"Works" relates to the construction component of a construction project. It includes maintenance works but excludes consultancies. All building and construction/roads and bridges works valued at $250 000 and over are treated, and known, as "Major Works". Procurement of all building and construction/roads and bridges works valued at less than $250 000 is considered to be "Minor Works".
At a high level and in summary, the following processes apply:
open tenders must be called for Major Works, unless approval for direct/limited submissions sourcing has been granted (refer Treasurer's Instruction 1207 and Purchasing Overview
the Buy Local Policy
(Treasurer's Instruction 1225) applies to all major works procurement - this means:
a pre-procurement local impact assessment must be completed and approved before the procurement may commence;
disaggregation of significant procurement opportunities must occur unless an exemption is approved by your Head of Agency;
a Local Benefits Test must be applied to all procurements with a value of $50 000 or more; and
where the procurement is valued at more than $5 million, a Tasmanian Industry Participation Plan is to be approved prior to a contract being finalised or sub-contracting occurring;
where the procurement is valued at more than $5 million for all consultancies, $10 million for building and construction, or more than $15 million for roads and bridges, you must prepare a pre-procurement industry consultation report (unless covered by a class exemption) and have the report approved prior to the commencement of the procurement (Treasurer's Instruction 1218);
where an appropriate prequalification category exists, prequalified suppliers must be engaged (Treasurer's Instructions 1207 and 1215);
the procurement process for all procurements valued at $100 000 and over must be reviewed by your agency's Procurement Review Committee prior to a contract being awarded or negotiations being entered into with the preferred supplier (Treasurer's Instruction 1218);
the preferred supplier for all building and construction/roads and bridges works valued at $250 000 and over must:
A Project Manager checklist is available to assist step you through the procurement and contract stages.
Note: where a free trade agreement applies, requirements in addition to those set out in the Treasurer's Instructions may be applicable. The International Procurement Obligations publication (refer Resource Centre) provides information on the additional free trade agreement requirements.
Prior to advertising or issuing procurement documentation, you should ensure that:
- a pre-procurement local impact assessment has been undertaken and approved (Treasurer's Instruction 1225);
- where applicable, a pre-procurement industry consultation report has been approved (Treasurer's Instruction 1218);
- appropriate documentation is being used (refer here);
- suppliers have been provided with at least one electronic option for the lodging of their submission (Treasurer's Instruction 1207);
- minimum tendering opening periods will be complied with (Treasurer's Instruction 1209);
- for projects valued over $5 million, approval has been sought from the Parliamentary Standing Committee on Public Works;
- you have possession of the site and that all relevant Local Government planning and State and Federal legislative requirements have been satisfied;
- where the site is not owned by the Crown, the building owner's consent has been sought;
- you have established whether the project site is in the Tasmanian Heritage Register and if so, that the requirements of the Historical Cultural Heritage Act 1995 are met;
- you have checked the accuracy and completeness of tender documents prior to advertising; and
- sufficient complete sets of tender documentation (specifications, drawings, Bills of Quantities etc) are available for distribution, if you are not distributing documents electronically.
The General Conditions of Contract in the Crown Solicitor's pro forma RFT documentation (clause 27.1 of AS 2124-1992) require the Principal to nominate the date on which the contractor will be given possession of the site or sufficient of the site to enable the contractor to commence work. For most contracts, the contractor should be given possession on the date of the Formal Instrument of Agreement. Details of possession of the site are to be provided in the Annexure to the General Conditions of Contract.
Before submissions are sought, you must ensure that adequate arrangements have been made and proper programming occurs for any preliminary work necessary to permit the successful tenderer's immediate access to the site, or sufficient access to the site, by the date stated in the Annexure.
Application of Tendering Code and the National Code of Practice for the Construction Industry (TI 1201)
The Australian Standard Code of Tendering AS 4120-1994, which sets out the ethics and the obligations of the Principal and tenderers, applies to all building and construction (including roads and bridges) procurement valued at $10 000 or more.
As well as ensuring you comply with the requirements yourself, must also ensure that all tenderers comply with the National Code of Practice for the Construction Industry, 1997 edition, and the Tasmanian Annexure to the National Code of Practice for the Construction Industry.
Further information on the Code of Tendering and the National Code of Practice is available from Treasurer's Instruction 1201 and from here.
Use of Prequalified Contractors (TI 1207 and 1215)
For all Major Works, you must ensure that:
where appropriate prequalification categories exist, contracts are awarded to contractors with the appropriate prequalification registration; and
where subcontractors are to be engaged by a contractor and the value of the work to be done by the subcontractor exceeds the Major Works thresholds for building construction or roads and bridges, the subcontractor also holds the appropriate prequalified registration, where an appropriate prequalification category exists.
