a guide to procurement sourcing - nt.gov.au€¦ · web view... and factsheets supporting this...

A guide to procurement sourcing

DEPARTMENT OF TRADE, BUSINESS AND INNOVATIONDraft

Document control

Document detailsDocument title A guide to procurement sourcingContact details [email protected] and version 29 September 2017

Version 0.5Approved by Director, Procurement Strategy and CapabilityDate approved 16 October 2017Document review Every four months

Change historyVersion

Date Author Change details

0.1 24 March 2017 Procurement Policy Initial version – table of contents only0.2 21 April 2017 Procurement Policy Second version with text added0.3 20 June 2017 Procurement Policy Incorporation of feedback received 0.4 31 August 2017 Procurement Policy Further development for consultation0.5 29 September 2017 Procurement Policy Final changes to enable publishing

AcronymsThe following acronyms are used in this documentAcronyms Full formAPRO Agency Purchase Requisitions OnlineASIC Australian Securities and Investment CommissionCAL Contractor Accreditation LimitedCAPS Contract and Procurement ServicesNT Northern TerritoryNTG Northern Territory GovernmentNTPS Northern Territory Public SectorQTOL Quotations and Tenders OnlineRFO Request for offerWLC Whole of life costing

DEPARTMENT OF TRADE, BUSINESS AND INNOVATION of 3729 September 2017, Version 0.5, Draft

Disclaimer

DisclaimerThis guide is a draft only (version 0.5) and is still under development. Feedback on this guide can be emailed to [email protected] by Friday 12 January 2018 for inclusion in version 1.0.

Specifically, feedback is sought on:

usefulness of the guide and templates

ordering and placement of each section

areas where additional guidance is required or missing

suggestions for templates and factsheets.

Staff must ensure that all procurement activities undertaken comply with the procurement rules and procurement governance policy found on nt.gov.au1.

1 https://nt.gov.au/industry/government/procurement-conditions-framework/procurement-directions


https://nt.gov.au/industry/government/procurement-conditions-framework/procurement-directions

mailto:[email protected]

Table of Contents

ContentsDisclaimer.........................................................................................................................................31 About this guide........................................................................................................................62 What is sourcing?.....................................................................................................................73 Governance................................................................................................................................9

3.1.......Probity..............................................................................................................................93.2.......Defensible decision making...........................................................................................10

4 Roles and responsibilities......................................................................................................115 Approach the market..............................................................................................................14

5.1.......Procurement documentation..........................................................................................145.2.......Manage the procurement approach...............................................................................15

5.2.1........Advertising period...................................................................................................155.2.2........Release and closure of request for offers...............................................................15

5.3.......Establish communication principles...............................................................................155.3.1........Critical communication points.................................................................................16

5.4.......Clarifications during advertising.....................................................................................17

6 Assess and negotiate.............................................................................................................186.1.......Assessment panel briefing.............................................................................................186.2.......Conflict of interest declaration.......................................................................................196.3.......Pre-scoring review.........................................................................................................20

6.3.1........Admissibility............................................................................................................206.3.2........Mandatory project requirements.............................................................................216.3.3........Acknowledgement of addenda...............................................................................21

6.4.......Assessment of offers.....................................................................................................216.4.1........Scoring....................................................................................................................226.4.2........Whole of life costing................................................................................................236.4.3........Clarifications during assessment............................................................................236.4.4........Calculating value for Territory.................................................................................246.4.5........Shortlisting..............................................................................................................256.4.6........Interviews, presentations and other checks............................................................256.4.7........Due diligence..........................................................................................................26

6.4.7.1........Financial and legal capacity...............................................................................266.4.7.2........Past performance reports...................................................................................266.4.7.3........Referee checks..................................................................................................27

6.5.......Negotiations...................................................................................................................286.5.1........Negotiation plan......................................................................................................28

6.5.1.1........Negotiation team................................................................................................296.5.1.2........Key areas for negotiation...................................................................................29

6.5.2........Undertaking the negotiation....................................................................................29

7 Select and award.....................................................................................................................317.1.......Identify preferred respondent(s)....................................................................................32

7.1.1........Declining all offers..................................................................................................327.2.......Prepare assessment recommendation..........................................................................327.3.......Finalise contractual terms and conditions......................................................................337.4.......Contract award..............................................................................................................337.5.......Contract execution.........................................................................................................34


Table of Contents

7.6.......Debriefing respondents..................................................................................................347.6.1........Purpose of the debrief............................................................................................347.6.2........Preparing for the debrief.........................................................................................347.6.3........Conducting the debrief............................................................................................357.6.4........After the debrief......................................................................................................36

7.7.......Contract disclosure........................................................................................................36

8 Appendix A...............................................................................................................................37



1 About this guideThe guide to sourcing provides recommended procurement sourcing practices for NTG agencies to effectively undertake the sourcing stage of the procurement lifecycle (Figure 1).

The guide provides:

1. an understanding of the benefits associated with effective procurement sourcing practices

2. an overview of procurement sourcing practices

3. guidance on recommended activities to be performed in the sourcing stage.

The guide must be read in conjunction with the procurement governance policy, procurement rules and procurement circulars. In addition, agencies must ensure that activities comply with any internal processes in place. This will enable agencies and its personnel to adopt compliant procurement practices that strive to deliver value for Territory.

The various templates and factsheets supporting this guide are listed in Appendix A and are referenced throughout the guide with the prefix S1, S2, S3 etc.

Figure 1



2 What is sourcing?Within the NTG, sourcing refers to the process of undertaking the steps associated with going to market, assessing, negotiating and awarding a contract. Sourcing comprises of the following three stages:

1. approach the market (refer section 5)

2. assess and negotiate (refer section 6)

3. select and award (refer section 7).

Each stage of sourcing is further explained in sections 5 to 7 of the guide as noted above.

For NTG activities, there are several key information inputs that form part of the sourcing process, many of which are developed during the planning phase. These include (but are not limited to):

project documentation

a project specific procurement plan

project risk register

assessment plan

sourcing documentation (ie the request for tender)

offers received (ie tender responses)

assessment tools and instruments.

Successful sourcing processes and the associated contract award are required to meet high expectations in terms of probity, fairness and accountability in assessment, whilst enabling the achievement of value for Territory.

The guide is intended to provide clear instructions for embedding policy, probity and legislated requirements at every step of the process. If these guidelines are followed, agencies are more likely to be able to withstand scrutiny by third parties concerning their sourcing decisions.

Importance of sourcingWhy is sourcing important? to establish an open and competitive environment where

respondents have equal opportunity to participate

facilitates agencies paying market value for goods and/or services

seeks to ensure that the “best fit” offer is selected

enables procurement activities to be undertaken ethically and in accordance with a code of conduct

enables probity and legislative requirements being addressed at each stage of the process

facilitates the achievement of value for Territory outcomes

enables an impartial, fair and unbiased process

What are the risks if the sourcing stage is not

exposure to risks arising from probity, transparency and



Importance of sourcingperformed well? fairness issues

poor decision-making

disruption of the delivery of supplies

failure to deliver value for Territory

reputational damage for NTG

The benefits of successful sourcing are outlined and expanded on in the following table:

Benefits Achieving better value for Territory outcomes

the procurement of supplies most appropriate for purpose utilising the best available resources while boosting support to Territory enterprises

Open and fair competition maximising the opportunity for organisations and individuals to compete for business

Accountability allocating responsibility for compliance with policy and legislation, and adoption of best practice

Risk management adopting management strategies to minimise risk associated with decision-making, delivery failure, probity, transparency, and fairness

Probity and transparency promoting fairness, impartiality, consistency and transparency in all sourcing activities through effective governance, communication and feedback

Local industry participation using local where value for Territory is optimised and results in a local presence, local supply chain and local network base



3 Governance To ensure the success of the NTG’s procurement processes, there is reliance on a number of structures already in place in agencies, in particular:

project planning and management

a sound financial management framework based on the Financial Management Act

audit and fraud prevention programs and frameworks

good standards in governance

professional conduct and capabilities of staff, based on Office of the Commissioner for Public Employment requirements

maintenance of appropriate records of procurement activities in accordance with NTG records management standards and guidelines.

