo transport opportunities and also capital works and construction, industrial construction panel opportunities and our digital transformation agency has a data center panel and will be coming to establish a new panel arrangement for data services just for example. But those are just some large agency procurements then at the state and territory level, a very similar story. So each state and territory has its full pipeline. Queensland has a range of information and communications technology opportunities in the pipeline across the state between the estimated at between the one and 5 million Australian dollar mark.
So ICT infrastructure refreshes online newsletter services as well as ICT testing services, for example, New South Wales has managed service provider tender looking for whole of government services for example, around payment and contingent labour and statements of work as well as a food service that Juliana mentioned food catering earlier, a food services across the New South Wales Health Network, but the actual goods themselves, so the, the sort of various products for distribution to hospitals And finally the Northern Territory has a supply and delivery of pharmaceutical products and compounding services over 120, $126 million there.
And energy related financial engineering and technical advice consultancy services a two year panel contract that’s looking at around 3 million AUD. So as you can see, a wide swathe there, all available on the online portals.
Thank you, Juliana.
Juliana Reed
Thank you, Alan. And so finally, what we’re going to be looking at is if you bid for any of these procurements that you believe are covered by the agreement and you feel you’ve been discriminated against or the agreement has been breached in some way, what can you do?
So of the UK businesses, there is a link here where you can report the barrier. So this will take you to an online portal. But equally, if you want to contact us, we’re very happy to hear from you and see the UK and Australia. Myself and Alan will continue to have kind of ongoing dialogs. We have a provision in the agreement about cooperations that will continue to have ongoing dialogs and we’d be happy to hear that.
Very keen to hear about your barriers and to discuss together how we can try and ensure those come down in the future. So both Yasmin and I have our email addresses on the screen if you want to get in touch with us and we’re always very happy to hear from you. And Alan, I’ll pass over to you.
Alan McGuinness
Thanks, Juliana.
Yes, absolutely. In the same vein. So the Australian government, the link is there. We have our trade barriers register, which is a place that Australian exporters, including to the UK, can register any concerns or issues they’re facing, you know, that aren’t related to tariffs and non-tariff barriers, including of course in this instance related to government procurement and our agreements.
And also on the slide is my team’s inbox, which again we’re always happy to hear here about concerns as Juliana said, will be an ongoing dialog. And we have a range of cooperation areas that have been flagged in the agreements. And we’re also very keen to hear about success stories. So if there are any fantastic opportunities that businesses have been successful in tendering for, we’re always keen to hear about that as well.
Thanks.
Juliana Reed
Thanks, Alan. Yeah, actually off the back of that, I might also say this is obviously this presentation specific to UK Australia. If that any other barriers you’ve faced please use this tool. We have FTAs upcoming with many different countries Mexico, Israel, Gulf Operation Council, India, I’m sure you’ve seen them on the press. So if you have any barriers in those countries as well, let us know.
We can see if we can try and do something about them before, well before they even start and during them as well. And so yes, that takes us to the end of the presentation. And Jo, I will pass over to you. I know you’re going to handle a Q&A.
Joanne Holland
Thank you, Juliana. And thank you, Alan. For a really excellent session.
And I was pleased to hear that there’s some benefits for SMEs. Prompt payments is always a good one. And also free tenders. So that’s excellent to hear. We’ve got some good questions coming up. So hand it over to both of you. Just a one at the beginning of the layman’s difference between the GPA and the FTA.
Juliana Reed
Yeah, I would say you probably don’t massively need to focus on the difference. As I said, if you think you’re interested in a procurement just bird for it, I don’t try and only bid for things that are covered by the GPA and the FTA because broadly speaking, we do have our open procurement systems anyway and the layman’s difference is probably that the FTA is slightly more ambitious and the rules that apply to procurement under the FTA is more ambitious.
But actually, in terms of the practice that you experience when you’re bidding for procurement, there will be no difference. So this kind of background that we gave technical stuff in case you’re interested, but if you’re not, you don’t really need to think about it. You only really need to think about it. If you feel you’ve been discriminated against in some way and you want to do something about it, and then you need to see which agreement would apply. Alan I don’t know if you’ve got anything to add to that.
Alan McGuinness
No, I think I think you’ve covered that really well, Juliana.
I agree. I mean, obviously the other than the difference with the WTO, JPA having all the other or the other parties as opposed to the FTA just being between the UK and Australia, and as you said, the sort of disciplines and the ideas in the GPA very much reflected in our bilateral FTA. And we just built on those in those areas you outlined in the presentation, including to add some clarity and spell out some things the GPA may have been a bit more a bit more vague or silent about.
