SA Association of Consulting Engineers QBS vs Price Tendering

Quality Based Selection b Competitive selection based on: Skills and qualificationsSkills and qualifications Technical competenceTechnical competence Reputation, experience & capacityReputation, experience & capacity Commitment to client’s needsCommitment to client’s needs Approach and personnel to be usedApproach and personnel to be used Inclusion of previously marginalised individualsInclusion of previously marginalised individuals

Why not Price Tendering? b Sets interests of client and consultant at variance b No guarantee for fairness or transparency People unqualified either to draw up or evaluate tendersPeople unqualified either to draw up or evaluate tenders b Unsuitable for the procurement of a professional service Will contractor complete 50% of building as part of tender submission?Will contractor complete 50% of building as part of tender submission?

Why not price? (continued) b Threatens the viability of a profession which should be strengthened as a matter of national importance b Short-sighted b Places the delivery of infrastructure and technological advancement - the renaissance of Africa - in jeopardy

SA Government Policy b 1997 Green Paper on Procurement Reform “Calling for open tenders … even for routine assignments, is neither in an organ of the State’s not the consultant’s interest”“Calling for open tenders … even for routine assignments, is neither in an organ of the State’s not the consultant’s interest” “The selection of consultants on the basis of price alone may well lead to unsatisfactory or even disastrous outcomes and could, in all likelihood, have been avoided at insignificantly greater overall cost”“The selection of consultants on the basis of price alone may well lead to unsatisfactory or even disastrous outcomes and could, in all likelihood, have been avoided at insignificantly greater overall cost”

Local Government Transition Act (No 209 of 1993) “Subject to section 10G(5) of the Act, a municipality may dispense with the calling of tenders - (a) in respect of any contract which is for the execution of any work for the municipality where (vi) the contract relates to the appointment of any person to provide professional advice or services and the council concerned has consented to such an appointment, provided that it is in accordance with a schedule of fees approved by a nationally recognised institute or body.”

Benefits of Recommended Fee Scale b A Consulting Engineer is a Professional who takes responsibility for the outcome and performance of his/her design Peace of mind that the client receives cost- effective and professional advice backed by professional liabilityPeace of mind that the client receives cost- effective and professional advice backed by professional liability We accept the professional fee of a doctor or legal counselWe accept the professional fee of a doctor or legal counsel

Benefits continued b It is internationally accepted Internationally accepted and benchmarked norms - FIDICInternationally accepted and benchmarked norms - FIDIC USA outlawed price competition by professional engineers, in 1972USA outlawed price competition by professional engineers, in 1972 IBRD - no requirement for price competition; primarily quality based selectionIBRD - no requirement for price competition; primarily quality based selection

Benefits continued b Takes arbitrary guesswork out of the cost of using a professional consulting engineer b Certainty and predictability in the outcome a client can expect b Equitable and transparent environment within which professionals can compete on ability not fees

Benefits continued b Underpinned by a Code of Conduct b Endorsed by a Professional Indemnity Insurance Scheme b A Client has, in the SAACE, a body to turn to should should it believe that a professional consulting engineer has failed it in any way.