The Economic Growth Minister Nicola Willis announced the new (5th) edition of the Government Procurement Rules (Rules) on 9 October 2025, following extensive consultation on a proposed new version earlier this year.
The new edition of the Rules aims to streamline and simplify the Rules, making them easier to understand and apply in practice. This has been in part achieved by reducing the number of rules from 71 to 47 and restructuring the Rules to ensure the core principles and values that underpin procurement are set out at the start. In addition, the new edition of the Rules seeks to:
- support economic growth in New Zealand through the introduction of a new economic benefit to New Zealand test;
- ensure procurements are efficient and agencies’ contract management processes are effective; and
- increase the accountability of agencies for their procurement performance and transparency in relation to their use of public funds.
The new rules take effect on 1 December 2025, and agencies are encouraged to plan ahead and start to adjust their practices, procedures and policies accordingly.
Summary of the Key Changes
As outlined in our March 2025 article on the proposed updates to the Rules here, there are several notable changes as compared to the 4th edition of the Rules. The changes in the 5th edition are largely the same as the changes in the consultation version released in March 2025, although there have been some additional changes and a few new features to reflect feedback from the consultation.
New economic benefit rule
One of the most significant changes in the new edition of the Rules is the introduction of a new “economic benefit” rule (Rule 8), which was also included in the consultation version. Rule 8 requires that for contracts above the specified value threshold (being NZ$100,000 for goods, services and refurbishment works and NZ$9 million for construction works), agencies must seek economic benefits to New Zealand. This provides a framework for considering economic benefits as part of the assessment of public value. There is a specific requirement for agencies to include as part of their evaluation criteria a minimum 10% weighting for the evaluation of economic benefits. Agencies must consider factors such as making better use of New Zealand resources, using New Zealand businesses, and developing New Zealand industry capabilities or capacity.
As noted by Hon Nicola Willis, “New Zealand respects its international trade commitments and the settings in the Rules continue to uphold our obligations.” Rule 8 touches on this specifically by requiring that agencies operate within the context of relevant national and international agreements and procurement policies to which New Zealand is a signatory.
For contracts below the specified value threshold, unless there is good reason not to, agencies are expected to award such contracts to New Zealand businesses that are capable and have the capacity to deliver the contract.
These changes are aimed at supporting local businesses in competition for government work while also encouraging international companies to demonstrate commitment to creating economic benefit in New Zealand. This ensures taxpayer money is spent responsibly and efficiently, and public trust is maintained.
New Government Procurement Principle - Proportionality
A new Government Procurement Principle that requires agencies to be proportionate and right size the procurement has been added to Rule 1, which was not included in the consultation version of the Rules. This requires agencies, among other things to make it easy to do business with government, to design and run an efficient end-to-end process that is proportional to the value, complexity and risk and reduce time, cost and complexity for suppliers. These themes are reflected in a number of the changes in the new edition of the Rules.
Efficient planning and contract management
Agencies are required to consider additional factors in the planning of a procurement including, among other things, the procurement objective, market analysis, economic benefits and risk identification, analysis and management (Rule 6). New contract management rules have been added that require agencies to have a systemic approach for identifying the contracts they have and a contract management plan that is right sized based on the contract’s value, complexity, risk and duration (Rules 34 and 35).
Accountability and transparency
The new edition of the Rules has a focus on improving accountability and transparency in Government procurement processes. Agencies are required to be accountable for their procurement performance and be transparent in their expenditure of public funds (Rule 3). An agency’s procurement policies must be publicly available (Rule 1), which is aimed at increasing public confidence and trust in procurements.
Other changes
There are other notable changes that have been made in the Rules, including:
- new requirements relating to the establishment of supplier panels and publication of a contract award notice for secondary procurements (Rules 22 and 32); and
- the introduction of proportional due diligence considerations (Rule 25), which complements the new Government Procurement Principle noted above.
Next Steps
If you would like more information about the changes to the Rules, or assistance in updating your practices, procedures and policies to ensure you can comply with the new Rules from 1 December 2025, please get in touch with the contacts listed or your usual Bell Gully adviser.
Disclaimer: This publication is necessarily brief and general in nature. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.
