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Procuring Low-value Construction Works or Services

Policy

This policy helps schools comply with all applicable requirements for procuring construction works or services valued at $50,000 (including GST) or less. This policy falls within the 'Plan' stage of the School Asset Lifecycle.

Details

The Victorian School Building Authority (VSBA) encourages schools to make independent financial decisions for construction works and services that are in the best interests of students and the school community. However, the VSBA must ensure that all school financial decisions are consistent with relevant policy, regulations and legislation.

Schools must complete the steps outlined below when purchasing public construction works or services valued at $50,000 (including GST) or less to ensure the Department fulfills its mandatory obligations under the Project Development and Construction Management Act 1994 (Vic) (PDCMA) and the Ministerial Directions and Instructions for Public Construction Procurement.

Policy requirements

The following requirements apply to school-funded construction works, construction services and some maintenance works valued at $50,000 (including GST) or less. For more information, including which maintenance works are in scope of this policy, refer to the Definitions section.

School councils have delegated authority to enter into construction procurement contracts for self-funded building works or improvements valued at $50,000 (including GST) or less. The school council, as nominated financial delegate, must also endorse the preferred tenderer recommendation before executing a contract.

Schools must obtain at least one supplier quote for contracts valued at $50,000 (including GST) or less. However, the VSBA recommends seeking multiple quotes wherever possible.

If the contract value is estimated to exceed $50,000 (including GST), schools must not obtain tenders or quotations, or commence or enter into any associated works, services or contracts, until they have sought VSBA approval to proceed. Refer to guidance for this in the Department's School-funded Capital Projects Policy.

Instructions for both single and multi-quote procurements

The Flowchart for Single and Multi-quote Low Value Construction procurements (in the Resources tab) instructs schools how to procure construction contracts valued at $50,000 or less (including GST) in compliance with this policy.

Definitions

Financial delegate
The school council must nominate a financial delegate, responsible for approving a construction procurement and endorsing a preferred tenderer recommendation before a contract can be executed.

Construction works
Construction works mean construction, maintenance (except cleaning, gardening, and services that don’t impact physical structures), rehabilitation, alteration, extension or demolition of any improvements on land by (or on behalf of) the Department, including associated tendering processes, project delivery and contract administration.

Construction services
These services directly relate to delivering construction works. They include engineering, architectural, land surveying, and design services but not services indirectly related to construction, such as legal or commercial advice.

Maintenance
Procuring maintenance for school infrastructure and fixtures is subject to the requirements of the PDCMA. Examples include structural repairs (such as roof repairs), lifecycle items (for example, replacing a covered way), and repairs that extend the life of a structure (for example, painting the exterior of a building).

Maintaining non-fixtures — for example, changing light globes, inspections, servicing removable air conditioning units (as opposed to ventilation systems), or repairing modular furniture — is governed by the Financial Management Act 1994 (Vic) (FMA), not the PDCMA.

Public construction rules may not apply to minor maintenance (for example, repairing broken windows) that is part of broader facilities management agreements for services such as gardening, general cleaning or security. To decide if a bundle of maintenance activities is public construction, schools should consider the predominant purpose of the overarching contract and its potential impact on land or buildings. More information on maintenance and public construction can be found in DTF Guidance 1.3B, or call the VSBA.

(Non-construction related goods and services contracts are subject to the FMA. Refer to guidance for these in the Department’s Procurement — Schools Policy).

Relevant legislation

Department policy requirements for schools procuring construction works or services valued at $50,000 or less

Reviewed 24 February 2021

Policy last updated

15 June 2020

Scope

  • Schools
  • School councils

Contact

Victorian School Building Authority

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