Treasurer's Instruction 1207 notes that contractors must be prequalified by the closing date for the tender to enable their submission to be considered for evaluation given that prequalification is a condition for participation. As prequalification of contractors may take a number of weeks to finalise, agencies should factor this timeframe into their procurement plan where it is likely that contractors that are not prequalified are likely to submit tenders.
Information on prequalification is available at Prequalification.
National Prequalification System for Non-residential Building (the NPS) - additional requirements
Generally the same procurement requirements apply when engaging NPS prequalified contractors as for all other building construction major works projects. Some minor additional requirements apply and information on these is set out below:
When undertaking building construction procurement impacted by the NPS, you should ensure that the tender documentation includes clauses relevant to Tasmanian Government procurement policy requirements and relevant to the use of the NPS. Refer to the publication, Guide to Inclusions in Building and Construction Tender Documentation in the Resource Centre panel.
Compliance with the Building Act 2016
You should ensure that evidence of compliance with the registration requirements of the Building Act 2016 is sought and obtained from contractors at the tender stage.
Evidence of appropriate prequalification
Where the prequalification level is such that the National Prequalification System applies you should obtain from contractors, at the tendering stage, a copy of their NPS prequalification approval/certificate and/or a copy of their NPS Mutual Recognition certificate in Tasmania. Information on the currency of the certificates can be confirmed prior to evaluating tenders by contacting Treasury's Contracts Officer on (03) 6166 4220 or at email@example.com.
Electronic Options for the Lodging of Submissions
Treasurer's Instruction 1207 requires agencies to provide suppliers with at least one electronic option for the lodging of their submission. The method used is a matter for the agency to determine ensuring all requirements in relation to handling and confidentiality can be met. Electronic options may include, for example, the use of the Tenders website electronic lodgement functionality or a secure email or facsimile facility. Where email or facsimile is used:
the facility should be secure;
access to the submissions should be controllable to prevent compromising security of responses/ confidentiality; and
access should be auditable and/ or documented.
When the Tenders website has been used to advertise a procurement process, the Tenders website electronic lodgement functionality would generally be the preferable electronic option and is recommended, however this is a matter for the agency based on the procurement itself.
Secure facilities must be provided at each designated lodgement location for receipt of submissions. A "secure facility" could include a lockable box/cabinet, an electronic tender box such as the lodgement facility on the Tenders website, or secure email/facsimile facilities.
Where a physical tender box is used, the facility should be located in a conspicuous position in the office, where it is readily available to the public to lodge tenders. Every tender box should to be fixed in its position and locked with two different locks such that both locks must be opened or unlocked independently of each other before the box can be opened.
If an email address is to be used, then the facility should be secure; access to the submissions should be controllable to prevent compromising security of responses/ confidentiality and access should be auditable and/or documented.
If a facsimile machine is to be used then again, confidentiality of the tender should be able to be guaranteed. It should not be possible for anyone other than the tenderer to know the details of the offer before tenders are closed.
When a facsimile number is nominated as the destination for tender bids, the receiving machine should be dedicated to the task of receiving the tenders and be in a secure location. Access to this location should be controlled to avoid the security of tenders being compromised and access should be auditable and/ or documented.
Some facsimile machines have sophisticated security and confidentiality functions built in. These may be adequate for receiving tenders in confidence.
Where agencies expect a large number of tenders to be received by facsimile, a backup machine should be considered to accommodate the rush of faxes often encountered close to tender closing time.
It is advisable to check the times on any facsimile machine used to receive tenders close to the nominated closing time. Using the telephone recorded time for calibration will enable the time of receipt of any facsimile tender to be accurately determined.
Digital timers on facsimile machines can lose or gain considerable time, even over short periods. A formal procedure should be followed before each tender closing time.
Conditions for Participation and Evaluation Criteria
Conditions for participation are the minimum mandatory conditions that potential suppliers must meet in order for their submission to be considered. These requirements are assessed as either being 'met' or 'not met' by a supplier in the first stage of evaluation of their submission.
Conditions for participation include any prequalification or pre-registration requirements (eg prequalification as a contractor with the Treasury Prequalification Scheme or the National Prequalification System for Non-residential building).
Other examples of possible conditions for participation include:
- solvency and financial viability;
- mandatory insurance policies/levels;
- relevant licences; and
- professional accreditations or registrations.
Non-conformity with conditions for participation will eliminate a supplier from further consideration. Therefore it is important for you to carefully consider what, if any, conditions should be mandatory. The conditions for participation should be clearly marked as mandatory requirements and the RFT should clearly indicate that a failure to comply with the requirements will eliminate the supplier from further consideration.
Evaluation criteria are the standards that are used to assess how well an offer meets your agency's requirements. They provide a mechanism for comparing offers by assessing the relative worth of different offers.
