Low value contracts

We’ve made it easier to buy goods and services valued under $250,000.
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What you need to know
  1. You can fast track low-value contracts in many circumstances.
  2. This policy is designed to help SMEs, regional and Aboriginal businesses.
  3. You still need to show value and make sure any contracts match market rates.

Special rules for low value contracts

We’ve made it easier for you to fast-track procurements under certain thresholds. This is especially true when you buy from small to medium enterprises (SMEs).

Rules still apply and you must meet certain requirements depending on the value and nature of the contract, who you’re buying from and the level of risk involved. Please note, all values below exclude GST.

Goods and services up to $10,000

You can buy from any supplier and negotiate directly so long as the supplier meets security and safety requirements. This applies even where the goods or services are available on a whole-of-government contract or mandated prequalification scheme.

You still also need to show value for money. You can usually do this by making sure their rates are in line with normal market rates.

You must also check your agency has no additional rules you must follow.

Goods and services up to $30,0000

If your agency is unaccredited you can choose a supplier based on receiving just one written quotation. If your agency is accredited, you should follow your agency’s rules.

You still need to use whole-of-government contracts and mandated prequalification schemes where they apply.

Goods and services up to $50,000

You can buy directly from a small business, even if the goods or services are available on a whole-of-government contract or mandated prequalification scheme. When you do, we encourage you to buy locally.

A small business is one that employs fewer than 20 full-time equivalent staff.

Goods and services up to $250,000 from Aboriginal businesses

For contracts valued up to $250,000 – including goods and services and construction - you can negotiate directly with suitably qualified Aboriginal businesses. You can do this even where the goods or services are available on a whole-of-government contract or mandated prequalification scheme.

You still need to achieve value for money, for example by confirming the costs are in line with normal market rates.

Read more about Aboriginal-owned businesses

Goods and services from Australian Disability Enterprises

You can buy goods and services, including construction, of any value from an Australian Disability Enterprise so long as you get one written quote. Australian Disability Enterprises are businesses set up to provide employment for people with disabilities.

Read more about Australian Disability Enterprises

Innovative solutions up to $1 million

You can negotiate directly with an SME to deliver innovative solutions on a short-term contract valued up to $1 million.

You can engage them to do proof-of-concept testing or outcomes-based trials to demonstrate the feasibility of a product or service that solves a specific problem or improves government service delivery.

You can use the innovation stream for goods, services and construction procurements.

Related content

  • Select suppliers: Get an overview of your obligations when it comes to selecting suppliers.
  • Evaluation criteria: Discover the criteria you must use to evaluate suppliers’ bids and proposals.
  • Probity and fairness: Get an understanding of your obligations when it comes to probity and fairness.
  • Supporting SMEs: Discover your special obligations to SMEs and regional businesses when selecting suppliers.
  • Australian Disability Enterprises: Find out about the special rules that apply if you select an Australian Disability Enterprise to carry out a procurement.
  • Aboriginal businesses: Read about the special rules for engaging Aboriginal businesses.