Strategic and Compliant Procurement in Western Australian Local Governments

Local governments in Western Australia are responsible for delivering an extensive range of services and infrastructure for their communities. To do this efficiently, they must procure goods and services in compliance with a strict legislative framework designed to ensure transparency, fairness and value for money.

This framework is set out primarily in the Local Government Act 1995 (WA) and the Local Government (Functions and General) Regulations 1996 (WA). Councils must also take into account relevant State Government policies such as the Buy Local Policy, Aboriginal Procurement Policy and Western Australian Social Procurement Framework.

A strategic and compliant approach to procurement is essential not only to meet statutory obligations but also to achieve best value outcomes for ratepayers.

The Legislative Framework

1. The Local Government Act 1995 (WA)

The Act provides the overarching requirement that councils must use sound contracting and financial management practices, ensuring openness and accountability in their operations.

Section 3.57 of the Act states:
“A local government is required to invite tenders before it enters into a contract of a prescribed kind under which another person is to supply goods or services.”

This provision forms the foundation of the procurement framework and is expanded upon in the Regulations.

2. The Local Government (Functions and General) Regulations 1996 (WA)

Part 4 of the Regulations prescribes the rules for tendering and procurement.

• Regulation 11(1): Tenders must be publicly invited where the expected value of the contract is $250,000 or more, unless an exemption applies.
• Regulation 11(2): Several exemptions to Regulation 11(1) are provided, including for purchases under a WALGA Preferred Supplier Panel, emergency procurements, or where goods and services are obtained through another government entity.
• Regulations 12–19: Set out the detailed procedural requirements for inviting tenders, keeping a tenders register, opening and assessing tenders, and notifying tenderers.
• Regulation 20: Allows Council to make minor variations to the procurement prior to the successful tenderer entering into a contract. However, if the tenderer is unable to enter the varied contract or cannot agree with Council on the variation the tenderer will cease to be the chosen tenderer.
• Regulation 21A: A local government may only vary a contract for the supply of goods and services with a successful tenderer if the variation is necessary to deliver the goods or services and does not change the contract’s scope, or the variation is a renewal or extension of the contract’s term as allowed under regulation 11(2)(j).
• Division 3: Sets out the circumstances that allow for pre-qualified supplier panels, where established in accordance with prescribed criteria and procedures.

Compliance Process – Step by Step

Below is a practical checklist for ensuring compliance with WA’s legislative procurement framework:

Key Principles

Beyond procedural compliance, councils must observe core procurement principles that underpin the legislation:

• Value for Money – assess cost and non-cost factors, including quality, risk, sustainability and local economic benefits.
• Openness and Transparency – ensure public confidence through clear processes and accessible records.
• Fairness and Equity – provide all suppliers with equal opportunity to compete.
• Accountability – maintain clear audit trails and decision-making justifications.
• Sustainability and Local Benefit – align procurement with social and economic development objectives.

Strategic Procurement – Beyond Compliance

Compliance with the Act and Regulations is mandatory, leading councils adopt a strategic approach to procurement. This involves developing procurement policies and frameworks that integrate legislative compliance with broader organisational goals such as:

• supporting local and regional businesses;
• delivering environmentally sustainable outcomes;
• facilitating innovation and partnership in service delivery; and
• ensuring whole-of-life value and risk optimisation in major projects.

A strategic approach enables councils to move from reactive, transactional purchasing to proactive, planned procurement that drives community and financial benefits.

How Muscat Tanzer Can Assist

We have extensive experience assisting local governments across Australia with:

• procurement policies and tender documentation;
• tender exemptions and compliance advice;
• pre-qualified panels;
• probity and evaluation support; and
• contract formation, variations and disputes.

Muscat Tanzer helps councils design procurement frameworks that are legally compliant, transparent and strategically aligned with their community goals.

If your council is thinking about refreshing its procurement framework and documentation or if you have any questions regarding procurement generally, do not hesitate to contact us.