1. Procurement of Consulting Services
KB Thapa

2. Content Consultants services (General) Procurement Condition
Procurement Steps
PPA,PPR Procurement Provisions
Methods of Selection
Preparing EOI and RFP
Evaluation Proposals
Negotiations and Contract Award

3. Consultant
Someone who borrows your watch , tells you the time and then charges you for the privilege.
-Unknown

4. 1.Consultancy Services (General)
Intellectual and professional activities based on skill, expertise knowledge and experience to provide professional advice and technical assistance for planning design and implementation of projects
provides access to latest technology and expertise of particular competence as and when required without hiring permanent staff
provides flexibility to organizations to adapt to changing conditions with less people employed

5. Consultancy Services/Advantages
Only expertise organization can afford the resources to adapt to the fast changing specialized technology
provides independent knowledge to the benefit of the project. Avoids conflict of interest
provides transfer of knowledge ,skill and technology to the executing agency
Frees line agencies from day to day functions of project implementation
Provides quality and cost effectiveness

6. Key Areas of Use of Consulting Services
Preparation
Master plan, Pre/feasibility studies, Design,
Implementation
Procurement services, Construction supervision, Project management, Quality management,
Advisory
Policy, Strategy, Institutional strengthening, Training, Operation

7. Differences between Procurement of Goods/Works and Consultants services
Physical deliverables (product based)
Intellectual deliverables
(Knowledge based)
Tender/Bid
Proposals
Prequalification
Short-listing
Price major factor (provided bidder meets minimum qualification)
Generally Quality is the major evaluation factor

8. Differences between Procurement of Goods/Works and Consultants services(contd.)
Specifications / drawings
Terms of Reference
Generally No negotiations (except in direct purchase)
Negotiations before contract award
Tender documents
Request for Proposals
Bid Security / Performance Security
Generally no such Securities
Professional Liability

9. 2.Procurement Condition
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10. 3.Procurement Steps In General involves the following steps:
Preparation of the Terms of Reference (TOR) – PPR Clause 69
Preparation of Cost Estimates –PPR Clause 12
Preparation of Shortlist of Consultants. through Standing List or open Expression of Interest Procedures –PPA 30.
Preparation and Issue of Request For Proposal (RFP) Document to Shortlisted Consultants - PPA 31;PPR 73 ;

11. 3.Procurement Steps In General involves the following steps:
Preparation & Submission of proposals
Receipt and Opening of Proposals PPA Clause 32: PPR Clause 75 & 79
Evaluation of Proposals -PPR Clause 76 & 80
Negotiations (PPA Clause 37) and Award Of Contract (PPA Clause 38)

12. 3.1 Preparation of Terms of Reference
TOR facilitates the Consultants to prepare their proposals and the Project Entity (PE) during proposal evaluation, contract negotiations and execution of the assignment. The TOR should include:
Background, objective and Scope of of the assignment to be performed by the consultant,
Information regarding relevant prior studies if any,
Description of required (if any) transfer of knowledge or skill by the consultant to the PE,
If training is a part of the assignment detail information on it

13. 3.1 Preparation of Terms of Reference
Key personnel requirement , their qualifications, roles and responsibilities and estimated inputs for the assignment.
Should mention that proposed experts involved in the firm’s work in hand will not be considered for evaluation,
Information regarding downstream additional or supplementary work which might be requested to contract following the completion or during the implementation of the assignment

14. 3.2 Preparation of Cost Estimate
PPR provides standard format for preparation of cost estimate for consulting services on the basis of the following:
Norms if prepared by the related ministry;
Terms of Reference of the consulting assignment;
Actual cost of procurement of the same nature in the current year or in previous years, by the public entity or other public entities after applying price adjustment.
208. The public entity should prepare the cost estimates under the following cost headings:
Remuneration of key and other staff required for the assignment;
Cost of travel, staff accommodation, office expenses, required goods, equipment and services , translation and printing of reports and other documents;
Cost of training, symposium or tours if the consultant is required to organize under the consulting services assignment.

15. 3.2 Preparation of Cost Estimate
The cost estimates should be prepared under the following cost headings:
Remuneration of key and other staff required for the assignment;
Cost of travel, staff accommodation, office expenses, required goods, equipment and services , translation and printing of reports and other documents;
Cost of training, symposium or tours if the consultant is required to organize under the consulting services assignment.

