Council Constitution 10 Part 4 - Contract Procedure Rules

Introduction

1. These Rules govern and set out how the Council shall select suppliers to provide goods, services or works and form part of the Council’s Constitution.
2. Where within these Rules the Director of Commissioning – Integrated Health & Care and Head of Supplier Management are referred to in the alternative, the former will be responsible for all procurement activities and matters in respect of health and care services procured and managed via the ICU and the latter will be responsible for all other Council procurement activities and matters. Any reference to the roles of Head of Supplier Management or Director of Commissioning – Integrated Health & Care shall be taken to include his or her delegate also.
3. Where an officer considers that there is good reason to enter into a contract for the purchase of goods, services or works even though it cannot be undertaken in accordance with the procedures specified within these Rules, it shall be managed in accordance with a process agreed by the Chief Executive and the relevant Executive Director.
4. These Rules are based upon:
   1. the Council's Constitution
   2. all relevant statutory provisions including the Local Government Act 1988 Part II, Local Government Act 1999, Local Government Act 2000, the PCR 2015, the Local Government (Contracts) Act 1997, the Localism Act 2011, the Public Services (Social Value) Act 2012 and the CCR 2016 (as amended The Public Procurement (Amendment etc.) (EU Exit) Regulations 2020);
   3. any direction by the Council, a Cabinet Member or Committee having appropriate delegated authority and
   4. Council policies and procedures which includes but shall not be limited to equality and diversity, safeguarding, Council information and communication technology security, security, data protection and social value and green city and modern slavery, insofar as they are directly relevant to that contract.
5. The Rules do not apply to:
   1. in-house purchases or in-house service provision (including purchase or service provision from a third party where the contracting authority effectively owns/controls it and the main focus and extent of its activities concerns the contracting entity);
   2. arrangements which establish or implement co-operation between contracting authorities;
   3. arrangements which cover flows of money or pooling of funds between the Council and health bodies (section 75, 76 and 256 agreements under the National Health Service Act 2006 (as amended));
   4. the acquisition or rental, by whatever financial means, of land, existing buildings or other immovable property. For the avoidance of doubt, if the council is placing obligations as part of the disposal under a wider development agreement, this may trigger procurement compliance considerations and officers should seek advice from Legal and the Procurement Team to determine if the Rules apply;
   5. the making or receiving of grants unless an output to be delivered is specified or the terms of the grant otherwise require compliance;
   6. Sections 5, 6, 7, 10, 11, 12, 13, 14 and 15 do not apply to relevant health care services as defined by Schedule 1 of the PSR 2023;
   7. contracts for permanent or fixed term employment (this does not include consultancy services or agency workers where, for clarity, the Rules do apply);
   8. arbitration or conciliation services;
   9. legal services connected with litigation or the exercise of official authority in accordance with Regulation 10(1)(d) of PCR 2015;
   10. certain financial services related to the issue, sale, purchase or transfer of securities or other financial instruments in accordance with Regulation 10(1)(e) and (f);
   11. for loans, whether or not in connection with the issue, sale, purchase or transfer of securities or other financial instruments;
   12. direct payments to customers following care assessment (for example, payments under Self-Directed Support or Personal Budgets);
   13. Non-trade payments to third parties, such as insurance claims, pension payments, court judgments, and statutory payments to public bodies.
       
       Officers must seek advice from the Procurement Team where Rule 1.5.1 and 1.5.2 is thought to apply. This is to ensure that a thorough assessment of compliance can be made and documented.
6. The Rules have three main purposes:
   1. To ensure and enable the demonstration of compliance by the Council with public procurement law including the principles of equality of treatment, nondiscrimination, transparency, mutual recognition and proportionality.
   2. To ensure the Council strives for Best Value in the way it spends money, so that in turn the Council may be able to offer better and more cost-effective services to the public and other stakeholders and
   3. To protect officers who follow the Rules.
7. With the exception of procurements undertaken in accordance with the Low and Medium Value Procedures (as detailed in Table 1), officers must not engage with a supplier without first engaging with the Procurement Team in accordance with Rules 9-15 (inclusive).
8. Executive Directors are responsible for ensuring that their officers comply with these Rules.
9. The Head of Supplier Management and the Director of Commissioning – Integrated Health & Care will investigate any incidences of non-compliance with these Rules with assistance from the Procurement Teams.
10. The Head of Supplier Management and the Director of Commissioning – Integrated Health & Care is responsible for providing advice on these Rules with assistance from the Procurement Teams.

