Effectively Managing Tenders, Specifications and Contracts

Summary of the SCM model

• Indicating how the tender process fits into the model.

• Relationship between Demand Management and Acquisition Management analysed in relation to the goods, works and services required.

• Identification of preference point system, designated sector, pre-qualification criteria,objective criteria and subcontracting

• Prequalification criteria for preferential procurement

• Tenders to be evaluated on functionality

• 80/20 preference point system for acquisition of goods or services for Rand value equal to or above R30 000 and up to R50 million

• 90/10 preference point system for acquisition of goods or services with Rand value above R50 million

• The regularity framework to ensure compliance

• Tender Process,

Bid Documents

• Standard Bidding Documents

• Conditional Bid Documents

Prescribed administrative process.

• Publication of advert

• Closing date and time

• Place of closure

• Validity period

• Cancellation and re-inviting of bids

• Protocol to ensure fairness and Transparency

Ethical Behaviour of Committee members

• Core Principles for an appropriate Tender Procurement System

• Compliance with Ethical Standards and code of conduct

• Avoiding abuse of the Tender System

• Awards to persons in the service of state

• Avoiding unauthorized, irregular and fruitless wasteful expenditure in the tender process

Using National Treasury Guidelines, the following are

defined and illustrated with practical examples to

assist in avoiding these accruing in future tenders.

• Un authorized Expenditure

• Irregular Expenditure

• Fruitless wasteful expenditure

Tender Committees

Establishment of bid committees

Roles and functions of each of the committees

• Bid Specification Committee (BSC)

• Bid Evaluation Committee (BEC)

• Bid Adjudication Committee (BAC)

(BSC)Bid Specification Committee

• Determine the Stipulated Criteria for the bid

• Compiling Specifications

• Compiling Terms of Reference

• Group Activity

Note:

Participants need to have a basic calculator or spread sheet in order to be able to complete the activities.

(BEC) Bid Evaluation Process

Administrative Process

• Appointment of the BEC

• Evaluation Panel in respect of professional Services

• Signing of declaration of interest

• Confidentiality and impartiality

• Adherence and to and signing of Code of Conduct

• Checking of National Treasury database for restricted suppliers

• Checking Register for Tender Defaulters

Bids are evaluated by the BEC in terms of Stipulated Criteria

• Compliance with specifications or terms of reference

• Capacity or capability of bidders

• Scrutinise bids for possible improper conduct by bidders

• Calculations of points according to prescribed legislation and regulations 80/20 or 90/10

• Case study based on Prices and BBBEE

• Individual Activity

• Group Activity

• Case Study based on Functionality as a Criterion

• Local Production and Content Evaluation of bids regarding

• Discounts

• Sub-contracting

• Evaluation on bids scoring equal points

• Cancellation and re-inviting of bids

Reporting obligation of BEC to BAC

• Minutes of BEC

• Motivation for bids passed over

• Availability of funds

• Recommendations

(BAC) Bid Adjudication Process

Administrative Process

• Appointment of the BEC

• Composition

• Functions

• Signing of declaration of interest

• Confidentiality and impartiality

• Adherence and to and signing of Code of Conduct

• Minutes of meetings

• Process

• Use the report or submission of the BEC

• Adjudicate the bids

• Make final recommendation for awarding of contract

Award of Contract

Group Activity

Effective Contract Management

Perform contracts administration activities.

Administration of contracts by adhering to critical elements and in accordance with applicable legislative requirements.

• Price adjustments are calculated due to escalations.

• Administrative close-out or extension of a contract undertaken in accordance with prescribed policy.

 Perform Records Management Activities.

Contract documentation is completed, signed and recorded.

• Formal service level agreements

• Letter of acceptance

• Content for contract circular and amendments are

maintained for audit purposes.

Price adjustments

• Change of contract conditions or content

• Contract closure.

Manage Relationships and Monitor

Performance On Contracts.

• Contracts are managed to ensure that specific requirements are met.

• Contract performance is assessed and monitored

• in accordance with performance indicators.

• Performance includes the ability and capacity to execute contact

• Evaluation of contract performance is conducted to determine the risk of non-performance.

• Breach of contract

• Poor performance

• Improper conduct

• Control measures are in place to ensure that contract disputes are managed, and remedial action can be taken.

• Variation

• Cancellation

• Termination

• Restriction of suppliers

• Quality of performance information is analysed