H HO OW WT TO OD DO O BBU USSIIN NEESSSS W WIIT TH H R REEA AD DIIN NG G BBO OR RO OU UG GH HC CO OU UN NC CIILL AA G Guuiiddee ffoorr SSuupppplliieerrss aanndd CCoonnttrraaccttoorrss Prepared by: Corporate Procurement Level 7 Civic Offices Reading Berkshire RG1 7TD 0118 939 0945 Page 1 of 22 Corporate Procurement Unit April 2007 CONTENTS About this guide Section 1 Contractual Arrangements Section 2 Procurement Rules and Regulations Section 3 Effective Procurement Section 4 How to find out about opportunities Section 5 Applying for advertised contracts Section 6 Tendering for contracts Section 7 Tender Opening Section 8 Tender Evaluation Section 9 Contract Award Section 10 Electronic Trading Section 11 Contract Performance Section 12 Business Continuity Planning Section 13 Complaints Procedure Section 14 Current Council Contracts Section 15 Payment Terms Section 16 Further Information Section 17 Page 2 of 22 Corporate Procurement Unit April 2007 SECTION 1 : ABOUT THIS GUIDE 1. Reading Borough Council has produced this guide to assist suppliers and contractors; throughout this document reference to “suppliers” means the suppliers of goods, providers of services and contractors/constructors for works. 2. The information contained within this document informs suppliers of the professional processes applied by the Council in the way it awards contracts and conducts its business processes. 3. This guide is designed to help in three ways:a. b. c. It will make suppliers aware of the rules the Council must follow It will inform companies about the opportunities to supply the Council It explains how to bid for Council work 4. The Council encourages competition and welcomes bids from new and established suppliers. On the whole contracts are generally awarded on the basis of Best Value. The Council cannot discriminate in favour of local suppliers but they will be given every encouragement to compete for Council contracts. 5. Any company interested in pursuing business opportunities with the Council should respond to:• • the relevant individual tender advertisement the Official Journal of the European Union (OJEU) Contract Notice Following the guidance given in the advertisement/contract notice and applying to the nominated officer or department. Page 3 of 22 Corporate Procurement Unit April 2007 SECTION 2 : CONTRACTUAL ARRANGEMENTS 1. Reading Borough Council arranges contracts covering the procurement of a wide range of goods, works and services. 2. All tenders are advertised using as appropriate local papers and trade publications, various websites such as South East Centre Business Portal and Supplier Route to Government Portal and where appropriate OJEU. In addition Business Link and the local Chamber of Commerce are also advised of forthcoming business opportunities with the Council. 3. The nature and style of the tenders varies, depending upon the required outcome of the project, however the main aspects of the procurement exercise will be detailed within the tender documentation. 4. Many of the contracts let are in the form of a framework agreement thereby enabling the Council to place orders on a “call-off” arrangement. 5. The Council also lets a wide range of works contracts using select lists of approved contractors, however these ‘lists’ are in the process of being phased out in favour of the Exor Accredited Database. However, whenever appropriate individual works related contracts which fall below the current OJEU financial limits are advertised accordingly. 6. Contractors who are registered with Exor are acceptable to the Council and therefore do not need to complete the Council’s prequalification questionnaire (n.b. excludes OJEU procurements). 7. The Council also utilises collaborative procurement arrangements when appropriate, e.g. OGC, thereby enabling goods and services to be provided in an efficient, cost effective and sustainable way and assist the Council to meet its corporate objectives. The Council is also a contributor to the Thames Valley Procurement Forum applying, where appropriate, joint working with the other five unitary authorities in Berkshire and beyond. Page 4 of 22 Corporate Procurement Unit April 2007 SECTION 3 : PROCUREMENT RULES AND REGULATIONS 1. All local authorities are subject to regulations at a European, national and local level. 2. European Rules All public sector contracts, no matter what their value within the European Union are covered by a treaty which incorporates the free movement of goods and services and which prevents discrimination against prospective bidders on the grounds of nationality. The principles of the treaty are backed up by a series of E.C. Procurement Directives, namely, • • • • Public Supplies Directive 1993 – 93/36/EEC Public Services Directive 1992 – 92/50/EEC Public Works Directive 1993 – 93/37/EEC Amending Directive 1997 – 97/52/EC (amends the three directives above) These directives are included in UK law as a number of regulations:• • • The Public Supply Contracts Regulations 1995 S.I. No. 201 The Public Services Contracts Regulations 1993 S.I. No. 3228 The Public Works Contracts Regulations 1991 S.I. No. 2680 The above Directives have been incorporated into the new consolidated EU Public Procurement Directive (2004/18/EC) which includes a single unified text. The new Directive is designed to facilitate good procurement whilst ensuring that the market is opened across the EU. By January 2006, all procurement within Reading Borough Council, will require to be compliant with the procedures stated in the new Directive and the changes which they will bring about. 3. The directives and regulations require the Council to follow detailed procedures for all procurements above financial thresholds. These thresholds are reviewed every two years, currently:Supplies Services Works £ 144,371 144,371 3,661,319 Page 5 of 22 Corporate Procurement Unit April 2007 The current thresholds are valid until 31st December 2007. 