Procurement policy & procedures for the Pensions Authority (Updated August 2017 )

Procurement policy & procedures for the Pensions Authority (Updated August 2017 ) 2017

These procedures are for use by all personnel involved in procurement for the Pensions Authority. They aim to provide guidance and interpretation of the national and European procurement rules to be followed in the award of all significant contracts. For assistance please contact: Catherine McAuley Operations Unit 1

Contents 1. INTRODUCTION... 4 1.1 Objectives of the Procurement Policy... 4 1.2 The Main Rules... 4 1.3 Using Existing Authority or National Contracts/Framework Agreements... 4 2. THRESHOLDS AND AUTHORITY LEVELS... 6 2.1 Calculating the Value of a Contract... 6 2.2 The National and EU Thresholds... 7 2.3 Authority Levels... 7 2.4 Invoice Authorisation... 8 2.5 Section 12 Authorisation... 8 2.6 Corporate Procurement Register... 8 3. PROCEDURES FOR PROCURING GOODS OR SERVICES... 9 3.1 Quotations... 9 3.2 Quotations Less than 5,000... 9 3.3 Quotations Between 5,000 and 25,000... 9 4. NATIONAL TENDERING... 12 4.1 etenders... 12 4.2 Open Procedure National Level... 12 4.3 Recommended Timescales National Level... 14 4.4 Restricted Procedure National Level... 15 5. SELECTION CRITERIA EXPLAINED... 17 5.1 Selection Criteria... 17 5.2 Selection Criteria in the Open Procedure... 18 6. CONTRACT AWARD CRITERIA EXPLAINED... 21 6.1 The Options Available... 21 6.2 Evaluation of Tenders... 22 7. NOTIFICATION TO SUCCESSFUL AND UNSUCCESSFUL TENDERERS... 24 7.1 Award Letters... 24 7.2 Regret Letters... 24 7.3 Debriefing... 24 8. USING EXISTING FRAMEWORK AGREEMENTS... 25 8.1 When are Frameworks established?... 25 8.2 Using the Authority s Framework Agreements... 25 8.3 Using National Framework Agreements... 25 8.4 Establishing & Operating Framework Agreements... 26 8.5 Awarding Contracts within Frameworks... 27 2

9. TENDER MANAGEMENT... 29 9.1 Issue and Receipt of Tenders... 29 9.2 Opening and Registration of Tenders... 29 9.3 Dealing with Late Tenders... 29 9.4 Extension of the Tendering Period... 30 9.5 Clarification / Verification Meetings (Post Tender)... 30 9.6 Innovation... 31 9.7 Accessibility... 31 9.8 Cancellation of Award Procedures... 31 9.9 Filing and Disposal of Tenders... 32 9.10 Freedom of Information... 32 9.11 Contracts... 32 10. FREQUENTLY ASKED QUESTIONS... 34 THE APPENDICES... 39 APPENDIX 1 TYPES OF CONTRACTS... 39 APPENDIX 2 EUROPEAN TENDERING... 41 APPENDIX 3 ADDITIONAL PROCEDURES AVAILABLE... 47 APPENDIX 4 - SETTING WEIGHTINGS FOR SELECTION CRITERIA IN OTHER PROCEDURES APART FROM OPEN PROCEDURE... 50 3

1. INTRODUCTION These procedures have been developed to provide assistance to personnel in the Pensions Authority (hereinafter referred to as the Authority ) involved in awarding contracts irrespective of value. They apply to all procurements entered into by personnel of the Authority. With effect from September 2010, all procurement within the Authority is centralised. The purpose of the procurement policy is to ensure that all staff are aware of the appropriate procurement policies and procedures to be applied. All staff must observe these procedures and should therefore make themselves aware of the details contained within this policy. 1.1 Objectives of the Procurement Policy The principal objectives of the Authority s procurement policy and procedures are: To ensure that value for money is achieved in all purchasing activities; To promote open and effective competition; To offer full and fair opportunities to all qualified providers; To enhance the Authority s technical and operational capabilities; To ensure full compliance with all National and European procurement rules. The guiding principles are transparency and openness of competition. During any procurement process, the principles of equal treatment, non-discrimination, mutual recognition and proportionality should be recognised. 1.2 The Main Rules The following basic requirements must be complied with: The European Treaty and the principles which derive from the Treaty (i.e., transparency, equal treatment, proportionality and mutual recognition see Appendix 1 for more information); Directive 2004/18/EC of the European Parliament and the Council relating to the award of contracts and the corresponding Irish Regulations (S.I No. 329 of 2006); Remedies Directive 89/665/EEC, as amended by Directive 2007/66/EC relating to review procedures on the award of public contracts, and the corresponding Irish Regulations (S.I No. 130 of 2010); The guidelines of the Department of Finance; and These in-house procedures to include any framework agreements in operation. All staff should have regard for the published Code of Conduct for Employees in their dealings in the area of procurement and awareness of the regulations in place at the time of procurement. 1.3 Using Existing Authority or National Contracts/Framework Agreements 4

Prior to initiating any procurement, staff should satisfy themselves that no existing contract or framework agreement has been put in place for the specific supply or service either by the Authority itself or by another central government agency, such as the Office of Government Procurement. Where such contracts or frameworks are in place, these should be used unless there is sufficient justification to go outside these arrangements. The Operations HEO will be able to advise if the Authority or another central government agency has a contract in place for the procurement. Justification for going outside of frameworks might include: The nature of the contract might be unique and may not fall generally within the scope of the original framework agreement; Previous contracts may not have delivered value for money and there is a need to test the market. Public bodies are encouraged to undertake a market analysis to understand the range of goods on services on offer and where possible to consult with the category councils established by the Office of Government Procurement (OGP) (see www.procurement.ie ). There are 16 category councils, 8 of these categories cover common goods and services used in the public sector and when fully established, the OGP will put in place contracts for these categories that everyone will use. REFERENCE DOCUMENTS - SECTION 1 www.procurement.ie for information on existing contracts or framework agreements. 5