Compliance with these rules

1. Compliance with the Rules is mandatory, and any person found to have been acting in breach of these Rules may be subject to disciplinary proceedings. Compliance includes seeking and having proper regard to all legal, financial and professional advice obtained in accordance with these Rules.
2. Officers must seek advice from the Procurement Team in any and all instances of uncertainty about whether the Rules apply and how to apply the Rules.
3. The Rules work in concert with Council policies and relevant legislation. When conducting procurement activities officers must ensure they also comply, where relevant, with:
   1. all requirements of public procurement law;
   2. the Council’s Constitution;
   3. the Council’s Records Review and Retention Schedule;
   4. the Council’s Green City Charter;
   5. Council policies including:
      • the Council’s Gift and Hospitality Policy
      • the Council’s Anti-bribery Policy
      • the Council’s Social Value and Green City Procurement Policy
      • the Council’s SCC First Policy
      • the Council's Modern Slavery Charter
   6. the Council’s Corporate Plan and its Procurement and Contract Management Strategy.
4. Officers must ensure that any agents, consultants and contractual partners and suppliers conducting procurement activities on the Council’s behalf comply with these Rules.
5. The Procurement Teams will advise on whether and how the Rules apply in any particular case. Where appropriate, the Procurement Teams may seek legal advice from the Council’s Legal and Governance Team.
6. Unless expressly directed by the Head of Supplier Management or the Director of Commissioning – Integrated Health & Care, the Procurement Teams must manage all Procurements with an estimated Contract Value exceeding the Medium Value Transaction Threshold.
7. In the case of relevant health care services as defined by Schedule 1 of the PSR 2023, the requirements set out in the PSR 2023 must be adhered to.

Conflicts of Interest and Corruption

1. Any interest which may affect the award of a contract under these Rules must be declared. Any officer of the Council participating in a contract award decision or employee of the Procurement Team must provide the Head of Supplier Management and Supplier Management or Director of Commissioning – Integrated Health & Care with an advance written declaration of any such interests. Such interests include the ownership of shares in a potential supplier, previous employment by a potential supplier or the employment of a family member by a potential supplier.
2. The Head of Supplier Management or Director of Commissioning – Integrated Health & Care must either certify that such interests are acceptable or take any necessary action in respect of potential conflicts of interest and the officer should not participate in the evaluation or award of the contract by the Council.
3. Officers must be aware of other requirements of the Council’s Constitution with regard to conflicts of interest, bribery and corruption.
4. Every Contract which the Council enters into shall include a provision which entitles the Council to terminate the contract and recover losses from the contractor resulting from such termination if the contractor or anyone acting on the contractor’s behalf has:
   1. offered or given or agreed to give to any person any gift or consideration of any kind as an inducement or reward for doing or forbearing to do, or has done or forborne to do, any action in relation to the obtaining or execution of the contract or any other contract with the Council; or
   2. shown or has forborne to show favour or disfavour to any person in relation to the Contract or any other Contract or agreement with the Council; or
   3. committed an offence under the Prevention of Corruption Acts 1889 to 1916 (or any act or acts as may replace the same) or has given any reward the receipt of which is an offence under the Local Government Act 1972 (or any act as may replace the same) or committed an offence under the Bribery Act 2010.

Gifts and Hospitality

1. No gifts or hospitality should be accepted from any bidders to any contract being let or about to be let by the Council. Acceptance of gifts or hospitality may be a disciplinary offence. Every officer managing a procurement, letting (or planning to let) a contract or managing a contract for the Council must inform the Head of Supplier Management or Director of Commissioning – Integrated Health & Care of any offers of gifts or hospitality. Reference should be made to the Council’s policy on Gifts and Hospitality in place at such time and other relevant Council policies.