Due to the varying agency organisational structures, recognition can only be given to generic project and contract management structures. Some interpretation will be needed in agencies to accommodate this approach. Staff undertaking procurement activities must ensure consideration of their agency structures and processes.

3.1 ProbityProbity aims to maintain the integrity of the public sector by adopting and following well-considered procedures and processes to ensure that procurement decisions are fair, transparent and defensible.

The broad objectives of probity in procurement are to:

provide accountability

maintain integrity

ensure compliance with processes

ensure that all offers will be assessed against the same criteria

minimise potential conflicts and the potential for litigation

ensure the procurement activity provides the best outcome

avoid the potential for misconduct, fraud, and corruption.

When conducting procurement activities, it is important to ensure:

fair and impartial behaviour

accountability and transparency

lawful behaviour

adequate management of conflicts of interest

security of commercially sensitive and confidential information.



It is important to ensure that all procurement activity is always conducted with adequate probity in mind. Any discussion or contact with respondents during the assessment process must be done with due regard to probity, particularly:

No information on the assessment process is to be divulged to any respondent.

The status (that is whether preferred, under consideration or rejected) of any other offer must not be advised or implied to any respondent.

All communication with respondents should be in writing and specify a timeframe for responding. In circumstances where an issue is discussed verbally with the respondent, the discussion must be documented and retained with the offer documentation. The respondent must confirm their verbal advice in writing prior to the completion of the assessment process for the information to be used in the assessment.

Notations should not appear on any original hard copy offers submitted by a respondent.

It may be appropriate to engage an independent observer (for example a probity advisor or specialist consultant) to oversee the clarification process, particularly where the procurement activity is complex and/or of significant risk and value.

3.2 Defensible decision makingThe agency and its personnel must ensure that all procurement recommendations, decisions and actions are defensible. Defensible means that the decision is based on proper consideration of the situation and information available at the time (including information that is reasonable to obtain), free from real or perceived bias and procedurally fair. This applies throughout the entire procurement lifecycle but is particularly important in sourcing.

Further guidance on defensible decision making is provided in the guide to planning.



4 Roles and responsibilitiesThe table below defines key roles and responsibilities associated with the sourcing stage. The roles identified in the table may have alternative naming conventions within each NTG agency. Agencies should interpret roles and responsibilities to align with terminology relevant to their agency.

Clarity of roles and responsibilities is critical in achieving efficient and effective sourcing processes. It is recommended that roles be allocated early in the procurement lifecycle, ideally in the planning stage to provide personnel with the opportunity to be aware of, and provide input into, the planning and sourcing stages. Where necessary, and without compromising the procurement process, the same employee can be assigned to more than one roles.

Roles Responsibilities

Project manager manages a specific project for which procurement activities are undertaken

coordinates the preparation of project-specific procurement plan, project risk register, offer and contractual documents and any other associated pre-offer documentation

identifies and manages agency, project and procurement risks and mitigation strategies, at all stages of the procurement lifecycle

liaises and consults closely with the chairperson of the assessment panel during the assessment process

reports to the project sponsor

determines the materials and participants required for assessment process

Project sponsor a senior agency executive responsible for ensuring the overall objectives of the specific procurement project are delivered and the proposed benefits realised

Steering committee group formed from stakeholders to guide the development and progress of a project as applicable (the chairperson of a steering committee for a NTG project is generally a senior executive of the agency with responsibility for the project)

oversees the general progression and direction of the specific project, ensuring risks are identified and managed appropriately, and decisions are made when required

Accountable officer the chief executive (however described) of the agency or a person who the Treasurer declares in writing to be the accountable officer for the purposes of the Financial Management Act

provides strategic leadership, direction and oversight of the procurement lifecycle and associated governance in the agency




Delegate officer in an agency who holds the appropriate financial and other delegated authority to approve the scope, program, quality, budget cost and other key parameters of a project and to accept an offer

Chairperson of the assessment panel

responsible for chairing, managing and coordinating the assessment process

thoroughly familiar with the project, undertakes governance reviews to determine appropriate approvals and controls and identifies any risks

nominates and appoints assessment panel members, in consultation with senior agency managers

develops and finalises the assessment plan prior to the release of sourcing documents to the public

briefs the assessment panel members accurately and fully on the scope, quality, performance, and program required

employs checklists, tools, and guidelines as appropriate in implementing various sourcing activities

maintains probity requirements such as confidentiality and conflicts of interest, and ensures compliance with mandatory requirements

liaises with project manager, identifies, and manages risks specific to the assessment process

ensures assessment panel members are informed and perform in accordance with the assessment plan

brings the assessment to a successful conclusion, including preparation of a procurement recommendation paper for the delegate to consider

ensures all reporting meets expected requirements

remains mindful of the public perception which recommendations could produce

explains assessment panel decisions to third parties if required (including scoring outcomes) when subject to third party review

may manage and conduct respondent debriefs

provides a handover report to the project manager




Members of the assessment panel

assesses offers and make recommendations on which offer provides best value for Territory

brings either a technical or general understanding of the project

able to maintain probity requirements and act in accordance with the assessment plan

able to explain their decision (including scoring outcomes) when subject to third party review

Procurement Services administration of procurement policy and processes within the agency

provide advice to agency personnel, on the application of procurement policies, practices and guidelines

ensure agency procurement practices are aligned to NTG policy, rules, and guidelines

Procurement Review Board provide strategic procurement advice to government

review APMPs to identify opportunities for collaboration

review agency procurement procedures or practices to assure compliance with the procurement framework

monitor procurement trend diagnostics at an agency and whole of government level

oversees agency and industry compliance with the Buy Local Plan

monitors the overall effectiveness and impact of the Buy Local Plan, including monitoring for unintended consequences

determines appeals in relation to eligibility or admissibility of an offer in accordance with the procurement framework



5 Approach the marketThe focus of this step is on ensuring that the agency effectively (clearly and unambiguously) expresses to the market what is required (scope of requirement), the level of quality expected, the timeframe for delivery of the supplies and the conditions of offer and contract.

Market documents should enable respondents to produce responses that allow for differentiation between offers and enable effective assessment of value for Territory. By this stage, the scope of requirement and request for offer documentation should have been developed and the procurement approach approved by the delegate.

The core purpose of this step is outlined in the following table:

Purpose of approaching the market

Why is an effective market approach important?

to provide prospective respondents with clarity on the scope, quality and timeframes for the delivery of supplies

to minimise respondents’ provisions for risk contingency when the scope is unclear

to enable NTG agencies to clearly differentiate between respondent’s offers

to enable a logical, consistent and transparent assessment of value for territory across all offers

to encourage respondents to only submit information necessary to make an effective decision

What are the risks if the market is not approached effectively?

favouritism or bias towards one or more respondents

inability to reach quality, relevant and appropriate respondents

inability to sufficiently differentiate between responses, leading to sub-optimal decisions

inconsistent information to make an informed decision

failure to deliver value for Territory outcomes

does not provide respondents with sufficient time to prepare an appropriate response

5.1 Procurement documentationThe quality of procurement documentation often determines the quality of the procurement outcome. Poor procurement documents can contribute to poor responses and poor project outcomes. For this reason, standardised procurement documentation is used to maintain consistency throughout the procurement process.