2. THRESHOLDS AND AUTHORITY LEVELS 2.1 Calculating the Value of a Contract An estimate of the value of a contract must be calculated in advance of a procurement process to determine the correct procedure to be followed. The thresholds apply to the aggregate value of all contracts OR contracts awarded within a framework agreement. Aggregate values may be calculated as follows: The total value of supplies purchased during the last 12 months, i.e., where the same supply is purchased from one or more suppliers; The estimated total value of contracts expected in the next 12 months or during the term of the contract if for a longer period (i.e., 2 or 3 years). In estimating the value, the following should be borne in mind: VAT should not be included; The potential value of options or renewals should be included; The full cost, including delivery charges, follow-up servicing maintenance, consumables, etc. should be considered; The total value of all likely contracts under a framework agreement should be included; The value of all lots should be taken into account. Contracts may be awarded in lots to facilitate more specialist firms applying for elements of a job, where the Authority wishes to facilitate entry by smaller or new market players, or in accordance with the following example: An IT contract comprising 3 elements - Lot (a) Project Management - 50,000 - Lot (b) Software Design & Implementation - 120,000 - Lot (c) Training - 50,000 A 10-20% contingency on the estimate should be included to ensure the correct procedure is followed, i.e., where the value is estimated to be 190,000, by applying a contingency of 10% it would be evident that the contract could exceed the EU threshold and should therefore be advertised at EU level (as it must publish those over 209,000). The value of the supplies and services determine which value threshold the procurement falls within and the applicable procedures. Please ensure that you obtain prior written agreement from the appropriate approval levels of your unit that the expenditure is necessary. 6

2.2 The National and EU Thresholds Supplies & Services VAT Exclusive Less than 5,000 Between 5,000 and 25,000 *Note: 10,000 requirement for IT Related Contracts Between 25,000 and 209,000 Over 209,000 1 ACTION Seek email or fax quotation from one or more suppliers. Seek 3-5 written quotations (fax or email) or publish on etenders. The Department of Finance require public bodies to have open competitive tendering for IT related supplies and services which are in excess of 10,000. Publish tender via www.etenders.gov.ie website with national notice using the Open procedure. Follow EU procedures publish tender via www.etenders.gov.ie website with an OJEU notice. 2.3 Authority Levels Approval to award contracts must be sought on the basis of the following authority levels: Value VAT Exclusive Less than 5,000 5,000 to 50,000 50,000 to 99,000 AUTHORISATION LEVEL Executive Officer Up to 30,000 Higher Executive Officer Up to 50,000 Assistant Head For contracts greater than 20,000 not being awarded by competitive tender or where lowest tender is not being accepted Chairperson of the Finance & Audit Committee or the Pensions Regulator must authorise (approval in writing required and notified to the Authority at next regular meeting). Head of Unit/Pensions Regulator 100,000+ Authority 1 The EU thresholds are revised every two years. The next revision is due in January 2018. 7

2.4 Invoice Authorisation Value Approval Level Authorisation Less than 10,000 EO / HEO Head / Assistant Head Ops 10,000 to 30,000 Assistant Head / Head Head / Assistant Head Ops of Unit 30,000 to 100,000 Pensions Regulator Head / Assistant Head Ops Above 100,000 Authority Pensions Regulator 2.5 Section 12 Authorisation Under section 12 of the Pensions Act, 1990, as amended ( the Act ) the Authority is required to obtain prior Ministerial approval for the engagement of consultants and advisers where the amount of the contract exceeds 55,000 (ex. VAT). Prior to awarding any contract for consultancy where the value is likely to exceed 55,000 (ex. VAT) a written request must be made to the Department of Social Protection ( the DSP ). The request should detail the service to be provided, timeframe and anticipated costs. Operations will forward this request to the DSP and once approval has been obtained from the DSP in writing the contract can be awarded. The DSP approval is retained on file and recorded on the Corporate Procurement Register. 2.6 Corporate Procurement Register The Operations Unit maintains a central register of all procurement contracts entered into by the Authority. Full records of quotations sought and agreements to proceed with the purchase must be logged with Catherine McAuley in the Operations unit in advance of any contract being entered into. This is particularly important if the goods or services were not projected in your unit s annual budget. All contracts subsquently entered into must also be scanned and forwarded to Catherine McAuley. From 1 August 2014, the Authority is required to publish contract award notices on the etenders website for all contracts valued over 25,000. Therefore, it is essential that all contracts are forwarded to Catherine McAuley with copies of the published award notice where the contract exceeds 25,000. Every unit must nominate one person to be the point of contact on this matter. The Corporate Procurement Register can be found in shared data here. REFERENCE DOCUMENTS - SECTION 2 www.etenders.gov.ie for information on thresholds. 8