But I think, I think functionally no difference in terms of bidding in either of our markets. It’s those protections that the agreements offer.
Joanne Holland
Excellent. Are you able to confirm the relevance threshold, what is below or what is above and what does cover actually mean.
Juliana Reed
Sure. So the relevance of the threshold, what we’re well maybe started with what’s covered mean? Covered means that the rules of the agreement apply if the procurement is something that is in those market access schedules and is therefore so-called covered by the agreement.
It means that the rules of the agreement do apply to that procurement. So you cannot be discriminated against for that procurement. Or if you are if you feel like you are and the agreement’s been breached, you have access to some sort of resolution, whether that’s procurement being rerun or compensation or whatever it may be. And so for it to be covered, it has to be above a certain threshold.
And the real relevance of that threshold is that you may find whether in the UK or Australia or in other countries that if the procurement is below threshold, that can be where sort of more local policies tend to emerge. So for very small procurements, you don’t necessarily have to go through a formal process of advertising it for a set amount of time because quite frankly it wouldn’t really be worth it for the government and it wouldn’t necessarily be worth it to businesses either.
We’ve got a procurement for let’s say we need to buy £10,000 worth of desks. Is there that much point in going through a very rigorous procurement process where it has to be advertised for a certain amount of time. The amount of bureaucracy that that would create? So it’s really for the bigger procurements and we’ll send on the slides which outlines the thresholds in all each of our domestic regulations And so as for the bigger procurements where above those thresholds which will be covered by the agreement and whether the rules of the agreement would apply, hopefully that answers the question.
Joanne Holland
We have a comment here, a really interesting session.
So that’s very good feedback. If an Australian or UK company wants to bid for tenders but doesn’t want to set up in the market they’re bidding in, will procurement providers be able to reject bids if companies aren’t setting up in that country? Or will it.. Will that be considered discrimination under the rules?
Juliana Reed
Sure. I mean, I can answer this from a UK perspective and then maybe have to hand over to Alan for an Australian perspective.
Certainly from a UK perspective, there is no obligation to set up in the country. There may be for things that aren’t covered by the agreement, for example, we do not have a health care procurement within the agreement because I am sure my UK businesses will be aware very much of the sensitivities around health care in the UK and so things like health care, procurement, health care, service, procurement you may have to set up locally if that’s not covered by the agreement anyway, but the things covered by the agreement from a UK perspective, there would be absolutely no obligation to set up in the UK. I can pass you over to Alan on the Australian side.
Alan McGuinness
Thanks, Juliana. So a very similar picture on the Australian side. So for procurements that are covered by the rules of our agreements and are above the thresholds which we just touched on in the last question, we absolutely don’t have that requirement. We don’t discriminate in that procurement based on the location or the ownership of the supplier. But as Juliana said, that absolutely applies to the covered areas of procurement and above those monetary thresholds which as Juliana said, are set, you know, and certainly in Australia’s case, at a consistent level across our free trade agreements to give that, you know, dependency and certainty to suppliers.
Joanne Holland
Just another question reminding what’s the online tender portal called?
And Juliana the slides will be available? If people contact – because your contact details are on the side that they contact us first at hello@AustraliaChamber.co.uk , we’ll pass on any queries, etc. to Juliana or Alan and the slides as well. So that’s hello@AustraliaChamber.co.uk. Another question on the threshold.
What’s the difference between 138 K and 427 K?
Juliana Reed
Yeah, yeah. So that’s a good question. So we ran through earlier those different types of entities, different types of government departments or agencies that procure. So the lower threshold of 138 is for central government entities like the Department for International Trade, the Cabinet Office, the Home Office, sort of big government departments.
The thresholds tend to get slightly higher. So more towards that 400 mark 400 thousand mark for things like utility entities where the thresholds are slightly higher. So essentially means that depending on the government department that is purchasing, the thresholds might vary slightly. I would say again, don’t concern yourself about it too much because really you shouldn’t be discriminated against anyway. But if you are interested to see how they match up and you can either have a look at the agreement or perhaps we can send something in writing afterwards about how across the different annexes, all the different types of government entities, those thresholds apply.
But alternatively, if you want to see a list of the government entities that is covered at the very top of that list, I will show you the thresholds. If you Google some, if you Google UK, Australia procurement chapter, UK Australia FTA, you could go to procurement chapter and have a look. It is very much just lists of entities with a number at the top telling you the threshold.
