Tender evaluation and recommendation report
The purpose of this section is to alert health services / agencies and consultants involved in managing projects of the information to be included in the tender evaluation and recommendation report in order to comply with process, probity and audit requirements.
In accordance with industry practice and government audit requirements, the department will carry out random independent audits of the tendering process used in awarding contracts. The administrative time of all parties involved in the audit process can be minimised if relevant information is included in the tender evaluation and recommendation report.
The building code requirements need to be adequately covered. Requirements may be included in the body of the report, as attachments or as summaries as applicable.
Typical inclusions for tender evaluation and recommendation report
Tender / scope
- Brief description of the scope of works being tendered.
- Proposed procurement method.
- Nominate the Principal to the contract.
Pre tender estimate
- Cost Plan D estimate of building works tendered.
- Date estimate prepared.
Type of tender
- expression of interest and short list including the names of shortlisted tenderers or
- prequalified tender or
- public tender.
- Conditions of tender or indicate standard conditions used.
- Contract conditions and special conditions or indicate standard forms used.
- Refer to documentation - working drawings, specification and bill of quantities where applicable (to be made available in full if required).
- Tender pro formas and schedules which are required tender inclusions (these may include web based references).
- Bill of quantities if included.
Key selection criteria
- Pre-determined key selection criteria (KSC).
- Identification of mandatory KSC's.
- Weightings of KSC's.
- Copy of advertisement and date of tender advertisement.
- Name of newspapers used for advertisement.
- Tender period including closing date, time and place.
- Nominated contact for queries.
Addenda (and clarifications) issued during tender period
- Refer to log of all queries received, together with responses (to be made available in full if required).
- Copy of each written addendum issued.
- Copy of advice to tenderers if the issue of addenda caused an extension to the tender period.
- Confirmation that all tenderers received all addenda and incorporated the addenda into their tender.
- Formal / documented procedure adopted with details of where, when and names of persons responsible for opening and recording tenders received.
- Shortlisted tenderers. Tenderers who have collected tender documents and did not submit a tender are to be noted. It is good practice to contact non-tenderers and obtain an explanation for a tender not being submitted.
Tender validity period
- In weeks or days with expiry calendar date to be included. This is usually 90 days.
Note: To prevent tenders from lapsing, it shall be the responsibility of the principal consultant to seek, on the agency's behalf, confirmation from tenderers for an extension of the validity period if a tender is not awarded before the expiry of the original validity period.
- Copy of the tender opening summary form.
An analysis of tenders against each predetermined key criteria including:
- method of delivery
- environmental sustainability, such as materials, resources, water and waste management
- occupational health and safety (OHS) and industrial relations (IR) compliance with government requirements in Ministerial Directions (mandatory)
- VIPP compliance, being a certified VIPP plan or VIPP statement (depending on tendered value)
- ranking of tenders - often summarised in the form of a matrix
- subcontractor - approval of nominations
- reference checks.
Where a health service / agency or the department is to enter into a contract they should confirm that their financial and legal advisers are satisfied with the financial and legal status of the recommended tenderer.
For a contract perceived to be high risk, complex or large ($5M or more) an independent assessment of financial viability is to be undertaken. The level of surety (generally in the form of unconditional bank undertakings) is to be set accordingly.
Several studies of disputes in the building and construction industry have revealed that a major cause of disputation (including litigation) results from the poor management of risks. Disputes are costly, often cause project delays, and should be avoided wherever possible through the pro-active management of risk. Major causes of disputes arise from:
- Poor quality documentation (ambiguous, inconsistent or incomplete drawings and specification are typical matters of concern) and it is important that the consultant attest as to the suitability of the documents as fit for purpose.
- Another area of concern arises from client initiated changes and the disruption to all parties can create extensive problems for the contractor and consultants and it is important that the client carefully consider the suitability before agreeing to the design and sign off accordingly.
Project risks exist at all stages of a capital works project and the PCG or governance group should identify and incorporate key risks into a project risk register. The register should identify risks and have strategies for risk mitigation; it should be kept up to date throughout the project.
The SP shall re-visit the risk register to confirm that identified risks associated with tendering have been effectively managed, with specific attention to risks identified for the tendering process.
The experience and qualifications of the proposed contractor's management, supervision and other staff is an important risk factor. Other risks include issues of probity, transparency, timeliness, security, schedule of rates and charges. Risks are usually managed through inclusion in the key selection criteria and may affect the required level of contract security to be incorporated into the contract.
Contractor related risks should be ascertained at the EOI stage and at the RFT for a two stage tender process, and should be considered in the tender evaluation.
Timeliness is important to the principal and occupiers of facilities. The experience of the department and project consultants should be used to develop a realistic project timeframe covering all stages from feasibility study to the end of occupied commissioning. As a project progresses, the project timeframe is revised and this permits more detailed planning by the occupiers for example regarding fit-out, commissioning and occupation.
At the tender stage, a tentative program will be sought from tenderers, showing how they intend to deliver the project within the contract period and the level of allowable delays called ‘float' in their program. The contract program should include allowances for expected delays caused by seasonal weather conditions and unexpected site conditions.
The contract conditions cover how delay and slippage are managed during the contract stage, but where time is critical to the agency / health service or department negotiations at the tender evaluation stage may include the tenderers capacity to accelerate activities to make up for lost time.
Value for money
The tender evaluation should consider value for money as a key evaluation criterion. This will include factors such as life cycle costs, alternative details / finishes offered. Operations and maintenance costs can be more significant where the facility needs to be decanted or service delivery is interrupted while replacements or upgrades occur and the inclusion of a cheaper initial tender price may need to be critically appraised when considering the wider implications for the agency. This may result in the lowest tender not being recommended for acceptance.
All non-conforming tenderers are to be noted with reasons provided, for example:
- late tender
- exclusions from tender price
- failure to provide certified VIPP plan
- qualification on materials / equipment which are different from those specified
- qualification on performance criteria of mechanical or electrical equipment
- qualification on time for completion which is different to that specified
- qualification on price submitted, e.g. Rise and fall basis instead of fixed price
- non-compliance with statutory documents.
Tender recommendation principles
- Award should be based on the best value conforming tender in conjunction with project specifics and general tender selection criteria.
- If a non lowest tender has been selected the reasons supporting the selection should be reported.
- Confirm all non-conforming tenders are rejected.
- Confirm all unsuccessful tenderers will be formally informed after award of a contract to the successful tenderer.
Attachments to be Included
The following attachments are to be included as an appendix to the tender recommendation report:
- summary of shortlisting process or minutes of pre-qualification meeting with the contract supplier register (CSR)
- copy of tender advertisement
- copy of the tender opening summary form and details of any tenders rejected because they were not received on time
- statement from probity advisor, where appropriate.