Tender Period (TIs 1205 and 1209)
Each tender is to be allocated a specific closing time, date and place. This information is to be contained in the Tender documentation and in the Tender advertisement.
Minimum "open" time periods apply to major works tenders. For procurement that is not impacted by a free trade agreement, the Treasurer's Instruction 1209 requires that all major works tenders must be open for a minimum of 2 1/2 weeks (18 days) advertising time when the projects are valued at less than $1 million and 3 1/2 weeks (25 days) for projects valued at $1 million and over.
In addition, a tender:
- must not close earlier than 2.00pm;
- must not close on a Monday or a day immediately following a public holiday; and
- must close at least one week after the recognised industry Christmas close-down.
It is usual practice to close tenders on a Wednesday at 2.00pm where possible, after taking the above factors into account.
Tenderers intending to lodge a submission should be acquainted with all matters relating to the proposed contract, including an inspection of the site, prior to submitting their tender.
Extensions to Tender Periods
Once tenders have been called, the tender period should not normally be extended. As a general rule, a request by a single tenderer for an extension of the closing date would not be considered. However, if the number of tenderers is likely to be significantly reduced due to an insufficient tender period or due to the issue of addenda, consideration may be given to extending the tender closing date.
Consideration should be given to extending closing dates when there is insufficient time, eg at least 5 working days, to notify all prospective tenderers of the issue of addenda. Further information on issuing of addenda is below.
Extensions of time should only be approved by an officer authorised by the agency to approve extensions of a tender closing date.
Inviting Submissions (TIs 1207 and 1209)
Open tenders must be undertaken for all major works procurement (Treasurer's Instruction 1207) unless direct or limited submission sourcing has been approved.
In order for a tender to be classified as open it must, at minimum, be publicly advertised on the Tenders website. At your discretion and on a case by case basis, you may also choose to place advertisements for tenders in the tenders sections of local, interstate and overseas newspapers and/or journals.
Detailed information in relation to inviting submissions is contained in the sections below.
Each individual tender advertisement must include the information set out in Treasurer's Instruction 1212.
How to advertise in the print media
See How do I advertise tenders?
Direct Invitation to Tender
Copies of the Request for Tender (RFT) can also be sent direct to identified businesses at the time the tender is advertised.
Copies of the RFT must not be provided to any potential tenderer until after the tender has been advertised.
Where local capability exists, at least two tenders must be sought from Tasmanian businesses. A Tasmanian business is a business that operates in Tasmania, has a permanent office or presence in Tasmania and which employs Tasmanian workers.
Supply of Documentation
Details of suppliers issued with tender documentation must be recorded in an appropriate manner. This is especially important as it enables the identification of suppliers should addenda or amendment to the original documentation be required.
Meetings with Tenderers
Meetings to be held during the tender period between agency officers and prospective tenderers may be called for important contracts. The tender documentation must advise the details of such meetings.
A meeting of this kind should take the form of an introductory explanation, site inspection and formal meeting. Such meetings should make reference to the tender documents and must not be in conflict with or additional to them. The objective is to clarify any uncertainties that tenderers may have relating to the site or the documents. These meetings should not be held before the tender documents are released.
Parties not involved in the potential contract should not be permitted to attend. All parties at the meeting should be required provide name, organisation, and signature on an attendance sheet.
The meeting and site inspection must be conducted in such a way that no tenderer is disadvantaged against any other. The agency officer responsible for the meeting should describe the main features and critical aspects of the work and the contract. Relevant conditions and clauses of the contract should be referred to for special attention.
All meetings should be minuted. All questions from tenderers concerning clarification of any aspect of the site, works or documents are to be formally recorded (minuted) at the meeting and made known to all present, and are to be referred for confirming answers at the formal meeting held at the conclusion of the site inspection. Any questions should be answered by referring to a relevant specification clause or drawing. Only when clarification is necessary should any explanation be given. The minutes should be forwarded to all tenderers, and should become a part of the tender documents. Questions, which cannot be answered at the meeting, are to be taken on notice, and the questions and answers are to be given in writing to all tenderers, together with a full written record of the site inspection and meeting, at least one week before the closing of tenders. The distribution should include agency nominated subcontractors whether or not they were present at the site inspection or meeting.
All tenderers must be required to confirm in their tenders their agreement with these written records. Any alterations, deletions or additions to the tender documents found necessary as a result of the site inspection or meeting are to be advised separately by the issue of an addendum.
Issuing Addenda and Clarification of Tender Documentation (TI 1209)
Addenda to Tender Documents
Note: Where significant errors in documents are discovered just prior to the calling of tenders, it is preferable to delay the calling of tenders rather than issue the documents and then issue addenda.
