Breda Byrne€¦ · " Mutual Recognition In the event that tenderers are required to submit...

Breda Byrne Procurement Consultant, Achilles Procurement Services 16/09/2014

© 2014 Achilles Procurement Services Ltd. Confidential 2

1.  Introduction to public procurement 2.  The Structure of the Public Sector 3.  Tendering and Procedures 4.  Tendering to the Public Sector

AGENDA


§  The European Courts of Justice has provided the following explanation for the need to regulate public procurement:

Ø  to ensure that public funds are spent honestly and efficiently, on the

basis of a serious assessment and without any kind of favouritism or quid pro quo, whether financial or political, and

Ø  to ensure the abolition of barriers and the creation of a level playing field by means of transparency and objectivity.

Advocate General Jacobs, Case C-19/00, “SIAC”

Purpose of Regulating Public Procurement


THE BUYERS’ RULES Ø  Treaty of Rome

Ø  European Directives (and corresponding transposition)

Ø  National Guidelines (i.e. Guidelines on Competitive Tendering / Notifying Success and Unsuccessful Tenderers)

Ø  In-house Procedures

Ø  KEY OBJECTIVE – Value for Money through competitive tendering.

Background to Public Procurement


•  Regulated Environment •  Once a public body spends above a certain figure on goods,

services and works they are governed by Directive 2004/18 EC for Public Bodies (SI 329 of 2006)

•  A new Directive (2014/24/EU) has just been published in OJEU and

due to be transposed into Irish Law by the end of 2016

§  While the Directives do not apply to below-threshold contracts, certain principles deriving from the European Treaty must be complied with at all times.

Background to Public Procurement


TREATY PRINCIPLES Ø  Transparency The principle of transparency requires an appropriate level of advertisement for all public contracts Ø  Equal Treatment Comparable situations must not be treated differently and that different situations must not be treated in the same way. Ø  Mutual Recognition In the event that tenderers are required to submit diplomas, certificates or other written forms of evidence, documents originating in other Member States offering an equivalent level of guarantee must be accepted by the contracting authority. Ø  Proportionality An action must not go beyond what is necessary to achieve its objectives

At the heart of Public Procurement


§  Central Government – 15 Government Departments including Houses of the Oireachtas

§  Stage Agencies – 500 + organisations such as OPW, RTE, Enterprise Ireland, The Revenue Commissioners, Prison Services, IDA, Health and Safety Authority, Financial Services Ombudsman, etc.,

§  Local Government – 31 Local Authorities and 26 County Councils responsible for local government in 24 geographical counties including the County of Dublin which has three South Dublin Dunlaoghaire-Rathdown and Fingal County Council

§  Health Sector – Health Service Executive – 29 public hospitals

§  Education Sector – 5000+ Schools, 7 Universities, 28 Colleges and Institutions of Technology

WHO ARE THEY?


§  The public sector is a key marketplace for SMEs, representing a valuable route to a market which each year procures c.€9 billion annually on Supplies and Services excluding Works.

§  All public sector organisations buying in goods and services must get the best value for money. This means they must choose the bid that offers “the optimum combination of whole-life costs and quality (or fitness for purpose) to meet the user’s requirement”.

§  It is important to realise that bids for public sector contracts will not

be considered solely on the lowest price quoted.

SPEND ON GOODS AND SERVICES


Ø  Diverse requirements Ø  Positively inclined towards SMEs as suppliers Ø  Little or no risk of bad debt Ø  Prompt payment terms Ø  Potential for ongoing work Ø  Responsibility to provide services irrespective of economic

conditions Ø  Trading successfully with the public sector will also give you added

credibility when dealing with private sector customers.

Benefits of Supplying to the Irish Public Sector


§  All types of services – legal, consultancy, HR, printing, advertising and media buying, security, cleaning, event management etc. §  All types of goods – stationery, printer cartridges, cars,

ambulances, park furniture, street furniture, telephone systems, computer systems etc.

§  Works – construction and renovations of various public buildings throughout the country

What do they buy?


