PAPER K
CONTRACT STANDING ORDERS AND PROCUREMENT PROTOCOLS
MAY 2021
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CONTRACT STANDING ORDERS
Index
Introduction
1.
Basic Requirements
Page 3
1.1
Key Principles and Responsibilities
Page 3/4
1.2
Conduct
Page 4
1.3
Financial Values
Page 4
1.4
Exceptions to the Rules
Page 5
1.5
Other Considerations
Page 6
2.
Establishing and Managing Contracts
Page 7
2.1
Openness and Forward Planning
Page 7
2.2
Pre-Procurement Considerations
Page 7
2.3
Seeking Competition
Page 8/9
2.4
Choosing the Procurement Procedure
Page 10/11
2.5
Determining Tender Award / Evaluation Criteria
Page 11
2.6
Preparation of Invitation to Tender
Page 11
2.7
Receipt and Opening of Tenders
Page 12
2.8
Evaluation and Award of Contract
Page 12/13/14
2.9
Debriefing of Unsuccessful Tenderers
Page 14
2.10
Contract Documentation
Page 14
2.11
Variations and Extensions
Page 14/15
Annex 1
Contract Registration Form
Annex 2
Contract Standing Orders Waiver Report
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CONTRACT STANDING ORDERS
Introduction and standards
This policy explains how Ryde Town Council follow procurement practices for all procurement
processes of goods, services, works and contract management. Procurement can also involve
Public/Private Partnership (PPP) or joint commissioning with another public sector organisation.
Standards expected of all public services
Honesty
Impartiality Openness Accountability
Accuracy
Fairness
Integrity
Transparency
Objectivity Reliability
These should be carried out -
• In the spirit of, as well as to the letter of, the law
• In the public interest
• To high ethical standards
• Achieving value for money
The highest standards of probity are required of all Council officers and members involved in
the procurement, award, and management of any Council contract. Similarly the Council will
endeavour to be fair and open in its dealings with all suppliers and prospective suppliers, and all
members and officers shall uphold these principles.
1.
BASIC REQUIREMENTS
1.1
Key Principles and Responsibilities
1.1.1 All procurement activity must be in connection with the Council’s lawful functions and
within the bounds of its statutory powers.
1.1.2 All procurement shall be in accordance with all relevant legislation and, when
applicable, the European Union Procurement Directives.
1.1.3 All procurement activity shall be conducted with integrity and fairness throughout. It
shall also be conducted with sufficient openness to engender public confidence in the
procurement processes generally and meet the requirements of the Freedom of
Information and Equality Acts, Data protection, Health and safety, Environmental
Sustainability, Employment rights, Anti-corruption Law and the UK Bribery Act.
1.1.4 Those awarding contracts shall have a duty to ensure and demonstrate that the best
value for money is obtained, having regard to an appropriate and realistic balance
between price, quality, social value, and other considerations which can differ with the
requirements of each contract specification.
1.1.5 Unless there are sufficient and explicitly stated reasons to the contrary, a reasonable
show of competition shall be sought as part of all contract-letting processes.
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1.1.6
No contract shall be awarded unless there is delegated authority to award the contract
and there are adequate budget funds available.
1.1.7
The Town Clerk is responsible for ensuring compliance with these procurement
regulations and for ensuring that staff employed by the Council, and Council
Committees who are given such delegated responsibility have the necessary skills and
knowledge appropriate tothe task. Staff have a responsibility to familiarise themselves
with these rules and undertake any necessary training.
1.1.8
Most contracts can be let by the Clerk (subject to relevant delegated authority) without
formal reference to members. Only where a contract has a whole life value of over
£10,000 or be deemed to be of particularly high risk, sensitivity value or other
substantial effect on the Council’s objectives or its reputation,shall the Full Council (or
where appropriate the delegated committee) be called upon to take procurement
decisions.
1.2
Conduct
1.2.1
Members and staff must ensure that when involved in making any procurement
decisions, they always act in the best interest of the Council and the community it
serves.
1.2.2
It is important to be impartial. The Council has a policy on registering disclosable
pecuniary interests, and all members and staff are required to comply with these.