3. PROCEDURES FOR PROCURING GOODS OR SERVICES 3.1 Quotations The quotation process is less structured than a tender process and enables the receipt of offers by fax or email. Quotations are used when the Authority is inviting proposals from known suppliers or service providers without public advertisement for contracts less than 25,000 in value. However, the use of the etenders website can also be availed of even if the contract is below 25,000.The suppliers or service providers should be recognised competent players operating in that market. If no suppliers are known, enquiries should be made with other public bodies to identify suitable parties. If no parties can be identified, an advertisement should be placed on the etenders website. NOTE #1: All requests for quotation and agreements to proceed with the purchase must be logged with Catherine McAuley in the Operations unit for inclusion on the Central Register in advance of any contract being entered into. 3.2 Quotations Less than 5,000 When the total estimated value of a contract/purchase is less than 5,000, it is a requirement to seek at least one quotation. While it is acceptable to make a phone call to the firm, it is recommended to confirm requirement in writing and, where possible, the supplier should be asked to respond in writing by letter, fax or email. Staff should ensure that the expenditure is necessary, has appropriate approval and that the supplier chosen offers the best value for money option for the Authority. Suppliers should be chosen on the basis that they are competent players in the market and have proven expertise. Suppliers that have done business with the Authority in the past may be considered. Where the Authority is not confident regarding the competency of the firm chosen, more than one quotation should be sought. Full records should be kept of the quotations sought and agreements to proceed with the purchase. 3.3 Quotations Between 5,000 and 25,000 If awarding a Supplies or Service contract valued between 5,000 and 25,000, the requirement is to seek at least 3 quotations from suitably competent companies. As a minimum, the request for quotation should include the following: A Statement of Requirements including technical specifications, quantities, delivery requirements, service back-up, etc. Any specifications should be based on performance or functional requirements. Brand names should never be used, and if they have to be used, the words or equivalent should be included; (Note: If inviting quotations from unknown parties, it is advisable to ask them to demonstrate that they have successfully delivered similar contracts; request 9

details of previous contracts and confirm that only firms demonstrating competence in the field will be considered) Award criteria i.e., price only or economically most advantageous offer in terms of price, delivery, quality of product or service offered, after-sales service, etc. These criteria should always be chosen to suit the needs of the contract in question; Instructions to Tenderers, which covers issues such as the number of copies of tender required, the Freedom of Information Act, tax clearance, confidentiality, withholding tax, etc. Quotations must be received in writing, i.e., by letter, fax or email. Suppliers should be given at least 10 calendar days to submit a quotation, but the time chosen should be appropriate to the contract in question. For quotations of a simpler nature, less time may be given. THE QUOTATION PROCESS (Contracts < 25,000) Confirm that no existing contract or framework exists either awarded by the Authority or established by a Central Government agency such as The National Procurement Service Identify firms from which to request quotation Phone to confirm that they are capable of and interested in quoting Receive quotation in writing (by fax or email) Evaluate response and make decision whether to proceed or not Notify successful and unsuccessful parties Note: For contracts greater than 25,000 please refer to Section 4. 10

REFERENCE DOCUMENTS SECTION 3 Central Register of Procurements 11

4. NATIONAL TENDERING Tendering is a more formal process for requesting offers from the market (the Request for Tender). In this case, tenders are received by a specified closing date and time either as sealed hard copies or as confidential electronic submissions. They can only be opened after the closing date. Please contact Operations regarding the Request for Tender. NOTE #1: All requests for quotation and agreements to proceed with the purchase must be logged with Catherine McAuley in the Operations unit for inclusion on the Central Register in advance of any contract being entered into. 4.1 etenders When awarding Supplies and Services contracts in the range of 25,000 to 209,000, a formal competitive tendering procedure must take place with an advertisement on the Irish Government procurement website (www.etenders.gov.ie). Competitive tendering ensures that all of the costs of a proposed purchase are taken into account and that the selection of suppliers is open and transparent. NOTE #2: In the case of IT procurements, the Department of Finance recommend that all IT contracts above 10,000 should be the subject of competitive tendering via www.etenders.gov.ie where possible. Comprehensive information must be included in the advert that appears on the etenders website. The tenders can be advertised using either of the following procedures: The OPEN Procedure (single stage tendering); The RESTRICTED Procedure (two stage tendering). In line with the Department of Finance Guidelines (Circular 10/14), all procurements under 134k for supplies and services must be by open procedure. PLEASE NOTE: IT IS THE AUTHORITY S POLICY TO USE OPEN TENDERING FOR ALL OF ITS REQUIREMENTS. 4.2 Open Procedure National Level When using the OPEN procedure, a request for tender document must be available at the time of advertising. Where possible this document (in pdf format) should be uploaded with the advertisement (www.etenders.gov.ie). This provides access for suppliers to the tender document(s) and enables the Authority to track the level of interest in the procurement. While open tendering means that any interested party may submit a tender, care should be taken to ensure that only competent firms are considered for award. This test of competence (i.e. test of suitability of legal, financial/economic and technical capacity) should be reviewed prior to looking in detail at the tenderers offers. 12

In open tendering, the request for tender document should contain the information outlined under the following headings: A technical specification of requirements The specification should detail the performance or functional requirements for the contract. Where the Authority is not in a position to specify the exact method of delivery and wants the market to offer the best options, it may choose to enable variants. This should be indicated in the notice under other information. The specification should contain as much information as possible to enable the market to give a comprehensive offer and a competitive price. A variant is a solution other than that defined in the technical specification. When assessing tenders that offer variant solutions there are a number of rules that must be taken into account: - Acceptance of variants must have been signaled in the notice; - The specification must be drawn up in terms of minimum requirements, acceptance of variants must be referred to in the tender and the contract documents must state the minimum requirements in an identifiable manner; - Tenderers must meet the minimum requirements; - The economically most advantageous award criteria must be used. In the absence of any of these factors, variants cannot be considered at all. Vague specifications can lead to difficulties for tenderers preparing their offers, can result in a wide range of prices being received and can cause problems in terms of evaluation and ensuring equal treatment. Selection / Suitability Criteria In the open procedure, any interested party can submit a tender. Therefore, care should be taken to ensure that the winning tenderer is a valid, financially sound, suitably experienced firm. Tests of legal, financial, economic and technical criteria can be employed. Legal capacity can be tested by seeking information on: - Tax compliance; - Compliance with Article 45 2 requirements regarding bankruptcy, fraud, money laundering, corruption or professional misconduct. Financial and Economic capacity can be tested by seeking information on: - Accounts turnover, balance sheets, etc.; - Bank references; 2 Article 45 refers to exclusion of tenderers on grounds relating to corruption, fraud, money laundering, bankruptcy, payment of taxes, etc. 13