You have an obligation to avoid unnecessary amendments to tender documents. However, addenda are to be issued when clarifications, alterations, additions or deletions are required to tender documents.
Where matters of significance make it necessary to amend tender documents during the tender period, the amendments shall be advised as an addendum forwarded to all tenderers to consider the addendum properly and fully before tenders close.
After tenders have been invited, amendments to the tender documents could include but need not be limited to:
- the correction of errors/conflicts in the documents that would/could affect interpretation;
- amendments to the extent and nature of the work (ie the specifications); and
- amendments to protect the Principal's interest in the subsequent administration of the contract.
Mandatory requirements in relation to the issuing of addenda are included in Treasurer's Instruction 1209 and include:
- one copy of every addendum to be included in the final contract documentation;
- one copy of every addendum to be included in each set of documents not yet issued;
- one copy of every addendum to be forwarded by email notification of an addendum placed on the Tenders website (where appropriate), fax or courier to each of the prospective suppliers that have previously obtained documents; and
- where the addendum results in a substantial change to the tender and is issued with less than five working days remaining to the tender closing date, an extension of the tender closing date is to be granted to all tenderers.
A 'substantial change' means a change which would require the tenderer to re-work their submission and/or pricing.
In a Design and Construct contract, where an addendum results in a substantial change to the tender and is issued with less than three to four weeks remaining to the tender closing date, an extension of the tender closing date should be granted to all tenderers.
Each addendum for a particular work is to be consecutively numbered and should precisely define and describe the alterations, additions or deletions required, with reference to the appropriate elements in the documents.
Where an addendum is to be issued for tender documents which includes a Schedule of Rates, the addendum should detail the necessary quantity or description changes. A supplementary Schedule of Rates may also be necessary.
Each addendum must state that the addendum will be incorporated in the tender documents and tenderers must be required to confirm receipt, in writing, of the addendum and that allowance has been made for each addendum. The receipt is to be included with the tender.
Clarification of Tender Documents
Tenderers may ask you to clarify anything in the tender documents that they find unclear however, you cannot give to any tenderer information that is also not promptly conveyed to all other tenderers.
You shall nominate a person (the Contact Officer) with knowledge of the work required, to respond to all inquiries from tenderers. The Contact Officer's name and telephone number should be inserted in the tender documents.
All inquiries should be recorded by the Contact Officer, noting time and date of receipt and the issue discussed.
It is important that all inquiries are directed through the Contact Officer. Any questions that are covered by the documents should be answered by reference to the relevant specification clause or drawing. Only when clarification is necessary should any explanation be given. Any explanation is to be promptly given by way of an addendum to all tenderers.
When an inquiry reveals a significant error, ambiguity or discrepancy, the information provided should be promptly conveyed, by addendum, to all tenderers.
Where briefing meetings are held for tenderers, meetings shall be minuted. The Minutes shall be forwarded to all tenderers, and become part of the tender documents.
Where tenderers reveal a unique approach to a particular matter, that approach is not to be revealed to other tenderers.
Receiving and Opening Tenders (TI 1209)
Treasurer's Instruction 1209 requires that fair and impartial procedures must be in place in relation to receiving and opening of all tenders.
In order for a tender to be considered, it must be in writing and received at the place and before the time and date shown in the tender documentation and in the tender advertisement.
Information provided by a supplier submitting a tender or quotation response is to be treated as confidential until the preferred supplier is selected and a contract is awarded.
After the awarding of a contract, information provided during the procurement process by each unsuccessful supplier is to continue to be treated as confidential. Information contained in any resultant contract is to be dealt with in accordance with the Confidentiality Policy.
Documents to be Lodged
The tender documents sometimes provide various schedules, which may need to be completed and submitted by the tenderer. Those schedules marked "Submit with Tender Form" must be submitted with the Tender Form by the closing time of the tender for the tender to be considered complete and formal.
The tender comprises the proper completion of the following:
- the Tender Form provided in the tender documents;
- any accompanying schedules, eg receipt of addendum; and
- the supply of all other information and documents eg construction program, which the tender documents require to be submitted with the tender.
If any tender schedules are not submitted, the tender will be deemed to be assessed as incomplete. See below.
When the tender documents allow alternative tenders to be submitted or when the tenderer proposes an alternative tender, the tenderer must:
- where the information submitted for the alternative tender(s) will differ from the conforming tender, submit the information called for in the Request for Tender (Conditions of Tender section); and
- each alternative tender must be clearly identified.
Where addenda have been issued, the tenderer must refer to each addendum that has been received and state that the tender allows for the instructions given in any addendum.
Each secure facility is not to be opened until the time set for the closing of tenders has elapsed.
When the time set for the closing of tenders has elapsed, it is recommended that each secure facility be opened in the presence of a minimum of three officers, including at least two senior officers of the agency. The contents of the secure facilities should be clearly identified and recorded.