The use of standardised procurement documentation will enable:

1. objectives and the procurement scope to be clearly and unambiguously stated

2. clear supply requirements and desired outcomes to be reflected in offer documents

3. identification of the most appropriate respondent(s) to deliver best value for Territory



4. efficiency in ensuring only relevant information is provided and requested

5. efficient use of time in preparing sourcing documentation and responses.

Procurement documents should be based on the latest applicable version of the standard conditions of offer and contract. Where it is determined that these are not suitable for a procurement activity, consideration may be given to drafting alternative (ie non-standard) conditions. This should have been identified in the planning stage with appropriate approvals obtained prior to approaching the market. Further information on non-standard

5.2 Manage the procurement approach

5.2.1 Advertising period

Providing an appropriate advertising period is essential to ensure that the procurement activity is transparent, consistent and fair for all potential respondents. Sufficient time will need to be allowed for respondents to prepare appropriate responses to a request to submit offers. Longer response periods should be considered where the procurement activity is complex and/or of high value or risk. Agencies should be receptive to industry feedback if requests for extensions to the advertising period are requested.

The minimum invitation period for each tier is outlined in section 5.5 of the procurement rules.

5.2.2 Release and closure of request for offers

For tiers 1 and 2, agencies are responsible for establishing processes for managing the release and closure of request for offers. It is recommended, particularly for tier 2, that agencies manage this via a central team using a secure, generic email account to ensure proper handling of offers lodged. The release and closure of requests should be undertaken by personnel who have appropriate training and knowledge of the procurement function.

Agencies must ensure that all respondents are given the same information, including details of lodgement and closing date and time.

For tiers 3 to 5, this function is managed by Contract and Procurement Services (CAPS). Request for offers are released and closed via Quotations and Tenders Online (QTOL). Following closure, CAPS will publish a list of respondents in alphabetical order on QTOL. This list remains available until the procurement activity is either cancelled or awarded. Prices are not disclosed.

Details of offers received are commercially confidential and with the exception of respondent names, must remain confidential during and beyond the procurement process.

5.3 Establish communication principlesWell planned procedures are crucial for a successful assessment outcome. Sound internal processes should be established to ensure the effective control and management of the flow of information.

The following basic communication principles should be applied during the sourcing stage:

any information that is not general public knowledge must only be communicated to a respondent with the approval of the appropriate delegate

no respondent should receive, or be perceived to have received, additional information to that which is publicly available in respect of the assessment, unless this information is expressly released in writing by the project manager with appropriate approval

communication should be in writing and forwarded through appointed personnel, generally the chairperson



procedures for site visits, access to data sheets, briefing sessions, clarification meetings and other direct contact with respondents (or prospective respondents) must be established so that all respondents (or prospective respondents) are afforded the same opportunity

the chairperson of the assessment panel should manage communications with respondents and with any other stakeholders

no communications should be conducted with respondents about any other respondents documentation, commercial pricing, the assessment process or information/materials gained or used in the assessment process

all communication with respondents should be documented and retained on file register which is to be maintained by the chairperson for audit purposes (this is commonly referred to as the communication register.

It is critical that effective respondent communication principles are established for:

written correspondence with respondents

oral correspondence with respondents

confidentiality, decision making, reporting structures

assessment discussions among assessment panel members

procurement complaints

ministerial communication and announcements.

A template plan is provided at S1: Communication plan.

5.3.1 Critical communication points

During the sourcing stage, there are a number of critical communication points. The following table provides an example of these critical points and should be included in the communication plan as appropriate.

What (key message)

When (timeline)

Who (audience)

How (channel)

Release of request for offer to market

Upon release Potential respondents for tiers 1 and 2, generally via email

for tiers 3 to 5, via Quotations and Tenders Online

Receipt of offer Within two days of closing

All respondents who have submitted an offer

for tiers 1 and 2, generally via email

for tiers 3 to 5, receipt is issued automatically if lodging via Quotations and Tenders Online



What (key message)

When (timeline)

Who (audience)

How (channel)

Advise that offer has been deemed inadmissible by the agency, including appeal rights

Within two days of a decision being made

All respondents who have been deemed inadmissible

Letter (managed by CAPS for tiers 3 to 5)

Notification of procurement outcome

Within five days of procurement outcome being approved

All respondents who submitted an admissible offer

Letter (managed by CAPS for tiers 3 to 5)

Debrief respondents on assessment of their offer

As soon as possible after request received

All respondents who request a debrief

Face-to-face if possible, or via teleconference

Post-award notification on quotations and tenders

Within five days of procurement outcome being approved

General public On Quotations and Tenders Online (excludes tier 1)

Notification of contract commencement and how to access

Prior to commencement of contract

Contract users and other stakeholders (eg contract administrator)

Email or intranet

5.4 Clarifications during advertisingIn circumstances where a statement or information provided in a request for offer is open to interpretation or is not readily understood, clarification of the statement or information may be requested by potential respondents.

All clarifications received during the advertising period should be actioned promptly as the information sought may be required to enable a respondent to complete their offer.

The agency should issue an addendum to address clarifications received during the advertising period, particularly where it requires a change to the request for offer, or the information to be provided will advantage the respondent.

Addenda are issued to all potential respondents. For tiers 3 to 5, this is managed by CAPS through the APRO system. For tiers 1 and 2, agencies need to establish their own processes and procedures for issuing addenda.

When issuing addenda, consideration must be given to extending the closing date for receipt of offers. This is particularly important where the addenda includes a significant change that may require a respondent to re-draft or change their offer.



6 Assess and negotiateThe focus of this stage is to effectively assess responses received to identify the respondent that will deliver best value for Territory.

Respondents must be treated impartially and equitably at all stages in the procurement lifecycle, but this is particularly important during this step. Responses must be assessed in line with the predetermined and approved assessment criteria and weightings.

The core purpose of this step is outlined in the following table:

Purpose of assessing and negotiating

Why is an effective assessment and negotiation process important?

enables offers to be considered, on an equal basis, against the predetermined, approved, and published assessment criteria and weightings

facilitates transparency and consistency in the assessment of offers

promotes decisions that are aligned to value for Territory principles

enables the assessment process to be conducted objectively and free from any bias or the perception of bias

encourages adequate preparation, consideration of risks and development of a strategy for negotiation

seeks to ensure appropriate personnel with relevant qualifications, experience and capabilities conduct and manage negotiations

encourages appropriate approvals being gained prior to conduction negotiation

What are the risks if the assessment and negotiation process is not performed effectively?

favouritism or bias towards one or more respondents

reputational risk from selection of inappropriate respondent

failure to deliver value for Territory outcomes

failure to achieve the required procurement outcome due to the selection of inappropriate respondents

6.1 Assessment panel briefingAssessments of offers should be undertaken by an assessment panel, comprising of a group of personnel with relevant skills and knowledge appropriate to the value and risk of the procurement activity, and who are free of any conflict of interest that could undermine the objectivity of the assessment.