§  Main portal in Ireland to advertise opportunities is: Ø  www.etenders.gov.ie – If you are not registered on this website you are

missing out. Registration is easy and is free of charge. Ø  Circular 14/10: all supplies/services over €25k must be advertised here

Also: §  Official Journal of the European Union http://ted.europa.eu

(European contracts)

§  Local Papers

§  Commercial Directories

§  In-house Tender Lists

How to Access Public Contracts


§  “The Brown Book” – Guidance on Supplies and Services (2004) relating to Competitive Tendering and Value for Money for below Threshold contracts.

Circulars: §  Circular 10/14 – Initiatives to assist SME’s in Public Procurement

(replaces Circular 10/10) §  Circulars 02/09 and 02/11 – ICT Expenditure §  Circulars 16/13 – Revision of arrangements concerning the use of

central contracts §  Circular 06/12 – Public Procurement and Framework Agreements.

§  Guidelines and model contracts for Construction and Engineering Services – www.constructionprocurement.gov.ie)

Key Department of Finance Guidelines


§  Department of Public Expenditure and Reform have recently set up the Office of Government Procurement

§  Other information on public procurement can be found on www.simap.europa.eu

Key Department of Finance Guidelines


§  The provisions of the EU Directives apply only to contracts with a value above certain thresholds as outline below

Threshold for Application of EU Directives

Supplies Services Works

Central Government €134,000 €134,000 €5,186,000

Local and Regional Authori?es, State Agencies, Health / Educa?on / Body governed by public law

€207,000

€207,000

€5,186,000


§  In addition to the National rules, the Treaty Principles will also apply to the award of these contracts

Threshold for Application of National Rules

Value Procedure Adver4sement

General Services / Supplies

Less than €5,000 Single Quote Known Competent Firms

€5,000 -‐ €25,000 3 – 5 Quotes Known Competent Firms

€25,000 -‐ €134,000 Open Procedure Only eTenders

€134,000 -‐ €207,000 Any appropriate Procedure

eTenders

Works / Construc4on-‐Related Services

Less than €5,000 Single Quote Known Competent Firms

Up to €50,000 3 – 5 Quotes Known Competent Firms

€50,000 to €250,000 Open Procedure eTenders

€250,000 to €5,186,000 Any appropriate procedure

eTenders


§  PIN NOTICES – Prior Information Notice – some organisations publish these at the beginning of the year and it indicates the possible contracts that may be awarded over the coming 12 months. Requires no action usually from the supplier. Enables the buyer to shorten timescales. Enable suppliers to plan and prepare.

§  TECHNICAL DIALOGUE or MARKET SOUNDING PIN This is issued when a public sector buyer wishes to conduct

research on a product or service they may or may not buy. §  CONTRACT NOTICES OR CALLS FOR COMPETITION – aims at

specific contracts and require the supplier to make an applications/tender.

§  CONTRACT AWARD NOTICES – provide details of contracts already awarded and give valuable information on successful tenderer and value of contracts.

UNDERSTANDING ADVERTISEMENTS


§  Normal process employed by buyers for goods and service valued below €25,000

§  Quotation process involves public bodies inviting competent

suppliers to quote against specific requirements §  Firms are identified on the basis of internal knowledge, existing

suppliers registered on financial system or can even be via Golden Pages

§  No public advertising required therefore à Suppliers should target individual bodies to ensure they are considered when such jobs arise

QUOTATIONS


§  Public Bodies are obliged to advertise on eTenders any purchases above €25,000

§  There are a number of different tendering procedures: -  Open Procedure

-  Restricted Procedure

-  Competitive Dialogue Procedure

-  Negotiated Procedure

TENDERING AND PROCEDURES


§  OPEN – SINGLE STAGE -  Normally the full tender documents will be available on etenders -  Everyone can tender but you must meet the criteria set out by the

buying organisation in the tender document -  National Value Contracts i.e. below threshold 14 – 21 days to submit

a tender -  European Value Contracts i.e. above threshold – 40 days to submit

tender

KEY FEATURES OF OPEN PROCEDURE


§  RESTRICTED PROCEDURE – TWO STAGE PROCESS

§  STAGE 1 – QUALIFICATION QUESTIONNAIRE §  published on eTenders §  Interested parties must download documents, complete and return by

the deadline date. §  Based on responses the top 5 or 7 will be invited to tender. §  This stage tests the financial and technical competency of

supplier firms. §  National timescales 14 – 21 days / EU Timescales 30 Days

§  STAGE 2 – INVITATION TO TENDER §  Only those successful under stage 1 will be invited §  Must complete and return by a deadline date. §  National timescales 14 – 21 days / EU Timescales 35 / 40 Days

KEY FEATURE OF RESTRICTED PROCEDURE


How Your Tender will be Evaluated - Open Procedure


How your Tender will be evaluated - Restricted Procedure


§  Selection criteria and award criteria are separate arrangements forming part of a contract award procedure.