4. The Council endeavours to follow a basic set of principles:• For Supplies, Part A Services (see table below) and Works contracts above the thresholds a specific Tender Notice must be placed in the supplement to the Official Journal of the European Union (OJEU) to give all suppliers in the European Union an equal opportunity to tender • Tenders must be invited in accordance with one of the prescribed procedures (open, restricted, negotiated). Each procedure imposes minimum time-scales covering the tender activities to ensure that reasonable time to respond to adverts and prepare submissions is given to all interested parties • A notice of contract award must be placed in OJEU within the laid down time scale. • Unsuccessful contractors must be fully debriefed if requested Part A Services 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Maintenance and repair of vehicles and equipment services Land transport services Air transport services Transport of mail by land and by air Telecommunications services Financial services (including insurance and investment services) Computer and related services Research and development services Accounting, auditing and bookkeeping services Market research and public opinion polling services Management consultant services and related services Architectural, engineering, planning and related scientific and technical consulting services Advertising services Building cleaning services and property management services Publishing and printing services Sewage and refuse disposal services; sanitation and similar services They are the types of services which are most eligible for crossborder trade. Page 6 of 22 Corporate Procurement Unit April 2007 5. National Rules Whilst there is no requirement on local authorities to subject services to competition all councils have a duty under Best Value legislation, which was introduced in April 2000 (as laid down in Part 1 of the Local Government Act 1999) to fundamentally review their services and make arrangements to ensure continuous improvement having regard to economy, efficiency and effectiveness. Councils should set performance indicators and targets for improvement and these should by published in an annual Performance Plan. All local authorities recognise that effective procurement is at the heart of Best Value and that the Best Value review process will help deliver the best possible services for the people of the community they serve. 6. Local Rules All procurement activities carried out by the Council must conform with the Council’s Contract Procedure Rules in relation to contracts – these can be viewed on the Council’s website. (http:/www.reading.gov.uk/documents/servingyou/procurement/ contract_procedure_rules.pdf). The process that will be followed is dependent upon the nature of the item being procured and its value. A general guide is given in the table overleaf: Page 7 of 22 Corporate Procurement Unit April 2007 Value Below £10,000 From £10,000 and up to £49,999 From £50,000 or where the risk in a specific procurement is perceived to be high, or any procurement of any value that may involve a transfer of staff Above current EU Thresholds Procedure that will normally be followed by Classification the Council Low Value Procurement A written quotation will be obtained from the suppliers before a formal purchase order is issued. The purchase order form shall specify the services, supplies or works to be provided and set out the price and terms of payments. Intermediate Value At least 3 written Procurement tenders or quotations shall be invited before a formal purchase order is issued specifying the supplies, services or works to be provided. Faxed or emailed quotations are acceptable for these purposes. The lowest tender or quotation shall be accepted unless the Director or Service Head is satisfied that better value for money will be achieved by accepting a different one. High Value Procurement Will be subject of a full tendering exercise. One of three contract award procedures shall be used as appropriate for the particular procurement, i.e. open, restricted or negotiated. The relevant Corporate Director/Service Head shall appoint a Project Officer for the contract. EU Regulations apply The Council will adhere to EU Procurement Procedures. Page 8 of 22 Corporate Procurement Unit April 2007 SECTION 4 : EFFECTIVE PROCUREMENT 1. Effective procurement will support the key strategies and priorities of the Council. Within the parameters of E.U. and National Legislation, procurement will be used as a means to support wider Council objectives such as equal opportunities, social inclusion and the regeneration of the local economy. 2. The Council strives to ensure that its activities are characterised by honesty, equality, integrity and transparency with the objective of delivering high quality, best value public services. Page 9 of 22 Corporate Procurement Unit April 2007 SECTION 5 : HOW TO FIND OUT ABOUT OPPORTUNITIES 1. Potential suppliers are advised to regularly check both the Council’s Website, local newspapers and relevant trade journals for advertisements placed by Reading Borough Council seeking tenders for goods, works and services. 2. In addition to the above each year the Council publishes a Prior Information Notice (PIN) on it’s Website showing contracts it intends to let during a particular financial year. (http://www.reading.gov.uk/councilanddemocracy/procurement) 3. The Council, in conjunction with the South East Centre of Excellence, has been involved in developing a Business Portal which gives details of existing contracts and contracting opportunities across the 74 Councils of the South East. Potential suppliers are advised to regularly examine the Business Portal for forthcoming opportunities. Since January 2007 the Council has published it’s current contracting opportunities on the South East Centre of Excellence Business Portal; visit www.sece.gov.uk/businessportal. 