The assessment panel should be briefed by the chairperson of the assessment panel in preparation for the assessment. Summary documents which describe the procurement and the proposed process will greatly assist with the briefing. These documents should include the assessment plan, the project risk register and the pre-sourcing estimate, although other agreements, plans and policies may also be required to inform the assessment panel’s decisions, as identified in the assessment plan.



As a result of briefing the assessment panel, all members will:

be reminded of their confidentiality and disclosure requirements

have a common understanding of the project objectives

understand the content of the assessment plan and how the assessment process is to be conducted

approach the assessment in a consistent and systematic way

be informed as to their accountabilities and responsibilities

understand how to conduct themselves in accordance with assessment rules and with a thorough understanding of the probity requirements.

A meeting agenda template is provided at S2: Assessment panel briefing agenda.

6.2 Conflict of interest declarationAll personnel involved in procurement activities are required to perform their duties in a manner that is fair, transparent, free from bias and unaffected by self-interest or personal gain. Personnel engaged in procurement activity are not to use information obtained during official duties to:

gain a direct or indirect financial advantage

gain improper advantage for self or others

act partially or inconsistently with their obligations

cause harm to other people, business or the government.

Similarly, potential respondents should not approach government personnel in a way that is or could be perceived to be an attempt to inappropriately influence procurement outcomes or processes.

The government aims to foster and maintain complete confidence in the integrity of its procurement process by ensuring:

persons involved in the assessment process conduct themselves in an ethical and appropriate manner

persons do not hold financial interests that conflict with the conscientious performance of their duties

persons do not accept from respondents or associates any gifts, gratuities or favours including: entertainment, transportation, lodging, future employment, future business opportunity, services or any other pecuniary or non-pecuniary benefit

persons involved in the assessment process do not engage in any practice that gives one party an advantage over another

that it is apparent to all involved that the assessment process is objective, unbiased, and does not favour one respondent over another

that the assessment process ensures open and effective competition and is defensible.



The following circumstances must be disclosed in writing to the accountable officer or delegate:

persons having any indirect or direct interest which conflicts or might reasonably be thought to conflict with their duties

persons having any indirect or direct interest which influences or might reasonably be thought to influence improperly their conduct in the discharge of their responsibilities.

Prior to conducting an assessment of an offer, all individuals undertaking the assessment will complete a declaration of interests and confidentiality form which is to be retained by the chairperson of the assessment panel. This may have been performed in the planning stage but should be updated as necessary when offers close.

The chairperson should inform panel members, and any other officers involved with the procurement activities, of what constitutes a conflict and encourage declaration at the panel briefing and as needed throughout the procurement process. If a conflict is detected, it should be managed in accordance with any applicable conflict of interest management strategies. The conflict of interest and confidentiality forms for members of the panel should indicate their understanding and acceptance of the assessment plan and the risk register.

Declarations should detail the conflict in full and to the satisfaction of the chairperson. Assessment panel members must confirm they have no conflicts. Failure to declare conflicts of interest may result in penalties under Employment Instruction 7 (Discipline) issued under the Public Sector Employment and Management Act.

Conflicts of interest must be assessed and managed by the chairperson on a periodical basis throughout each assessment process. As conflicts arise relevant details should be recorded in the risk register.

Templates for conflict of interest declarations are provided with the planning guide.

6.3 Pre-scoring review

6.3.1 Admissibility

The conditions of offer set out a range of requirements that each offer must comply with in order to be admissible for assessment. There are two types of admissibility requirements, mandatory and discretionary.

CAPS will undertake an initial admissibility checks and will advise the agency of any admissibility issues identified. These initial checks are limited to a review of the response schedules submitted by the respondent and do not identify all admissibility items. Each agency is responsible for ensuring that all admissibility issues are identified and dealt with.

If a respondent fails to comply with a mandatory requirement (ie offer must be in English), the agency must deem it inadmissible. If a respondent fails to meet a discretionary requirement (ie offer must be submitted prior to the closing date and time), the agency may consider the circumstances surrounding the failure and deem the submission admissible.

Before making a determination, the agency must give consideration to the following:

whether admitting the offer will compromise the integrity of the process

whether the respondent has or is likely to gain an unfair advantage

reasons for the respondent’s failure to comply with a requirement

whether the response is capable of assessment

whether the response was mishandled by the agency or a third party



evidence of unfair practices.

All decisions made in regard to admissibility must be defensible. The agency should avoid applying a ‘blanket rule’ to admissibility issues (ie late submissions) and ensure that each failure is reviewed in isolation to previous cases as the circumstances surrounding the failure will generally change.

If a respondent is deemed inadmissible, they will be given two business days to appeal the decision with the Procurement Review Board. This applies to both mandatory and discretionary admissibility issues. Agencies cannot finalise an assessment until all admissibility issues, and any resultant appeals, are closed off.

Further information on admissibility, including types of admissibility issues and whether or not they are mandatory or discretionary is provided at S3: Admissibility of offers.

6.3.2 Mandatory project requirements

In some circumstances, the request for offer may have outlined other mandatory requirements that respondents are required to meet. These mandatory requirements relate directly to the project itself and are separate to those discussed in section 6.3.1. For example, you may require certain professional qualifications, compliance to industry standards or use of particular systems and equipment.

Before commencing the assessment, the panel should check that all respondents have met any mandatory requirements. If a respondent has not met a mandatory requirement, the offer should be set aside and not considered further in the assessment.

Agencies must be able to defend and justify any decision to make certain requirements mandatory. This must be decided in the planning stage and clearly communicated to potential respondents in the request for offer documentation.

6.3.3 Acknowledgement of addenda

The assessment panel, or their procurement services team, should ensure that all respondents have acknowledged any addenda released during the advertising period. Whilst failure to acknowledge addenda is not an admissibility issue in itself, it may lead to other admissibility issues that will need to be addressed.

For example, if the agency released an addendum to change the scope of requirement, it will need to ensure that all respondents received the addendum and prepared their response to align with the new requirements. If a respondent has missed an addendum, their offer may be incapable of assessment (ie incomplete) and may need to be deemed inadmissible. The assessment panel should seek guidance from their procurement team.

Failure to acknowledge an addendum can be rectified via clarification but must be done in accordance with the procurement rules (see section 6.4.3 or rule 21 of the procurement rules). For tiers 4 and 5, CAPS will undertake an initial addendum acknowledgement and then the agency is responsible for following up a response.

A template addenda clarification email is provided at S4: Addenda clarification email template.

6.4 Assessment of offersThere are some basic requirements respondents must meet in order to do business with the NTG. Respondents need to be assessed against these requirements in a consistent manner to ensure a competitive and fair foundation is established for assessment.

The time required to complete an assessment and award a contract will vary with a number of factors, including:



the number of offers received

the value and complexity of the supplies sought

the quality of the request for offer documents issued

the number of addenda issued

the experience of the chairperson and the assessment panel members

the quality of the offers received

the thoroughness of the assessment plan preparation.

The assessment must be undertaken in accordance with the assessment plan and pre-determined criteria and weightings and by personnel with relevant skills and knowledge appropriate to the value and risk of the procurement activity. Minimum panel numbers for each tier are outlined in section 5.5 for the procurement rules.

The assessment and award must be completed within the offer validity period outlined in the request for offer documentation, including any extensions. The following timeframes are recommended for each tier:

tier 2: 4 weeks

tier 3: 6 weeks

tier 4: 10 weeks

tier 5: 12 weeks.

Timing starts are the close of offers and finishes at contract award.

A checklist of recommended assessment activities is provided at S5: Procurement assessment checklist and covers activities from close of offers to award of the contract.

