The procurement thresholds for Australian federal and state public sector procurement are set to determine the level of scrutiny and competition required for different types of purchases.
For the Australian federal government, the thresholds are as follows:
- For non-building and construction goods and services: AUD 80,000 (excluding GST)
- For building and construction goods and services: AUD 450,000 (excluding GST)
- For any procurement of goods and services related to national security: AUD 4 million (excluding GST)
These thresholds are used to determine the level of competition and scrutiny required for procurement activities. For purchases below the threshold, government agencies are generally free to select a supplier based on their own criteria, without the need for a competitive tender process. For purchases above the threshold, government agencies are required to engage in a competitive tender process, where multiple suppliers are invited to submit bids and the government agency selects the most suitable supplier based on a range of factors, including price, quality, and delivery timelines.
The procurement thresholds for each state and territory government in Australia are generally similar to those of the federal government, but with some variations. Here is an overview of the rules for each state:
- New South Wales: For goods and services, the threshold is AUD 250,000 (excluding GST). For construction works, the threshold is AUD 1 million (excluding GST). Purchases below the threshold do not require a competitive tender process, while purchases above the threshold require a competitive tender process.
- Victoria: For goods and services, the threshold is AUD 250,000 (excluding GST). For construction works, the threshold is AUD 1 million (excluding GST). Purchases below the threshold do not require a competitive tender process, while purchases above the threshold require a competitive tender process.
- Queensland: For goods and services, the threshold is AUD 250,000 (excluding GST). For construction works, the threshold is AUD 1 million (excluding GST). Purchases below the threshold do not require a competitive tender process, while purchases above the threshold require a competitive tender process.
- Western Australia: For goods and services, the threshold is AUD 250,000 (excluding GST). For construction works, the threshold is AUD 2 million (excluding GST). Purchases below the threshold do not require a competitive tender process, while purchases above the threshold require a competitive tender process.
- South Australia: For goods and services, the threshold is AUD 220,000 (excluding GST). For construction works, the threshold is AUD 9 million (excluding GST). Purchases below the threshold do not require a competitive tender process, while purchases above the threshold require a competitive tender process.
- Tasmania: For goods and services, the threshold is AUD 250,000 (excluding GST). For construction works, the threshold is AUD 1.5 million (excluding GST). Purchases below the threshold do not require a competitive tender process, while purchases above the threshold require a competitive tender process.
- Northern Territory: For goods and services, the threshold is AUD 500,000 (excluding GST). For construction works, the threshold is AUD 1.5 million (excluding GST). Purchases below the threshold do not require a competitive tender process, while purchases above the threshold require a competitive tender process.
- Australian Capital Territory: For goods and services, the threshold is AUD 250,000 (excluding GST). For construction works, the threshold is AUD 1.5 million (excluding GST). Purchases below the threshold do not require a competitive tender process, while purchases above the threshold require a competitive tender process.
Procurement thresholds in Australia help to determine the level of competition and scrutiny required for government purchases. They set out the minimum dollar amount at which a competitive tender process must be undertaken, ensuring that government agencies obtain value for money.