4. In addition, contracts over the EU thresholds are advertised in the Official Journal of the European Union (OJEU). These can be viewed at www.ted.eur-op.eu.int. - potential suppliers are advised to regularly view these websites to obtain details of forthcoming opportunities. Page 10 of 22 Corporate Procurement Unit April 2007 SECTION 6 : APPLYING FOR ADVERTISED CONTRACTS 1. The OJEU Contract Notice or tender advertisement placed by the Council will inform potential suppliers of the procedure to be followed and the information required by the Council. 2. Formal applications must be made by either letter, fax or e-mail. Potential tenderers will either be invited to tender (where an open tendering procedure is being followed) or will be sent, either by post or e-mail, a pre-qualification questionnaire (where a restricted or negotiated procedure is being followed) to assess the potential bidder’s suitability to the supply the Council and the ability to satisfy the terms and conditions of the contract. It is essential that companies supply all of the requested information and respond by the due date stated in the documents. 3. The information requested in the pre-qualification questionnaire will provide the Council with basic details about an organisation, verifies that it can be identified as a legitimate trading organisation, that is has acceptable levels of economic and financial standing, that it promotes good practices in the areas of equal opportunities, protection of the environment, health and safety and is capable of trading electronically. 3. The pre-qualification questionnaire normally requests the following supplier/contractor information:• • • • • • • • 4. Company Information Technical Resources and References Financial Information Quality Assurance Information Environmental Issues Equal Opportunities Health & Safety Electronic Trading Responses to the questionnaire will be used to determine a company’s eligibility to tender for the contract which has been advertised. Page 11 of 22 Corporate Procurement Unit April 2007 SECTION 7 : TENDERING FOR CONTRACTS 1. An invitation to tender (I.T.T.) will only be dispatched to companies who have in the opinion of Reading Borough Council satisfactorily completed the pre-qualification questionnaire. 2. Occasionally the Council will use an open tendering procedure which means that any interested party can tender for the contract and will be assessed for suitability to deliver the contract following receipt of tenders. 3. Tender documents will normally be dispatched by recorded delivery and will be also be provided electronically if so requested by the contractor. 4. The Council’s I.T.T. documentation will normally consist of the following:• Letter of Invitation – this gives specific details on when and where the tender should be submitted • Form of Tender – a company’s agreement to abide by the terms and conditions of the tender • Instructions to Tenderers – provides guidance for completing the tender documentation and will normally contain the tender evaluation criteria • Certificate of Non-Collusion – a company’s agreement to provide a competitive tender submission without disclosing information to other interested parties • Specification of Requirements – sets out the objectives of the contract • General Conditions of Contract – defines the rules tenderers must comply with • Special Conditions of Contract – the timescales etc of the contract • Tender Pricing Schedule – the document where tenderers enter the contract prices • Pre-addressed tender return envelope or tender return label – this states the time and the date by which the tender must be returned and must be used to return the tender documentation • Any relevant supporting information Page 12 of 22 Corporate Procurement Unit April 2007 SECTION 8 : TENDER OPENING 1. All returned tenders are administratively controlled by the Council’s Committee Services Section and dependant upon the value of the contract are opened in conjunction with Councillors and department representatives on an agreed date and time for the opening of tenders. 2. There are sometimes obvious mistakes and errors made by contractors/suppliers during the tender process which can lead to their tender being disqualified or not accepted. a. Reasons for disqualification: • Identification of tenderer marked on the return envelope • Tender documents received after the closing date for the receipt of tenders. Tenderers must ensure that tender documents are returned no later than the time and date stipulated in the tender documents. If the deadline is missed the tender submission will not be considered. • Tender documents sent to the wrong address – must be returned to the stated return address • Tender documents returned in the ‘open’ post not in the appropriate return envelope • Form of Tender not signed b. Reasons for non-acceptance: • Uncompetitive – failure to submit the most cost effective, best value offer • Not quoting a price for the specified product • Not quoting a price for the specified fixed price period • Not completing the tender documents in full – incomplete tender • Unsatisfactory references • Unsatisfactory financial history Page 13 of 22 Corporate Procurement Unit April 2007 SECTION 9 : TENDER EVALUATION 1. All returned tenders will be evaluated, against the pre-determined criteria, by the issuing department or appropriate evaluation panel. 