6.4.1 Scoring

The assessment plan, which should have been established in the planning stage, will identify the assessment criteria and weightings to be applied. In line with the assessment plan and procurement rules, all respondents must be assessed using a weighted comparative analysis method.

During the assessment scoring process, it is important that assessment panel members remember that price is not the only or the most important criterion in the determination of value for Territory. It is a balanced or weighted consideration of both price and qualitative or non-price criteria.

Assessment panel members should score each offer separately against each criterion before convening to moderate their scores. Assessment panel members will bring different levels and areas of knowledge to the table during this process.

The moderation process can be based on arithmetic averages, or on a discussion of why each assessment panel member determined their score. Averaging of scores is not recommended as this overlooks the likelihood that one or more of the assessment panel members may have misunderstood the respondent’s response or has not considered some key aspects of the requirement.

If the assessment panel members are not able to resolve any differences in scoring by discussion, it is unlikely they will be able to provide meaningful feedback to respondents during debriefing. If an agreed score is not able to be achieved, and that score will affect the overall outcome of the assessment, it may be appropriate to produce a minority report.



The chairperson should take care to ensure that no member is dominating these discussions and “forcing” opinions on other members. Chairpersons need to be diligent in guiding the panel to ensure an agreed score is thoroughly discussed for each assessment criterion.

The scoring methodology (ie scale) needs to be established during the planning phase as part of the assessment plan. The recommended scoring scale is provided at S6: Procurement assessment scoring scale.

6.4.2 Whole of life costing

Whole of life costing (WLC) is a methodology for identifying and calculating the total costs and expenses associated with the purchase of supplies. This includes all initial and future costs related to the entire life cycle of the supplies, including design, planning, acquisition, installation, operation, maintenance, refurbishment, and disposal costs.

The assessment process should utilise WLC, where appropriate, to ensure the best value supplies are procured.

WLC is particularly applicable to high value procurements and can also be applied to low value procurements when competing procurement options have markedly differing cost structures or usage patterns.

WLC analysis may involve considerable time and effort and analysis needs to be commensurate with the value and risk of the procurement, so that the benefits outweigh the costs involved.

The four key steps in calculating the whole of life costs of a proposed procurement are to:

develop a plan

identify the cost elements

create a cost structure

discount the future costs.

There can be limitations or constraints to applying WLC. While it is relatively simple to establish the acquisition cost of a supply, it can be more difficult to estimate the operational and maintenance costs incurred during its life. Similarly, choosing the ‘correct’ discount rate can be equally contentious. Consideration is also to be given to likely cost increases that may occur over this period.

It is important that identified costs for each year of the cycle be matched to the budget provided before an option is chosen. In some cases, different options will have budgeting implications beyond the initial purchase price which need to be considered before a respondent is recommended for acceptance.

6.4.3 Clarifications during assessment

In circumstances where a statement or information provided in an offer is open to interpretation or is not readily understood, clarification should be obtained from the respondent. In doing so, the agency must frame the clarification in a manner that does not result in the respondent gaining an unfair advantage over other respondents.

Clarifications that introduce new material or substantially change an offer, beyond correcting an obvious typographical error, must be treated as a negotiation (refer section 6.5).

Obvious typographical errors that will impact on the outcome of the assessment must be clarified and can be corrected with the approval of the delegate. Examples of obvious typographical errors include, but are not limited to:



incorrect placement of a decimal point

failure to correctly multiple or add numbers.

Any discussion or contact with the respondent must be done with due regard to probity. This includes not providing information about the assessment process, any other respondent or their offer, or intentions as to the award of the contract.

In all cases, the decision to undertake a clarification must be defensible. Refer rule 21 of the procurement rules for further information.

6.4.4 Calculating value for Territory

Value for Territory is one of five procurement principles underpinning the NTG’s procurement framework. It is the overarching principle governing the procurement of supplies, and achieving best value for Territory is the expected outcome of a planned procurement process when all key requirements are considered.

The objectives of best value for Territory are:

rigorous assessment process which recognises enhancement of industry and business capabilities in the Northern Territory

selection of respondents based on predetermined assessment criteria which results in the best outcome for government and the Territory

achievement of broader government strategic outcomes, including enhancement of industry and business capability and competitiveness in the Northern Territory, through procurement while enhancing economic, social, and environmental outcomes.

This includes consideration of the respondent’s:

past performance

whole-of-life costs

contribution to the local community and economy

capacity to contribute to government’s broader strategic and policy outcomes

timeliness of delivery of supplies and the supply chain

capacity to deliver and related experience

innovative methods

any scope specific requirements.

Best value for Territory is not a separate criterion but the outcome of a comprehensively planned and appropriately conducted procurement process where all key requirements are considered.

Best value for Territory is not about selecting the successful respondent based on price alone, it means achieving the best return for government and the Territory. The percentage weightings applied to each assessment criterion form the basis for determining the best value for Territory.

The final agreed scores will need to be entered into a spreadsheet to determine overall scores. The recommended scoring spreadsheet is provided at S7: Value for Territory scoring spreadsheet.



The rankings achieved can be used to inform decisions to shortlist or undertake referee checks, interviews, site visits etc. For example, the panel may choose to only undertake referee checks or site visits for top-ranked offers or those who achieve a minimum score.

6.4.5 Shortlisting

It may be appropriate to use a shortlisting process during the assessment of offers. This occurs after initial scoring has been completed. Under the procurement rules shortlisting cannot be based on price alone.

A shortlisting process tends to be employed for multi-stage procurement processes. In stage one, respondents demonstrate compliance with assessment criteria based on elements such as experience, qualifications, financials, managerial capacity, and competence. In the second stage, respondents who have been shortlisted are invited to respond to a detailed request for offer against assessment criteria based on elements such as specific technical requirements, timeliness and price.

The agency should clearly specify that a shortlisting process will be used in the request for offer documentation and outline in the assessment plan how this will be managed (ie what will be assessed for shortlisting?), and the cut-off for shortlisting (ie what score must a respondent achieve to be shortlisted and is there a limit to how many respondents will be shortlisted?).

6.4.6 Interviews, presentations and other checks

The assessment panel may elect to undertake their own investigations and include information from a variety of sources. These sources may include interviews with respondents, site visits, presentations, demonstrations, product tests or other research. The aim of this process should be to better understand the respondent’s proposal and test the respondent’s claims.

Interviews and presentations with respondents can be used to gain a better understanding of the claims and proposals made in a respondent’s response. It is never an opportunity for respondents to amend an existing offer, submit a replacement offer or adjust prices.

Interviews and presentations can be difficult to manage as they are conducted in person and this reduces the ability to control the flow of information between the parties so it is important that the panel is adequately prepared.

Before conducting an interview or presentation, the chairperson should:

adequately prepare by considering probity risks and establishing a uniform agenda and approach for the interviewing team

officially invite, manage, record and disseminate interview outcomes in writing

a. it is recommended that this includes a written acknowledgement by the respondent to abide by the established rules for the interview or presentation

ensure the panel does not seek additional information unrelated to the response and that they continue to aim at obtaining a better understanding of the existing offer

ensure unrelated information provided by the respondent is not considered in the assessment

ensure that all respondents are afforded the same opportunity during interviews.

The decision to proceed to an interview or presentation, particularly if not with all respondents, should be clearly documented and approved by the appropriate delegate as part of the assessment process.



