Visionwest urges procurement rule changes after tender loss

Visionwest has called for changes to government procurement rules after losing part of a Health New Zealand home healthcare tender, warning the outcome could reduce support services for vulnerable Auckland residents.

Health New Zealand awarded Home and Community Support Services work to a group of businesses, excluding some large charitable providers. An internal audit review by the agency found the procurement process was fair, reasonable, and transparent.

Visionwest is one of New Zealand's larger social service charities, providing community healthcare alongside housing and welfare support. It supports about 7,000 older and disabled people across Auckland, Bay of Plenty, Waikato, and Rotorua Lakes District, and says more than 650 employees could be affected by the tender decision.

The dispute centres on whether procurement rules give enough weight to the broader role charities play in delivering state-funded services. Visionwest argues charities should be assessed not only on service delivery, but also on how any surplus is used and on the wider support networks they maintain in local communities.

Brook Turner, Director of Partnerships at Visionwest, said: "While bidding between for-profit and non-profit organisations is an important consideration, the current approach risks overlooking what happens to any surplus generated from delivering those services. In the case of charitable organisations, those funds are reinvested into additional community support rather than distributed as profit."

Turner said the same principle should apply in other areas where public purchasing policies already consider broader social or economic factors.

"If government procurement can recognise the wider economic and social value of using New Zealand wool, it should also recognise the value of contracting New Zealand charities that reinvest their funding directly into local communities," Turner said.

Broader value

Visionwest said its model differs from that of a commercial operator because home healthcare clients can also be referred to other parts of the charity. Those services include social housing, homelessness support, food assistance, financial mentoring, family support, and counselling.

The charity said this integrated structure can matter when an older person or disabled client has needs outside the narrow scope of a home-care contract. In its view, the decision should be judged not only on the delivery of care hours, but also on the loss of connected services that may sit behind them.

"This is not simply a question of who can deliver a specified number of home-care hours. It is about what happens to that funding after the core service has been delivered, and the wider support available when a vulnerable person's needs go beyond the terms of a contract.

A commercial provider delivers the service it has been contracted to provide. A community charity such as Visionwest can also connect that person with housing, food support, financial mentoring, counselling, and other assistance that may prevent them from falling through the gaps," Turner said.

Visionwest said losing the contract would reduce its ability to maintain that wider support structure in Waitematā. It also warned that changing providers could unsettle long-standing relationships between clients and care workers.

"We are not saying private providers should be prevented from winning government work. We are saying a New Zealand charity that has spent decades building trusted relationships and an integrated community support network should not be assessed as though it is interchangeable with a conventional commercial operator.

Charities have been established specifically to support people who have nowhere else to turn. That purpose and the additional value it creates need to be recognised in the procurement process," Turner said.

Care disruption

The charity said many of the people affected are older residents who rely on familiar support workers for everyday tasks and routine human contact. It said changing those arrangements could have effects beyond a simple transfer of service provider.

"The potential impact goes well beyond changing the name of the organisation providing someone's home care," Turner said.

"Many of these clients are older people who have developed trusted relationships with the same support workers over months or years. Those workers may help them get dressed, prepare meals, take medication safely, or simply provide one of the few regular human connections they have.

Disrupting these relationships can affect a person's health, confidence, independence, and safety," Turner said.

Turner also said government-funded service revenue helps sustain the wider infrastructure used across the charity.

"Visionwest is not owned by shareholders and no dividends leave the organisation. The funding is reinvested into improving services and supporting the communities in which our clients live," Turner said.

"Removing a major service from a charity does not affect just one operational division. It changes the organisation's overall capacity to respond when vulnerable people have complex needs that do not fit neatly within a single government contract.

The people most likely to feel that loss are those who have already fallen through the gaps and have nowhere else to turn," Turner said.

Tender process

Visionwest also raised concerns about how the bidding process was interpreted. It said it did not submit a standalone Waitematā proposal because it believed the procurement guidance required its final bid to remain aligned with its original region-wide registration of interest.

The charity said eight proposed subcontractors later became unavailable, after which it led a consortium of nine community organisations. It later became aware that subregional bids from other providers had been accepted.

"Had we understood that a Waitematā-only proposal remained available, we would have submitted independently. We acted in good faith and structured our proposal around the procurement guidance provided, but the consequence is that our standalone capability in a community we have served since 1991 was never assessed," Turner said.