And so you might not want that detail, but if you’re interested, it is there on the internet.
Joanne Holland
Thank you, Juliana. You may have covered this, but perhaps it’s worth asking again Should businesses only bid for those contracts which are covered by the agreement?
Juliana Reed
Short answer and I’ll hand over to Alan as well in a moment is no. We’d really encourage you to bid for as many opportunities as possible. A large part of these contracts will be covered by the agreement anyway, because we try to make it as comprehensive and broad-ranging, wide-ranging as possible. But like I said, particularly saying to UK, to Australian businesses, the UK market is very open, we seek value for money.
So please do bid. We want to see as many options as possible and I’m sure the message to UK businesses is the same – please bid for opportunities in Australia, if you experience any barriers, let us know. We’ll see if we can help you in any way whether that particular procurement or for future procurements if it’s not something we’re able to address immediately, but I’ll pass to Alan as well.
Alan McGuinness
No, I think you’ve absolutely captured it. Julianna, exactly the same in reverse. So as we’ve both already touched on, now our markets are already open and based on that value for money and competition, principle. So I would say definitely bid for any contracts of interest. The tender documentation, of course, will have the specific requirements of the procurement and note any special specialised requirements, etc. But no, yeah, I would say go for it.
But as noted before, it really is just the difference between what we what we guarantee in a legal sense at the treaty level and it doesn’t mean that there are plenty of other opportunities out there. We very much welcome them the suppliers to bid for them.
Joanne Holland
I’ve just a question now on health care bids entity in Australia as required, but does this apply to digital health care bids?
Juliana Reed
I think this might have come from what I mentioned a moment ago about health care. So I can perhaps clarify a bit the position of the inclusion of healthcare in the UK, Australia FTA from a UK perspective. So something like the NHS, our National Health Service is covered by the agreement for the procurement of goods. So any goods that are purchased – hospital beds, pharmaceuticals, whatever it may be, would be procured by the NHS.
And there is no need to establish in the UK to bid for those contracts and to, to win those contracts. Even similarly, the health that, that, sorry, the services that covered in the agreement are covered when procured by the NHS. So things like legal services, cleaning services, real estate services would all be covered for information technology, digital services, would be covered with no requirement to establish in the UK where the real sensitivity lies is the procurement of health care services.
So if there’s a branch of the NHS that is being run privately or the government decides that part of it wants to be run privately, should be run privately, and they want to procure health care services so they want to get a load of doctors on board or they want radiology services, anything like that. That needs to be that that is not included within the agreement.
I’m sure you can understand that the sensitivities around health care. So that is why that is excluded from the agreement for both the UK and Australia as well. And it’s a sensitivity across many, many different countries in the GPA as well. And very few countries would cover that health care services. Hopefully that answers the question.
Joanne Holland
Do the tender portals offer automatic nudges for certain sectors to avoid having to check daily and weekly.
Juliana Reed
That is a very good question and I am not entirely sure I can go and check that.
I think they probably do have that capability. Yasmin is nodding at me, saying, yes, they definitely do have that capability and I’ll take Yasmin’s word for it because she’s a tech wiz, so yeah, I believe they do. But I couldn’t say with absolute certainty though it seems Yasmin is very sure, but yeah. Alan, I don’t know on the Australian side it does that capability.
Alan McGuinness
No, no I know off the top of my head I would have to defer to my Australian Government, Department of Finance colleagues who manage the AusTender portal, and of course each state and territory manages theirs as well.
It wouldn’t surprise me if there’s something along those lines, but I can’t give a definitive. I know there’s the ability to to to sign up for alerts and such with an email address, not through a rigorous process or anything, but yes, I can’t give a definitive on that specific question.
Joanne Holland
Thank you, Alan and Juliana. We’ve come to an end of questions and I just want to now thank you both for covering a really comprehensive topic, which is the government procurement.
I think both of you have stressed that, you know, please, please participate, please apply. We are available here at the Australian UK Chamber of Commerce to also assist putting you in touch with the relevant parties. So please do get in touch. If you get in touch with us hello@AustraliaChamber.co.uk. This was the second of our four part series on the FTA which combines the Australian and the UK Government.
So please stay tuned. I want to thank the audience for coming along and listening today. Thank you so much. Please do have a nice day if you’re in the UK and in Australia – a lovely evening. Thank you