1.3
Financial values
1.3.1
Unless otherwise stated, any financial values or thresholds stated in this policy refer to
the projected value of a contract for its whole duration, not the annual value. For
contracts that have an extension option, then the contract value shall be calculated
based on the original contract period plus the possible extension period. For any
contracts that are for an unspecified period, a ‘default’ duration of four years shall be
assumed for the purposes of calculating the financial value.
1.3.2
No attempt must be made to break down one large purchase into several smaller
purchases, solely with the aim of trying to circumvent the financial thresholds specified
in this policy Moreover, it is the aggregated expenditure by the Council as a whole on
like or similar goods and services, rather than that of individual budget holders, that shall
have effect - this being particularly important as regards compliance with the EU
Procurement Directives.
1.3.3
All values stated throughout this policy exclude VAT.
1.3.4 The list of all staff having approved delegated authority limits shall be maintained by
the Clerk to the Council. The Clerk will be responsible for ensuring that the Full Council
are provided with the necessary details to enable the list to be kept fully up to date.
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1.4
Exceptions to the rules
1.4.1 This policy does not apply to:
o Contracts of Employment
o Contracts that relate solely to the purchase or acquisition of land and property
1.4.2 In addition, exemptions from the full provisions of this policy as regards seeking
competition may apply in the following circumstances:
i.
Genuine emergencies - Critical preventative or remedial work where there is a
real and imminent risk to the safety of people or property arising from a hitherto
unforeseen ‘catastrophic’ event or incident such as fire, bombing, flooding, major
landslide, etc.
ii.
Urgency not of the Council’s own making - The urgency must have been
reasonably unforeseeable (e.g. existing supplier going into liquidation, urgently
imposed statutory changes, etc.) and genuinely be a case of ‘time is of the
essence’. However, urgency arising through problems of the Council’s own making
(whatever the cause and regardless of whether it involved previous delays or
shortage of resources, etc.) shall not in itself justify exemption.
iii.
Collaborative / Joint Purchasing - Where another authority/public body is acting
as ‘lead buyer’ and provided that the person(s) awarding the contract can
demonstrate the arrangements comply with the requirements of all applicable
legislation including, if necessary, the EU Procurement Directives. This includes
any recognised wider public sector agreements including, for example, Office of
Government Commerce (OGC) contracts, etc.
iv.
Sole source of supply - Where suitable goods or service are genuinely only
available from one supplier (e.g. if patent, copyright, or other exclusive design rights
exist). Similarly, for any highly specialised/niche services where, for all practical
purposes, no realistic alternative source of supply exists.
v.
Reasons of compatibility - If compatibility with existing goods, equipment or
services is essential (e.g. spare parts/components for existing equipment) or where
additional units are being purchased to match existing equipment and there is an
overwhelming case for matching the existing items on the grounds of functionality,
aesthetics, etc.
vi.
Partnering
- Where a formal partnering arrangement and/or established
framework agreement already exists as the result of an earlier competitive
selection and award process.
vii.
Grant or match funding - To secure grant or match funding within a restrictive
time frame.
1.4.3 In the event of a contract being awarded under any of the circumstances stated above
a waiver report will be provided to the council or relevant committee for approval at the
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earliest opportunity.
1.5
Other considerations
1.5.1 Where they exist, corporate contracts and framework agreements shall be used.
The Clerk to the Council shall be responsible for maintaining and distributing details of
such contracts, as necessary.
1.5.2 Any procurement activity shall accord with other relevant Council policies,
technical standards, or requirements as necessary e.g. ICT hardware and software
compatibility policy, in-house printing protocol, etc.
1.5.3 Consultants acting as an agent on behalf of the Council are required to operate
in accordance with this policy. It is the responsibility of the Clerk to the Council or
delegated officer engaging the consultant to ensure such compliance. Furthermore, the
selection and engagement of consultants is a procurement activity, and therefore
subject to this policy.
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2.