- Details of insurances. Technical capacity can be tested by seeking information on: - Previous contracts - Health & Safety - Quality - Environmental criteria - Manpower and skills To facilitate the participation of as many firms as possible, the Authority may accept confirmation that turnover, bank references, tax clearance, health and safety are in place and only look for evidence at the time of contract award. Experience of tenderers must only be assessed at the selection/qualification stage of the procurement process. No further credit for experience is permitted at the award stage. Selection criteria are explained further in section 5. Award criteria The tender document must clearly outline the award criteria to be used. There is a choice of two criteria: Lowest tender price, Or Most Economically Advantageous Tender (MEAT) where criteria such as cost, quality of product/service, timescale for completion etc. are set to assist in evaluation. Contract award criteria is explained in more detail in section 6. PLEASE NOTE IT IS THE AUTHORITY S POLICY TO USE MOST ECONOMICALLY ADVANTAGEOUS TENDER AS THE AWARD CRITERIA 4.3 Recommended Timescales National Level There are no mandatory timelines for national value contracts. However, the Authority complies with the principle of equal treatment and non-discrimination and therefore recommends that the following minimum timescales be applied: Procedure Quotations less than 5,000 Receipt of Tenders 5 days 14

Quotations less than 25,000 National Tenders Open Procedure 10 days 21 days 4.4 Restricted Procedure National Level The restricted procedure is defined as those national procedures whereby only those tenderers invited by the contracting authority may submit tenders. Government policy requires the use of the open procedure for contracts for supplies and services with a value of up to 134,000. Where the restricted procedure is utilised, the contracting authority selects the tenderers to be invited to tender from amongst those expressing an interest, based on their qualifications and experience. However, it is the Authority s policy to use the open procedure and the Authority does not foresee any intended use of this procedure. If you believe a situation requires the use of the restricted procedure, please contact Operations. 15

THE OPEN PROCEDURE PROCESS Confirm that no existing contract or framework exists either awarded by the Authority or established by Central Government agencies such as The National Procurement Service. Draft and publish notice on etenders using Open Procedure and upload tender documents for download directly from site. Respond to any requests for clarification by issuing responses to all interested parties. Receive tenders either (a) electronically via etenders or (b) in hard copy. Open and register tenders after official closing date and time. Evaluate tenders against the selection / suitability criteria (i.e., legal, financial/economic and technical criteria). Those meeting all these criteria are then evaluated against the award criteria. Select winning tender and seek approval to award. Notify successful and unsuccessful tenderers (Note: standstill period of 14 days if EU procedure used). Respond to any debriefing requests. 16

5. SELECTION CRITERIA EXPLAINED 5.1 Selection Criteria Selection criteria are often called Qualification Criteria or Suitability Criteria. These criteria are used to establish that all companies considered for contract award or invited to tender have the legal, financial, economic and technical capacity to do business with the Authority, relevant to the contract in question. 5.1.1 Criteria to Test Legal Capacity The Public Sector Directive, which applies to EU value contracts, requests contracting authorities to test the bona fides of parties tendering by requiring them to confirm that they are not guilty of corruption, fraud, money laundering, criminal activity, are not bankrupt and have paid their taxes. The Irish Government requires public bodies to seek a tax clearance certificate from firms with whom more than 10,000 worth of business annually is being considered. To meet these obligations the Authority can seek: A signed declaration regarding Article 45 suitability; A signed declaration regarding compliance with all statutory obligations including labour law, health and safety, Pensions Act, etc; A current tax clearance certificate from the Irish Revenue Commissioners. 5.1.2 Criteria to Test Economic/Financial Capacity Information on the following may be sought under the heading of Economic / Financial Capacity, whereby candidates or tenderers are required to provide: Current reference from bankers; Balance sheet information; Evidence of overall turnover and profitability; Evidence of turnover on relevant activities over the past 3 years; Details of insurances, i.e., professional indemnity, public liability, employer s liability, etc. 5.1.3 Criteria to Test Technical Capacity Information on the following may be sought under the heading of Technical Capacity: Details of organisation structure; Range of products / services offered; Educational and professional qualifications of key personnel; Details of plant and equipment; Details of previous contracts executed over the past three years, including client names, contract values and contract details; References; Details of quality assurance system, if any (including scope and date of certification and renewal); Health and safety policy and record. 17

5.1.4 Minimum Levels and Rules for Selection Criteria It is up to the individual responsible for the procurement to determine the minimum levels or rules to be applied to criteria. They must be set relevant and proportionate to the specific contract in question. In the open procedure, it is recommended to have a rule for each criterion, which will be assessed on a pass/fail basis. In the other procedures, some criteria can be pass/fail, but the qualitative criteria, such as previous experience, resources, etc., need to be weighted. Other information deemed relevant and proportionate for the contract in question may also be included under technical capacity. Again, the information requested must be evaluated and must be proportionate and relevant to the contract in question. These requirements must be specified in the tender documentation in the open procedure. In line with the Department of Finance Circular 10/14, public bodies may reduce the burden of evidence on tenderers in the open procedure and only seek confirmation that suitability requirements are met, requiring the evidence to be provided by the successful tenderer prior to formal contract award. Adopting the confirmation approach rather than the evidence approach is suitable for tax clearance, accounts, insurances, health and safety, etc., but more comprehensive information should be sought on previous experience, resources, etc. Experience of tenderers must only be assessed at the selection/qualification stage of the procurement process. No further credit for experience is permitted at the award stage. The prior experience of an individual who has formed a SME may be considered in the case of a newly formed SME. However, the range and expertise of the team assigned to the project can be considered. 5.2 Selection Criteria in the Open Procedure The selection criteria tests should be set appropriate to the contract value, contract risk, size of market and potential for smaller and more innovative firms to be considered. An example of criteria and rules might be: Criterion Rule / Minimum Level Evidence Required Legal Declaration of Bona Fides (Article 45) Tax Clearance Certificate Tenderers must confirm that none of the exclusion criteria regarding bankruptcy, corruption, etc. applies to them. Tenderers must confirm their ability to provide a tax clearance certificate of a value over 10k (inc vat) within any 12 month period. Declaration must be signed and provided with Tender submission. Confirmation must be provided that, if successful, a tenderer will be in a position to promptly provide a tax clearance certificate 18