When opening an electronic "tender box" such as the lodgement facility on the Tenders website, the steps set out in the Agency User Manual for the Tenders website should be followed.
The secretary of the Tender Evaluation Committee should prepare a tender schedule, for each job or project, listing all tenders received for that project and the cost of execution and completion of the works as estimated. The normal procedure is for the final cost estimate to be placed in the tender box by the consultant prior to the tender closing time.
Tenders should be listed in their opening order.
Each tender received should have an Evaluation Committee stamp imprinted at the foot or end of each tender form and on all other pages of the tender. A memorandum of the opening should be made and signed by the Evaluation Committee member(s) witnessing the opening and scheduling of tenders.
Members of the public should not be present at the opening of tenders. The only reason for allowing members of the public to be present at the opening of tenders is for confirmation that their tender has been received. This can be achieved by faxing written confirmation to each individual tenderer within minutes of the tenders being opened. The only information tenderers are entitled to receive is confirmation that their tender has been received.
In cases where a tenderer has submitted an alternative tender, that alternative is to be scheduled as a separate tender in addition to the conforming tender and the words "alternative tender" is to be added after the name of the tenderer concerned on the relevant entry on the Evaluation Committee schedule.
A late tender is one that has been submitted but the complete tender has not been received in the tender box in the tender closing location by the closing time for the tender.
Late tenders not impacted by the thresholds for building and construction under a free trade agreement are not to be considered for acceptance unless:
- circumstances beyond the tenderer's control were the cause of the lateness; and
- accepting a late tender will not compromise the integrity of the tendering process or provide any unfair advantage to the tenderer lodging the late tender.
In defining what constitutes "circumstances beyond the tenderer's control", the following factors should be considered.
Tenders, which are lodged in the tender box after the advertised close of tenders, will be considered for acceptance only if:
- they have been mailed through Australia Post and are postmarked no later than the day before the advertised closing date of tenders; or
- they have been facsimiled to the address of the tender box stated in the tender documents and the facsimile transmission was completed before the close of tenders.
Tenders sent by facsimile which are not fully transmitted to the address of the tender box stated in the tender documents by the close of tenders, even if transmission is delayed due to the receiving facsimile machine being engaged, faulty or otherwise inoperative, will not be considered for acceptance.
Where a tender is impacted by a free trade agreement (refer to Treasurer's Instruction 1202), an agency must not accept late tenders unless the delay is due solely to mishandling by the agency.
Where any late tender is received, the time and date of receipt shall be noted on the document and endorsed by the Tender Evaluation Committee secretary and member(s) witnessing the opening.
The same conditions are to apply to a late Expression of Interest as a late tender.
In all cases where the tenderer has withdrawn the tender, the submission for approval must comment on and note the reasons for that action and include a recommendation that the request to withdraw be accepted.
No advice is to be given as to the standing of any tenderer relative to other tenderers or estimated cost of the work.
Tenders should remain valid for a set period (refer to Withdrawal of Tender below).
Evaluating Tenders (TI 1210)
All tenders must be fairly and equitably evaluated in a manner that is consistent with the Government's procurement principles and in accordance with the evaluation criteria and methodology outlined in the request documentation. The final decision must be able to withstand public scrutiny (Treasurer's Instruction 1210)
An evaluation committee should be appointed for each procurement project for the purpose of reviewing and evaluating tenders received and making recommendations. As far as practicable, the committee should include the person(s) who prepared or was responsible for preparation of the tender documents and the person(s) who will administer the contract. Persons carrying out a tender evaluation should also be experienced in tender examination and should be experienced in the type of work under consideration.
The chairperson of the tender evaluation committee must ensure that tendered information is kept confidential In order to protect confidentiality, it is advisable to pass all papers dealing with tenders by hand or other secure means and those papers should be kept in a locked place outside working hours. No marks of any kind other than receipt stamps etc should be made on documents submitted by tenderers.
A technical review of all tenders should be undertaken even if it is a simple lump sum contract and a compliant tender within funding approvals.
A Tender Assessment Checklist can be used by agencies when assessing tenders. A checked-off and signed copy should be attached to the submission to the Procurement Review Committee.
Conformity of Tenders
All tenders received should be on the appropriate tender form or forms and are to be checked for correct signing by the tenderer. A tender should be from a legal entity.
Review of Schedules, Programs and Addenda
Where tenderers are required to submit various schedules with their tenders or when so requested by the Principal, a review of all these schedules must be carried out to ascertain whether or not they are in conformity with the tender documents.
Technical schedules or technical data submitted by tenderers may need to be reviewed to determine whether they are in accordance with the tender requirements.