ESTABLISHING AND MANAGING CONTRACTS
2.1
Openness and forward planning
2.1.1
The clerk to the council shall maintain an up-to-date contract database of all the
councils’ current contracts and timeframes which must be reported on a quarterly basis
to the Finance Committee and on an annual basis to the Full Council.
2.1.2
The council shall maintain an approved contractors list for the value up to £10,000
across the range of supplies, services, and minor works. This list must be reviewed
every 3 years and any major changes within that time must be reported to full council
for approval.
2.2
Pre-procurement considerations
2.2.1
Realistic consideration
(proportionate to the risk, complexity, and value of the
purchase) should be given to possible alternative options. For example, this might
include a fundamental revision of the need for standardisation of the specification;
reuse or recycling of equipment; internal provision of the service; collaboration with
other purchasers; etc.
2.2.2
The involvement of elected members in procurement decisions is generally most
effective at the earlier rather than later stages of the procurement cycle - particularly
in terms of helping to scope the requirement, developing an outline business case, and
determining the procurement approach. For example, members can often bring
valuable insight and perspectives to issues such as how well a proposed requirement
meets the Council’s strategic objectives and its current priorities (“strategic fit”), or
whether a wide enough range of possible supply options (including innovation and/or
collaboration with other organisations etc.) is being explored.
2.2.3 General market research or consultation can be undertaken with potential suppliers
before the issuing of an Invitation to Tender (e.g. regarding the nature or extent of
supply, contract
‘packaging’, etc.) provided this does not prejudice any potential
tenderers. No technical advice on the preparation of an Invitation to Tender or similar
shall be accepted from anyone who may have a commercial interest in this if it might
prejudice the equal treatment of all potential suppliers or distort competition in any way.
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2.3
Seeking competition
2.3.1
Formal competitive tenders shall be invited for any procurement with an estimated total
value of more than £75,000 (Reference is to be made to clause 1.3.1 of these CSO’s
when determining the total value). Tendering opportunities shall be advertisedon the
Council’s website and Contracts Finder in accordance with the Public Contracts
Regulations 2015, and as appropriate, in the local press and/or relevant trade
journal(s)
2.3.2
Where applicable, the further requirements of the EU Procurement Directives and
Public Contracts Regulations 2015 must be complied with, including advertising in the
supplement to the Official Journal of the European Union (FTS) and Contracts Finder.
This potentially affects all contracts above £181,302 in the case of goods andservices,
or above £4,551,413 in the case of works contracts (1 January 2018 thresholds).
There are additional thresholds for the requirement to advertise in Contracts Finder
and the publication of Prior Information Notices. Regular guidance should be sought
on the application of the EU Procurement Directives and the Public Contracts
Regulations 2015; the values of the relevant thresholds; and the compilation and
submitting of FTS notices.
2.3.3
For contracts with an estimated value between £5,001 and £24,999 at least three
written quotations from bona fide suppliers should be sought. Requests for Quotations
(RFQ’s) can either be invited from known suppliers to the Council, or when there are
no known suppliers or a wider competition is deemed appropriate then the RFQ can
be advertised. Each contractor responding to the advertisement shall be supplied with
the RFQ documentation. For contracts with a value from £25,000 up to £75,000, the
RFQ will be advertised on Contracts Finder in accordance with the requirements of
the Public Contracts Regulations 2015 and in addition to any other advertising medium
used. Each contractor responding to the advertisement shall be supplied with the RFQ
documentation. This will be in addition to RFQ’s being invited from known suppliers.
At least three written quotations should be obtained.
RFQ’s involve less formality than the tendering process. However, as with an Invitation
to Tender, any Request for Quotation must communicate clearly to the potential
suppliers what is required (the specification).
2.3.4
For contracts up to £5,000, no formal competition is strictly required. However, it is
essential to demonstrate best value is achieved and it will often be appropriate to
obtain more than one quotation to do this. The Council shall develop an Approved
List of Contractors for this purpose across a range of supplies, services, and minor
works. This list must be reviewed every three years for approval by Full Council and
reported on an annual basis to the Council’s Finance Committee for noting. Any major
changes during the three-year period must be reported to Full Council for approval.
