Before You Go to Market: Getting the Procurement Decision Right.

Article 1 in Muscat Tanzer’s series: Public Money, Sound Decisions — A Practical Guide to Government Procurement and Contracting

A service contract is nearing expiry. The incumbent is performing reasonably well, the operational team wants continuity, and funding is available. Someone suggests obtaining a fresh quotation and extending the arrangement.

Before approaching the supplier, several questions need answers. Is an extension available under the contract? Who can approve it? What is the value of the proposed commitment? Does the applicable procurement framework permit that approach? Would a different scope or process deliver a better outcome?

Similar questions arise when a council plans a community facility or a State agency commissions engineering services. An approved budget and a desired completion date are starting points. The organisation also needs to understand what it is buying, how it may buy it and whether the market can deliver.

Sound procurement begins with those decisions.

Why it matters

The Queensland Audit Office’s Local government 2025 report identified procurement and contract management weaknesses in more than 60% of councils as at 30 June 2025. It highlighted the need for stronger decision-making, oversight and management of conflicts of interest.

For State Government buyers, the Queensland Procurement Policy 2026 emphasises value for money alongside local opportunities, simpler processes, innovation and economic, environmental and social outcomes. These objectives need to inform procurement design and assessment.

The practical task is to connect the identified need, the market conditions, the procurement approach, the approval and the eventual contract.

1. Define the outcome and scope

Begin with a clear statement of the problem to be solved.

“Engage a consultant” describes a purchase. “Obtain an independently verified assessment of asset condition to inform the next capital works program” describes an outcome.

That distinction helps establish the deliverables, required expertise and measures of satisfactory performance.

Before preparing procurement documents, clarify:

• what must be delivered and how it will be used;
• what is included and excluded;
• the timing, dependencies and operational constraints; and
• how successful delivery will be demonstrated.

Involve the people who will use and manage the contract. They can identify requirements that might otherwise emerge only after award.

An unclear scope makes offers harder to compare and creates room for additional fees, variations and disputes about the supplier’s obligations.

2. Understand the market

Procurement planning should look beyond the organisation’s own project list.

At launch, the Queensland Construction Portal mapped approximately $174 billion in major public and private construction projects through to 2029–30. Covering projects valued at $50 million or more, it also forecasts workforce, skills and materials demand.

For councils and State agencies buying construction and related services, this information can help identify assumptions to test. Will suitable contractors have capacity during the proposed delivery period? Are key personnel and materials likely to be available? Does the timetable allow realistic procurement and mobilisation lead times?

Smaller projects may draw on the same contractors, engineers and supply chains as major developments. Their procurement planning should consider that potential competition.

Pipeline forecasts provide context for project-specific enquiries. They do not establish that a particular supplier is available or that a proposed price and program are achievable.

Use market information and appropriately managed early engagement to test assumptions, then reflect the findings in the scope, budget, timetable and contract.

3. Establish a realistic value and funding position

The initial quotation or first year’s allocation may give an incomplete picture of the commitment.

For planning purposes, consider the anticipated term, extension options, implementation costs, recurring charges and foreseeable additional requirements. Apply the valuation rules under the relevant framework when determining the procurement pathway.

A software purchase may involve configuration, migration, training, support and exit assistance. A maintenance contract may combine routine services with substantial additional work.

Consider related requirements together to understand the overall purchase. Separate orders should not be used to circumvent procurement requirements.

Confirm that funding covers the intended scope and duration, including any approvals needed for commitments extending into later financial years. Where estimates remain uncertain, record the assumptions and how they will be tested.

Market pressures also deserve attention. If delivery depends on constrained resources or long-lead materials, assess the implications for the estimate and program before inviting offers.

4. Confirm the rules and procurement approach

Councils and Queensland Government agencies share procurement objectives, but their governing frameworks differ.

For councils governed by the Local Government Act 2009, the Local Government Regulation 2012 provides strategic and default contracting frameworks. Check the applicable pathway, council policy and any proposed exception. Brisbane City Council operates under separate legislation.

State Government buyers should identify the requirements applying to their entity under the Queensland Procurement Policy 2026, agency procedures, delegations and relevant category requirements.

Confirm whether an open tender, quotations, an existing arrangement or another permitted approach is appropriate. If using a panel or standing arrangement, check its scope, eligible purchasers and purchasing conditions.

If relying on an exception, document the grounds, supporting facts and required approval before proceeding.

Work backwards from the required commencement date, allowing for supplier responses, evaluation, approvals, negotiation and mobilisation. A contract nearing expiry should prompt timely planning.

Early market engagement can clarify capacity and requirements. Manage supplier contact, confidentiality and information sharing so participants do not gain an inappropriate advantage.

5. Confirm authority and prepare the contract

An approved budget does not necessarily confer authority to approach the market, select a supplier or enter into a contract.

Identify the approvals required at each stage and confirm that the relevant decision-maker’s authority covers the nature and value of the commitment.

Prepare the contract alongside the procurement documents. Address deliverables, payment, insurance, liability, confidentiality, data handling, intellectual property, performance measures and termination rights as appropriate.

Translate identified market risks into practical requirements. For construction, that may include evidence of resource availability, realistic milestones and clear processes for delay and variations. For technology, it may include implementation responsibilities, data access and transition assistance.

These terms affect pricing and supplier participation. Leaving them until after selection can create negotiation difficulties or undermine the basis on which offers were compared.

Identify who will manage the contract and ensure they have the capacity and information to do so.

Five questions before approaching the market

1. What outcome are we buying, and is the scope clear enough to price and evaluate?
2. Have we tested market capacity and the realism of our budget and timetable?
3. Which rules apply, and why is the proposed procurement approach permitted and suitable?
4. Who can approve the process, expenditure and contract?
5. How will the contract allocate risk, measure performance and support ongoing management?

The record should be proportionate to the procurement’s value, complexity and risk. Another officer should be able to understand what was proposed, why the approach was chosen and who authorised it.

Good preparation gives suppliers a clearer opportunity to compete. It also gives the organisation a stronger basis for assessing offers, managing delivery and explaining how public money has been committed.

How Muscat Tanzer can assist

Muscat Tanzer assists councils and government agencies with procurement planning, advice on contracting requirements and approvals, and the preparation and review of tender documents and contracts. We help teams address legal and probity issues early so they can approach the market with clear requirements and a sound basis for decision-making.

In our next article, we examine probity in practice: managing conflicts of interest, supplier contact and commercial pressure.