§  They are subject to separate rules.

§  Selection criteria concern the technical and financial capacity of the candidate, rather than the work to be carried out.

§  In contrast, award criteria concern the nature of the work to be carried out or the manner in which it is to be done, to the exclusion of any considerations relating to the candidate.

§  The directive draws a clear distinction between the criteria for checking the suitability of a contractor and those for awarding the contract, which relate to the particular service offered by the tenderer.

Difference between Selection and Award Criteria


§  FINANCIAL CAPACITY Ø  Please provide details of turnover and profitability (%) for your

organisation in respect of the past three financial years or alternatively, if the date of establishment was more recent, information on turnover / profitability on a pro-rata basis.

Ø  Rule: Tenderers must provide appropriate evidence demonstrating a turnover in excess of £150,000 and operation with a profit in the most recent financial year.

§  TAX CLEARANCE Ø  Please provide a current valid tax clearance certificate from the Irish

Revenue Commissioners. Ø  Rule: Tenderers must provide evidence of a current and valid tax

clearance certificate or, alternatively, evidence that they have applied for it. It is stressed that award of contract will be conditional upon the production and maintenance of a valid tax clearance certificate

Examples of Pass/Fail Selection Criteria


§  Certain contracting authorities may stipulate that a minimum score must be met in respect of selection criteria in order to avoid elimination from the competition.

§  These minimum scores may be expressed as a percentage of the maximum scores available under a particular criterion (typically either 40% or 60%).

Minimum Score Required’ and Selection Criteria

If your applica?on fails to meet a minimum score associated with a par?cular criterion, it may not be

assessed under the remaining criteria.

This does not affect your rights under the remedies regula?ons.


§  In accordance with Circular 14/10, operators are allowed to self-declare their financial capacity only

§  This relates to criteria concerning turnover / profitability, insurances and tax clearance.

Self-Declaration and Circular 14/10

If you have self-‐declared certain informa?on, the evidence in ques?on must be made available promptly to the authority on request. DO NOT self-‐declare informa?on unless you are in a posi?on to provide the evidence. Any misrepresenta?on in this regard could threaten your posi?on on future tender lists.


Buyers may exclude firms who are: Optional

�  Bankrupt or subject to proceedings for bankruptcy �  Convicted of offence re professional conduct �  Guilty of grave professional misconduct, which can be shown �  Guilty of membership of criminal organisation �  Failure to pay social security contributions in country of

establishment �  Failure to fulfil tax obligations �  Guilty of serious misrepresentation in supplying information on

above

Article 45 Declaration


Mandatory to exclude if you are:- •  Guilty of corruption •  Guilty of fraud •  Guilty of money laundering •  Guilty of membership of criminal organisation

This document accompanies all tender documents and must be completed and signed.

Article 45 contd


�  Are they ◦  PRICE ONLY, or ◦  Most Economically Advantageous Tender (MEAT) in terms of

certain criteria, e.g. �  Ultimate cost �  Delivery Schedule �  Quality of Service Offered �  After Sales Service �  If MEAT, what percentages are allocated to each criterion?

�  MEAT is the more common option! �  Under MEAT – all weightings must be provided – if not enquire what

they are!

Award Criteria


§  Usually a combination of quality criteria and cost §  For EU value tenders, obligation to inform you of the weightings to

be applied; e.g. §  Quality of product – 30% §  Warranties and after sales support – 20% §  Delivery schedule – 10% §  Cost 40%

MEAT - Award Criteria


�  Methodology for delivery of the service �  Resources allocated �  Health & safety management for contract �  Fitness for purpose of solution offered �  Quality, quantity and balance of resources offered �  After sales �  Warranties �  Installation support �  Level of Training offered �  Other criteria relevant to the specific contract – must be stated in

tender documents

Other examples of MEAT Criteria


§  Buyers may invite some or all tenderers into a clarification meeting §  This is normally to determine if the supplier truly understands the

requirement – opportunity to verify information in tender §  Not an opportunity to negotiate §  An authority cannot score mere ‘performance at interview.’