Exemptions to the Rules

1. No exemption can be given which breaches public procurement law.
2. An exemption to these Rules may only be agreed by:
   1. the Director of Commissioning – Integrated Health & Care (or his or her delegate) or
   2. the Head of Supplier Management (or his or her delegate)
3. This Rule 5.3 applies to exemption requests falling within the High Value Transaction Procedure. A Request for Exemption may be granted if the relevant officer listed in 5.2 is satisfied that there is sufficient justification to authorise the request on one of the following grounds:
   
   1. the nature of the market for the works to be carried out or the goods or services to be provided has been investigated and is demonstrated to be such that a departure from the requirements of the Rules is justifiable; or
   2. the requirement is for works, goods or services that are required in circumstances of extreme urgency that could not reasonably have been foreseen; or
   3. there are other circumstances which are genuinely exceptional.
4. Where it is proposed to utilise Regulation 32 of PCR 2015, or Regulation 14 of PSR 2023 in the case of urgent awards, a Request for Exemption must be considered by the relevant officer listed in Rule 5.2. The request must set out a thorough assessment of how the request complies with one of the grounds laid down in Regulation 32 of PCR 2015, or Regulation 14 of PSR 2023.
5. No exemption requests will be considered unless and until a Request for Exemption form has been fully completed and submitted to the Procurement Team. Officers shall not enter into contracts with suppliers, allow services or works to commence or arrange for the delivery of goods until an exemption request is formally approved by the Director of Commissioning – Integrated Health & Care or the Head of Supplier Management. If an exemption is granted, the provisions of the Council’s Financial Procedure Rules must still be followed and details of the Contract must be published in accordance with legislation.
6. A record of the decision approving an exemption and the reasons for it must be kept by the Procurement Team, an entry made in the register of approved exemptions and the Contracts Register updated accordingly by the Procurement Team.
7. Approved exemptions will be conditional on the relevant Executive Director providing and agreeing a plan with the Head of Supplier Management or the Director of Commissioning - Integrated Health & Care to mitigate the need for further exemptions relating to the Contract.
8. An exemption will be deemed to have been approved by the Director of Commissioning – Integrated Health & Care in the case of a child placement or education funding (or any combination thereof) where:
   1. The value of such placement or education funding is below the relevant PCR Threshold and
   2. All compliant frameworks agreements have been considered and are unable to meet the requirement and in any such instance, Rules 5.5 to 5.7 (inclusive) shall not apply.
   This Rule 5.8 applies to services for the placement of a child (including most obviously in a residential home, into foster care or into adoption) and for the provision of associated educational services to that child. Any contract awarded under this Rule must comply with the Council's transparency obligations, such as entering the contract details on the Contracts Register and publishing the relevant contract award notices.
9. An exemption shall never be given in relation to either Rule 3 (Conflicts of Interest and Corruption) or Rule 4 (Gifts and Hospitality).
10. These Rules may also be varied or departed from when the Director of Legal and Governance advises that statute or subordinate legislation requires such a variation.

Assessing the need

1. With the exception of activity undertaken in accordance with the Low and Medium Value Transaction Procedures, the Requesting Officer must engage with the Procurement Teams as soon as a need which may result in a procurement is identified.
2. Prior to commencing a procurement, the following options for delivery of the need must be considered:
   1. The consequences of not buying the goods or services or having the works done at all;
   2. The Council making the goods or delivering the services or works in-house (in accordance with the SCC First Policy);
   3. The Council providing the goods, services or works as part of a partnership arrangement with another party;
   4. The Council commissioning jointly with another contracting authority;
   5. The Council participating in a shared services arrangement with another council or other public sector entities for services delivery;
   6. The Council utilising a pre-existing Contract to fulfil the requirement; or
   7. The Council achieving delivery through any combination of 6.2.2 to 6.2.6.
3. Where the assessment of the need determines that a procurement is required, the appropriate procedure shall be undertaken in accordance with Rule 9 (Procedure Determined by Contract Type and Value).