Where a construction program is required to be submitted with the tender by the tender documents, it should be checked to ensure that it is in accordance with any constraints specified in the tender requirements, particularly that the Date for Practical Completion is no later than that required by the contract, and does not impose unreasonable time constraints on the Principal. Any questionable matters are to be clarified prior to tender acceptance.
Where addenda are issued, it is important to check that tenderers have lodged a signed acknowledge of the issued addenda and that this acknowledge states that the tender allows for all addenda issued for that tender.
Schedule of Rates
For tenders including a schedule of rates, all rates and extended amounts submitted by tenderers are to be checked. Where errors in extension calculations become evident, these are to be corrected and a revised total tendered amount calculated and shown. The revised total is to be used in the review of tenders and for the recommendation to accept a tender. The changing of tendered rates or prices, either by the tenderer or the agency is not to be permitted.
Alternative tenders are not to be considered unless they are allowed for in the Request for Tender documentation and there would clearly be an advantage to the agency. Where an alternative is offered by only one tenderer, prices are not to be sought from other tenderers on the basis of that alternative.
If tenderers are encouraged to offer alternative proposals, the documents must specify the conditions under which alternative proposals are to be submitted. If tenderers can offer an alternative proposal at a lower price or better value for money which satisfies the Principal's requirements, then this is clearly to the agency's advantage. Unless otherwise stated, alternative proposals should only be considered when submitted with a conforming tender.
Alternative Products and Services
Alternative products and services can be described as any product or service identified by graphic representation or by a proprietary item naming in the tender documents one or more of the following:
- trade name;
- brand name;
- catalogue; or
- reference number.
The identification of a product or a service as a proprietary item shall not necessarily imply exclusive preference for the item so identified but shall be deemed to indicate the required properties of the item, namely type, quality, appearance, finish, method of construction and performance.
Alternatives may be offered to equipment, plant and materials specified, except for those items for which it is specified that alternatives will not be considered.
When an alternative or substitute item of work or service is offered, the tender documentation should state that it shall be accompanied with the following information:
- itemised monetary amount;
- complete technical information;
- method of installation;
- any special features; and
- details of any modifications which would be required to the whole or part of the works due to the use of the alternative.
Qualifications Submitted by Tenderer
All tenders received are to be examined to ensure that they do not contain qualifications submitted by tenderers, which will affect all other tenders.
A differentiation must be made between a qualification to a tender and any alternative tender submitted by a tenderer.
Qualifications can take many forms, including technical, commercial, contractual, and may arise under the following conditions:
- pre-printed commercial conditions are printed on the tenderer's letterheads;
- the tender complies with the requirements of the tender documents and the items listed in the tender, by the tenderer, as not being allowed for in the tender amount are in fact not required and have been correctly assessed by the tenderer. These items can be accepted without further clarification;
- the tender does not fully, or partially, allow for work detailed in the documents and intended to be included in work under the contract;
- the information provided in any technical schedule shows that some particular aspects depart from the contractual requirements; and/or
- the tender varies commercial/contractual aspects of the documents.
Where a tender being considered contains a qualification to the provisions of the tender documents, the tenderer must be requested to comply with the requirements of the documents and withdraw the qualification(s).
The Government's position is that all qualifications must be withdrawn, by the tenderer, without amendment to the tender amount. Any tender, that does not comply with the tender documents, is to be rejected.
Omitted Information or Amended Information
Tenderers under consideration can be requested to submit any information they omitted from their tender. Some clarification is often necessary but the methodology by which further information is called for needs to be very carefully controlled. Any contact to be made with tenderers is to be restricted to seeking tender-related information only.
In the review of some tenders it may only be necessary to clarify a small number of minor points and this can be handled by phone discussions with subsequent written confirmation by the tenderer.
Where an agency provides potential suppliers with opportunities to correct unintentional errors of form between the opening of tenders and any decision, the agency must provide the same opportunity to all participating potential suppliers.
Evaluation of Tenders in Accordance with Tender Documentation
All tenders must be evaluated in accordance with the evaluation criteria and methodology outlined in the tender documents. Tender evaluation for major works will generally be in accordance with Treasury's Guidelines for Tender Evaluation Using Weighted Criteria or in the case of roads and bridges, in accordance with the Department of Infrastructure, Energy and Resources' Weighted Attribute Tender Assessment Process for Works.
The Government's policy is to accept the tender most favourable to the Government and the agency. That may not be the tender with the lowest tender amount. Matters such as corrections of errors, attribute assessments, removal of qualifications or departures, annual operating costs, maintenance costs, hours of work, may all impact on the net value to the Principal.
Tender Evaluation Using Weighted Criteria
The publication, Guidelines for Tender Evaluation Using Weighted Criteria has been developed to present a consistent and robust whole of Government approach for all Government major building works and services tenders that utilise the weighted criteria method for tender assessment.