Post-Tender Clarifications

If you are invited to a clarifica?on mee?ng, it should not be seen as an opportunity to ‘pitch’ for work.

The ques?ons asked should solely concern your wri^en

tender submission.

The contrac?ng authority cannot engage in any nego?a?on of your tender, par?cularly with regard to

price.


§  The company with the top score when “MEAT” is the award criterion is the WINNER!

§  The cheapest tender only wins when “Lowest Price” is the award criterion

THE RESULT


§  Must notify tenderers as soon as possible after the award decision of results §  In EU contracts – the winner is a “preferred

bidder” for a period of at least 14 days – this enables unsuccessful tenderers to seek a legal review of the decision (no standstill for national value contracts)

§ Unsuccessful tenderers should be notified at the same time as the successful tenderer is notified of being “preferred bidder”

NOTIFICATION


§  S.I. 130 of 2010 transposes Directive 2007/66/EC (the Remedies Directive). It applies to above-threshold contracts.

§  It covers the following elements:

Ø  Persons to whom review procedures are available (‘eligible

persons’);

Ø  The powers of the Court in the context of review procedures;

Ø  The manner in which applications to the Court must be made;

Ø  The remedy of ineffectiveness;

Ø  The content of notification letters;

Ø  The duration of ‘standstill periods.’

The Remedies Regulations – An Introduction


§  Unsuccessful candidates are entitled to notification letters containing the following:

Ø  A summary of the reasons for the rejection of the application;

Ø  Scores may be provided at the authority’s discretion. However, meaningful narrative reasons are of substantially greater importance.

Notification Letters (1/2)

Best prac?ce dictates that candidates are informed of the outcome of their applica?ons as soon as a decision has been made regarding

the tender list.

However, a contrac?ng authority is en?tled to wait un?l the contract has been awarded to inform tenderers. In this case, it must also provide details of the award decision reached and the

dura?on of the stands?ll period.


§  Unsuccessful tenderers are entitled to notification letters containing the following:

Ø  Details of decisions reached concerning the award of a contract; Ø  The exact standstill period applicable to the contract; Ø  A summary of the reasons for the rejection of the tender in

question; Ø  The characteristics and relative advantages of the tender selected; Ø  The name of the successful tenderer (or framework members); Ø  The reason for any finding of non-equivalence with the

specification. Ø  Again, scores may be provided at the authority’s discretion.

However, meaningful narrative reasons are of substantially greater importance.

Notification Letters (2/2)


•  A reviewable contract may not be concluded before the expiry of the published standstill period.

•  The standstill period for a contract begins on the day after the day on which each tenderer or candidate ‘concerned’ is notified of the outcome of his or her tender or application.

•  The standstill period is never less than 14 calendar days when notification is sent electronically and 16 days when sent by other means.

•  No standstill period is required in the case of below-threshold contracts or in the case of contracts awarded under a framework agreement. However, in certain cases, a contracting authority may choose to observe a voluntary standstill period.

The Standstill Period


§  Step One – Be in the Know -  If you don’t know about an opportunity you won’t win it; so ensure

you are investing time in searching for and identifying useful contract opportunity gateways. Also, do your research and find out which public authorities have previously utilised the type of services you have to offer.

-  Step Two – Be Selective - Focus your energy by being selective about those opportunities for

which you wish to express an interest. The scattergun approach will only cost you additional time and ensure that you do not commit the correct level of attention and resource to each tender response.

- Seek to tender for smaller contracts first. This may help you to gain experience with the public sector and provide reassurance to other public bodies that you understand what is important to them. The requirements for smaller contracts may also be easier to meet.

