What type of contract are you managing?

Commonwealth Contracting Suite (CCS) Contract

•  The CCS is an online interactive suite of smart forms designed to assist procurement officials prepare procurement documentation for Commonwealth procurement valued under $1 million.

•  The CCS is mandatory for use by non-corporate Commonwealth entities (NCE) for procurement under $200,000 (including GST) except for specific circumstances as detailed in RMG-420 Mandatory use of the Commonwealth Contracting Suite for procurement under $200,000. Corporate Commonwealth entities (CCE) are encouraged to use the CCS as appropriate.

•  If your contract has been created through the CCS then it will be a short contract with simplified terms and language and will be easy to understand with regard to responsibilities and obligations for both you and the supplier.

•  The CCS (which incorpoates the Commonwealth Contract Terms) is drafted in plain English and aims to make contract management as easy as possible.

Entity's Standard Form Contract

•  Some larger entities have developed their own contract templates. These may be longer form contracts for when the CCS is not being used. This means that contracts will be standardised and reflect the entity's approach to procurement.

•  Entities need to ensure that templates are regularly updated to reflect any changes to legislation or policy.

•  Contextual advice on managing these contracts will generally be available in your entity.

Digital Sourcing Model Contract

•  The Digital Transformation Agency (DTA) has a suite of templates. These are suitable for sourcing information and communication technology (ICT) products and services that are not covered by a whole of Government arrangement.

•  More information on these templates is available from the DTA website. Contact DTA for contexutual contract management advice.

Bespoke Purpose Designed Contract

•  Occasionally, an entity may have a requirement that raises issues or involves risks or requirements that require a particular approach. This will require the entity to develop a contract that reflects these requirements and will often involve input from legal, procurement and technical specialists. These are usually high risk or specialised contracts.

•  Management of these contracts may require assistance from specialist advisers.

Standing Offer Arrangements (Panels)

•  Standing offer arrangements are established by entities for frequently sourced goods or services. A Standing Offer Arrangement consists of a Deed of Standing Offer (DoSO) with a supplier that enables the entity to obtain particular goods or services where the prices and contractual terms are already agreed. It is common for entities to put in place standing offer arrangements with a number of suppliers for the same or similar services - this is commonly referred to as a 'panel'. Generally the DoSO will be the same for each supplier under the panel. The person (or team) who manages the standing offer arrangement is generally referred to as the panel manager.

•  Procuring from a standing offer arrangement provides efficiencies as it mitigates the ongoing costs to the supplier and the entity to continually tender for frequently used goods or services.

•  Most standing offer arrangements will provide for the entity to issue an official order or a work order to a supplier for specific goods or services - with this forming a contract between the parties for those goods or services. Value for money must still be considered each time goods or services are purchased under a standing offer arrangement and the entity issuing the official order is responsible for its management to ensure that the value for money is achieved.

•  Details of current standing offer arrangements can be found on the AusTender website.

Coordinated Procurement Arrangements (eg whole of Government)

•  Whole of Government coordinated procurement arrangements are established for a number of reasons, including to give effect to policy decisions, to collectively procure goods and services in common use across entities to leverage the purchasing power of the Australian Government, to improve consistency and control, and to deliver savings and efficiencies.

•  Whole of Government arrangements may take the form of a contract or standing offer. These contracts and arrangements have been variously established by lead entities including the Department of Finance and the Digital Transformation Agency. Contract management processes vary for different arrangements. If you are managing your entity's purchasing from a whole of Government arrangement, you will need to clearly understand the processes for purchasing from that panel. The panel management team will be able to assist you.

•  Most whole of Government arrangements are mandatory for use by non-corporate Commonwealth entities and opt in for corporate Commonwealth entities. A list of these can be found on the Department of Finance website.

Cooperative Procurement Arrangements (with other entities)

•  Sometimes, a number of different entities will have a similar requirement for goods or services. Cooperative procurement enables such entities to obtain goods or services jointly through the one arrangement. This can be achieved through a joint approach to the market and/or when an entity establishes a contract or standing offer that allows other entities to access it (often referred to as 'piggybacking').

•  Cooperative procurement can make better use of resources across entities and also for potential suppliers. Efficiencies may be derived from several entities coming together and implementing and maintaining one arrangement in lieu of many. This can reduce the number of administrative processes and share the procurement and contract management process workload. It may also be able to leverage better prices and service arrangements and can reduce the number of tenders for which a potential supplier will need to bid for.

•  However, care needs to be taken to ensure that there is sufficient alignment between each entity's requirements to ensure that the cooperative procurement delivers value for money for each entity in the context of their particular requirements.

Purchase order

•  For transactional or routine purchases an entity may issue a purchase order. This could be based on the Commonwealth Purchase Order Terms (available on the Department of Finance website) and contain a simple description of the goods or services required. Generally, this is issued to a supplier and does not require their signature. A purchase order will still create a legally binding contract but is unlikely to require the level of management required by more complex contracts.

Credit card purchase

•  The Australian Government payment card policy promotes payment cards as the preferred payment mechanism for eligible payments to suppliers for amounts under $10,000. This is subject to the supplier being able to accept payment by credit card. Where practicable, payment should be made at the point of sale. A tax invoice (receipt) must be provided by the supplier for the payment. In this instance, a formal written contract is not required. Further guidance on this policy can be found in RMG-417 Supplier Pay on Time or Pay Interest.

•  Payments by credit card rarely require complex contract management processes.

Vendor terms

•  Acceptance of a vendor agreement is also a form of contract. These are often found with requirements such as venue hire, software licensing, product warranty and when you click on the 'I agree' to online terms and conditions. These will generally contain clauses that will require the entity to sign up to contingent liabilities.

•  RMG-417 Supplier Pay on Time or Pay Interest policy will apply to this procurement unless the supplier's contract payment terms are shorter than those set out in RMG-417.

•  Annex 1 provides additional information on a range of potential contract management issues including contingent liability provisions.