2. Evaluation will focus on examining how the tenders submitted will deliver the service (quality) and the cost of the service (price). The balance between quality and price will depend on the characteristics of the contract. 3. The Council will normally award the contract on the basis of Best Value to the authority. The definition of Best Value is the purchase of all goods and services at the most advantageous terms and conditions and can include:• • • • • • • • • • price quality quantity reliability fitness for purpose of the product reliability of the delivery economy over time reliable after sales service environmental considerations total cost to the Council The total cost to the Council includes administrative overheads (whole life cycle of acquisition) such as raising orders, processing invoices for payment etc. 4. Advisory report is submitted to the appropriate Council committee requesting permission to award contract. Page 14 of 22 Corporate Procurement Unit April 2007 SECTION 10 : CONTRACT AWARD 1. The successful tenderer will be notified in writing by letter or an official e-mail. 2. Letters will also be sent to unsuccessful tenderers. For procurements where EU Directives apply Reading Borough Council will, in accordance with said directive, incorporate a minimum 10 calendar day standstill period at the point information on the award of the contract is communicated to tenderers. This period allows unsuccessful tenderers to seek further debriefing from the contracting authority before the contract is entered into. Applicants have 2 working days from the notification of the award decision to request additional debriefing and that information has to be provided a minimum 3 working days before the expiry of the standstill period. 3. Upon request the Council will, subject to commercial confidentiality; endeavour to provide unsuccessful tenderers feedback on why their bid was unsuccessful. This should be viewed as constructive feedback and used to ensure that unsuccessful tenderers are aware of areas for improvement to enable them to compete better for future contract renewals. 4. In addition, whenever appropriate, the Council will publish a Contract Award Notice in OJEU. Page 15 of 22 Corporate Procurement Unit April 2007 SECTION 11 : ELECTRONIC TRADING 1. As part of Reading Borough Council’s Procurement Strategy it intends to increase the levels of electronic business over time. This will include:• • • • Electronic Tendering Electronic Ordering Electronic Invoicing Electronic Payment The Council is currently actively working with current suppliers to deliver its e-Commerce Strategy. Page 16 of 22 Corporate Procurement Unit April 2007 SECTION 12 : CONTRACT PERFORMANCE 1. All the Council’s suppliers and contractors will be regularly monitored to assess their compliance with pre-defined performance criteria which is normally set out in the contract documentation. 2. All Council departments are encouraged to hold regular review meetings with suppliers and contractors to encourage close working relationships and the resolution of potential performance issues. Page 17 of 22 Corporate Procurement Unit April 2007 SECTION 13 : BUSINESS CONTINUITY PLANNING 1. All the Council’s suppliers and contractors will be required to provide evidence that they have a Business Continuity Plan and are in a position to support the Council’s response to an emergency and continue to be able to provide critical services in an emergency. Contractors and suppliers will also be required to provide evidence that they have adequate business continuity arrangements in place, e.g. attendance of your staff on training courses/exercises. 2. The Council will also put appropriate arrangements in place to monitor the procedures which relevant contractors have put in place. Page 18 of 22 Corporate Procurement Unit April 2007 SECTION 14 : COMPLAINTS PROCEDURE 1. All Council or contractor complaints should be discussed and resolved through the contract monitoring review process. However, if any contractor or prospective supplier has a complaint about unfair treatment or discrimination that cannot be resolved through normal commercial contact with the Council, then the complaint can be made in writing or online through Reading Borough Council’s Formal Complaints Procedure. Further details can be obtained from www.reading.gov.uk/complaints.asp. Page 19 of 22 Corporate Procurement Unit April 2007 SECTION 15 : CURRENT COUNCIL CONTRACTS 1. These details can now be found by visiting The South East Centre of Excellence Business Portal at www.sece.gov.uk/businessportal. The information contained in the Business Portal is regularly updated by the Council. Page 20 of 22 Corporate Procurement Unit April 2007 SECTION 16 : PAYMENT TERMS 1. Suppliers and Contractors should note that Reading Borough Council’s normal payment terms are 30 days from receipt of invoice, unless there is a query which will not allow the invoice to be paid. Payments are made via BACS. 2. The Council will not accept liability for the payment of any invoice for goods and/or services supplied against an order which has not been properly authorised. 3. Please note that all invoices sent to the Council should quote an appropriate official order number – failure to quote this order number may result in payment being delayed. 4. Suppliers and contractors should ensure that all necessary details are included on invoices, that they are correctly addressed and that any change of name and address on their part is notified promptly to Reading Borough Council. Page 21 of 22 Corporate Procurement Unit April 2007 SECTION 17 : FURTHER INFORMATION 1. If you require any further information regarding a specific tendering opportunity please contact Reading Borough Council, Corporate Procurement Unit on 0118 9390900. Page 22 of 22 Corporate Procurement Unit April 2007