Key Points to Consider when Tendering


§  Step Three – Size Matters - Remember that public authorities will wish to be confident that you

can deliver, so are unlikely to invest a high-value contract with a company with a relatively low turnover. As a rule of thumb, you could consider not tendering for contracts that are worth more than 25% of your current annual turnover. However, check how long the contract is expected to be let for – for example

-  a contract with a value of €500,000 and a duration of three years has an annual value of around €166,000 – which could be within your reach.



§  Step Four – Invest before you Bid -  You need to be clued up on the requirements of the public sector

tendering process. Read the public procurement regulations and attend seminars and events that provide an insight into the tendering process. A lack of understanding of the procurement process will undermine the quality of your bids. Invest in putting together a dedicated team with the right skills and time available to understand how the process works. This will enable you to maximise your chances of being successful.

§  Step Five – Build Strong Relationships - Getting to know your clients, their ethos and needs is vital as is

building personal relationships with key people within the public bodies you wish to work with. While SMEs have to work extra hard to engage in a personal relationship with the potential client, they do have the benefit of being small and therefore less impersonal than large organisations.



§  Step 6 – Develop an Effective Marketing Campaign -  Approaching public sector organisations before they actively

advertise contract opportunities can be a good way to get on their radar and make them aware of the sort of products/services your organisation offers. Upstream marketing with key public sector agencies will raise your profile so that your business name will be in their minds when they tender contracts.

§  Step 7 – Build a Standard Qualification Questionnaire Response

-  The process that all public authorities will undertake has many similarities so if you have your responses to the common Pre- Qualification Questionnaire (PQQ) material prepared in advance, you can then tailor this information to answer the PQQ on a questionnaire by questionnaire basis and save time similarly with Tender document.

-  Become familiar with NPS / CWMF templates



§  Step 8 – Build a Tender Toolkit -  To save time and resources, develop a tender toolkit from which

you can lift and amend sections of text as necessary. Although no two tenders are the same and there is no standard format used by organisations, many ask for the same information.

-  After every tender, refine your toolkit utilising lessons learnt. Always check to ensure that text you have reused is completely appropriate to the opportunity you are responding to. Please, Please, Please ensure that there is no information relating to a previous tender in your document. Attention to detail is key!



§  Step 9 – Identify and use Support Schemes -  SMEs should explore the use of national, regional, local government

or independent support schemes that can offer advice, training or other support to SMEs looking to bid for public sector work.

-  Few Examples:- •  Go To Tender Workshops •  Leader Programmes in your area etc. §  Step 10 – Meet the Clients Needs - The rigours of the public procurement process demand that

suppliers are incredibly diligent about meeting all the requirements of the procurer. Suppliers should ensure that they can meet all criteria, and their proposal should reflect this in detail.



§  Step 11 – Combine Expertise with Innovation -  There is recognition by government that new products can

potentially deliver better value for money than those that are tried and tested, and so a more outcome-based approach to procurement – rather than simply a cost-effective, single-solution approach – is being applied to contracts. It is recognised that SMEs are able to provide innovative solutions and value for money. If you have an innovative solution, seek the permission of the client to offer it. However, ensure that when you present an innovative solution it is not perceived as a risk.



§  Step 12 – Address Risk -  SMEs need to promote themselves not only as innovators but also

as experts in their field. Help and reassure your potential client by always identifying potential risks and showing how your proposal mitigates them. Any reduction of the risks perceived by the public sector to be associated with contracting with SMEs is likely to result in an increase in engagement with such companies.

§  Step 13 – Carefully match Responses to stated Criteria - The criteria for selection and / or award are clearly stated in either

the original notice or the invitation to tender documentation or both. Ensure that you understand the relative weighting/scoring that the authority is applying to each criterion and make sure that your response addresses these criteria proportionally



§  Step 14 – Consider engaging a specialist “Bid Writer” -  Consider utilising the services of a specialist public sector bid writer.

Specialist bid writers understand the procurement process and what it takes to make a successful bid. This approach may at first seem costly but you will increase your chances of success and fast track your learning so that you will not need their skills in the long run.

§  Step 15 – Price Matters - Remember that most tenderers will have similar capabilities to achieve the technical requirements of the tender. Where this is the case, price will become increasingly important. Where price is weighted at more than 25%, then it may be difficult to win unless you are providing the lowest or close to the lowest price. - Be careful not too submit abnormally low tenders though!