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These requirements are summarised in the following table:
Estimated Total Value
Competition
Advertising Requirements
(i.e. for full duration of
Requirements
contract including any
extension options)
Up to £5,000
No formal competition
No advert required
required, although
requests for quotations
can be sought to
demonstrate best
value
£5,001 - £24,999
Obtain at least three
Advertise RFQ in accordance with
written quotations using
clause 2.3.3
the RFQ process.
£25,000 - £75,000
Obtain at least three
Advertise RFQ on the Contracts
written quotations using
Finder website in accordance with
RFQ process.
clause 2.3.3 and as appropriate in
any additional advertising medium.
£75,001 and above
Invitations to Tender
Advertise on the Council and
Contracts Finder websites, the local
press and at least one industry
publication
£4,551,413 and above
Invitations to Tender
Advertise on the Council and
(Works contracts) or
processed in
Contracts Finder web sites, the
£181,302 and above
accordance with the
Official Journal of the European
requirements of the EU
Union (FTS) and at least two
(Goods and Services
contracts)
Procurement Directives
industry publications
and Public Contracts
(1 January 2018
Regulations 2015.
thresholds)
2.4
Choosing the procurement procedure
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2.4.1 The Public Contracts Directive provides for six basic award procedures to choose
from. One of these procedures will be used for all contracts whose total value equals
or exceeds the EU Procurement thresholds detailed in the table above. The choices
are: Open, Restricted, Competitive Dialogue, Competitive Procedure with
Negotiation, Innovations Partnership Procedure, and Negotiated Procedure
without Prior Notification. The selection of the most appropriate one will be
determined by the Clerk to the Council, delegated officer, or delegated project team,
and shall depend on circumstances as follows:
2.4.2 In Open Procedures, any interested economic operator may submit a tender in
response to a contract notice. The tender shall be accompanied by the information for
qualitative selection that is requested by the contracting authority.
2.4.3
In Restricted Procedures, any economic operator may submit a request to participate
in response to a call for competition by providing the information for qualitative selection
that is requested by the contracting authority. Only those economic operators invited to
do so by the contracting authority following its assessment of the information provided
may submit a tender.
2.4.4
In Competitive Dialogues, any economic operator may submit a request to
participate in response to a contract notice by providing the information for qualitative
selection that is requested by the contracting authority. Only those economic operators
invited by the contracting authority following the assessment of the information
provided may participate in the dialogue.
2.4.5
The Competitive Procedure with Negotiation, any economic operator may submit a
request to participate in response to a call for competition by providing the information
for qualitative selection that is requested by the contracting authority.
2.4.6
The Innovation Partnership Procedure, any economic operator may submit a
request to participate in response to a contract notice by providing the information for
qualitative selection that is requested by the contracting authority. The contracting
authority may decide to set up the innovation partnership with one partner or with
several partners conducting separate research and development activities.
2.4.7
In certain narrowly defined circumstances the contracting authority may also award a
contract using the Negotiated Procedure Without Prior Publication. Here the
contracting authority would approach one or more suppliers seeking to negotiate the
terms of the contract. One of the permitted circumstances is where, for technical or
artistic reasons or because of the protection of exclusive rights, a particular supplier
can only carry out the contract.
2.4.8
Contracting authorities have a free choice between the open and restricted procedures.
The competitive dialogue procedure and the competitive procedure with
negotiation are available where certain criteria are met, including where the
contract is complex or cannot be purchased ‘off the shelf’. The negotiated
procedure without prior publication may only be used in the limited circumstances
described in the Public Contracts Directive.
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2.4.9 Contracting authorities using the restricted procedure, competitive dialogue
procedure and the competitive procedure with negotiation must aim to select
several suppliers sufficient to ensure genuine competition. Provided there are
sufficient suitable candidates, the Public Contracts Directive requires a minimum of
five for the restricted procedure, and three for competitive dialogue and
competitive procedure with negotiation.
