Victorian Government Purchasing Board
Achieving Excellence in Government Procurement

Q What is the VGPB?

The Victorian Government Purchasing Board (VGPB) sets the policies that govern procurement of non-construction goods and services across all Victorian Government departments and some public bodies. The aim of VGPB’s policies are to provide a procurement model that allows each organisation to obtain maximum value for money from the procurement of goods and services.

The VGPB was established under the Financial Management Act 1994.

Q. Does the VGPB policy framework apply to the procurement of internal government provided shared services?

The VGPB policy framework does not apply to the procurement of services from internal government shared service providers i.e. Cenitex, Fleet, Property, Facilities Management, Library, Records Management, VicTrack, Solicitor General. An internal shared service is an; optional service, hosted by a department or agency, to service a portfolio of customers. Typically, these services involve business support and cover either transactional activities, decision support or strategic services.

Consistent with the Guiding principles for shared services endorsed by the Victorian Secretaries Board. Secretaries are accountable for deciding if, when, and how they adopt a shared service. Each shared service provider regularly benchmarks its cost, quality and customer satisfaction. These benchmarks and the transparency provided within the Guiding principles for shared services, provide a consistent framework for the shared service customer to assess and evaluate the benefit of adopting the service.

An internal government shared service provider should not be asked to participate in an external market engagement (invitation to supply) because they are not an independent external entity. Their inclusion in the process would create a potential conflict of interest compromising the market engagement.

Q How has procurement changed?

VGPB policies have moved away from a prescriptive threshold based approach to a complexity and risk based model. The policies recognise procurement as a core business function and support better procurement outcomes through strategic planning.  

For more information please click here.

Q How many procurement policies are there?

There are five policies that cover procurement as an ‘end-to-end’ activity. The five polices are:

  • governance;
  • complexity and capability;
  • market analysis and review;
  • market approach; and
  • contract management and contract disclosure.

These policies are underpinned by four directives - value for money, accountability, probity and scalability. For more information please click here.

Q. Who do the VGPB policies apply to?

Compliance with VGPB policies is mandatory for government departments and some public bodies for the procurement of goods and services. Please visit scope of policies for a complete list.

Public bodies not mandated by legislation, such as schools, TAFE colleges, water authorities and local government are not mandated to comply with VGPB policy. However, they are encouraged to align their processes with VGPB procurement policies as a matter of good practice.

Q Where can I find guides, tools and templates for the policies?

Click on the following links to locate good practice guides, tools and templates.

Q What happened to the former VGPB policies?

As at 30 June 2016 the former VGPB policies were officially revoked and ceased to be applicable. All departments and mandated public bodies have transitioned via the procurement reform framework to the new policies.

Q How is procurement by the Victorian government undertaken if it is not within VGPB scope?

Public construction is procured under the Project Development and Construction Management Act 1994 (Vic). For more information about procurement for public construction refer to this link.

Health and hospital related goods and services are procured under the Health Services Act 1988(Vic) managed through Health Purchasing Victoria. For more information refer to this link.

Procurement by Local Government is undertaken in accordance with the Local Government Act 1989. For more information refer to this link.

Q. What has replaced the former VGPB ethical purchasing policy?

Ethical procurement and employment is not specifically mentioned in the procurement reform policy framework. The VGPB supply policies are high level principle based to allow organisations to establish a procurement framework based on their procurement profile. Ethical employment and ensuring suppliers meet their responsibility in relation to conditions of employment is embedded in the standard form market approach documents and contracts. For more information refer to this link  

Q. I don’t understand how the VGPB policies apply to my organisation?

The Public Administration Act 2004 and how an organisation is established defines the application of specific legislation. If you are unsure as to the application of the VGPB supply policies to your department or public body, contact your internal procurement unit, Chief Procurement Officer or speak to a financial delegate from your organisation for more information.