Valuation of Contracts

1. An estimated Contract Value likely to provide the most economically advantageous outcome for the Council must be identified prior to commencing a procurement. This shall be based on the total consideration estimated to be payable over the full term of the contract, including all possible Contract extension and other payment options, by the Council to the Supplier.
2. In the case of a Framework Agreement or Dynamic Purchasing System, the estimated value shall be the total value of all contracts that could be entered into by the Council and other contracting authorities (where applicable) during the lifetime of the Framework Agreement or Dynamic Purchasing System.
3. In the case of Concession Contracts, the Contract Value shall be calculated on the basis of the total turnover of the concessionaire generated over the duration of the Contract, net of VAT, in consideration for the works and services that are the object of the concession, as well as for the supplies required for such works and services that may be required over the lifetime of the agreement, including Contract extension options.
4. Where the duration of the contract is indeterminate, the estimated Contract Value must be the estimated value of the contract over a period of four years.
5. The estimated Contract Value must be referenced within the Request for Procurement.
6. If a requirement is or can be related to another Council procurement or is for goods, services or works which are, or may also be, procured by another part of the Council and/or on a recurring basis, this may affect the Contract Value for the purpose of these Rules (i.e. the requirements for aggregation may apply). Officers must obtain guidance from the Procurement Teams before commencing such a procurement.
7. The Council may decide to award a contract in the form of separate lots and may determine the size and subject-matter of such lots whilst at all times adhering to Regulation 46 of the PCR 2015. Such a decision shall be made by the Procurement Teams.
8. The value of any contract must not be:
   1. underestimated deliberately or
   2. calculated by disaggregating (subdividing) it from other elements of the procurement or from other related procurements in order to reduce the perceived Contract Value or avoid the application of procedures set out in these Rules.
9. If the Council has a single requirement the value of which is over a threshold set out in Table 1 but which the Council wishes to meet by entering into multiple Procurements, then the value of the multiple procurements may need to be aggregated for the purpose of these Rules and advice must be sought from the Procurement Team in these instances.
10. Artificially underestimating and/or disaggregating the Contract Value are clear breaches of the Rules and may lead to disciplinary proceedings being initiated.

Authority to Purchase

1. The Constitution governs the limits within which the Executive Directors and their authorised officers may authorise purchases on behalf of the Council and these limits must not be exceeded. The Executive Director for Corporate Services maintains a list of authorisation limits which specifies a maximum financial limit for each transaction for each authorised officer.
2. Executive Directors must ensure that procurement activity is undertaken by authorised officers who can demonstrate knowledge and understanding of these Rules and skills appropriate to the task. These officers should already have authority under the above list and if not, must be granted authority by the Executive Director for Corporate Services.
3. Officers must ensure that the appropriate budget holder has the funds in place for any proposed contracts and that the necessary budget approval from Finance has been obtained prior to commencement of the procurement process. This must be validated before a decision is made to award a contract.
4. Officers must follow the processes laid out in the Constitution with regard to decision making. This includes Member consultation, Cabinet or Council approvals and Officer Decision making processes, where appropriate.

Procedure Determined by Contract Type and Value

1. The Rules and the associated procedures vary according to Contract Value, with stricter, more rigorous procedures for higher value transactions. This is to ensure that the benefits of a more thorough, complex procurement process are not outweighed by the cost of the procedure, relative to the value of the goods, services or works in question.
2. Notwithstanding the Contract Value or procurement procedure utilised, all procurements undertaken by the Council must adhere to public procurement principles of equality of treatment, non-discrimination, transparency, mutual recognition and proportionality and such adherence must be demonstrable if challenged.
3. Officers must always engage with the Procurement Team prior to starting procurement activity for all procurements other than those within the Low and Medium Value Transaction Thresholds.
4. In respect of all procurement procedures other than those undertaken in accordance with the Low and Medium Value Transaction Procedures, unless otherwise directed by the Head of Supplier Management or the Director of Commissioning – Integrated Health & Care, a Request for Procurement must be completed, signed by an officer authorised in accordance with the Officer Scheme of Delegation and submitted to the Procurement Team prior to the commencement of any procurement.
5. Tender or quote documentation appropriate to the procedure being undertaken must be developed to reflect size, scope, and type of specification where required (i.e. input versus output or outcome specification) and any other specific terms and conditions which are key to the subject-matter, subject always to Rule 23 (Conditions of Contract).
6. Where a competition has been undertaken in accordance with any of the procedures in Table 1 and only a single tender has been received, a contract may be awarded, subject to a value for money review being undertaken and an audit trail demonstrating compliance with the relevant procedure being available for inspection.
7. All contractual agreements entered into must specify the goods, services or works to be provided, state the price to be paid, and include appropriate terms and conditions of contract in accordance with Rule 23 (Conditions of Contract).
8. Where a procurement relates to services (or services together with the purchase or hire of goods or the carrying out of works), an assessment of the required services must be undertaken by the procuring officer in conjunction with the Procurement Team to ensure compliance with the Public Services (Social Value) Act 2012.
9. In respect of any procedure where more than one quote or tender is being requested, a quote or tender from at least one SME must be sought.
10. In respect of any procedure where at least three quotes are being requested, quotes from at least two local suppliers must be sought subject to such suppliers existing within the local area. “Local” shall mean within the city of Southampton or if the requirement cannot be sourced within Southampton within the county of Hampshire.
11. In respect of all procedures other than those undertaken in accordance with the PCR Procedure, where it is deemed appropriate by the Procurement Team when considering value for money and, the sector/market and risks, the procurement may be reserved by supplier location (in respect of services only) or to SMEs and Voluntary, Community and Social Enterprises (VCSEs) (in respect of supplies, services and works) in accordance with Procurement Policy Note (PPN) 11/20 – Reserving Below Threshold Procurements and relevant legislation.
12. Advice must be sought from the Procurement Teams at the earliest opportunity if a request for de-brief is received from a tenderer or a candidate.
13. Table 1 (below) shows the relevant procedure to be followed depending upon the nature of the requirement and its estimated Contract Value.

