Administrative Guidelines on Engaging Professional Services in the Victorian Public Service

Download the PDF

You can download the guidelines PDF or read the full text below.

1. Overview

Professional services and labour hire play an important role in supporting the Victorian Public Service (VPS) to ensure government priorities are achieved.

The purpose of these Administrative Guidelines on Engaging Professional Services in the Victorian Public Service (Guidelines) is to provide a practical decision-making framework for the use of professional services, including approval, record-keeping and reporting requirements. This framework will support limiting professional services engagements to specific circumstances and allow departments to achieve their budget commitments.
Labour Hire arrangements are covered separately under the Administrative Guidelines on Engaging Labour Hire in the Victorian Public Service (Labour Hire Guidelines).

For detailed information about the policies that govern procurement in the Victorian Government more broadly, contact the Victorian Government Purchasing Board, or visit the Victorian Government Purchasing Board website.

2. Scope

Bodies and entities in scope of the Guidelines

The Guidelines are circulated to public service bodies and entities under Section 36A of the Public Administration Act 2004 (Vic) (the Act) and apply to all government public service bodies and entities as defined in the Act that are mandated to comply with VGPB policies. The Guidelines do not apply to:
• special bodies as defined by section 6 of the Act
• exempt bodies as defined by section 4 of the Act
• to any government body established under the Inquires Act 2014 (Vic)

Engagements in scope of the Guidelines

An engagement is in-scope when any ‘core public service functions’ are expected to form a material part of the engagement, regardless of value.

‘Core public service functions’ are a material part of an engagement when expenditure on the six types of services in Table 1 is expected to collectively:

account for a significant proportion of the proposed engagement OR
have a proposed value exceeding $150,000 (incl. GST), even if this will not be a significant proportion of the engagement

Worked Example

An entity is seeking to undertake an infrastructure project. The budget for the proposed work is $10,000,000, which includes preparing a substantial business case and undertaking significant stakeholder engagement.

The entity estimates that, collectively, these 'core public service functions' components will be valued at approximately $250,000 and will not account for a significant proportion of the proposed work. However, as the components are estimated to collectively exceed $150,000 (incl. GST), the engagement is in-scope of these Guidelines.

Core Public Service Functions

Strategic policy/program advice, development, or implementation
Program reviews, assurance, or evaluation
Business strategy and organisational development and redesign
Business case preparation and development
External stakeholder/community engagement and facilitation
Internal meeting and event facilitation

Exemptions

VicGov internal service engagements (e.g. VGSO) or VicGov internal shared service providers are exempt from these Guidelines.
Public construction services are exempt from these Guidelines. Public Construction is defined in Ministerial Directions for Public Construction Procurement and Construction Guidance 1.3b as services directly related to construction works that will impact on physical structure (e.g. architecture, engineering).

3. Valid engagement circumstances

To go-to-market for work which is considered a core public service function, as determined by the test outlined in section 2, one of the below four ‘valid engagement circumstances (VEC)’ must apply, and the conditions required for that valid engagement circumstance to apply must be met:

A. Work requiring skills or expertise that cannot be efficiently maintained within the organisation¹.

To meet this condition, the following must apply:

The necessary technical or specialist skill(s) required to deliver the work or services are not available within the organisation, AND
Current and future demand within the organisation for the technical or specialist skill(s) does not warrant recruiting the capability into the organisation.

B. Need for genuine independence

To meet this condition, one of the following must apply:

There is a legal obligation (legislative or contractual agreement with another level of government) for services to be performed by an entity external to government for the purpose of integrity or assurance, OR
The services require independent assessment from a body separate from those involved in the work and a genuine effort was made to identify appropriately independent resources elsewhere in the organisation.

C. Work requiring immediate or time critical action that cannot be met within existing VPS capacity

To meet this condition, the following must apply:

The work is urgent or time critical; such as it relates to an emergency, a legal/court deadline, or a similarly critical event; or it is a public commitment with specific deadlines that cannot be pushed out (and DPC has agreed this position), AND
The work relates to unpredictable demands (i.e. should not be used for periods of predictable or foreseeable surge work), AND
The ability to meet at least some of the required capacity through reprioritising existing resources or using surge functions has been considered prior to going to market and is not feasible.

D. Engagement has received explicit Cabinet approval

To meet this condition, the following must apply:

Where a decision of Cabinet (or a Committee of Cabinet) explicitly requests a service be delivered externally.

Whether a VEC applies should be assessed and approved by the responsible senior executive prior to going to market, and the decision and VEC recorded.

Secretaries (or equivalent) may provide an exemption in exceptional circumstances to go-to market, even when one of the four VECs does not apply for which is considered a core public service function.

4. Approval requirements

Scope of approval requirements

Engagements in scope of the Guidelines are subject to these approval requirements. The definition of engagements in scope are defined in Section 2.

The approval requirements do not apply to engagements which have received explicit Cabinet approval (see Section 3 - Valid Engagement Circumstance D).

These, and other, engagements which are out of scope of these approval requirements for any reason, are subject to departments/entities’ standard procurement and approval processes and thresholds.

Approval requirements

The Secretary – or equivalent Head of a public service body – must confirm the valid engagement circumstance and approve the decision to go to market for in-scope engagements, if either of the following is true:

A. The estimated engagement value is more than $150,000 (including GST)
Note that as approval is required before going to market, the financial threshold applied here relates to the estimated value of the proposed engagement.
B. A valid engagement circumstance does not apply (See Section 3)
If no valid engagement circumstance applies, Secretary (or equivalent) approval is required before going to market regardless of the estimated value of the contract.

Department Secretaries, or equivalent Head of a public service body, are accountable for the procurement of all professional services engagements, regardless of delegation permitted under the Guidelines.

