Where a prequalified contractor is engaged, a Prequalified Contractor Performance Report must be completed for every contract valued at $250 000 or more. The report must be prepared when the contract is completed OR when it is terminated due to unsatisfactory performance.
While the above requirements are a minimum, it is recommended that agencies prepare progressive performance reports during the contract term as a means of documenting performance for either internal own use or as justification for termination if issues identified are not able to be resolved.
Responsibility for completion of performance reports should be assigned to the person best able to make factual assessments against the evaluation criteria. For most contracts this is the Superintendent.
The reporting person (and the reviewing officer) should ensure that comments are not untruthful, malicious or defamatory. In particular, comments should commence with "in my opinion ...".
Information on how to prepare a contractor performance report in relation to contractors prequalified with the Treasury Prequalification System together with information on appropriate clauses to include in tender documentation is set out below.
Information on completion of performance reports on contractors prequalified under the National Prequalification System for Non-residential Building is available here.
Copies of reports must be forwarded to the Manager, Contracts, Procurement and Property Branch (contact details below).
Documentation of poor performance
When an agency first becomes aware of poor performance by a prequalified contractor, the allocated responsible officer should meet with the contractor to outline shortcomings in the construction of the works and state areas of concern, eg lack of supervision, unsatisfactory rate of progress. The agency should seek from the contractor the means by which the contractor intends to resolve the problem and by what date. The agency should remind the contractor that the Department of Treasury and Finance has a contractor reporting system that is used to provide data which may result in the contractor's future tenders being passed over, or the contractor's prequalification registration being downgraded and that a report will need to be completed at the termination or conclusion of the contract. Should the contractor's performance fail to improve in a reasonable time, the agency should prepare a report that details any issues or concerns.
The contractor should to be given the opportunity to comment on the issues and concerns and rectification should be discussed. The report does not need to be forwarded to Treasury at this stage but is useful as documentary evidence of the issues should unsatisfactory performance not improve.
Completion or termination of contract
When a contract valued at $250 000 or more is completed or terminated, a Prequalified Contractor Performance Report is to be prepared by the agency. A pro forma Contractor Performance Report is available for use.
Where Selected, Nominated or Designated subcontracts are included in the contract, separate reports are to be attached to each main contract report. After an assessment has been made in accordance with the performance criteria, the overall performance should be influenced by assessment of whether the contractor demonstrated a planned and committed approach to achieving the cost, time and quality performance requirements defined in the contract.
The report on each completed contract will be the main source of data for evaluation of the performance of a contractor. Assessment of overall performance should reflect the contractor's performance against the criteria outlined below and in the context of the project as a whole. This can be achieved either by an overall objective assessment by the person making the report or by an agency using the rating system detailed below.
When performance has been unsatisfactory, the report must be accompanied by concise backup evidence and all relevant details of the unsatisfactory performance. This material should include:
- minutes of any relevant meeting with the contractor where the adverse performance was discussed;
- any written response by the contractor to the adverse assessment;
- outcome of any agency review of the contractor's performance; and
- status of any review being undertaken.
The contractor must be given the opportunity to comment on the report, and the contractor's comments (if any) should be appended to the report.
The report is then to be reviewed by another agency officer (usually the Principal's Representative).
The completed report is to be sent to:
- the Manager, Contracts, Procurement and Property Branch, Department of Treasury and Finance; and
- to the contractor.
The completed report should be forwarded within a reasonable time period after the completion of the contract.
Standard Performance Criteria and Evaluation
In assessing a contractor's performance an agency must look at the performance in the context of the project as a whole, including the respective roles and obligations of the Principal and contractor under the contract. Evaluation against performance criteria must be a measure of the contractor's performance of the contract, after taking into account matters beyond the contractor's control ie if certain matters impact upon the satisfactory completion of a project but are outside the contractor's control, eg poor documentation supplied by the Principal; or the result of some action by the Principal which under the terms of the contract give rise to a Principal-caused delay, then these matters should be taken into account by the agency.
The standard performance criteria are:
- time management;
- standard of work;
- quality assurance;
- management of site personnel;
- coordination of sub-contractors;
- contract administration;
- occupational health and safety; and
Thereafter, the agency should make a determination on whether the contractor should be recommended as suitable for further work.