Table 1

* Please note that these are the “PCR Thresholds” and are applicable from 1 January 2024

The PCR Procedure

1. The PCR Procedure shall be managed by the Procurement Team and approved by the Head of Supplier Management or the Director of Commissioning – Integrated Health & Care.
2. Minimum timescales relating to tender procedures are governed by the PCR 2015 and these must always be followed.
3. In accordance with Rule 10.2, a Contract Notice must be published in the Find a Tender Service and in Contracts Finder.
4. Advertisements published additional to those under Rule 10.3 (for instance in the local press or trade journals):
   1. must not appear on Contracts Finder or in any other form of publication before a Contract Notice is published on the Find Tender System and
   2. must not contain any information additional to that contained in the Contract Notice.
5. All contracts tendered under this procedure must allow for a ten-calendar day standstill period between when the decision to award is communicated and the contract being entered into.
6. In accordance with Rule 10.2, all contracts awarded pursuant to the PCR procedure must be publicised by means of a Contract Award Notice transmitted no later than 30 calendar days after the date of the contract award.
7. In line with changes to the PCR 2015, for the purposes of understanding if the value is above the PCR Threshold, the value of the procurement will be calculated inclusive of VAT. This reflects a change in approach following Brexit and the UK’s (now independent) membership of the World Trade Organisation’s Agreement on Government Procurement (GPA).

PCR 2015 Schedule 3 - Social and other specific services

1. Regulations 74 to 76 of the PCR 2015 set out specific services which may be procured by applying this more flexible procedure.
2. The procurement process for these services must be conducted in accordance with the requirements set out in the PCR 2015 and must at all times uphold the principles of transparency and equal treatment of economic operators.

The High Value Transaction Procedure

1. Subject to Rule 12.2, the contract opportunity must be advertised by the Procurement Team at the start of the tender procedure. Information on the contract opportunity must be published on Contracts Finder within 24 hours of being advertised elsewhere.
2. The tender procedure shall be that identified as the most appropriate by the Procurement Team.
3. Tenders should be sought by the Procurement Team unless the Procurement Team determines that by virtue of its complexity at least three written quotes will allow Best Value to be demonstrated.
4. Where Rule 12.3 is determined to be the most appropriate process to follow, the requirements of Rules 9.9 and 9.10 must be observed.