6.4.7 Due diligence

A well written offer is no guarantee that the respondent will deliver the supplies after being awarded the contract. In line with the NTPS code of conduct and the procurement rules it is the responsibility of the assessment panel to scrutinise the respondent’s claims to ensure that the evidence on which recommendations are based is:

Frank, independent, based on an accurate representation of the facts and … as comprehensive as possible. This includes setting out the advantages, disadvantages, costs, and consequences of the available options.

Undertaking a due diligence process, appropriate to the value and risk of the supply, is how assessment panels test the respondent’s claims in order to produce a recommendation which meets these requirements.

Furthermore, the duty of care for ensuring the accuracy of the recommendation and the information on which procurement decisions are based extends beyond the assessment panel to all those involved in the assessment and authorisation process. This includes procurement officers assisting with procurement activities, supplementary panellists, delegated officers and members of the Procurement Review Board.

6.4.7.1 Financial and legal capacity

The object of seeking financial information is to determine if respondents have sufficient financial capacity to fulfil the requirements of the supply. While financial statements are generally sought for projects greater than $5 million, the type and extent of information sought from respondents should match the value and risk associated with the supply. For example, it would be a suitable step to undertake for a strategic contract (high risk, high value). Agencies should ensure only suitably qualified personnel undertake the financial and legal due diligence of a respondent’s offer.

While some preliminary checks are undertaken by CAPS on behalf of agencies in the pre-scoring review (ie business checks with ASIC), agencies are expected to undertake their own analysis of the financial and business information provided within the offer and make the final determination of the respondents financial and legal capacity.

Even CAL accredited respondents may require additional agency analysis and verification of the respondent’s current financial and legal status due to the time lapse between accreditation and submission of an offer.

6.4.7.2 Past performance reports

Reviewing past performance reports is a valuable method of assessing the past performance, in instances where the respondent has previously contracted with the NTG. When reviewing past performance reports, the chairperson should consider:

how the performance report relates to the current project, ie is it of a similar nature, scope and size

whether the performance results are able to be rationalised consistently with the assessment criteria

analysis of contents of reports other than scores (particularly opinions) to avoid directly quoting within the scoring justification sheets (panel members need to arrive at a justification independently)

consistent application process for performance reports across for all respondents

use of performance reports for scoring justification is acknowledged



providing the respondent a right of reply (ie natural justice) if a negative performance report is obtained.

At a minimum, performance reviews must have:

been fully and accurately completed by the contract manager, project manager or delegated officer who has sufficient knowledge of the performance of the contract and the respondents fulfilment of that contract

include evidence that there is no conflict of interest or bias in completion of the report and that a fair and impartial approach was adopted

be based on and specifically relate to the respondents fulfilment of the contract as proposed or varied and not lay blame on the contractor for faults or weaknesses caused by the agency or acts of god/nature or the indirect actions of others that could not otherwise be avoided

provided the respondent every opportunity to comment and respond to the contents of the report, particularly if it contained negative information

been reviewed and approved by the appropriate party as reported within the governance structure.

If a performance report or performance review activity is known to have been poorly conducted or completed, or did not consider the principles of natural justice and does not meet the minimum requirements above, the performance report must not be used for assessment purposes.

6.4.7.3 Referee checks

The nomination of referees is crucial for assessment, particularly where they are limited alternative sources of information in respect to the assessment of past performance criteria.

The performance of due diligence is fundamental to the proper assessment of past performance information. The NTPS code of conduct directs persons to take all reasonable steps to ensure the information upon which they base their decisions is correct and relevant.

As respondents are less likely to nominate referees with whom they’ve had disputes or performance issues, panels may, where appropriate, seek out the views of other persons with whom the respondent has contracted, rather than accept only the respondent’s nominated referees.

Assessment panels should use referee information to check that the content or claims made in submissions is true and correct. Assessment panel members must exercise their own judgement to determine the level of scrutiny needed to assure themselves that they have an accurate understanding of the respondent’s previous performance and how much relevance and influence the views of other parties have within the selection process. The reasons for this are:

referees may not be impartial, objective or fair in their delivery of information to the panel

it is highly unlikely the panel can manage or control the objectiveness, impartiality or fairness of referee reports.

If a referee contradicts the respondent’s claims, the panel should seek to qualify the claims through a third-party source and raise the inconsistency with the respondent, preferably in writing. The respondent must be given the opportunity to a fair hearing and the decision and scoring against the relevant criteria, deferred until the issue is finalised.

Where no response is received from the respondent or the respondent admits that their claims were false or misleading, the panel should score accordingly.



Where the respondent responds with evidence and the referee also provides evidence, the nature and extent of the referee negation should be assessed with respect to risks to the project. Where the risk result is not acceptable, panel members should score accordingly. Panel members need to be mindful that they can only alter or score where an evidenced negation or risk relates directly to assessment criteria. Justification of the risk assessment must be included within the recommendation report.

It is advisable to seek legal opinion if it appears there is a civil dispute between the respondent and the referee. Where legal advice indicates the preclusion of the referee negation, scoring should not be altered.

If it is discovered that a referee is a panel member (this should be identified in the pre-scoring review), the conflict of interest must be assessed by the chairperson and an appropriate mitigation strategy adopted.

6.5 NegotiationsAs part of the assessment, there may be occasions where it is appropriate to negotiate with one or more respondents. This is generally identified after initial scoring, shortlisting, referee checks, interviews etc.

Negotiation should only be considered in exceptional circumstances such as where the sourcing process has not resulted in effective competition, where a respondent seeks to introduce additional information during the clarification process or the scope of requirement has changed. Negotiation should only be carried out with respondents whose offer has been assessed as competitive and providing value for Territory.

Under the procurement rules, negotiations on price are permitted only with the approval of the agency accountable officer. Non-price negotiations may be approved by a delegate in accordance with the agency procurement delegations.

All requests to the agency accountable officer or delegate to enter negotiations with a respondent must clearly outline the reasons why so that the agency accountable officer or delegate is fully informed. This should include how the panel arrived at the decision to not negotiate with all respondents, if that’s the case. Any negotiation with respondents during the assessment process must be done with due regard to probity.

Where an agency is considering negotiations with one or more respondents, consideration must give to the potential to place respondents excluded from negotiations at a disadvantage. Where it is considered that one or more respondents will be disadvantaged, then negotiations should involve all respondents.

Approval to negotiate is generally captured in a procurement assessment recommendation. A template for this is provided at S8: Procurement assessment recommendation.

6.5.1 Negotiation plan

Effective preparation is a key aspect of negotiation. This preparation should include research about the company you are negotiating with and will include factors such as their market share and penetration, financial health and stability, corporate structure and goals etc.

The strategic approach to negotiations varies from procurement to procurement dependent on the style of contract and the assessment methodology. The chairperson should develop a negotiation plan, which considers:

establishing the negotiating team

identify key areas for negotiation



analysing the parties and the deal

deciding on a strategy and tactics

ensuring the other party understands the rules – stick to the topics – don’t allow them to introduce marketing material – tell them clearly what they can and cannot do, and if they continue to diverge, tell them they risk being set aside

negotiating and recording

reflecting all the negotiated points in the contract.

It is important to ensure that all relevant approvals and endorsements for the negotiation plan have been adequately identified and recorded to ensure appropriate steps are followed throughout the negotiation phase. It is recommended that the negotiation plan is attached to the procurement assessment recommendation paper.

A template negotiation plan is provided at S9: Negotiation plan.