§  Step 18 – Act as a Sub-Contractor

-  Centralised procurement à need to partner with other organisations -  Generating revenue through the public sector need not mean

working directly for the public sector. Increasingly, public bodies are hiring large firms that contract out work to smaller suppliers. SMEs should be aware that acting as a subcontractor to larger private sector organisations with public sector funding may be a faster route to public sector revenue. Winning subcontractor business also provides a useful reference should you wish to work directly for the public sector in the future.

-  Tender Together - InterTradeIreland Consortia Seminars -  Tuesday 30th September - The Radisson Blu Hotel, Belfast -  Tuesday 4th November - The Maldron Hotel, Dublin Airport



§  Step 19 – Invest in a High Quality Service Ethos - Delivering a higher-quality service than is required will increase the

likelihood of contract renewal. Once the contract is won, SMEs looking to stay in favour and be considered for the next contract period must invest in meeting, if not surpassing, the service delivery requirements of their client. Your target should be to give your client the feeling that you are their partner in trying to achieve and deliver their requirement. Make it difficult for them to consider alternative providers.



§  Step 20 – When you lose…… -  The chances are that you will lose tenders before you win them.

The more tenders you respond to, the better you will get at tendering, but only if you ensure that you do not make the same mistakes time and time again.

-  So ensure that your tendering activity is a rewarding learning curve by seeking information from the awarding authority after every unsuccessful tender to determine why you were not selected or why you were unsuccessful at the invitation to tender (ITT) stage. Most importantly, learn the lessons for the next time. Remember that you have a right to know what the winning bid was and why it was better than yours. Even if you are successful it still pays dividends to seek information on your tender - you will discover where your bid was stronger than the competition, and possibly also learn about areas of weakness.



§  Once you have decided to bid, you'll need to decide how you'll manage the bid:

- Who gathers information and does research? - Who co-ordinates all the material you need? - Who writes the drafts? - Who checks them? - How will the rest of your firm's work get done? -  If you have any questions on the tender document ensure you ask

these questions within the timeframe for clarifications. -  Co-ordinate all the information into a tender document -  Include a covering letter that responds to the bid invitation,

summarises your main message and explains how the documents are organised

Writing your Tender


§  Make sure you match the bid specification and answer all the questions.

§  Summarise your bid and explain why it answers the client's needs. Write this last but put it at the beginning of your tender.

Crucial rules for your tender documentation §  Focus on the client - talk about their needs and how you can solve

their problems. When you write about yourself, it's to prove you have the skills, experience and organisation to fulfill the client's requirements.

§  Help the client by coming up with ideas where possible - from alternative ways of doing things to how to tackle possible worries about future maintenance and staffing implications.

§  Give details of your team. Emphasise strengths - CVs or tailored biographies should highlight successes with similar projects as well as qualifications and experience.

Writing your Tender


§  Here are some tips on editing and supplying your tender: ü  Keep sentences and paragraphs short, punchy and business-like. ü  Use bullet points and headings to break up text. ü  Decide on a typeface, layout and type size - not too small - and stick

to them. ü  Make sure everything is consistent. Are CVs all presented in the

same way? ü  Be careful when cutting and pasting text to make sure the format

stays the same. ü  Make sure you have developed a logical argument.

TIPS ON EDITING YOUR TENDER


§  Read everything again, then get a colleague to read it - checking for meaning, typing mistakes and omissions.

§  Use appendices for supporting additional information. §  Produce a front cover with the project title, date, name of the

organisation requesting the tender and that of your own firm. §  Number paragraphs and provide a contents page so material can be

easily found. §  Consider getting it printed and bound professionally - if the client

has asked for hard copies rather than submission via email. §  Ensure you sign all the relevant documents and include them. §  Attention to detail is key! §  Make sure your tender is delivered on time – it is unlikely that

organisations will consider your tender if it arrives after the closing date. Best of Luck!

TIPS ON EDITING YOUR TENDER


Thank you.

Achilles.com/LinkedIn Twitter.com/Achillesltd

www.achilles.ie

Breda Byrne€¦ · " Mutual Recognition In the event that tenderers are required to submit...

Documents

Transcript of Breda Byrne€¦ · " Mutual Recognition In the event that tenderers are required to submit...