2.5
Determining tender award / evaluation criteria
2.5.1 The various qualitative award criteria must be appropriate to the contract in question
and reasonably expected to provide a best value outcome. These qualitative factors can
include moderate recognition of what are often termed ‘Corporate Social Responsibility’
issues. In other words, considering how well each supplier is in accord with the Council’s
own policies, objectives, and values in relation to, for example, care for the environment;
promoting equalities & diversity; supporting fair trade; well-being of the local community;
etc. Reference should also be made to the Public Contracts Regulations 2015, and EU
Public Procurement Directive for further information on qualitative award criteria that
may be used.
2.5.2 As far as possible, pricing factors should cover all identifiable elements that make up
the ‘whole-life cost’. Where price is not a fixed sum, but instead comprises a schedule
of prices or rates with no firm commitment as to quantities then a best endeavours or
notional bill of quantities shall be incorporated into the Invitation to Tender/evaluation
process to facilitate satisfactory total price comparisons between tenderers.
2.5.3 The award criteria (though not necessarily the actual weightings to be applied to each
criterion in the evaluation model) should be stated to prospective tenderers in the
Invitation to Tender (ITT) documentation. Subsequently, evidence of each tenderer’s
suitability to supply shall be judged against these criteria - usually by small panel of
suitably knowledgeable officers (typically up to 3) convened as required.
2.6
Preparation of invitation to tender
2.6.1 Every effort shall be made to produce clear and straightforward Invitation to Tender
documentation. Whenever practical, specification details should focus on successful
outcomes rather than being unnecessarily prescriptive as to the precise method of
achieving those outcomes, as potentially this can encourage innovation from tenderers
and avail particular market expertise. Similarly, variant bids (i.e. allowing tenderers to
suggest possible variations or alternative ways in which they might satisfy the potential
contract) should be an allowable option and duly considered in the pursuit of best value.
2.7
Receipt and opening of tenders
2.7.1 A reasonable length of time must be allowed for tenderers to compile and submit their
bids, having regard to the complexity of the tender and, when appropriate, any
mandatory timescales under the EU Procurement Directives and Public Contracts
Regulations 2015. The Invitation to Tender must clearly state the latest date and time
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that tender bids can be received by. Any tenders received after the closing date shall
not be considered unless there is clear evidence that it was posted at least the day
before the closing date and any delay in delivery was wholly outside the control of the
tenderer.
2.7.2 All tenders submitted must be in official tender envelopes and are to be posted or
delivered to the Ryde Town Council Offices, where they will be held in a secure locked
box until the designated tender closing date. The Clerk to the Council and the authorised
project officer or Council member will then open all the tenders received and record the
value of each tender bid in a register maintained for that purpose. No assessment or
recording of any of the qualitative information shall be practical at this stage.
2.7.3 The tenders shall then be passed to the lead project manager or authorised person
responsible for the tender, who shall arrange the evaluation of the tenders.
2.8
Evaluation and award of contract
2.8.1 All compliant tenders shall be checked for basic arithmetic accuracy. If any arithmetical
errors are found they must be notified to the tenderer who shall be given the opportunity
to confirm (urgently and in writing) what the correct price is or withdraw the tender bid
altogether. No amendments to the billed rates shall be allowed. Common sense shall
prevail as to the nature of any such errors and that they do not undermine the basic
integrity of the tendering process.
2.8.2 All tenders shall be evaluated against the designated award criteria set out in each
specification.
2.8.3 The appropriate delegated person, normally the Clerk to the Council is empowered to
award contracts without formal reference to elected members for contracts up to a value
of £10,000, provided this policy has been fully complied with. However, if the contract
up to this value is considered to be of a particularly important or sensitive nature, the
approval of the Full Council, or delegated Council Committee, to award the contract
shall be obtained. In addition, the requirements of Clause 1.1.10 must also be met for
contracts whose whole life value lies between £5,001 and £10,000.
2.8.4 The authority to request quotations, invite tenders and award contracts is summarised
in the following table:
Summary of delegated authority for procurement
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Person
Request
Request for
Invite tenders
Award contracts (subject
for
Quotations
(Values above
to necessarybudget
Quotations
(Values
£75,000)
available)
(Values up
between
to £10,000)
£10,001 and
£75,000)
Clerk tothe
No
By authority of
By authority of
No restriction for Quotesup to
Council.