6.5.1.1 Negotiation team

A negotiation team will be formed to facilitate an effective negotiation process. It is important to consider the mix of skills and experience required by team members, such as facilitation skills, negotiation experience, subject matter/technical expertise, financial analysis skills and legal support. Subsequently, agreement must be reached on the roles each individual team member will assume, particularly who will be responsible for leading the negotiations and facilitating discussion, and who will track concessions and points of agreement. Most importantly, it is essential to check that the team has the authority to negotiate and agree to all of the contractual terms.

6.5.1.2 Key areas for negotiation

When planning for the negotiation process it is helpful to fully understand and establish what the key areas for negotiation will be. The negotiation team should consider:

Key concerns: including overall goals, key issues and pressures, type of relationship sought, timeframes that need to be met.

Respondent views: how does the respondent view the agency and the potential deal, what is the respondents position in the market, what are its needs, goals and pressures, what concessions can it make, and who are the key decision makers.

Variables under negotiation: what are the variables in the negotiation, what is the value and relative importance of each variable to both parties, what would a good or ideal outcome look like, identify any deal breakers, what is a compromise outcome, what is a fall-back position.

Identify zone of Agreement: list everything you could do if you don’t reach agreement, explore each of your options and try to improve on them, choose your best option.

6.5.2 Undertaking the negotiation

Once relevant approval has been gained, it is then appropriate to begin the negotiations. The chairperson will issue an invitation to negotiate to the affected respondent(s). This may also be managed by the agency procurement services team.

Initiation of negotiations does not necessarily mean that a contract will be awarded and the possibility of re-opening the competition should be retained. The chairperson should make it clear to each respondent that a successful negotiation does not necessarily mean that they will be awarded the contract. This is particularly important when negotiating with more than one party.



The letter inviting the respondent to enter into negotiations should be on official letterhead and include:

an invitation to negotiate

dates, project references and locations

the addressee, being the persons nominated in the submission

parties present at the negotiation

reasons for negotiation and issues to be discussed, to avoid any “ambush”

a request to accept the invitation and explain how the invitation can be accepted

contact details for queries

signature of panel chairperson, delegate or procurement services team member.

Prior to undertaking negotiations, the negotiation team should ensure the following:

establish a framework for conducting the meetings

align the capability and authority of the negotiation personnel with the complexity of the procurement

undertake processes for engaging stakeholders to obtain input and advice as negotiations progress

query expectations of the respondents ensure all appropriate questions are asked

assess the respondent’s positions and exchange options

consider the position on the scope and scale of offers and concessions that will be considered

ensure the process is conducted in a consistent manner and record in writing the agreement and confirm with both parties.

There are many styles and approaches to negotiation and some of the most popular styles are highlighted in the following table:

Approach AttributesAcceptance negotiator does not engage in constructive discussion but just accepts

the status quo

style is generally regarded as “weak” but it can be a useful tactic when a compromise can be used as a bargaining tool

Bargaining requires that both negotiating parties have something on offer worth exchanging

extracts value through the exchange of variables

Compromise middle ground is sought between the stance you take and the stance of the other party

prior to negotiations it is always advisable to identify the areas where you will and will not consider compromise so that you are clear where you can consider compromise



Approach AttributesLogic utilised frequently within business negotiations to persuade the other

party of the logic of their position

each party will prepare evidence in support of their argument in the hope that the other party will be persuaded to change their position

Emotion ability to identify the emotions of the main participants

influenced by the relationship (especially if there is an existing one) and/or the experience of the people involved

emotions can have both positive and negative effects and it is important to be able to separate the substantive and relational issues as these will produce different emotions

The balance of power in negotiations is always very important as it is rarely equal between the parties. Each party must be aware of their own bargaining position and what they want to achieve in the negotiation. Short-term wins are often gained at the expense of the relationship and so must be used with care if the relationship is business critical.

Equally, different negotiating styles will be used in different market scenarios. Where there is healthy competition and multiple respondents, the buyer can drive a hard bargain. If there is little competition and just a few respondents, the negotiating approach will be very different especially if the product and/or service is critical to the buying organisation.

Considering the agency position, in terms of the interrelationship between the concern for the relationship and concern for the issues is critical in the negotiation process. As outlined in the following graphic, the ideal negotiation process will seek a collaborative process, whereby parties are concerned for the relationship and issues to be resolved, resulting in a ‘win/win’ scenario.

7 Select and awardThe focus of this step is on selecting and awarding a contract to one or more respondent(s). The core purpose of this step is outlined in the following table:



Purpose of select and award

Why is select and award important?

enables a fair and equitable process

to ensure appropriate advice is sought where required, particularly on complex or technical procurements

What are the risks if the select and award is not performed effectively?

contractual risk, arising from inadequate contractual arrangements

reputational risk due to poor management of probity, conflict of interest etc

failure to achieve procurement outcome due to selection of inappropriate respondent

sub-optimal outcome due to poor management of negotiations

7.1 Identify preferred respondent(s)The assessment panel assesses responses in a structured, disciplined and transparent manner to validate and select the preferred respondent(s). Assessment is to be based on responses to the weighted assessment criteria questions contained in the response schedules.

The offer selected as the most preferred option following the initial assessment received may or may not become the recommended offer depending on the outcome of any subsequent review, negotiation and approval processes.

At the end of the assessment, offers must be ranked from highest to lowest (based on total scores) and the highest ranked offer must become the offer accepted unless otherwise approved by the accountable officer.

7.1.1 Declining all offers

In some circumstances, it may be necessary to decline all offers. This may include no respondent being able to meet the requirements or the supplies no longer being required (ie change in government policy or priorities). Lack of budget capacity alone should not be used as a reason for declining all offers as agencies should have undertaken appropriate planning to identify the likely cost of the supplies.

The decision to decline all offers should not be taken lightly as respondents have often spent a considerable amount of time preparing their offer. Agencies should first consider other options, including negotiation to reach an acceptable outcome.

7.2 Prepare assessment recommendationAgencies must maintain appropriate documentation for the recording of the decision-making process for procurements as part of the standard procurement procedures.

Ultimately, the chairperson is responsible for the management of assessment information including how decisions were arrived at. Therefore, it is good practice for the assessment panel to be scrupulous in recording the assessment process and the reasons underlying its decisions (as indicated earlier).

At a minimum, the chairperson should ensure that:

there is sufficient documentation to provide an understanding of why the procurement was necessary



there is sufficient documentation to explain the process that was followed and all relevant decisions made, including authorisations and the basis of those decisions

information accurately reflects the process and scoring results

process and decisions can be substantiated and defended and withstand third party review.

A template for recording assessment recommendations, and obtaining approvals, is provided at S8: Procurement assessment recommendation.

7.3 Finalise contractual terms and conditionsBefore awarding the contract, it is important to finalise the agreed conditions of contract. The final conditions may be the governments, the respondents, or a mix of both. The conditions should be relevant to the objectives discussed in the negotiation process and relate to price, intent, scope, potential issues, and risk factors.

When finalising a contract, it is important to include the follow:

details of price, payment terms and delivery schedules

intent of the good or service

scope of the good or service

details of the respondent and the agency

details of transition and implementation.

7.4 Contract awardOnce approval has been obtained a contract is awarded by issue of a notification of acceptance letter (or email or purchase order for the tiers 1 and 2). This notice must be consistent with the proposed contract details identified in the assessment and recommendation report.

Alternatively, a specially prepared contract document (ie a formal instrument of agreement) could be used when the conditions of offer require this kind of formal execution. In these circumstances, a conditional notice of acceptance may be issued. This will confirm acceptance of the offer subject to the execution of the contract.

There may also be additional negotiated terms and conditions and clarifications that form part of the contract. The elements that make up the contract will be referenced by the notice of acceptance, email or purchase order or included in the final agreement.