Financial Capacity Evidence of turnover for most recent years of operation Insurances Employer s and Public Liability Technical Capacity Previous experience Manpower and Skills Tenderers must confirm their turnover exceeds XXXX during at least one of the most recent years (or pro-rata if more recently established). This should not exceed twice the estimated contract value for routine (low-value, high volume) goods and services competitions. Tenderers must confirm that employer s and public liability insurances are in place. The Authority should only require such types and levels of insurance which are proportionate and reasonable in the context of the particular contract. Tenderers must demonstrate that they have successfully delivered at least three contracts of a similar nature and scale in the recent past (three years or less). Where it is an SME without a trading record the prior experience of an individual who has formed the SME can be considered. Tenderers must demonstrate that they have access to sufficient manpower and skills. Confirmation must be provided that, if successful, evidence of turnover can be provided. Means of evidence available must also be stated (i.e., whether audited accounts, a statement from the auditor or other evidence acceptable to the contracting authority). Confirmation that insurances are in place and confirmation that, if successful, specific levels of insurance will be put in place prior to contract award. Tenderers must provide information on contract dates, value and scope, as well as client names and contact details, as part of their Tender submission. Tenderers must provide information on manpower numbers and skills range over the past three years. 5.2.1 Evaluation of Selection Criteria in the Open Procedure When seeking information to test financial and technical capacity in an open procedure, you should confirm that the tenderer has met all the criteria set in the tender document before commencing detailed evaluation of the tenderers offer for compliance with specification and evaluation against the award criteria. Only companies qualified against the selection criteria are eligible for detailed evaluation of their tenders. An example of this assessment could be as follows: Criterion Rule Co. A Co. B Co. C 19

Turnover Insurances Previous experience Must confirm a turnover of at least xx and willingness to provide evidence. Must confirm professional indemnity insurance in place. Must demonstrate successful delivery of at least three contracts of a similar nature valued greater than xx p.a. Yes Yes Yes Yes Yes Yes Yes No No RESULT Passed Failed Failed Qualified for Tender Evaluation under Award Yes No No Criteria 20

6. CONTRACT AWARD CRITERIA EXPLAINED 6.1 The Options Available The Directives and the national guidelines provide two options for contract award criteria: Lowest Tender Price, being the lowest tender price; Or The most economically advantageous tender according to stated criteria and weightings. The tenderers have to be informed of the award criteria and weightings to be used for the contract, either in the notice and/or in the tender documents. Always ensure the same criteria are used in the tender documents as appear in the notice or advertisement. 6.1.1 Lowest Price When lowest price is used this is the only criterion that can be applied. Use of lowest price should only be considered when the selection criteria are sufficiently robust enough to ensure that only competent firms are being evaluated. 6.1.2 Most Economically Advantageous The rules on most economically advantageous are: All the criteria including sub-criteria must be stated in the tender documents. These may include various criteria relevant to the subject of the contract. For example, they may include period for completion, running costs, cost effectiveness, quality, technical merit and technical assistance; The weightings to apply to the criteria and sub-criteria must also be stated in the tender documents. If it is not technically possible to indicate criteria weightings in advance, they must be listed in descending order of importance. New or amended criteria must not be introduced in the course of the contract award procedure; The weightings to be set are at the discretion of the Authority, and must be indicated in the tender document; The criteria must be relevant and proportionate to the contract in question; Cost must be included as one of the Award Criterion. The whole life-cycle costs should be taken into account rather than just the current costs, where appropriate. For further details of lifecycle costs see FAQ 13. NOTE #1: Award criteria / weightings may be changed but any change must be notified to the tenderers prior to the closing date and, if applicable, an extension to the closing date should be provided. NOTE #2: In order to protect against poor quality offers, minimum scores can be set against some or all of the qualitative criteria. If this is to be used, the minimum scores must be indicated to the tenderers in advance. 21

An Example of Award Criteria for a service contract is outlined below: Service Contracts Weighting Maximum Points Methodology for delivery of the 30% 300 180 service Quality and level of expertise and 25% 250 150 resources offered Project plan and timescale for delivery 10% 100 60 Account management 10% 100 60 Ultimate cost 25% 250 n/a Minimum Points Required NOTE: Only criteria, weightings and rules made known in the tender documents can be used at evaluation. 6.2 Evaluation of Tenders Tenderer An evaluation committee should be formed to evaluate tenders. This team should comprise end users and/or specifiers. For a high value complex project, external 3 team members should be included on the evaluation committee. The committee should meet prior to the evaluation and acquaint themselves with the criteria and methodology for evaluation. Tenders must be evaluated against the pre-stated award criteria and weightings, which appeared in the call for competition and/or the invitation to tender document. Once the criteria have been announced, no new criteria can be introduced, unless the market is given sufficient notice of the change in criteria, either by an amended notice/advertisement and/or by amended tender documents. In evaluating tenders, the weightings indicated in the tender documents must be applied. The following is an example of a scoring matrix for tender evaluation: Ultimate cost Quality of technical solution offered Quality and level of resources offered Warranty and after sales support Weighting 50% 30% 15% 5% Maximum Score 500 300 150 50 Score options See 0, 60, 120, 180, 0, 30, 60, 90, 120, 0, 10, 20, 30, TOTAL formula 240, 300 150 40, 50 SCORES Rules N/a Must score 180 Must score 90 Must score 30 Tender A 500 240 120 50 910 59, 000 Tender B 60,500 492 180 90 30 792 3 External may be a member of staff from a different division in the Authority or an external member from another public body. 22

