All-of-Government Contract for External Legal Services
Ministerial Q+A
Q1) How many tendered?
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125 tenders were received.
Q2) How many missed out?
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87 of the providers who tendered were not awarded a place on the panel.
Q3) How were the successful providers chosen?
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The initial selection criteria focused on quality of service (including a firm’s expertise), the
second was value for money. Approximately 30 senior legal practitioners from across
government worked on the evaluation panels, together with the Programme’s
procurement experts. The final list of providers is ranked by value-for-money score.
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The cost negotiation for this All-of-Government contract was undertaken in an innovative
manner, with legal providers undertaking a series of open on-line electronic negotiations
to secure their final place on the contract - in effect, like “Trademe”, but in reverse.
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The whole procurement process complied with Mandatory Rules and was independently
reviewed by PriceWaterhouse Coopers, in terms of the quality and probity of the process.
Q4) What were the main factors in providers missing out?
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The legal market is very competitive with many high quality providers, only the best value
providers were selected. Those missing out did so as a result of the combination of the
qualitative and value for money assessments.
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The capacity for legal services work offered by the market far exceeded the capacity
government requires. This was also a key factor in providers missing out.
Q5) Why a panel of 39?
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The 39 panel providers were assessed as the best respondents to meet the needs of the
diverse group of Eligible Agencies. We did not go into this process with a specific panelsize in mind.
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The panel includes small, medium and large Law Firms – it’s not just the big firms that are
best value for money.
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The capacity for legal services work offered by the market far exceeded the capacity
government requires, meaning we only needed 39 panel providers.
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Q6) What guidelines will agencies be given in terms of who they choose from the panel?
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MED has drafted a clear set of guidelines for purchasing from the panel. However,
ultimately Agencies will be given enough information and flexibility to choose a
provider(s) that best meets their unique needs.
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For the first time there will be transparency of performance and cost of Law firms across
Government and I am sure this will be a major factor in agencies choices.
Q7) Is there a risk that some unsuccessful firms will go out of business?
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There will be some providers affected by this project. Most (~85%) of the unsuccessful
firms have less than 25% of their business with government (and just over half of these
have 10% or less of their business with us).
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We have identified 14 firms with business over this 25% threshold, that could be
significantly impacted. MED will work with those firms/individuals and agencies to
transition them out of government business over a period of time that reduces that
impact.
Q8) Aren’t SME’s being adversely effected by this?
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The panel is a mix of sole-practitioners (6), Small/Medium legal firms (25) and larger legal
firms (7).
So 80% of this panel comprises sole-practitioners and Small/Medium size legal firms.
Q9) What’s the impact on the wider legal marketplace?
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Time will tell – this contract has “shaken-up” the legal market, particularly in Wellington
as for the first time Government has applied a single/common commercial process to the
buying of legal services across government.
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Both the level of reporting and improved value delivered through this contract will
potentially filter through to the wider legal market place.
Q10) Can an agency choose not to select from this panel?
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The panel has extensive breadth and depth to it. However, if the panel does not meet the
specific/niche needs of an Agency, they can purchase off-panel.
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MED will review the performance of the panel after two years to ensure it is meeting the
on-going needs of Agencies.
Q11) How much difference is there in pricing between panel members?
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Overall the average saving for agencies is 18% less than they pay now.
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The panel comprises sole practitioners through to large firms, from across New Zealand.
The rates vary considerably between some providers, and some areas of law.
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This pricing will all be transparent to agencies, when they are making decisions about
which firms/individuals to engage.
Q12) How quickly are agencies expected to move across?
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Transition will begin in the new year. Agencies are expected to begin purchasing from the
panel early in 2012. Given the value-for-money this contract offers, it is expected that
agencies will transition fairly quickly.
Q13) Which All-of-Government Contracts are next?
 Cabinet have directed MED to implement further All-of-Government contracts for:
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Banking Services
Electricity
Energy Management Services
Media Buying
Mobile Telephony
Travel Management Services
Recruitment Services
The next “cabs off the rank” are Energy Management Services, which aims to support
agencies to reduce energy consumption to reduce carbon and save money; and Mobile
Telephony.
Key Facts and Figures
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Total spend - $600 million (over the 6 year term)
The contract establishes a panel of 39 legal service providers
The panel is a mix of sole-practitioners (6), Small/Medium legal firms (25) and larger legal firms
(7). Crown Law received automatic inclusion on the panel.
The scope of the contract includes all legal services provided by Barristers & Solicitors to the
Public Sector across seven areas of law:
o Banking and Finance ( 8 x legal providers selected)
o Corporate and Commercial (14 x legal providers selected)
o Employment (11 x legal providers selected)
o Environmental (12 x legal providers selected)
o Litigation (8 x legal providers selected)
o Property (9 x legal providers selected)
o Public (13 x legal providers selected)
Note – Some legal providers are on more than one panel above
The contract excludes Category 1 legal services (as defined in the Cabinet Manual and provided
by or under the direction of Crown Law, and services from QCs, Barristers sole & Patent
Attorneys).
The contract term is for up to 6 years.
 Negotiated discounts available for all 218 Eligible State Sector Agencies, 2,500 Schools
and 78 local authorities.
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