Tender Compared to Estimate
Where the lowest conforming tender is 10% below or above the estimate, the estimate must be checked and confirmed, as caution needs to be exercised in making recommendations for the award of tenders, which are at a price which varies greatly from what was determined to be a fair market value. Fair market value is what the market wants to carry out a particular work.
Where the lowest conforming tender is ten per cent (10%) or more below the estimate, the following action must be taken:
- the tender estimate must be checked and reconciled with the tenderer's price and with that of other tenderers; and
- where, following a review of the estimate, the preferred tenderer's price is 10 per cent or more under the estimate, the tenderer is to be requested to confirm in writing that the nature and the value of the contract is fully understood, that the price properly reflects all the contractual obligations and that they remain satisfied that the tender price is correct.
Where the lowest conforming tender is ten per cent (10%) or more above the estimate, the following action must be taken:
- the tender estimate must be checked and reconciled with the tenderer's price and with that of other tenderers; and
- where, following a review of the estimate, the preferred tenderer's price is 10 per cent or more over the estimate, the agency must ensure that the preferred tender is registered within the required prequalification thresholds.
An agency may need to refer back to the quantity estimator when consideration variations have occurred.
Note: The tenderer should not be made aware of the agency's estimate or other tenderers prices.
Withdrawal of a Tender
Under Common Law a tenderer is always entitled to withdraw their tender. From an administrative point of view, an agency's interests are not served by tenderers withdrawing their tenders. Therefore it is usual that a provision is included in the Request for Tender documentation that tenders remain open for either 60 or 90 days from the closing time of the Request for Tender or for some other period as appropriate. A suitable clause is contained in Crown Solicitor's Request for Tender (Building and Construction version) pro forma document.
In cases where no such clause is contained in the Request for Tender, to constitute a valid revocation or withdrawal of a tender, there must be a clear and unequivocal statement that the offer has been withdrawn. The statement of withdrawal should be in writing from the tenderer.
If, during the tender evaluation a tender is withdrawn or revoked at any time prior to acceptance, then the tender evaluation must be recalculated with all scores and calculations attributed to the withdrawn tender removed.
Variations in Tender Price After Tender Closing
The total value of the tender recommended for acceptance can vary from that submitted through the tender box for various reasons (eg errors in extensions, attribute assessments, errors in the tender documents). When these variations occur, they must be fully explained.
The following definitions are used:
The "tender amount" is that amount shown in the tender, as received through the tender box, and which is the tenderer's opinion of the lump sum amount, or the sum of the schedule of rates as extended, required to complete the work under the contract.
The "adjusted tender amount" is the tender amount as adjusted by the addition or subtraction of:
- corrections to scheduled rate extensions; and
- amounts agreed to for an increased or reduced scope of works.
The "weighted tender amount" is used where the relativity of tenders may be affected by matters such as attribute assessments, annual operating costs, and hours of work or contractor performance. These matters can impact on the net value of the tender to the Principal. The "weighted tender amount" is the tender amount weighted by the addition or subtraction of assessed amounts for any item specified in the tender documents to apply to the comparison of tenders.
Awarding Contracts (TI 1210)
Prior to any contract being awarded or before negotiations are entered into with the preferred supplier, you should ensure that where the value of the procurement is
$100 000 or more, the procurement has been reviewed by the agency's Procurement Review Committee.
For all Major Works procurement, a recommendation as to the preferred tender must be made to, and approved by, the relevant Head of Agency. The responsibility for approval of the preferred tenderer may not be delegated below Head of Agency although the signing of the contract may occur in accordance with the agency's procurement delegations as determined in accordance with Treasurer's Instruction 1203. Where the procurement is valued at more than $5 million, a Tasmanian Industry Participation Plan must be approved by the Head of Agency prior to the contract being finalised with the supplier, and before a supplier enters into sub-contracting arrangements (refer to Treasurer's Instruction 1225).
The following checks should be undertaken prior to making a submission to the Procurement Review Committee.
Verifying Prequalification Status of Preferred Contractor
Agencies should ensure that prior to awarding a contract the contractor's prequalification status, threshold and categories are checked to ensure that the information in the submission corresponds with the prequalification information held on the relevant prequalification databases.
For building construction, Treasury and Finance maintains a database of prequalified consultants and contractors for government only access. The database is accessible from the Tenders website.
Information on the contractors prequalified under the NPS is available by contacting the Contracts Officer, Procurement and Property Branch, on (03) 6166 4220 or by email at firstname.lastname@example.org.
Information on the prequalification scheme for roads and bridges contractors is available from the Department of State Growth.