The officer issuing the notice of acceptance, or the contract manager, should seek satisfactory proof that the contractor has received it. The contract does not come into effect until the contractor is notified.

For tiers 1 and 2, the agency is responsible for contract award. For tiers 3 to 5, this is undertaken by CAPS. All unsuccessful respondents (excluding those deemed inadmissible) must be notified of the outcome and invited to ask for a debriefing (see section 7.6).

During a procurement activity, it’s important to be transparent about when decisions are made and which respondent has been awarded the contract. This is consistent with open government and accountability for the use of taxpayer funding. It also provides market information for all potential respondents, including potential sub-contractors and promotes competition and value for Territory.

The project offer, contract manager or procurement team should also ensure that period contracts are recorded in the agency period contract register to ensure that the expiry date can be monitored



for renewal at the appropriate time. It is important to ensure that the information entered, especially the expiry date, is correct.

7.5 Contract executionThis will be the final step in concluding the agreement with the respondent. Contract execution is the process of signing an agreed contract, after which its terms become binding on the parties to the contract. For most NTG contracts, this step is not required as the notice of acceptance and other documents outlined in the conditions of offer, will form the contract.

7.6 Debriefing respondents

7.6.1 Purpose of the debrief

Debriefs are an important step in the sourcing stage and can assist respondents with improving their chance of success in future procurement activities.

The aim is to provide:

reasons why the respondent was unsuccessful

how they were assessed against the assessment criteria

answers to questions or concerns, within certain limits

how future submissions can be improved.

Debriefs are not an opportunity for a respondent to appeal a decision that has been made and must instead focus on the points above. The debriefing can also be used as an opportunity to obtain feedback from the respondent on the quality of the request for offer documents, and the process undertaken. This feedback can be used to improve future procurement activities.

Agency staff must be consistent in their approach to conducting debriefs. It is recommended that debriefs are conducted face-to-face or over the phone as this can enable more meaningful discussion between both parties. However, if necessary, written debriefs can also be provided.

7.6.2 Preparing for the debrief

Respondents often invest substantial time and effort into preparing their offers and it is expected that agency staff will do the same when preparing for a debriefing.

When a respondent requests a debrief, it is recommended that the following details are confirmed:

how the debrief will be delivered (eg in person, over the phone or in writing)

when and where the debrief will occur or when a written response will be provided

who will be attending the debrief on the respondents behalf (name and position title)

if they have any specific questions or issues that they would like addressed.

It is important to gather all information relevant to respondent to enable the debriefing to achieve its aim. It is recommended that you:

review the tender and assessment materials to confirm the rationale for the decision made

summarise in writing how the offer was assessed (ie scores, strengths, weaknesses)

ensure that appropriate agency staff are available to attend the debrief.



For face-to-face and teleconference, it is recommended that at least two agency staff are in attendance, including at least one person from the assessment panel (generally the chairperson). A note taker should be assigned to capture the minutes of the meeting.

In the case where the debriefing is with a respondent who may be considered difficult, consideration should be given to requesting the presence of either a procurement or probity specialist, legal representative or an independent facilitator with arbitration experience.

Staff involved in the debriefing must ensure that discussions do not include:

any information regarding other offers received and how they were assessed (whether directly or indirectly)

o it is important to ensure that the commercial confidentiality of offers received is maintained at all times; breaching confidentiality may subject to disciplinary under the Public Sector Employment and Management Act and in some cases, criminal charges

how their offer was ranked

o scores can be provided but you should explain what the score means and instead focus the conversation on where they fell short and how they can improve next time

other prices received (excluding the total contract award price)

business consulting advice as this is not about advising them how to do business better

promises concerning future procurement opportunities.

A template to assist with capturing relevant information for the debriefing is provided at S10: Debriefing meeting preparation form.

7.6.3 Conducting the debrief

Where possible, all debriefs should be conducted within 10 days of the contract being awarded.

If during the debriefing a respondent asks a question that you are unable to answer (either because the information is not on hand or you’re unsure if you can), take it on notice and advise that a response will be provided in writing within one to two business days.

When conducting the meeting, the following order of events is recommended:

1. Welcome the respondent and thank them for their time.

2. Introduce the parties in the room and explain the role that each person played in the process (eg chairperson, delegate, procurement advisor).

3. Advise that the debriefing will focus solely on how their offer was assessed and that no information regarding any other submission can be discussed. You may also like to advise that this is not an opportunity to review the decision made but rather assist the respondent with improving future chances.

4. Offer to provide an overview of the procurement and assessment process undertaken (ie who was on the panel, offers are assessed in accordance with our framework, that the overall aim was to select the respondent who represented best value for Territory).

5. Provide an overview of how they performed against each assessment criteria, including strengths, weaknesses and how they can improve future offers.

6. Provide the respondent with an opportunity to ask questions about the procurement and assessment process and ensure that you address their concerns appropriately. This should also include an opportunity to provide feedback on the process undertaken.



7. Confirm that they are satisfied with the debriefing. If not, advise of avenues available to make further enquiries/complaints (ie to the agency, Procurement Liaison, the Buy Local Industry Advocate).

8. Close off the debriefing by confirming questions taken on notice, thank the respondent for their time and offer to provide a copy of the written minutes.

A recommended meeting agenda template is provided at S11: Debrief meeting agenda.

7.6.4 After the debrief

Following the debriefing, ensure that a written copy of the minutes is saved on file with all other records related to the procurement activity. Minutes must be made available to the respondent if requested and should detail any issues arising or anticipated complaints.

A template is provided at S12: Debrief minutes template.

If you anticipate a complaint in relation to the procurement or debrief, you should advise the relevant person in your agency (ie your manager, the agency’s chief procurement officer or procurement unit, secretariat if a minister may become involved).

7.7 Contract disclosureContract disclosure ensures high standards of probity and transparency. Where required, details of contracts awarded in relation to tier 2 and above supplies must be published online unless approved otherwise by the Minister responsible for procurement. Contract disclosure is managed by CAPS via the APRO system following the award of the contract.

Key details for disclosure include:

contract details

a. contract number

b. contract title

c. category of the supplies

d. process undertaken (ie public, select)

e. procuring agency

f. contract value.

respondents details:

a. name

b. city/suburb and state

c. if they are a Territory enterprise

d. award date.



8 Appendix A

Prefix and template name Location of reference in guide

S1: Communication plan 5.3 – Establish communication principles

S2: Assessment panel briefing agenda 6.1 – Assessment panel briefing

S3: Admissibility of offers 6.3.1 – Admissibility

S4: Addenda clarification email template 6.3.3 – Acknowledgement of addenda

S5: Procurement assessment checklist 6.4 – Assessment of offers

S6: Procurement assessment scoring scale 6.4.1 – Scoring

S7: Value for Territory scoring spreadsheet 6.4.4 – Calculating value for Territory

S8: Procurement assessment recommendation 6.5 – Negotiations and 7.2 – Prepare assessment recommendation

S9: Negotiation plan 6.5.1 – Negotiation plan

S10: Debrief meeting preparation form 7.6.2 – Preparing for the debrief

S11: Debrief meeting agenda 7.6.3 – Conducting the debrief

S12: Debrief minutes template 7.6.4 – After the debrief

DEPARTMENT OF TRADE, BUSINESS AND INNOVATION of 3729 September 2017, Version 0.5

a guide to procurement sourcing - nt.gov.au€¦ · web view... and factsheets supporting this...

Documents