Tender C 70,000 Tender D 62,000 425 240 150 50 865 480 300 150 40 970 = winner In determining the amount to be calculated under the cost basket, the figures to be taken into account should reflect the requirements outlined in the tender document and could include capital cost, training costs, cost of spares, etc. An equivalent basket of costs should be taken into account for each tenderer. Regarding the scoring of tender cost, the score for any given tender can be calculated as follows: Max Marks Available x Lowest Valid Tendered Price Price of Tender being Evaluated For example in a scenario where four tender prices are assessed: (i) 59, 500 (ii) 60,500 (iii) 70,000 (iv) 62,000 and a total of 500 points is allocated for the price element, the respective scores for each tender price would be: (a) 500 x 59,500 = 500 59,500 (b) 500 x 59,500 = 492 60,500 (c) 500 x 59,500 = 425 70,000 (d) 500 x 59,500 = 480 62,000 REFERENCE DOCUMENTS SECTION 6 Tender register open procedure Individual Tender evaluation Evaluating Tenders Short listing Tenders Certificate of Tenders Received 23

7. NOTIFICATION TO SUCCESSFUL AND UNSUCCESSFUL TENDERERS 7.1 Award Letters It is a requirement to write to, and inform, the successful tenderer as soon as possible. If appropriate, the terms of the contract may be confirmed. 7.2 Regret Letters Quotations Where more than one quotation was sought and there are unsuccessful suppliers, the unsuccessful suppliers should be notified that they have not won, told who won (where possible) and thanked for their submission. This communication can be by email or by phone. However, written feedback is strongly encouraged as a matter of good practice. Tenders (between 25k and EU threshold) As soon as possible after the decision to award a contract, the unsuccessful parties should be notified. Regret letters should normally issue at the same time as the award letter. Information in the regret letter should be as follows: A statement informing the addressee that they have not been successful; A summary of the reasons why they did not win; The name of the winner. 7.3 Debriefing It is the policy of the Authority, once notifications have been issued for national value contracts, to give a verbal debriefing to unsuccessful candidates and tenderers where these are requested. This can be done over the telephone. A debriefing is just to provide an objective assessment of the comparative strengths and weaknesses of the unsuccessful tender. Care should be taken to ensure that information such as the identity of other tenderers (apart from the winning tenderer), the prices or pricing strategies of all tenderers or commercially sensitive information is not disclosed. 24

8. USING EXISTING FRAMEWORK AGREEMENTS 8.1 When are Frameworks established? A framework agreement is defined as an agreement between the Authority and one or more providers, the purpose of which is to establish the terms governing contracts to be awarded during a given period, in particular with regard to price and, where appropriate, the quantity envisaged. A framework agreement is a mechanism for awarding contracts of a repetitive nature, without the requirement to individually advertise each contract. They are generally used when there is a repeat need for services, continuity of service is required to achieve savings. It is often used where the quantities envisaged at the outset are unknown. In general, their use should be advantageous and more beneficial than carrying out standard tendering prodecure for individual requirements. Only firms within the framework agreement can be considered for contract award. Only contracts falling within the scope of the advertised framework agreement can be awarded under the framework. 8.2 Using the Authority s Framework Agreements The Authority has established a number of framework agreements for repetitive services in the past. Currently, we only have one in place for Legal Services. Please ensure there is not any existing framework agreement in place prior to initiating any procurement. Framework agreements established by the Authority have been set up as multi-party frameworks. Approval to use the framework must be sought from the designated framework manager. Please talk to Corporate Services prior to establishing any framework agreement. 8.3 Using National Framework Agreements From time-to-time, central government agencies may establish framework agreements that are either mandatory or voluntary for use by the public sector. The National Procurement Service (NPS) in the Office of Works has established a number of frameworks for services and supplies. Some are voluntary and some are mandatory. Details of these frameworks are available from Corporate Services. In the case of single party frameworks, confirmation should be received that the Authority has a right to use the framework and that it offers value for money to the Authority against prices it may have achieved previously by tendering itself. 25

8.4 Establishing & Operating Framework Agreements NOTE: This is a general guidance document on establishing and operating framework agreements. The existing frameworks established by the Authority have their own specific mechanisms for operation defined; please refer to the specific guidance for the operation of the existing Authority frameworks. 8.4.1 Framework Agreements Defined A framework agreement is defined as an agreement between one or more contracting authorities and one or more economic operators, the purpose of which is to establish the terms governing contracts to be awarded during a given period, in particular with regard to price and, where appropriate, the quantity envisaged. It is a mechanism for awarding contracts of a repetitive nature. 8.4.2 Setting up Framework Agreements Before establishing a framework agreement, considerations should include: Is it appropriate (examine the relevant market, what do you want duration to be, do you know what you want from framework) Whether procedures should be used Frameworks can only be established on foot of a competitive tender process using the standard contract award procedures (open or restricted) and can be used for supplies, works or services. It is recommended to break framework agreements into lots, where possible to facilitate greater participation by SMEs. Framework agreements should clearly establish the nature and scope of future contracts and the terms applicable to them. While the framework establishes the terms and conditions that will apply to subsequent contracts, it does not itself create rights and obligations. 8.4.3 Duration of Frameworks The maximum duration of a framework agreement awarded in the public sectors is four years, unless, exceptionally where a longer period can be justified. 8.4.4 Calculating Value of Frameworks The value of a framework is determined by calculating the value of all contracts likely to be awarded over the lifetime of the framework, i.e., if there will be approx. 55 contracts valued at 10,000 each, then the value is 550,000 and therefore subject to EU advertising rules. 8.4.5 Numbers admitted to Frameworks Frameworks can be established with one supplier only or as multi-supplier frameworks with at least three suppliers. 26