The Medium Value Transaction Procedure

1. If the Contract Value of the procurement is within the Medium Value Threshold then there is no requirement for an officer to engage with the Procurement Team however, officers must contact the Procurement Team when in any doubt over the value of the procurement, how the procurement should be conducted and/or whether disaggregation applies.
2. Any officer conducting a procurement under this Medium Value Transaction Procedure must ensure they comply with all relevant requirements contained within these Rule (including but not limited to Rule 3, Conflicts of Interest and Corruption). Advice can be sought from the Procurement Team if there is any doubt in relation to the interpretation of the Rules.
3. Officers must obtain at least three written quotes from suitable suppliers before a supplier can be selected, unless the officer determines that only one or two suitable suppliers exists for the specific requirement. Any decisions to obtain less than three quotes must be documented and justified. Records of the reasons and justification shall be kept by officers but may need to be shared in the event of an audit. Where three or more quotes are being sought, where possible this should include a quote from at least two local suppliers, (“local” to be interpreted in accordance with Rule 9.10).
4. When obtaining quotes, officers must ensure they are conducting a like for like comparison and that quotes are evaluated on the same basis and must be reasonably certain, all things considered, that the contract that is being entered into represents Best Value.
5. Officers must inform suppliers the basis on which their quote will be evaluated and a subsequent Contract awarded, which will include the process, timescales, evaluation methodology and terms and conditions to be used.
6. Officers must ensure that they are carrying out appropriate due diligence on their chosen suppliers. This could include but not be limited to insurance requirements, health and safety requirements, economic and financial standing assessment.
7. Where appropriate for the requirement in question, officers may request that the opportunity be advertised on the Council’s on-line tendering system portal and an open market competitive procedure undertaken.
8. Where it is proposed to use a third-party framework agreement for contracts falling within this Medium Value Transaction Threshold, officers must comply with the process set out in Rule 18. This process will be supported by the Procurement Team.
9. Officers must provide the Procurement Team with any and all information relating to the contracts and suppliers to facilitate completion of the Contract Register and to enable the Council to meet its obligations in respect of the Local Government Transparency Code 2015 including providing details of all Contracts equal to or above £5,000 in Contract Value in a timely manner.

    

The Low Value Transaction Procedure

1. If the Contract Value of the procurement is less that the Low Value Threshold then there is no requirement for an officer to engage with the Procurement Team however, officers must contact the Procurement Team when in any doubt over the value of the procurement, how the procurement should be conducted and/or whether disaggregation applies.
2. Officers must obtain at least one written quote from a supplier before a supplier can be selected. Where possible, this should include a quote from a local supplier, (“local” to be interpreted in accordance with Rule 9.10).
3. Officers must be reasonably certain, all things considered, that the contract that is being entered into represents Best Value.
4. Officers must ensure that they are carrying out appropriate due diligence on their chosen suppliers. This could include but not be limited to insurance requirements, health and safety requirements, economic and financial standing assessment.
5. Where it is proposed to use a third-party framework agreement for contracts falling within this Medium Value Transaction Threshold, officers must comply with the process set out in Rule 18. This process will be supported by the Procurement Team.
6. Officers must provide the Procurement Team with any and all requested information relating to the contracts and suppliers to facilitate completion of the Contract Register and to enable the Council to meet its obligations in respect of the Local Government Transparency Code 2015 including providing details of all Contracts equal to or above £5,000 in Contract Value in a timely manner.

The Concession Contracts Procedure

1. Concession Contracts are arrangements where operational risk lies with the provider and payment consists of the right to exploit the services or works or those rights along with some payment to, or by the Council. Where the value is equal to or above £5,372,609 (indicative value excluding 20% VAT £4,447,174) ¹ the procurement of a Concession Contract is governed by the CCR 2016. See Rule 7.3 for details of how a concession contract must be valued. In cases where the estimated Contract Value is below the CCR 2016 threshold, the procedure related to the relevant threshold contained within these Rules shall be followed. For the avoidance of doubt, the High Value Transaction Procedure shall be used for any concession contract over £25,000 (exclusive of VAT).

1 -  This is the Concession Contract Regulation threshold with effect from January 2024.

Receiving and Opening Tenders and Quotes

1. Responses to an invitation to tender or quote must be received according to the format of response specified in the invitation to tender or quote and no later than the time specified for submission of tenders or quotes in the invitation to tender or quote.
2. Emailed tenders and quotes received are acceptable for Low, Medium and High Value Transactions, but copies must be retained by the Procurement Team (for High Value Transactions) and the procuring officer (for those undertaken in accordance with the Low and Medium Value Transaction Procedure). For the avoidance of doubt, emailed submissions shall not be accepted for procurements subject to PCR 2015, PSR 2023 or CCR 2016, unless there are exceptional circumstances which mean there are no other suitable means of receiving the tender submissions.
3. Tenders or quotes received for all procurement procedures:
   1. must be managed by the Procurement Teams using the Council’s on-line tendering system portal for electronic tendering where a High Value Transaction, PCR 2015, PSR 2023 or CCR 2016 procedure is being utilised, unless Rule 16.2 is being applied (for High Value Transactions only). Electronic tender responses must be received, time stamped and opened in accordance with the approved procedures implemented in that system and
   2. a record of opened and rejected tenders and quotes as well as candidates who did not submit a tender or a quote must be recorded for all procedures conducted under these Rules, PCR 2015, PSR 2023 or CCR 2016.