On major contracts the contractor's detailed construction program will form the basis for assessing the contractor's ability to manage time. On smaller contracts, the nominated commencement and completion dates may be adequate as the basis for assessment. The following matters should be considered when assessing the performance of a contractor:
- ability to meet programmed milestones;
- progress of the work;
- inclement weather;
- industrial conditions affecting the work;
- latent conditions; and
- delays caused by public authorities but not by the Principal.
Standard of Work
Standard of work will generally be measured against the requirements of the specification. In addition, the following matters should be considered:
- remedial work required, if any;
- conformance with specified performance criteria;
- compliance with specified tolerances and finishes; and
- performance during the defects liability period, if applicable.
Quality assurance should be measured by the extent of the contractor's compliance with the specified quality systems standards and with the project quality plan. The assessment should also include:
- the number of major or minor non-compliances discovered during a Principal's audit; and
- the number of recurring major or minor non-conformance reports issued by a contractor and the effectiveness of corrective action taken by the contractor.
Management of Site Personnel
The evaluation under this criterion should include:
- the adequacy of the number of site personnel engaged by the contractor, in terms of efficient use of resources for the work;
- the control of site personnel;
- payment of wages on time;
- observance of site rules and procedures, and suitability of staff, ie compliance with the requirements set out in the Code of Practice, including management, administrative, scientific or industry skills, and overall experience relevant to the tasks undertaken;
Co-ordination of Sub-contractors, consultants and suppliers
Under this criterion, evaluation includes:
- contractor's ability to manage both off-site and on-site subcontractors, consultants and suppliers;
- ensuring full compliance with legal and contractual obligations;
- ensuring timely delivery of goods and material; and
- ensuring timely payment of subcontractors.
Under this criterion, evaluation includes:
- compliance with the Code of Practice requirements concerning the forms of contract (AS 2124-1992, AS 2545-1993, or AS 4902-2000 and AS 4905-2002);
- timely requests for information;
- the provision of information such as drawings, reports or other documents;
- timely submission of claims for payment, variation claims, etc., including the adequacy of supporting evidence;
- proportion of claims approved for extensions of time; and
- number of claims submitted and proportion of variation orders approved (including value).
Occupational Health & Safety
The contractor's compliance with the Work Health and Safety Act 2012 and other related Acts:
- compliance with safety issues specifically nominated in the contract and/or the contractor's OHS&R Management System for the contract; and
- the number of infringement notices issued to the contractor.
Performance criteria may be added to meet an agency's specific requirements or any specific performance requirements set out in the contract. Performance against these criteria will be assessed in accordance with the evaluation process above.
Suitability for Further Work
The reporting officer and the reviewing officer, after taking into account the above, shall determine the contractor's suitability for further work.
Exchange of Information
A report prepared in accordance with the procedures specified above will be available to Tasmanian Government agencies. The information should be treated confidentially. Inquirers seeking the information should have reasonable grounds for doing so, and should only use the information for a proper purpose. For further information on accessing reports, contact the Manager, Contracts, Procurement and Property Branch (contact details below).
Contractor Report Rating System
Contractor performance rating should be allocated points against the performance criteria (eg time management, standard of service etc), based on the rating scale below:
Performance Rating Formula
The reporting person shall determine the performance rating using the formula:
A = contractor's point score x 100
total maximum points
This gives a percentage assessment "A".
The contractor's point score is the total of the points scored against the performance criteria.
The total maximum points may vary from report to report, depending on the number of performance criteria the contractor is graded against.
Contractor's Overall Performance
The assessment percentage should then be graded in accordance with the following:
Clauses for Inclusion in Tender Documents
Tenderers should be advised that during the course of a contract, a prequalified contractor's performance will be monitored and that performance reports will be made available to persons in other agencies and/or jurisdictions as appropriate.
Relevant clauses are contained in the pro forma Request for Tender (building and construction version) that is generally required to be used for Major Works contracts (refer Treasurer's Instruction 1207).
For tender documentation where the pro forma is not used, the Crown Solicitor should be consulted to ensure that appropriate clauses are included in the tender documentation. Guidance information on relevant inclusions in tender documentation is located in the Guide to Inclusions in Building and Construction Tender Documentation.