8.4.6 Award Criteria and Terms & Conditions When the initial competitive tender process is issued, the tender document should outline the terms of the initial contract (if one exists) and the award criteria for award of the contract / establishment of the framework agreement. The award criteria used for subsequent contracts within the framework must be on the basis of the mechanism indicated in the original tender document. It is therefore important to consider at the outset the basis on which future contracts over the lifetime of the framework agreement might be awarded. It is also advisable to outline the nature of contracts to be awarded over the lifetime of the framework, if this is known. In addition, it may be appropriate to establish terms and conditions for subsequent contracts covering pricing strategies, delivery, service level, etc., in order to streamline the tender process for subsequent contracts. 8.4.7 Pricing under Framework Agreements It is advisable to consider specifying the framework price or pricing mechanism that will apply throughout the framework period, or that will be subject to review at a specified point. This will help to streamline the procedure for awarding subsequent contracts, but careful consideration should be given as to whether it will achieve best value. If a price or pricing mechanism for the framework is to be established, this must be clearly set out in the framework agreement itself. 8.4.8 Time Limits for Mini-Tenders to Award Subsequent Contracts There are no specified time limits for subsequent mini-tender competitions to award additional contracts within a framework agreement. However, sufficient time should be provided for members to prepare proposals; it is recommended to allow at least 10 days if possible. 8.5 Awarding Contracts within Frameworks Single Supplier Framework - A single supplier framework is the most suitable when the future needs can be predicted with a degree of certainty and security of supply is required. Where a framework agreement is concluded with a single economic operator, contracts may be awarded based directly on the original terms With this type of arrangement, no substantial amendments may be made to the original terms under which the supplier was appointed to the framework agreement. Therefore, the original specification of requirements should be broad enough. Multiple Supplier Framework - Where a framework agreement is concluded with several economic operators, (minimum of three if possible), individual contracts may then be awarded either by: identifying the most economically advantageous tender by reference to the original tenders (suitable for rate type work) and awarding contracts by the cascade method, whereby the first member of the framework is consulted and if they cannot deliver the contract, the 2 nd is consulted and so on until the contract is awarded; rotation or by awarding a pre-agreed percentage of the total value of the contracts to suppliers awarded under the framework agreement. Or 27

conducting a mini-competition between all of the economic operators included in the framework as per the terms of the framework agreement. The invitation to tender should allow sufficient time for written responses. (E-Auctions may be used in this situation). 8.5.1 Award Notice Requirements An award notice (dispatched within 48 days of conclusion) should be published in the OJEU, indicating the names of the successful entrants to the framework agreement, where the value of the framework is in excess of the EU threshold. There is no requirement to publish an award notice for individual contracts awarded within the framework. REFERENCE DOCUMENTS SECTION 8 Drawdown mechanisms for existing frameworks including sample mini-tender. 28

9. TENDER MANAGEMENT 9.1 Issue and Receipt of Tenders Tenders must be issued in writing or by email to all appropriate candidates or made available to download directly from www.etenders.gov.ie (open procedure only). Where possible, they should be published on the etenders website. Receipt of tender responses can be submitted in writing in a sealed envelope to reach the Authority before the closing date and time (these must be clearly specified). Where possible, the Authority should allow for the online electronic submission of tenders facilitated by the etenders website; if this option is exercised, the tenderers must be clearly informed of this choice for submission. The RFT must have a unique email address for queries in relation to the particular procurement, for example, procurement@pensionsauthority.ie. The relevant manager in the unit should notify IT of the individuals to be included in the distribution list. At least three people should be included on this list. Queries should only be accepted by email or in writing never by telephone. Any question/issue that requires clarification should be documented and issued to all companies/individuals who have expressed an interest in the RFT. Under no circumstances can late tenders be considered. 9.2 Opening and Registration of Tenders All formal tenders must be held in a secure place in the Corporate Services office or by the Manager responsible for the tender process prior to formal opening. When tenders are received, the envelope must be officially date stamped and held unopened in a safe place until the formal opening date (usually one day after the closing date). All tenders must be opened together in the presence of two authorised officers of the Authority. The tenders should be opened the day after the closing date. Tenders should be stamped with a date/time tender opening stamp and recorded on the Register of Tenders and signed by the authorised persons present. The Certificate of Tenders received should be completed and held on file. Tenders should never be opened in advance of this time. 9.3 Dealing with Late Tenders It is a strict policy of the Authority to return all late tenders to the suppliers. A tender received after the opening of other tenders may not be accepted under any circumstances and must be returned to the sender unopened, if possible. If this is not possible, the tender must be date stamped with the date upon which it was opened. 29

