Doing Business with WA Local Government Western Australian Local Government Association (WALGA)
What’s coming up….. • The rules Local Government has to follow… • The Invitation • Preferred Supplier Arrangements • Tips for responding
The Procurement Framework Local Government Act 1995 Local Government (Functions and General) Regulations 1996 C Corruption, Crime Purchasing Policy and Misconduct Act o Regional Price 2003 Preference Policy m Public Sector A Panel of Prequalified Management Act p Suppliers Policy 1994 u Local l d Government i i a Procurement t n Framework Competition and c Consumer Act 2010 Code of Conduct e (Fed) Delegations Fair Trading Act 2010 Authority to (WA) Purchase Common Law Procurement Guidelines & Forms Procurement Systems
Underlying principles Value for Money Procedural Fairness Market Competitiveness Accountability Compliance Openness and Transparency Sustainability
Local Government Regulations • Governed by the Local Government Act 1995 and associated Regulations • Requirement to publicly invite tenders (state wide) if contract value is expected to be $150,000 exc GST (unless exemption applies)
Local Government Regulations • Sets out: – Requirement to publicly invite – Anti-avoidance – Minimum time to be open to public – Receiving and Opening – Late responses – Rejecting and accepting tenders – Additional information – Notification of outcome – Contract variation
Exemptions • Exemption to publicly invite Tenders exist when contracting with: – WALGA Preferred Suppliers and other exempt suppliers – no limit – Australian Disability Enterprises – No Limit – Suppliers pre-qualified under a panel established by the Local Government (if local policy permits) – Emergency provisions – Genuine sole supply (unique nature)
Purchasing Policy Each Local Government must have a purchasing policy which outlines how it must procure: • Thresholds – under $150,000 • how many quotes • written or verbal? • Sole supplier • Emergency purchasing • Pre-qualified supplier panels
Sustainable Procurement Positive environmental, social and economic impacts possible over the entire life cycle. • Environmental • Social – indigenous, disabled, human rights, labour practices • Economic – best possible outcomes for ratepayers, local economic benefit “ In carrying out its functions a Local Government is to use its best endeavours to meet the needs of current and future generations through an integration of environmental protection, social advancement and economic prosperity ” Section 1.3(3) of the WA Local Government Act 1995
Local Government Local Economic Benefit Achieved through: • Regional Price Preference Policy • Local Panel • Local Economic Benefit Criteria • Preferred Supplier Arrangement: zone/local filter
Local Panels Particularly useful for those areas not covered by Preferred Supplier Arrangements e.g. • Trades • Automotive • Construction Defined process by Act
The Invitation to …..
Process • Must satisfy selection criteria • Due diligence • Reach a Value for Money consensus decision • Approved/Endorsed by CEO and/or Approved by Council
Value for Money • Purchasing Decisions are based on ‘Value for Money’ • Price is only one contributing factor to the overall Value for Money assessment • No guarantee to local suppliers • Must satisfy other Value for Money considerations (selection criteria) • Process must demonstrate fairness and equity
Conditions • Tenderers should not rely on any information provided by any person other than the person listed • Do not canvas! • No Late Responses • Selection Criteria
The Panel Compliance Criteria - minimum requirements to be met by Tenderers • Tender Profile – ABN – full details – referees • Financial position • Conflict of Interest: actual, potential or perceived • Insurances: • Public Liability • Motor Vehicle, plant and equipment • Workers’ comp as per the Act • Departures, exclusions from conditions of contract (yes/no) then fill out relevant attachment • Any critical assumptions you have made relevant to the tender (pricing, ability or method of providing the requirements)
The Panel Qualitative Criteria (Weighted) – basis for evaluating “how well Tenderer is suited to meet the requirement”. • Demonstrable Projects 35% • Organisational Capability 30% • Key personnel 20% • Local Content 15%
The Panel Community Benefit The Tenderer must provide details of the benefits to the Shire from their involvement in a contract. Examples may include: • Local Employment; • Money they spend in local community • Use of local service providers; • Use of local food and beverage providers; • Use of local accommodation for work crews; • Sourcing of materials and consumables locally. • Costs of above!
Price Basis • Pricing can be: • fixed for term of contract • Hourly rate • schedule of rates • Include everything required: delivery, unloading and all applicable levies, taxes etc. • Complete the spreadsheet “price schedule”
Price Assessment • Offered pricing must meet the requirements as specified in the Request. • Assessment of price may be based on Total Cost of Ownership, including: • Acquisition price • Delivery (transport, freight) • Installation / commissioning / testing • Periodic and adhoc maintenance • Training, manuals etc • Contract management costs (hidden) • Warehousing / inventory • Disposal costs
Regional Price Preference Only for evaluation purposes Supplier % Reduction Region 10% (Goods and Local Business Services) Within Shire 5% (Construction)
Preferred Supplier Arrangements
Benefits • Less Tenders to respond to • Ease of Access - Tender Exemption status • High visibility to all local governments Fleet, Waste Infrastructure and and Civil • Quality Stamp of Approval Consumables • Market Analysis reports ICT, Energy • Simplified procurement and Services
Benefits Inclusive not exclusive • Encouragement to Local Councils to nominate regional/local suppliers • Zone/Local filter • Supplier can cover one zone or more– doesn’t have to be whole state • 850+ suppliers across 37 panels • eQuotes platform
The Issues and Tips
Key Issues • Make unsubstantiated claims • Reliance on reputation Question: Provide a list of the personnel from your organisation that will be involved in this project, specifying their particular roles and relevant experience. David’s reputation is built on honest hard work. The Greeks are remembered for their coliseums, David is remembered for 123 Venice Road, or the 4 storey unit development at The Horses Mews, 226 River Road, 29 Sailing Mast Quay, only to mention a few of the “Quality” projects completed by Dave. Nice try but I’m pretty sure Romans built Colosseums.
Key Issues • Provide an inappropriate level of detail Comments from evaluation process relating to qualitative criteria: Far too little 72 words, including the questions, is insufficient information information for the evaluation panel to consider the submission favourably. More detail is required to assess the response. Response to a Request for Quote: 152 pages – too much! Far too much information
Key Issues Excerpt from Shire of Wiluna minutes • Getting the information right Painting company Master Strokes initially requested a • Check your facts and details variation on their Tender price on the basis that they thought the Shire was located in Waroona . • Don’t rely on templates • Display lack of care and effort But I’m Local! • Entitlement by local suppliers
Tips on Preparing Responses • Focus on the Local Government’s needs • Read and abide by the Conditions of Tendering • Match your offer to the opportunity – Address every component of the Selection Criteria – Be succinct! • Understand and focus on Value for Money – Decision won’t just be based on lowest price • Don’t’ give us the line: – “References and insurances available on request” – We are requesting!
….And More Tips • Be honest and realistic • Assume the Shire knows nothing about you and your business – it’s all got to be on paper • If in doubt – ask the Contact Person! – Any uncertainties? – Missing Information? • If unsuccessful, request a debrief – Valuable tool to improve next time
Further Information • Name: Alison Maggs • Telephone: 08 9213 2016 • Email: AMaggs@walga.asn.au
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