Q. Who can buy goods and services on behalf of government?

You can only procure goods and/or services on behalf of the State of Victoria if you have approval from a financial delegate to do so. Your organisations intranet should list financial delegates or contact your internal procurement unit for advice.

Q What are the departments’ contract reporting requirements?

The VGPB Contract management and contact disclosure policy requires each department and mandated public body to report a summary of all contracts equal to or greater than $100 000 (including GST) on the contracts publishing system. Full contract information for contracts with an estimated value exceeding $10 million must also be published.

Individual variation, or variations with a cumulative value exceeding $100 000 (including GST) must be disclosed on the contracts publishing system against the contract to which the variation relates.

Q Can I receive any gifts, benefits or hospitality from a supplier or potential supplier?

No. The Victorian Public Sector Commission Gifts Benefits and Hospitality policy framework states individuals are to refuse all offers of gifts benefits or hospitality from people or organisations about whom they are likely to make decisions involving, tender process, procurement, enforcement, licensing and regulation.  For more information refer to the VPSC Gifts Benefits and Hospitality framework.  

Q How do the Free trade agreements (FTA) affect procurement in Victoria?

The VGPB supply policies comply with the requirements of the federal government free trade agreements.  For more information about FTAs refer to this link.

State Purchase Contracts (SPCs)

Q What is a State Purchase Contract (SPC)?

SPCs are standing offer agreements for common use goods and services, which are established when value for money can be best achieved through aggregating demand across departments and mandated public bodies.

Information is available at State Purchase Contracts (SPCs)

Q Who can use SPCs?

It is mandatory for departments and mandated public bodies to purchase from mandated SPCs. Certain non-government bodies may also be permitted to access an SPC on application to the lead agency. Non-government bodies are entities that are not consolidated, for financial reporting purposes, into the State of Victoria’s Annual Financial Report. The following types of non-government bodies may apply to access an SPC:

  • Victorian local government councils, and federal, state or territory governments;
  • Universities; and
  • Charities and not-for-profit organisations that are funded managed or sponsored by a State government body.

For further information refer to the guide to aggregated demand or refer to the rules of use for each SPC to see if your organisation is eligible.

Q Have State Purchase Contracts (SPCs) changed under the VGPB’s policies?

SPCs have not changed. However, under the policies, departments and mandated public bodies must consider how small to medium size enterprises can compete and participate in SPC opportunities. SPCs may also comprise a number of different delivery models such as pre-qualification registers. For further information refer to the guide to aggregated demand.

Q. What is a sole entity purchase contract?

Sole Entity Purchase Contracts (SEPCs) are contracts for the supply of goods or services, raised by an individual department or agency for specific use by that entity only.  

Q. Who manages the State Purchase Contracts (SPCs) for the state?

Department of Treasury and Finance through the Strategic Sourcing Group manage all SPCs except for the following: .

Q. What is the Local Jobs First Policy?

The Local Jobs First Policy comprises the Victorian Industry Participation Policy (VIPP) and the Major Projects Skills Guarantee (MPSG).

The Local Jobs First Policy (LJF), improves opportunities for Australia and New Zealand small and medium enterprise (SME) suppliers to compete for work on all types of government contracts, helping to create and sustain opportunities for Victorian businesses and workers. This policy is about local industry development.

The LJF policy must be applied by all Victorian government departments and agencies for any type of project with a value of:

  • $1 million or more in regional Victoria, or
  • $3 million or more in metropolitan Melbourne or for state-wide activities

Refer to the Local Jobs First Policy for more information.

Local Jobs First – Major Projects Skills Guarantee (LJF – MPSG) applies to all construction projects at or over $20 million. Refer to the Local Jobs First Policy for more information.


Q. How does LJF impact the VGPB’s policies?

The government has released Local Jobs First agency and supplier guidelines to support Agencies and Suppliers to understand, implement and comply with the Local Jobs First policy. Refer here for the guidelines.

Both the LJF and VGPB Supply Policy frameworks facilitate SME participation in government procurement.




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