Evaluating Tenders and Quotes

1. All tenders and quotes should be evaluated against criteria that state the basis for how the contract will be awarded. In respect of procurements exceeding the Medium Value Threshold, this evaluation criteria must be determined in liaison with the Procurement Team prior to the issue of the invitation to tender or quote and must include mandatory and (where relevant) desirable requirements linked to the subject matter of the contract.
2. The evaluation criteria must be detailed in the document used to invite tenders or quotes and must not be changed during the procurement process. Requests for variant bids (i.e. a proposal for a solution that differs from the solution set out by the Council) must be scored against the same evaluation criteria as a tender or quote which meets the Council’s stipulated requirements.
3. Contract awards must be based on the identification of the most economically advantageous tender or quote and the evaluation criteria must reflect this. In exceptional circumstances, it might be appropriate to award the contract on the basis of the lowest, or in the case of a concessions contract, highest, priced tenderer. If lowest price is used, there must be appropriate justification to do so and must not be used for procurements conducted in accordance with the PCR 2015. This approach should also not be used for contracts where social value benefits can be realised.
4. An evaluation to determine the most economically advantageous tender or quote involves scoring tenders or quotes objectively using criteria which must:
   1. be relevant to the specific procurement’s size and scope;
   2. be pre-determined and listed in the invitation to tender or quote, as the case may be;
   3. be strictly observed at all times throughout the procurement procedure;
   4. reflect the principles of Best Value;
   5. include price, quality and social value (where appropriate);
   6. consider whole-life costings, particularly in the case of capital equipment where the full cost of maintenance, decommissioning and disposal must be taken into account;
   7. indicate how the Council will score tenders or quotes and be capable of objective assessment;
   8. be weighted according to their respective importance which must be detailed in the document used to invite tenders or quotes;
   9. address, where applicable, the bidder’s proposal to accept a transfer of staff under the Transfer of Undertakings (Protection of Employment) Regulations 2006; and
   10. avoid discrimination or perceived discrimination on the basis of nationality or other cause contrary to the any of the Council’s policies.
5. Any resulting contract awarded must be awarded to the bidder who submits the most economically advantageous tender or quote (i.e. the quote or tender that achieves the highest score in the evaluation), or the supplier who submits the lowest, or highest concession price tender or quote if this approach is being used (see Rule 17.3).
6. The Procurement Team (or procuring officer in respect of procurements under the Low and Medium Value Transaction Procedure) must obtain clarification or explanation from suppliers who submit tenders or quotes which appear abnormally low and may reject a tender or quote if the evidence supplied is not satisfactory to justify the low tender or quote.
7. The results of the evaluation process must be recorded in writing.
8. Unless otherwise required by law, evaluators must not disclose information contained within tenders or quotes returned by a supplier to any third party.

Framework Agreements, DPS’ and use of Council Contracts

1. Third Party Framework Agreements and DPS’ may be used by the Council (as part of the procurement procedures in Rules 9-15) following an assessment by the Procurement Team of the suitability of the Framework Agreement or DPS including whether they are considered to offer Best Value for the need in question.
2. Where the Council has in place specific Contracts with suppliers to provide goods, services or works which are suitable for the requirement, these contracts, where capable of doing so, must be used to source a requirement unless directed otherwise by the Head of Supplier Management or the Director of Commissioning – Integrated Health & Care.

Use of Nominated Sub-contractors

1. Officers must not nominate the use of specific sub-contractors without the prior written consent of the Head of Supplier Management or the Director of Commissioning – Integrated Health & Care.
2. Any nominated sub-contractors must have been selected through use of the appropriate tender or quote procedure as if the Council were contracting directly with the sub-contractor.

