---
title: "Estimate the value of a procurement before the method is chosen"
url: "https://ailawframework.com/practice/government-procurement-and-tendering/estimate-the-value-of-a-procurement-before-the-method-is-chosen"
type: "task"
site: "AI Law Framework"
id: "A50-CO20261022-13"
practice_area: "Government Procurement & Tendering"
tier: "yellow"
lawyer_review: "required"
last_reviewed: "2026-10-22"
---

# Estimate the value of a procurement before the method is chosen

> From the draft contract, add the options, extensions, renewals, remuneration, taxes and charges the draft already states, and note the entity type and whether the procurement is construction services or a standing…

Canonical page: https://ailawframework.com/practice/government-procurement-and-tendering/estimate-the-value-of-a-procurement-before-the-method-is-chosen  
Last reviewed: 2026-10-22

Site index for agents: https://ailawframework.com/llms.txt

## Key facts

| Fact | Value |
| --- | --- |
| Practice area | [Government Procurement & Tendering](https://ailawframework.com/practice/government-procurement-and-tendering.md) |
| Human involvement | Yellow: Lawyer and AI draft together |
| How AI is used | From the draft contract, add the options, extensions, renewals, remuneration, taxes and charges the draft already states, and note the entity type and whether the procurement is construction services or a standing offer. Do not decide the method, and do not divide the procurement into parts. |
| What the lawyer must review | The lawyer estimates the value and chooses the method. Paragraph 9.2 says the expected value must be estimated before the method is decided. It is the maximum value of the proposed contract, including options, extensions, renewals or other mechanisms over the life of the contract. Paragraph 9.3 says that maximum includes all forms of remuneration, including premiums, fees, commissions, interest, allowances and other revenue streams, the value of the goods and services including options, and any taxes or charges. Paragraph 9.4 says a procurement in multiple parts includes the maximum value of all the contracts. Paragraph 9.5 says a procurement must not be divided into separate parts solely to avoid a threshold. Paragraph 9.6 says that if the maximum value over the whole duration cannot be estimated, the procurement is treated as above the relevant threshold. Paragraph 9.7 says Division 2 applies at or above the threshold unless an Appendix A exemption is applied. The thresholds on the page are $125,000 for a non-corporate Commonwealth entity other than construction services, $400,000 for a prescribed corporate Commonwealth entity other than construction services, and $7.5 million for construction services by relevant entities. Paragraph 9.12 says a procurement from an existing standing offer is not subject to Division 2, but must comply with Division 1. Paragraph 9.10 says limited tender at or above the threshold is available only under paragraph 10.3 or an Appendix A exemption, and paragraph 9.11 says that exemption or condition must be reported on AusTender. This estimate does not write that report. |
| Written for / versions | 1 jurisdiction versions below |

## Checking plan

**Source-by-source verification**

The responsible lawyer checks each element against the source named for it.

- What the AI does: From the draft contract, add the options, extensions, renewals, remuneration, taxes and charges the draft already states, and note the entity type and whether the procurement is construction services or a standing offer. Do not decide the method, and do not divide the procurement into parts.
- What the lawyer does: The lawyer estimates the value and chooses the method. Paragraph 9.2 says the expected value must be estimated before the method is decided. It is the maximum value of the proposed contract, including options, extensions, renewals or other mechanisms over the life of the contract. Paragraph 9.3 says that maximum includes all forms of remuneration, including premiums, fees, commissions, interest, allowances and other revenue streams, the value of the goods and services including options, and any taxes or charges. Paragraph 9.4 says a procurement in multiple parts includes the maximum value of all the contracts. Paragraph 9.5 says a procurement must not be divided into separate parts solely to avoid a threshold. Paragraph 9.6 says that if the maximum value over the whole duration cannot be estimated, the procurement is treated as above the relevant threshold. Paragraph 9.7 says Division 2 applies at or above the threshold unless an Appendix A exemption is applied. The thresholds on the page are $125,000 for a non-corporate Commonwealth entity other than construction services, $400,000 for a prescribed corporate Commonwealth entity other than construction services, and $7.5 million for construction services by relevant entities. Paragraph 9.12 says a procurement from an existing standing offer is not subject to Division 2, but must comply with Division 1. Paragraph 9.10 says limited tender at or above the threshold is available only under paragraph 10.3 or an Appendix A exemption, and paragraph 9.11 says that exemption or condition must be reported on AusTender. This estimate does not write that report.
- Who reviews: Responsible lawyer with competence in the matter
- Basis: Practical workflow informed by the linked primary sources; the traffic light and working checks are editorial guidance, not a court or regulator classification.
- Why: The level reflects what the work is, the consequence of an error, and how much of the output the lawyer must independently re-derive.

## Checks the lawyer makes

1. Include options, extensions and renewals. Paragraph 9.2 uses the maximum value over the life of the contract.
2. Do not split the buy to come under a threshold. Paragraph 9.5 forbids a split made solely for that purpose.
3. A standing offer follows paragraph 9.12. Do not apply Division 2 to a later order under it.

## Notes

- These are suggested working checks. Confirm the required checking with the responsible lawyer before work starts; the checking approach does not establish permission to use AI.

## Sources

- [Department of Finance, procurement method](https://www.finance.gov.au/government/procurement/commonwealth-procurement-rules/procurement-method) (checked 2026-10-22)

## Jurisdiction versions

| Jurisdiction | Level |
| --- | --- |
| [United States](https://ailawframework.com/practice/government-procurement-and-tendering/estimate-the-value-of-a-procurement-before-the-method-is-chosen/united-states.md) | Yellow |

*Practice guidance for planning and review. Confirm current primary sources and the requirements of the actual matter. This is general information, not legal advice.*