Negotiated contract limit now $100,000

Under Land Transport NZ's Competitive Pricing Procedures, the dollar limit for negotiated contracts for professional services for road controlling authorities and others (such as regional councils) is now $100,000.

This means that councils and Transit can negotiate contracts with individual consultants for up to $100,000, without going through a competitive tendering process. This saves staff valuable time preparing tender documents and evaluating proposals, while consultants save time (and money) preparing proposals. Ultimately this should help keep the cost of engaging consultants down, as less time is spent preparing bids, leaving more time to do real work. The safeguard for councils is that if consultants do not do good work for a good price, they can ask someone else next time.

The $100,000 limit for negotiated contracts for professional services is a little known fact that is documented in an October 2005 general circular on Land Transport NZ's website.

Councils are advised to read the detail in the general circular carefully to ensure that supplier selection adheres to the Expedited Procurement Procedures for Professional Services.