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[email protected] 087 2412001
Preparing a Tender from a Suppliers’ PerspectivePeter Brennan
Chairman, Bid Management Services
Procurement Reform
• Office of Government Procurement (OGP) set up on 1 January 2014
• Achieving €500m in savings over next three years the strategic driver (in a market for goods and services worth €9bn)
• Centralised purchasing in OGP, HSE, Defence, Local Government and Education
• Category management approach (professional services, facilities, ICT, utilities, print etc.)
• Fewer tenders for larger amounts• Clear commitment to work in interest of suppliers• A very welcomed initiative from a suppliers’ perspective
Some Metrics (Tender Scout)
• 7,500 tenders published in 2013 (to a value of €12bn)• 28% awarded to non-Irish companies• 40,000 submissions made by 20,000 bidders• Only 10% of SMEs tender; 70% are not even registered• Only 55% of award notices above EU threshold published• Fewer than 2% of Irish companies win tenders abroad
The Market (above EU threshold)
Irish Contracts
Non-Irish Contracts
Irish Share(no.)
Value of Contracts
Irish Share (value)
TED Notices
Cross-Border Awards
2008 943 296 68.6% €3.27bn 84.8% 1,572 1.8%
2009 771 172 77.7% €2.38bn 68.4% 1,292 1.4%
2010 660 115 82.6% €2.75bn 89.4% 1,296
2011 747 123 83.3% €2.04bn 88.2% 1,356
What are the Issues?
• Some rules not being applied• Templates not used systematically• Inadequate debriefings• Poorly defined specifications• Frameworks• Access to buyers• Need to encourage consortium bids• Cost of litigation/lack of appeals process
Some Rules not Being Applied
• Circular 10/10 examples: required turnover should not be more than 150% of the value of the contract
• Negotiated procedure used in inappropriate circumstances• Restricted procedure should be preferred option in vast
majority of cases• Buyers often cite non-binding ‘guidelines’• Inappropriate use of frameworks e.g. where a single supplier
appointed• But 63% of SMEs admit they do not understand the basic
rules
Templates not Used Systematically
• SMEs welcome the deployment of templates• However, used as an exception and not as a rule: only 50%
of buyers using them (2012)• Consistency of approach will result in better bids• Include Government’s prompt payment terms in template
contracts• Stakeholders should be consulted about operation and
revision of templates• Key role for OGP to ensure templates used where this is
appropriate
Debriefings
• Only 7% of suppliers get the feedback they request• 90% of those who get a debrief says it is of
considerable benefit• The ‘Dear John’ letter issues far too often• Buyers are hiding behind non-statutory nature of
guidelines• Many examples of best practice: Revenue, SEAI
and Garda Siochána• Specific guidelines on debriefings would help
Poorly Defined Specifications
• Smart market soundings and/or information days for complex procurements helps both sides
• Use standards e.g. FETAC• Do not rush publication of RFTs where doubts remain about outputs of
required training for example• Clarify in RFT if budget approved• Above all else, critical that award criteria are clear and weightings
proportionate and transparent i.e. There are no hidden sub-categories• Example: HSE RFT for supply of enhanced home care resulted in 260+
questions and recasting of the requirements – engagement helped both buyer and suppliers
Frameworks
• Panels still being used despite guidelines• Restrictive procedure better option instead of single supplier
frameworks • The way forward but will they be SME friendly as expenditure is
consolidated?• Popular option: HSE framework for design services attracted 552
submissions with 35 selected• Use of lots (and by region if possible) will help SMEs• Encourage bid consortiums• Start major frameworks with market soundings• PINs should be published well in advance of major frameworks
Access to Buyers
• Meet the Buyer events a great success• Dublin event (October 2013) attended by 747
suppliers and 130 buyers with €6m in contracts won
• Suppliers’ feedback universally positive• Sectoral MTB events are being planned• Important that OGP remains accessible
Consortium Bids
• SMEs need to be encouraged to form and join consortiums and trained to this end
• Buyers need to pro-actively support consortium bids, especially for frameworks
• Guidance should be published about promotion of bid consortiums
• InterTradeIreland’s new initiative in supporting consortium bids will help
Litigation and Appeals
• 35+ cases before NI High Court• Very few Irish cases due to cost of litigation• Having an OGP ‘Help Desk’ would benefit suppliers• Guidance needed about impacts of recent ECJ cases
e.g. Pressetext where issue of what constitutes ‘a material change’ critical
• OGP might consider low cost arbitration and mediation facility: NQAI’s appeals procedure an example of best practice
What Also Needs to be Done (1)
• Put guidelines for tender competitions in excess of €25,000 on a statutory footing
• Revise and update current guidelines (to reflect new EU Procurement Directives and OGP reforms)
• More training for buyers and suppliers• More market soundings • More feedback between buyers and suppliers• Publish new suite of Public Procurement Plans
What Needs to be Done (2)
• Publish contract award notices (with contract values) for all tenders in excess of €25,000
• Deeper direct engagement between OGP and suppliers• Clarify what constitutes a ‘material change’ • Publish detailed guidance about use of FOI in relation to
procurement• More e-functionality on e-tenders• Improve collection and dissemination of statistical data
Win-Win
• The procurement landscape is changing for the better• Buyers should help SMEs to leverage their successes in
export markets• Encourage innovation for sub-€25K pilot projects• OGP on-going dialogue with representative
organisations such as SFA and Chambers Ireland a positive development
• InterTradeIreland’s Centre of Tendering Excellence and Go-2 Tender Programme will make a significant impact
Contact
Peter BrennanBid Management Serviceswww.bidmanagement.ie [email protected] 01 525 2650 / 087 2412001