Assessment of Financial Capacity of Preferred Supplier / Financial Viability
For projects impacted by the National Prequalification System for Non-residential Building (NPS), agencies must undertake an assessment of the financial capacity of the preferred contractor prior to referring the evaluation to the agency Procurement Review Committee.
Information on financial assessment requirements may be obtained from the Manager, Contracts, Procurement and Property Branch, Department of Treasury and Finance, phone (03) 6166 4216 or by email at email@example.com.
The Confidentiality Policy is applied and, if appropriate, approval sought in accordance with Treasurer's Instruction 1401 for the inclusion of any confidentiality provisions. See the Confidentiality Policy for further information.
Verifying Contractor's Legal Status
When applying for registration or submitting a tender, some contractors use a name, for example a business name, which is not the name of a legal entity.
The rule of privity of contract states that, with very few exceptions, only parties to the contract can acquire rights or have liabilities under the contract. In other words, a person who is not a party to the contract cannot generally enforce the contract or be subjected to its burdens.
As a result of this rule, great care must be taken to ensure that contracts are awarded only to recognised legal entities. It is also important to ensure that the entity being awarded a contract is precisely the one which is prequalified to tender.
The trading name should only be used to help eliminate duplication of registration and for cross-referencing purposes. A registered business name must not be used as the sole means of identifying the principal(s) of a business for contract purposes.
The contract must name 'The Crown in Right of Tasmania' as the principal and contracting party except where a statute specially confers contracting power. An example of a statute conferring contracting power is the Director of Housing under the Homes Act 1935.
A submission shall not be deemed to have been accepted until the supplier is notified in writing of such acceptance.
When there has been a long delay in evaluation, the recommended tenderer should be requested to confirm that the tender still stands.
Any revised tender estimates or negotiations in relation to price or services are to be fully documented and any amendments are to be incorporated into the contract established between the Crown and the contractor/consultant.
A formal instrument of agreement is recommended for all major works projects. A letter of acceptance alone is not considered sufficient.
An experienced and responsible officer should prepare and issue the necessary formal instruments of agreement which should include any post-tender correspondence that is to form part of the contract and specify the total amount of security deposit and/or retention moneys (including the retention moneys percentage to be deducted from progress payments), the contract sum and the completion time.
Any revised tender estimates or negotiations in relation to prices or services must be fully documented and any amendments incorporated into the contract established between the Crown and the contractor/consultant. The clarification of all matters must occur during the evaluation and examination stage and be confirmed in writing.
When agency nominated sub-contractors are involved, two letters are to be issued:
- a letter to the contractor nominating the nominated sub-contractor; and
- a letter to the sub-contractor advising that the sub-contractor has been nominated to the contractor.
Performance Security and/or Retention Moneys (TI 1228)
Treasurer's Instruction 1228 requires an agency, in relation to all major works, to ensure that a contractor either:
- provides security in relation to the contract; or
- at the agency's discretion, provides retention moneys either instead of or in addition to security.
Detailed information in relation to performance security and retention monies is located in the Policy section of this website by following this link.
Unsuccessful Tenderers (TI 1207)
All suppliers submitting a tender are to be advised of the outcome and provided with details of the successful offer including the name of the supplier and the price accepted. Where a free trade agreement applies, a written explanation of the reasons that a tender was not selected must be provided to an unsuccessful supplier upon request.
All tenderers must be offered, and if requested provided with, a debriefing.
Reporting (TIs 1212 and 1213)
Refer to Reporting.
Publishing and/or Making Copies of Contracts Available
You are required to make available all contracts arising from a procurement that is valued at over $2 million by publishing the contract on the Tenders website.
The publication must occur within 10 days of the date of the award of the contract. The $2 million threshold is to be calculated inclusive of possible options to extend but exclusive of GST. If a procurement valued at more than $2 million results in multiple contracts being awarded, all contracts, regardless of value, must be published.
Where publication is not practicable, contact details of an officer able to provide access to the contract is to be placed on the Tenders website.
Refer to the Confidentiality Policy for additional information.
Appropriate records are to be maintained.
Tendering costs both you and the companies or entities that respond to a tender. You should not use a tendering process as validation of a consultant's estimating process. This practice is unethical and a waste of private sector resources.
Re-tendering should be avoided unless the tender documents have been substantially amended or a substantial period of time has elapsed since tenders were initially invited. Re-tendering may be considered where qualifications put forward by tenderers suggest a major inadequacy in the documentation or where there is significant suspicion or evidence of collusive tendering practices. The amended documents shall contain, as far as possible, provisions designed to minimise the effect of the delay (eg staged completion, shorter construction time etc).
You should also note that the Government has an agreement with the building and construction industry that projects will not be re-tendered within three months of the original tenders having been called.
It is recommended that you ensure that evidence of TasBuild registration is provided prior to the commencement of works.