9 Sep 2013

Call for Govt to examine contract awards

8:05 am on 9 September 2013

The chief executive of the former Ministry of Works says the Government should re-examine the way it awards key infrastructure contracts.

Opus Consulting chief executive David Prentice told the New Zealand Shareholders Association's annual investor conference that government procurement practices are becoming an obstacle to doing business.

He believes government policy, particularly procurement, is one area where New Zealand could show more leadership in the cost of doing business.

Mr Prentice says all areas of government are key clients for the infrastructure industry and in the past there has been a strong emphasis on trust, expertise, relationships and capability.

He says that has changed and procurement has now become a business in itself.

Mr Prentice says his consultancy can no longer rely on its track record with clients but must deal with procurement departments and fill in lengthy documentation in order to get contracts.

"But most importantly we lose touch with the people who will probably end up involved in running the project with us, if we're successful."

Mr Prentice says this does encourage competition, but it is beginning to stifle relationships making business harder and more expensive to do.