Restriction,
the Full Council,
the Full
£10,000 in value, unless of a
but subject
or Delegated
Council, or
strategically important or
to clause
Council
Delegated
politically sensitive nature,
1.1.10
Committee.
Council
but alsosubject to clause
Committee.
1.1.10
By authority of the Full
Council or Delegated Council
Committee for allcontracts of
value above
£10,000
Delegated Officer
No
By authority of
By authority of
No restriction for Quotesup to
authorisedby the Full
Restriction,
the Full Council,
the Full
£10,000 in value, unless of a
Council, ordelegated
but under
or Delegated
Council, or
strategically important or
Council Committee
the
Council
Delegated
politically sensitive nature,
, and under the
direction of
Committee, and
Council
but alsosubject to clause
direction ofthe Clerk
the Clerk to
under the
Committee,
1.1.10
to the Council.
the Council.
direction of the
and under the
Clerk to the
direction of the
By authority of the Full
Council.
Clerk to the
Council or Delegated Council
Council.
Committee for allcontracts of
value above
£10,000.
Both of the above underthe
direction of the Clerk to the
Council.
2.8.5 Performance bonds shall not be required as a matter of course, as in many instances
they can drive up costs unnecessarily and out of proportion to the real exposure to risk
of a failing supplier. However, they shall be considered if there are genuine concerns
about the stability of a particular supplier. In such instances, the bond must be in place
before the commencement of work by the supplier.
2.8.6 Suppliers and contractors are required to have appropriate public liability insurance
cover (and professional indemnity insurance where deemed necessary) that provides a
realistic level of protection to the Council and is proportionate to the value/risks involved.
(Note: Typically, a “standard” public liability cover level of £10 million for any one single
incident shall be sought, although alternative levels may be considered acceptable in
relation to the adjudged risks
2.9
Debriefing of unsuccessful tenderers
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2.9.1 If requested, unsuccessful tenderers shall be given constructive feedback on why their
bid was unsuccessful. This must not betray any commercially confidential information
provided by other tenderers, whilst the requirements of the Freedom of Information Act
shall be properly considered.
2.9.2 The full requirements of the EU Procurement Directives and Public Procurement
Regulations 2015 must be followed when procuring goods, services, or works that
require these procedures to be followed.
2.10 Contract documentation
2.10.1 In many instances, a straightforward acceptance letter (and/or purchase order) by the
Council of a supplier’s tender shall be sufficient to form the binding contract. However,
a pre-requisite for this is that the Invitation to Tender document itself is well-structured
in the first place (including the inclusion of the Council’s chosen terms and conditions)
and that good records are kept of all salient correspondence with the supplier
concerning the agreement itself, such that there can be no doubt about the rights and
obligations of both parties to the contract.
2.10.2 Contract documentation should normally be subject to approval by the Councils legal
representatives, particularly where it is of high risk or strategically sensitive. The formal
sealing of contracts shall not be deemed necessary except on Legal advice.
2.10.3 All contracts shall provide for contractors’ obligations in relation to Human Rights,
Freedom of Information, Data Protection, and other statutory obligations as required.
2.10.4 The delegated person or committee awarding the contract shall complete a Contracts
Register Form (Annex 1) for collation by the Clerk to the Council within two weeks of
award of contract so that the Council’s Contracts Register can be updated. Where
required, a mandatory Contract Award Notice (including those for Part B Services) shall
be published in the FTS within the statutory 48-day period from award of contract.
2.10.5 The Council’s Contracts Register should contain details of the procurement exercise to
trap key information about the contract (e.g. the goods and services and or works,
values, date started, expiry date, procurement category etc)(See also Annex 1).
2.11 Variations and extensions
2.11.1 Reasonable variations to the contract can be agreed with the supplier during the lifetime
of the contract provided they comply with the spirit of these Contract Standing Orders
and be within the delegated authority limits of the relevant delegated officer(s) or Council
Committees.
2.11.2 Options to extend a contract must have been stated in principle in the original Invitation
to Tender.
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