5. Record-keeping requirements

Departments and entities are expected to maintain appropriate records for all professional services engagements, including engagements in scope of these guidelines.

For engagements in scope of these Guidelines, these records should be able to demonstrate compliance with the Guidelines at the point of going to market and should include, at a minimum, the below fields in addition to fields required by the body’s internal procurement policies:

Engagement title
Primary ‘core public service function’ service
Approval level
Primary valid engagement circumstance
Estimated engagement cost (inc. GST)

This authority may be delegated to the responsible Deputy Secretary or equivalent if a valid engagement circumstance can be demonstrated.

Please contact your Chief Procurement Officer for further information regarding the applicable approval and record keeping requirements.

6. Approval process for engaging professional services

Decision matrix

The approval process contains three key guiding questions to support decision-making for engaging professional services. Each questions contains arrows labelled "Yes" and "No" that will direct you to two possible courses of action: the first is shown in a large vertical box on the right-hand side which reads "Department's standard approval process applies"; the second course of action is shown in a horizontal rectangle box on the bottom left of the process diagram that reads; "Secretary level approval applies". Both courses of action have arrows leading to a rectangle box on the bottom right corner of the process diagram that reads: "Engagement approvals and key details must be recorded".

The first question reads: "Are 'core public service functions' a material part of the engagement?" If you answer "No", a right facing arrow directs you to the large vertical rectangular box on the right-hand side which reads: "Department's standard approval process applies". A right down facing arrow then directs you to the rectangle box underneath that reads "Engagement approvals and key details must be recorded". If you answer "Yes", a down facing arrow directs you to the second guiding question.

The second key guiding question reads: "Which valid engagement circumstances apply?". There are three smaller boxes underneath to choose from, connected by three separate down facing arrows. The first reads: "No VEC is applicable". The second reads: "VEC A, B or C". The third reads: "VEC D".

If you have chosen the third box, "VEC D", a right facing arrow directs you to the large vertical rectangular box on the right-hand side which reads: "Department's standard approval process applies". A right down facing row directs you to the rectangle box underneath on the bottom right corner of the process diagram that reads "Engagement approvals and key details must be recorded".

If you have chosen the first box "No VEC is applicable", an "L" shaped right-facing arrow takes you to the rectangle box on the bottom left of the process diagram that reads: "Secretary level approval applies". A right-facing arrow then directs you to the rectangle box on the right corner of the process diagram that reads "Engagement approvals and key details must be recorded".

If you have chosen the second box, "VEC A, B or C", a downward facing arrow directs you to the third key quiding question that reads: "Is the estimated contract value above $150,000 (Inc. GST)?". If you answer "No", a right facing arrow directs you to the large vertical rectangular box, on the right-hand side which reads: "Department's standard approval process applies'. A right down facing arrow then directs you to the rectangle box underneath that reads: " Engagement approvals and key details must be recorded".

If you answer "Yes", a downward facing arrow directs you to the rectangle box on the bottom left of the process diagram that reads: "Secretary level approval applies". A right facing arrow then directs you to the rectangle box on the bottom right corner that reads "Engagement approvals and key details must be recorded."
Download

7. Additional guidance

Additional information and resources on Victorian Government State Purchase Contracts

State Purchase Contracts organised by category

Professional Advisory Services State Purchase Contract

User Guide - Professional Advisory Services State Purchase Contract

eServices Register

Marketing Services Register

Legal Service Panel

Other procurement resources

Browse State Purchase Contracts, Registers and other supplier lists

Procurement complexity and capability assessment policy

Victorian Government Financial Management and Financial Reporting Directions

Financial Reporting Directions and guidance for Departments

Standing Directions 2018 under the Financial Management Act 1994

Footnotes

Whenever possible, engagements should include a contractual obligation and clear project strategy for transferring relevant skills and knowledge across to the VPS.

Authorisation and amendments

Authorised by the Secretary, Department of Premier and Cabinet Victoria, under section 36A(1) of the Public Administration Act 2004 (Vic).

Jeremi Moule AO
Secretary, Department of Premier and Cabinet

Compliance

Under section 36A(3) of the Public Administration Act 2004 (Vic), if a public service body or a public entity to which guidelines have been issued operates, or intends to operate, in a manner that is inconsistent with those guidelines, the relevant public service body Head or public entity Head must provide written reasons for doing so to the Secretary, Department of Premier and Cabinet.

Number: 2024/05

Issue: 1.2

Issued by the Department of Premier and Cabinet Victoria (DPC) in July 2024.

These Guidelines are subject to periodic amendments. DPC will provide notification when an update has taken place.

Governance

Updated 2 September 2024

Administrative Guidelines on Engaging Professional Services in the Victorian Public Service

On this page

Download the PDF

1. Overview

2. Scope

Bodies and entities in scope of the Guidelines

Engagements in scope of the Guidelines

Worked Example

Core Public Service Functions

Exemptions

3. Valid engagement circumstances

A. Work requiring skills or expertise that cannot be efficiently maintained within the organisation1.

B. Need for genuine independence

C. Work requiring immediate or time critical action that cannot be met within existing VPS capacity

D. Engagement has received explicit Cabinet approval

4. Approval requirements

Scope of approval requirements

Approval requirements

5. Record-keeping requirements

6. Approval process for engaging professional services

Decision matrix

7. Additional guidance

Additional information and resources on Victorian Government State Purchase Contracts

Other procurement resources

Victorian Government Financial Management and Financial Reporting Directions

Footnotes

Authorisation and amendments

Compliance

Number: 2024/05

Issue: 1.2

A. Work requiring skills or expertise that cannot be efficiently maintained within the organisation¹.