***EMBARGOED UNTIL 0900 22 OCTOBER 2014 ***
21 October 2014
A new report undertaken by the Ministry of Defence has identified a number of ways to optimise relationships with the Defence industry.
The report was launched today by the Secretary of Defence Helene Quilter at the Defence Industry Conference being held in Wellington from 21-22 October.
Initiated by the previous Minister of Defence, the report aimed to determine the extent to which there was further opportunity to optimise the involvement of New Zealand industry in supplying the New Zealand Defence sector.
The recommendations in this report are not about changing government procurement policy.
The report has identified ways, within the Government Rules of Sourcing, to adapt and improve our practice and processes so that New Zealand businesses have the best possible chance to supply Defence, while Defence achieves the best value for money.
Around $800 million is spent annually by Defence on military assets, the Defence estate, equipment, maintenance and support, as well as day to day goods and services. Ms Quilter stated that the percentage of that expenditure committed in New Zealand each year has grown from approximately 50% to 66% over the past seven years.
Major recommendations from the report include improvements to whole-of-life costing, enhanced Defence procurement processes and practices to optimise New Zealand industry involvement, and increased Defence engagement, information sharing and collaboration with the industry.
Ms Quilter said, “The report found that there is a need for stronger engagement between Defence and the business sector.”
“Defence organisations are committed to implementing all the recommendations of the report including the introduction of New Zealand Industry Engagement Plans for all tenders valued at over $15 million. These will make clear what New Zealand options have been considered in the proposal.”
The Chief of Defence Force Lieutenant General Tim Keating said,” We welcome this report. Creating powerful relationships between the industry, the Ministry and Defence Force will enable us to better deliver on what the Government and New Zealanders expect of their armed forces.”
A full copy of the report will be posted on the Ministry of Defence website www.defence.govt.nz.