Hon Lianne Dalziel
Minister of Commerce

13 February, 2007
Media Statement

Government to buy eco-friendly goods and services

Businesses that provide sustainable goods and services are set for a major boost following the announcement of new government procurement policies, Commerce Minister Lianne Dalziel said today.

The policies – announced in Prime Minister Helen Clark's statement to Parliament – will see the government using its purchasing power to grow the market for environmentally friendly products including paper, cleaners, plastics and fuel efficient vehicles. In addition, public service departments will be required to create more sustainable workplaces, including greater use or renewable energy and recycling.

The government also intends to increase the number of products that carry the Environmental Choice NZ ecolabel to assist departments in implementing the new policy and encourage more suppliers to adopt sustainable practices.

"Central government is the biggest purchaser in New Zealand in a wide range of sectors, including IT equipment, buildings, and office supplies, with an annual procurement budget of $6 billion," Lianne Dalziel said.
"Sustainable public purchasing will provide significant market opportunities for New Zealand companies, encourage technological innovation and help to create new export opportunities.
"This government has always acknowledged its fiscal and environmental responsibilities and the new initiatives will build on the existing Govt3 Programme that has started guiding government agencies to operate more sustainably."

The policies will be designed to enhance the existing Govt3 Programme, promote government leadership in sustainable business practice and address the main barriers previously identified, including the need for leadership, information and resources.

"The aim of the new programme will be to deliver direct environmental benefits in a cost-effective way and encourage opportunities for New Zealand sustainable businesses."

Elements of the new initiative will include: clear and measurable minimum sustainability standards for core agencies when spending public money and eventual expansion of the Govt3 Programme to the wider state sector.

Full details of the government’s new procurement policies will be announced later in the year and in Budget 2007. For more information on Govt3 visit: www.mfe.govt.nz/issues/sustainable-industry/govt3/

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Q&A - Government leadership in sustainable procurement

What is being proposed?
The new sustainable procurement requirements will see government stating a clear preference to purchase from businesses that provide sustainable goods and services, while maintaining the existing focus on best value for money over whole of life.
To help them in doing this, government will increase the range of product types that carry the Environmental Choice NZ eco-label and provide an accessible public database of all reliable eco-labels and minimum standards relevant to the New Zealand market.

Why is the government doing this?
Government is the single biggest purchaser in a range of sectors, including IT equipment, buildings, and office supplies. The core government agencies spend $6 billion a year on goods and services, while the wider state sector spends about $25 billion a year. This offers a significant opportunity for the government to spend its money in a way that supports sustainable businesses and good environmental practice, grows the market for these products and helps New Zealand business access similar markets overseas, and provides best value for money over the long term.

Will buying sustainable products cost a lot more?
The new proposals include work to better identify the true costs and benefits of buying sustainable products. Sustainable purchasing is expected to have a financial benefit to the government in the long run, as sustainable products (like energy efficient buildings, vehicles, and computer monitors) have cheaper running costs over their life. An initial upfront investment in additional staff and technologies like video-conferencing will result in significant cost reductions in other areas such as air travel over time.
What is already being done?
47 government agencies are already participating in the Govt3 programme, which helps central government agencies become more sustainable in practical and measurable ways. Results to date include:
• Transit New Zealand reduced its waste by 51 percent in 12 months
• Ministry of Social Development implemented energy saving measures with cost savings of more than $400,000 per year.
• The Department of Corrections achieved savings of $300,000 per year by implementing a range of energy efficiency measures.
• The Office of the Auditor General has defaulted its printers to duplex, and encouraged staff to "think before they print". While staffing numbers have increased from 50 to 70 full time staff, the Office of the Auditor General has not increased its office paper order.
• Treasury’s waste to landfill reduced by 80 percent to 18kg per person per year.
• The Energy Efficiency and Conservation Authority conducted its first waste audit in 2003–2004 and identified that a high percentage of its waste to landfill was recyclable. It has now reduced its waste to landfill by 66 percent from 52.3kg to 17.9kg per person per year.
• Inland Revenue has a vehicle fleet of 221 cars. Replacement vehicles are now approximately 10% more efficient with 20% less carbon emissions that old vehicles, and they have introduced a shuttle service that runs between their main Wellington buildings. This has reduced costs by $36,000 a year.
• The New Zealand Defence Force has used sustainable procurement principles in its contract with office suppliers. This includes toner/ink cartridge recycling, and recycled product alternatives.
For information about what the Ministry for the Environment is doing to “walk the talk”, go to: http://www.govt3.mfe.govt.nz

ENDS

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