Govt looks to scrap EV mandates in procurement overhaul

Electric vehicle mandates for government agencies are set to be removed under proposed changes to procurement rules.

The changes aim to make it easier for New Zealand businesses to secure a share of the more than $50 billion in government contracts awarded each year.

Under current procurement rules, mandated agencies must choose a battery electric vehicle (BEV), or a plug-in hybrid electric vehicle (PHEV) if a BEV is not appropriate. This was part of the government’s carbon neutral programme which aimed to speed up the fleet transition to low-emissions vehicles and support New Zealand’s transition to a net zero emissions economy by 2050.

However, Economic Growth Minister Nicola Willis says the reforms are aimed at removing red tape and creating more opportunities for local businesses.

“The changes include introducing a new economic benefit test and scrapping 24 rules that put unnecessary obstacles in the path of Kiwi businesses,” Willis says.

“This is part of our plan to increase jobs and incomes by shifting New Zealand to a faster growth track,” she says.

The economic benefit test will require government agencies to consider the wider benefits to New Zealand when awarding contracts.

The Government also plans to streamline the procurement process by reducing the number of mandatory rules agencies must follow when tendering contracts. Currently, there are 71 rules, but under the proposal, this would drop to 47.

“Reducing the number of rules will streamline and simplify the process for New Zealand businesses,” Willis says.

“I know from my conversations with businesspeople that many find the paperwork involved in bidding for government contracts daunting. This will reduce the barriers that smaller and medium-sized New Zealand businesses face bidding for government contracts.”

The proposed changes are now open for public consultation, which will run until April 8. The Government will then consider feedback before making final decisions on implementation.

The Government is proposing to dispense with the following government agency requirements:

• build new non-residential government buildings to a five-star rating standard
• purchase battery electric or hybrid electric vehicles
• purchase office supplies that produce low amounts of waste and/or are recyclable; and
• pay the living wage in contracts for cleaning, catering and security guard services