Contract limits
- Your maximum contract value (MCV) depends on whether you’re accredited for goods and services procurement, and to what level.
- If a contract is over your allowable maximum contract value (MCV), you need to seek procurement assurance.
- The enforceable procurement provisions apply to both goods and services and construction procurement.
Covered procurements
If your agency is a ‘covered agency’ and your procurement is over the values listed below, it may be subject to the enforceable procurement provisions and is known as a ‘covered procurement’. Some types of procurement are exempt from the enforceable procurement provisions. Check the Board Direction for full details.
Covered procurements are subject to the rules contained in PBD-2019-05 Enforceable Procurement Provisions. These can impact the way you carry out your procurement.
There are 3 questions to determine if a procurement is covered:
- is your agency covered - refer to Schedule 1
- is it an exempt category or type of goods or services - refer to Schedule 2
- does it meet the thresholds:
- $680,000 (excluding GST) for goods and services procurements
- $9.584 million (excluding GST) for construction procurements
- Covered procurements apply to both goods and services and construction procurement
- Limits for construction contracts are higher than for goods and services contracts.
Read more about construction accreditation.
How to determine maximum contract value (MCV) for goods and services
Before going ahead with any procurement, you must make sure the contract is within your maximum contract value (MCV). This will depend on the size and nature of the procurement and your agency’s accreditation level.
Don’t split up contracts artificially to avoid these limits. You must take the whole procurement into account.
How unaccredited agencies procure goods and services
If your agency is unaccredited and you want to procure goods or services not covered by a whole-of-government arrangement, the following MCVs apply.
| Contract value | What you must do |
|---|---|
| Less than $10,000 | You can buy from any supplier, so long as:
|
| Between $10,000 and $30,000 | You need to get at least 1 written quote |
| Between $30,000 and $680,000 | You need to:
|
| More than $680,000 | If your agency is covered by PBD-2019-05 you must comply with it, unless the goods or services are exempt. You must also get concurrence to your proposed procurement approach from an accredited agency within your cluster or NSW Procurement. |
Learn more about procuring low-value contracts.
How accredited agencies procure goods and services
Level 1 and level 2 accredited agencies have different rules about the size of contract they can procure.
Level 1 accredited agencies
If you’re procuring goods and services and your agency has level 1 accreditation, your authority to procure depends on the size of the contract and the level of risk involved. Generally, this means:
- Low-risk contracts. You can procure goods and services valued up to up to $50 million.
- Medium-risk contracts. You can procure goods and services valued up to $35 million.
- High-risk contracts. You can procure goods and services valued up to $20 million.
If your contract is above these values, you’ll need to seek concurrence from a level 2 accredited agency in your cluster or NSW Procurement. You can’t split contract values to get around these limits. You must consider the whole procurement.
Level 2 accredited agencies
Level 2 agencies have no maximum contract value and may procure within their budgetary limits.
Read more about the levels of accreditation and what they mean for your authority to procure.
Related content
- Before you approach the market: Get an overview of what you need to do before approaching the market.
- Procurement planning obligations: Read about your obligations when it comes to planning a procurement.
- Government procurement arrangements: Discover what whole-of-government arrangements apply to procurement.
- Exemptions and preferences: Find out when you’re exempt from using a whole-of-government contract and which suppliers to give preference to.
- Understand accreditation: There are separate accreditation programs for goods and services procurement or construction procurement.