Government Supplies Department

Purchases of goods and related services required by government
departments are undertaken centrally by the Government Supplies
Department, which provides similar services to certain non-government
organisations, such as the Hospital Authority and the Vocational Training
Council. These goods and related services are normally obtained by
competitive tendering, without giving preference to any particular source
of supply, to ensure that users' needs are met at the best possible prices,
having regard to life-time cost and reliability of supply. Helping users to
derive the best value in their purchases, the department formulates a
specific purchasing strategy for each type of item based on market
conditions, focusing on meeting requirements for high-value and critical
items by cost-effective and reliable means.

In general, the department adopts open tender procedures in its
purchases, particularly for general and common items. Selective tender
procedures are used only for complex and critical purchases for which
suppliers are required to undergo a qualification exercise before tendering.
Restricted or single tender procedures are used where open competitive
tendering would not be an effective means such as in cases involving
compatibility with existing equipment, or patented/proprietary items, or
unforeseen urgency. Restricted tender procedures may also be adopted
for low-value purchases to save administrative costs.

Where open tender procedures are adopted, tender invitations are
published in the Government Gazette and four local newspapers and are
mailed to suppliers registered with the department. Consulates and
overseas trade commissions are also informed. To allow easy access by
overseas suppliers, the department has, since November 1995, included
its tender invitations and related information on the Internet.

In 1996-97, the department placed orders of a total value of $4.03 billion,
purchasing from 36 different countries. The major sources of supply
were the USA, the UK, China, Germany and Hong Kong. Major items of
purchase included computer systems, medical supplies and equipment,
waterworks items, electrical appliances, telecommunication equipment
and services, and food provisions.

Supplies of goods to meet general needs are held in the purpose-built
Government Logistics Centre in Chai Wan which was put into operation
in late 1996. In 1996-97, the department acquired stock items with a total
value of $382 million and issued items worth $437 million to its
customers. The department also seconds staff to other departments to
ensure a professional approach to acquisition and maintenance of stores
and equipment. 

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