16. 3.2 Preparation of Cost Estimate
Approval of Cost Estimates: [PPR 14 (2)]
Estimated Cost (Rs.)
Approving Authority
Up to 10 lakh
Office Chief, Gazetted - III
Up to 25 lakhs
Office Chief, Gazetted -II
Up to 50 lakh
Office Chief, Gazetted First - I
Above 50lakh
Head of the Department

17. 4.Procurement Provisions (PPA & PPR)
4.1 a) Invitation of Open Expression of Interest (EOI) and Preparation of Shortlist of Consultant (PPA 30)
Procurement based on Open Expression of Interest(EOI) from Consultants for value of services in excess of Rs. 20 lakh.
International EOI for value of services >10 karod with approval of one level higher authority.
National level EOI for assignments > Rs.20 lakh up to Rs.10 karod
b) Request for Invitation of Proposal from shortlisted consultants

18. 4.Procurement Provisions (PPA & PPR)
4.2 Invitation of Proposal from Standing list ( 3- 6 ) up to Rs.20 lakh
4.3 Sealed Quotations for value of services up to Rs.20 lakh (notice of 15 days in National paper).
4.4 Direct Purchase
Assignments of value up to Rs.5 lakh
Written Quotation or Proposal from at least 3 consultants in the standing list of consultants for value of assignments > Rs.1 lakh

19. 4.Procurement Provisions (PPA & PPR)
4.5 Direct Negotiation
For required trainings, workshops and Seminars of value up to Rs 5 lakh by entity chief
Approval one level higher authority for higher value of the assignment
4.6 Procurement through Design Competition
Services generally that includes aesthetic component e.g. Architecture ,Urban Planning etc. Selection method Similar to QBS.

20. 5. Methods of Selection As per PPA 31(4)
Quality- and Cost-Based Selection (QCBS)
Quality-Based Selection (QBS)
Fixed Budget Selection (FBS)
Least-Cost Selection (LCS)
As per PPR 83
Consultant’s Qualifications Selection(CQS)

21. 5.1Factors Affecting Choice of Selection Method
Technical complexity of the assignment
Size and value of the assignment
Whether the impact of poor performance by the consultant is high or low
Whether proposals are comparable (i.e., assignment can be carried out in different ways?)
Budget constraints

22. 4.2 Quality and Cost Based Selection (QCBS)
Key Considerations
Appropriate when scope of work is well defined and TOR is well specified and clear
To ensure a combination of economy and quality
- Weightage given to Quality: 70-90
- Weightage given to Cost : 10-30

23. 5.3 Quality Based Selection (QBS) Applicability
When complex and highly specialized consulting services are required. Defining precise TOR and inputs is difficult
Services can be performed in substantially different ways and hence cannot be easily compared
assignments where downstream impacts are so large that the quality of service is of overriding importance
Nature of work requires some flexibility in scope of work, TOR, duration of assignment for innovative solutions

24. 5.4 Fixed Budget Selection (FBS)
Applicability:
for simple assignment within fixed budget and scope of work that can be precisely defined
Allows better quality proposals than under QCBS because the process maximizes the quality under a fixed budget.

25. 5.5 Least Cost Selection (LCS)
Key Consideration
Lowest Financial Proposal from firm whose technical proposal gets minimum qualifying score.
Applicability
Used for consulting services of a standard or routine nature with well established practices and standard (audits, valuation, simple engineering designs etc.)

26. 5.6 Selection Based on Consultant’s Qualifications (CQS)
Applicability
Small assignment
Highly Specialized Expertise is required
Few consultants are qualified for the type of assignment
Preparation and evaluation of competitive proposal is not justified
Procurement period is short

27. Preparing Expression of Interest(EOI)
Preparation of shortlist involves :
Preparation of EOI document based on Standard EOI Document issued by PPMO or as applicable for DP financed projects,
Approval of the short listing criteria by the head of the department.
Publication of Notice for EOIs in daily newspaper of national circulation with submission period of not less than 15 days.
In case of international EOIs, the notice to be published in English language with submission period of at least 30 days.

28. Expression of Interest (EOI)
Notice may also be posted on the web sites of the PE, concerned ministry and the PPMO
EOIs to be evaluated on the basis of applicant’s qualification, experience and capability as per approved criteria and
3 to 6 firms capable of providing the services shall be shortlisted by the PE.
The turnover criteria for evaluation should not be in excess 1.5 times the cost estimate of the assignment.
The approved shortlist criteria should not be changed after registration of EOI application.

29. Expression of Interest (EOI)
Preparation of EOI document based on Standard EOI Document for the Selection of Consultants issued by the PPMO[1].
Approval of the short listing criteria by the head of the department.
Expression of Interest (EOI)
EOI Evaluation Criteria
Minimum (if applicable)
Score (out of 100)
A. Qualification
Qualification of Key experts
30 % to 50%
Experience of Key Experts
B.Experience
General of Consulting Firm
40 % to 60%
Special Experience of Consulting Firm within last 7 years and within last 4 years for persons
Silmiliar geographic experience
of Firm
C. Capacity
Financial Capacity
10 % to 20%
Infrastructure/equipment related to the
proposed assignment.

