Procurement Training for the third sector Phill O’Connor Service Manager Central Procurement

Overview of WBC Procurement 2015/16 the Council spent 187.7m on goods/works and services Did business with 3106 suppliers 90% of suppliers where small or medium sized enterprises (SMEs) 51.75% of spend with SMEs in excess of Government target for Councils to achieve 33% by 2020 29% of spend with organisations with a registered head office in Warrington 64% of spend was with organisations with a presence in Warrington 17.3% of spend was with not for profit sector 0.04% of spend with organisations outside the UK

OJEU Thresholds Thresholds from 1st Jan 2018 Goods and Services £181,302 Works £4,551,413 Light Touch regime £615,278 Thresholds are for the total value of the contract over the intended lifetime. If lifetime not known assume 4 years. Do not include VAT Contracts below these threshold are assumed to be of no cross border interest, so no OJEU advertising is necessary. However: The Treaty principles will still apply to the lower value contracts. i.e. ensuring transparency, equal treatment, non-discrimination etc) There is still a requirement, to ensure that the opportunity is accessible in Contracts Finder.

Light Touch Regime Part B services no longer valid Health and Social Services previously exempt from EU regs now covered, but at higher levels Some services still exempt – eg legal representation.

Council Thresholds TOTAL VALUE AWARD PROCEUDURE APPROVAL BY Up to £1,000 Quotations advisable Appropriate Authorised officer £1,001 to £5,000 Where possible three written quotations £5,001 to £50,000 A minimum of three written quotations or competitive tenders should be invited through the Chest £50,001 to OJEU Threshold Invitation to tender by advertisement through the Chest to at least three and no more than six tenderers Appropriate Authorised officer in consultation with Assistant Director and Section 152 Officer Above OJEU Threshold EU Procedure or, where this does not apply, invitation to tender by advertisement to at least 5 and no more than 10 candidates Executive Director/Asst Chief Exec/ Assistant Director in consultation with Head of Legal Services and Section 151 officer

Public Contract Regulations 2015 - General Changes Introduction of ability to conduct preliminary market consultation Encouragement to split requirements into lots, must provide justification why not done so Ability to use social and environmental labels where they are relevant to the nature of the procurement, proviso that alternatives can be accepted where proof can be shown that they meet the same standard All procurement activity must be electronic Introduction of new procedures, greater use of dialogue. Reduction in the complexity of operating Dynamic Purchasing Systems Changes to notices Ability to restrict some procedures to social enterprises

Award Criteria The award of the contract must be based solely on the ‘most economically advantageous tender ‘, however this includes price; cost (including life cycle costs); and the best price/quality ratio (= value for money)  The directive sets out some rules for costs that may be included in a life cycle approach (e.g. environmental externalities provided their monetary value can be determined and verified)  There is, as now, no exhaustive list of award criteria but these must be linked to the subject matter of the contract. Examples given in the directive explicitly include social as well as environmental aspects. Amongst other examples are quality, accessibility, design for all users, and innovative characteristics

Award Criteria The award of the contract must be based solely on the ‘most economically advantageous tender ‘, however this includes price; cost (including life cycle costs); and the best price/quality ratio (= value for money)  The directive sets out some rules for costs that may be included in a life cycle approach (e.g. environmental externalities provided their monetary value can be determined and verified)  There is, as now, no exhaustive list of award criteria but these must be linked to the subject matter of the contract. Examples given in the directive explicitly include social as well as environmental aspects. Amongst other examples are quality, accessibility, design for all users, and innovative characteristics

Growing business Public Contract regulations 2015 include proposals aimed at opening up the public sector procurement to allow SMEs in particular to grow their business All opportunities with a value in excess of £50,000 must be advertised on Contracts Finder where there is open competition. All awards must be notified via Contracts Finder even where there is a limited number of bidders invited. For contracts below EU thresholds all contracting authorities must not use pre-qualification questionnaires instead, authorities may seek information on suitability through publishing minimum standards/asking limited suitability questions in contract notices or tender documents provided the responses are not used to narrow down the list of candidates to invite to tender For procurements above EU threshold, a single Supplier Questionnaire for the public sector must be used will be available. Consideration should be given to dividing opportunities into lots to encourage bids from SMEs’ decisions not to do this should be recorded Required to publish details of all contracts awarded and whether the recipient is an SME or VSO

Public Services (Social Value) Act 2012. Came into force 31st Jan 2013 The Act requires that the council : consider how the service to be procured might improve the economic, social and environmental well-being of the relevant area (that is the area to which the council delivers its services); considers how in conducting the process of procurement, it might act with a view to securing that improvement Must be carried out prior to procurement Does not specify who should be consulted Does not define social value Revision has taken place to provide more guidance and include works and goods.

Developing Social Value Social Value is defined as: A process whereby organisations meet their needs for good, services, works and utilities in a way that achieves value for money on a whole life basis in terms of generating benefits not only to the organisation, but also to society and economy, whilst minimising damage to the environment.

Developing Social Value   Where the social values can be detailed and aligned to the council’s strategy themes Where it is not possible to define the social value outcomes clearly Commissioning Stage Social Value Act consultation may be undertaken Commissioners should identify the social value outcomes to be achieved aligned to the Council’s strategy themes. These should be built into the specification. Where it is not possible to identify defined social value outcomes the broad themes to be addressed should be identified by commissioners Procurement The identified social value outcomes can be included in tender assessment and given appropriate weightings. These outcomes need to be measurable. As the outcomes have been identified it is then possible to score the submission transparently and fairly The proposals put forward by the bidder will be integrated into the final contract The broad themes to be addressed can be included in the tender assessment, however these will not be scored, they will then be built into the final contract These may be more vague indications of the social value to be delivered and broader in their approach than in the first model Contract Management The outcome identified in the tender will be monitored as part of the ongoing management of the contract The outcome identified in the tender will be monitored as part of the ongoing management of the contract

WBC Procurement Strategy Linked to Council’s corporate strategy Opportunities for the most vulnerable Grow a strong economy for all Build strong, active and resilient communities Create a place to be proud of

WBC Procurement Strategy Key themes Reduce complexity in tenders Greater transparency of opportunities Include Social value measures Strengthen contract management and monitoring and make sure it is proportionate and pertinent Ethical standards in contracts including fair trade, local living wage Include service users in tender process, where appropriate Provide training to SMEs and Voluntary Sector organisations Encourage use of local supply chain Encourage use of voluntary opportunities and training opportunities Encourage use of employment of people with learning disabilities, physical disabilities, mental health problems, veterans and ex-offenders Consider duration of contracts which impact on third sector and potentially offer longer contract periods to ensure stability and

The Chest Search for contracts Search for opportunities Apply to participate Complete a submission