9.4 Extension of the Tendering Period Situations can arise where, for various reasons, tenderers do not have sufficient time to prepare a complete tender and consequently request an extension to the tendering period to allow them to complete the tender. In exceptional circumstances, a tender closing date may be extended. When this occurs, all those invited to tender must be advised of the new closing date by the relevant Manager not less than seven days before the original closing date. This notification requirement applies to both open and restricted procedures. No extension can be given if the request is received within seven days of the closing date. Corporate Services must formally approve all such extensions. When a request for an extension of time is received, discussions should be held with all relevant parties to see if it can be granted without impacting unduly on the project. If a substantial number of the tenderers submit similar requests, there may be no option but to grant the extension, regardless of the timeline for the project. 9.5 Clarification / Verification Meetings (Post Tender) Tenders may be clarified and verified in order to determine that tenderers have fully understood the requirements. The tender documents should advise tenderers of whether or not a clarification / verification process might be used as part of the tender evaluation process. The clarification meeting can be used to confirm and clarify the content of tenders prior to finalising the tender scores. It should be noted that this process is used to verify the content of tenders and/or of the tenderers understanding of the requirements. If it is used to confirm the scores allocated during the evaluation of the written tenders, this may result in adjustments being made to the final scores. The following points should be noted: As part of the tender documentation, tenderers should be informed that contract award will (or may) be subject to attendance at a clarification / verification meeting; The same evaluation team that evaluated the written tenderer should also carry out the clarification / verification meeting; The selection of tenders to be invited to such a meeting should take into account the principles of equal treatment, non-discrimination and proportionality. Therefore only tenderers who have a realistic chance of being awarded the contract should be invited; The meeting should address the tenderers response in accordance with the specification and award criteria. It is not permitted to have a criterion related to performance at interview ; Tenderers may not be permitted or invited to materially alter or amend tenders, particularly when the open and restricted procedures are being used; 30

Under the most economically advantageous award criterion, the tenderer who achieves the highest score at evaluation, and who has submitted a valid and responsive tender, is entitled to be awarded the contract. Ultimately, the company with the highest score that meets all of the criteria is the winning tender. 9.6 Innovation It is the Authority s policy to promote and support innovation through its procurements, particularly where this could offer significant value for money for the organisation. Wherever possible, tender documents and contract award procedures will be designed to encourage and support innovation. This will be taken into account in: The drafting of tender specifications and the use of variants; The use of the competitive dialogue procedure for complex areas to assist the analysis of innovative solutions; The setting of selection criteria to enable new companies / solutions be considered for the tender stage; The setting of award criteria to enable new innovative solutions to be considered in a fair and objective manner. 9.7 Accessibility It is the Authority s policy to ensure that relevant accessibility requirements for people with disabilities are included in all stages of the tender process. Section 27 (part 3) of the Disability Act states that Where a service is provided to a public body, the head of the body shall ensure that the service is accessible to persons with disabilities. This refers to both the provision of services, the supply of goods and the execution of works. Accessibility requirements should be clearly stated in requests for tenders/contracts/ quotations, where applicable. Suppliers may be asked to highlight features of their product or service that meet accessibility requirements for people with disabilities. Where there are no accessibility requirements relevant to the goods or services being procured, or where the accessibility requirements are deemed to be not practicable or may cause undue cost or delay, this should be recorded in a file note. Accessibility requirements should be given appropriate consideration and weighting during scoring and evaluation stages. Where suppliers are asked to make presentations, accessibility should be an agenda item for such presentations. 9.8 Cancellation of Award Procedures If, for whatever reasons, a contract must be cancelled, the Authority should publish a cancellation notice via etenders. In the case of quotations, the parties invited should be informed. Where possible, some indication of the reason for cancellation should be provided. 31

9.9 Filing and Disposal of Tenders A copy of each tender received (successful or unsuccessful) should be kept in the procurement file. All other copies should be disposed of in accordance with confidential waste procedures, provided the time frame for an appeal has passed (usually 30 days). A hard copy of the contract should be kept by the individual unit for 7 years after termination of the contract. A soft copy of the contract must be saved on the Central Procurement Register. 9.10 Freedom of Information Information may be requested on records relating to a tendering procedure. Certain records may be exempt on the grounds of confidentiality or commercial sensitivity. However, no tender related record is subject to either a release or an exemption as a class. Therefore, each record must be examined on its own merits in light of the relevant circumstances. It is usual that Tenderers will be consulted before the deciding officer will disclose any information. It should be noted that all tenders must be treated as confidential until such time as the contract is awarded. 9.11 Contracts The contract has to be drafted carefully. It should be clear and precise in order to avoid later disputes and possible litigation. The contract should draw on the Authority's Request for Tender (and any subsequent clarifications), the vendors proposal and any agreed changes to either. The contract should state that the Request for Tender and the tender proposal are to be read as part of the contractual agreement. Three years is the standard period for public sector contracts. The Authority usually includes an option to extend for one further year. The total cost of the project should be ascertained before a contract is formalised and the Authority should seek to ensure that the contract clearly specifies the maximum sum payable. Where possible, expenses should be included as part of the consultants' "all-in" fee. This provision should include an upper limit on expenses and should emphasise the need to vouch all items claimed. Travelling and subsistence costs should not normally exceed those appropriate rates currently applying in the civil service. Where large expense items can be anticipated, the contractor should be required to seek specific sanction in advance for each such item. All consultancy contracts should include the following:- A clearly specified fee for the project; Cost structure, time scale(s) and payment arrangements - the latter closely tied to the deliverables (outputs) of the project ; A schedule of tasks and deliverables (outputs); A clause in relation to the deliverables being of the required quality and completeness; 32

Ownership of deliverables/reports/software etc.; An "early termination" clause - this clause should state that where, at any time during the project, the work, being undertaken by the consultants, is found to be unsatisfactory by the Authority - the project may be terminated early, without the Authority being liable for the full costs; and A substantial retention amount. 9.11.1 Contract Extensions Under EU Directive 2004/18 EC, contracts cannot be extended by more than half their value. Department of Finance Guidelines in relation to the engagement of consultants and external support also stipulate that, for contracts involving consultancy, contractors or external service provision, extensions cannot exceed 250,000. REFERENCE DOCUMENTS SECTION 9 Central Register of Procurements Certificate of Tenders Received 33