30. Request for Proposal (RFP)
PE’s should make minimal changes in the appropriate Standard RFP (SRFP) document issued by PPMO for preparation of the RFP document for the specific assignment.
RFP should provide clear information to the consultants to facilitate:
the consultants to prepare and submit responsive satisfactory proposals;
the Client to evaluate the proposals and award the contract; and
the Client and the Consultant to administer the contract during execution of the assignment.

31. Request for Proposal (RFP)
The RFP is issued to all shortlisted firms & it includes:
Letter of Invitation
Instructions to Consultants
Data Sheet
Technical Proposal- standard Forms
Financial Proposal- Standard Forms
Terms of Reference (TOR)
Standard Forms of Contract

32. RFP Evaluation Criteria
Purpose of Evaluation Criteria
Fixes measures for evaluation of proposal
Basis for Committee members to evaluate the proposals so should not be ambiguous.
Should facilitate ease in evaluation
Ensures fixed selection criteria that will not be influenced by the proposals received
Ensures short listed consultants that the evaluation process is fair.

33. RFP Evaluation Criteria (PPR 71)
Marking Weightage for evaluation of proposals
Technical Proposal : 80
Financial Proposal : 20
Mark Distribution Technical proposal ( 100)
Firm’s Specific Experience : 0 to 25 %
Methodology : 20 to 35%
Key Personnel : 30 to 60%
Transfer of knowledge : 0 to 10%
Participation by nationals : 0 to 10%
Sub criteria's essential only and generally three.
Pass Marks to be mentioned

34. RFP Standard Forms of Contract
Lump Sum Contracts
Time Based Contracts
Performance Based Fee Paying Contracts
Agreement based on the condition that the consultant shall provide his services agreed in the contract when called for as required
Percentage Contracts
- inspection of goods, architect's services, supervision or monitoring service
Indefinite Delivery Contracts
- when specific work load unknown but services are required

35. Evaluation of Technical Proposals
Independent evaluation by each committee member as per approved evaluation criteria given in RFP and standard evaluation sheets developed for the evaluation . Scores to be averaged.
Committee members to hold meetings to develop common understanding provision of the criteria and interpretation information given in proposals
Technical proposals containing financial information shall be declared nonresponsive & rejected
A proposal shall be rejected if it fails to achieve the overall minimum technical score specified in the RFP

36. Evaluation of Financial Proposals
The evaluation committee will evaluate the financial proposals and the lowest Financial proposal (Fm) will be given a financial score (Fs) of 100 points .
Financial score (Sf ) of other proposals is determined as per the Formula given in RFP on the basis of the financial proposal (F) of the firm :
Sf = 100 ×Fm/F

37. Combined Technical and Financial Evaluation
Combined score shall be obtained by weighting the Technical and Financial scores and adding them. The weightings for quality and cost shall be as specified in the RFP. (generally 80:20)
The firm obtaining the highest total score shall be invited for negotiations.

38. Combined Technical and Financial Evaluation
Firm
(a)
Technical Score
Proposal
Price
(Rs)
(d)
Financial Score
Combined Score
[(c)+(f)] St
(b)
Weighted Score
(b)× 0.8
= (c )
Sf=
100×Fm/F
(e)
(e)× 0.2
= (f ) A 80 64
50000 60 12
76(III) B 85 68
60000 50 10
78 (II) C 75
30000
100 20
80 (I)

39. Approval of Proposals Approval of Cost Estimates: [PPR 81ka(1)
Cost (Rs.)
Approving Authority
Up to 10 lakh
Office Chief, Gazetted - III
Up to 50 lakhs
Office Chief, Gazetted -II
Up to 3 karod
Office Chief, Gazetted First - I
Above 3 karod
Head of the Department

40. Contract Negotiations
Invitation
Invite the first-ranked to negotiate a contract.
propose a schedule and agenda
ask the consultant to confirm the availability of all the nominated team members
summarize any issues identified during the evaluation that require clarification, any deficiencies to be corrected, any team members to be replaced etc
If delay in negotiations is expected request to extend the validity of its proposal for a reasonable time until negotiations can be held.

41. Contract Negotiations
Agenda
Opening remarks /opportunity to consultant also
Submission of Letter of Authorization by Consultant
Scope of Work/TOR
Work plan, Personnel Schedule, proper phasing
Personnel, non availability to be resolved
Counterpart staff and facilities
Equipment what by whom
Financial terms and conditions
Consultant’s contract
Record, Review and sign Minutes by all and,
Draft Contract by consultant

42. Award of Contract
Proposal is accepted if the negotiation is successful
Notice of Intention of Acceptance is issued to the successful and other qualified firms
If no complaint received within 7 days, the selected proposal be accepted and contract is signed.

43. Any Questions?