Awarding Contracts and Audit Trails

1. Executive Directors must ensure that the appropriate budget holder has the funds in place to sustain a contract prior to award.
2. Where a Contract Value is below £500,000 (excluding VAT), the Contract must only be signed by a Chief Officer authorised to do so in accordance with the Officer’s Scheme of Delegation or an officer in receipt of a formal sub delegation subject to receipt of confirmation from an Executive Director (verified by Finance prior to award) that the funds are in place to sustain the contract.
3. For all contracts where the Contract Value is equal to or exceeds £500,000 (excluding VAT), the contract must either:
   1. be made under the Council’s seal in accordance with the Constitution; or
   2. signed by at least two duly authorised officers of the Council authorised by the Director of Legal and Governance.
4. The decision as to whether to sign or to seal a contract shall rest with the Director of Legal and Governance. For the avoidance of doubt, no contract shall be attested by or signed by any councillor.
5. For procurements subject to the PCR 2015, a full and complete audit trail of all procurement activity resulting in the award of a Contract must be retained by the Procurement Team as required by regulation 84 of the PCR 2015 and in accordance with the Council’s Records Review and Retention Schedule.
6. With the exception of procurements undertaken in accordance with the Low and Medium Value Transaction Procedure, the Procurement Team shall produce and retain:
   1. a report containing information including contract value, the names of bidders rejected at the selection stage and the reasons for their rejection (for the PCR Procedure) including any conflicts of interest identified and how they were addressed and
   2. an audit trail of the Procurement and decision-making process in respect of any procurement which is withdrawn prior to contract award.
7. In respect of all Contracts awarded which exceed £25,000 (excluding VAT) in Contract Value (including those awarded as call-off contracts under framework and DPS agreements), the name of the contractor, the date on which the Contract was entered into and the value of the Contract must be published on Contracts Finder within 90 days of the Contract award. For Contracts that have been awarded following a procedure conducted in accordance with PCR 2015 or PSR 2023, a notice must also be published on the Find a Tender Service portal within 30 days of the contract award.
8. In respect of Low and Medium Transaction Procedures, a documented audit trail must be retained to demonstrate that the process upholds the principles of equality of treatment, non-discrimination, transparency, mutual recognition and proportionality has been upheld.

Ordering and Paying for Goods, Services and Works

1. No pre-payment for goods, services or works may be allowed above the value of £15,000, without the prior written consent of the Executive Director for Corporate Services and the Director of Legal and Governance.

Parent Company Guarantees and Performance Bonds

1. The requirement for a bond, parent company guarantee, or other security must be determined in consultation with the Head of Supplier Management or the Director of Commissioning – Integrated Health & Care in consultation with the Head of Finance.

Conditions of Contract

1. Unless expressly agreed by the Director of Legal and Governance all transactions regardless of value must use a model form of conditions of contract provided and approved by the Director of Legal and Governance.
2. The Head of Supplier Management in conjunction with the Director of Legal and Governance, must:
   
   1. keep a list of all model forms of conditions of contract that gives details of when the conditions were last updated; and
   2. review all current model forms of conditions of contract, on a regular basis including when applicable legislation is introduced.

Contracts Register

1. The Head of Supplier Management and the Director of Commissioning – Integrated Health & Care must maintain and publish the Contracts Register.
2. The Contracts Register is maintained by the Procurement Team and published on the Council’s website to enable the Council to meet its obligations in respect of the Local Government Transparency Code 2015

Variations and Extensions

1. Any variation to an existing contract (including an extension to contract duration) must demonstrate Best Value and must not be instigated solely to avoid or delay the requirement to conduct a procurement.
2. All variations to a contract must be made in accordance with the provisions of the PCR 2015 or PSR 2023, where relevant.
3. Officers must ensure that the appropriate budget holder has the funds in place for the variation and/or extension and that the necessary budget approval from Finance has been obtained before the variation or extension is agreed.
4. Officers must always obtain advice from the Contract Management Team before agreeing any variations to contracts if the variation is not already expressly provided for within the terms and conditions of the contract.
5. All variations approved in accordance with these Rules must be documented in writing and signed by an authorised signatory on behalf of the Council and counter-signed by the supplier.
6. Subject to any legal restrictions and compliance with these Rules, Chief Officers authorised to do so in accordance with the Officer Scheme of Delegation, or an officer in receipt of a formal sub delegation must authorise a variation or extension to an existing contract where such variation is provided for within the terms and conditions of the contract.
7. In respect of contracts below the PCR Threshold and subject to any legal restrictions and compliance with these Rules, any variation to an existing contract where the variation is not expressly provided for and where the consequent change in price (determined in accordance with the contract terms) is such that the annual value of the variation is:
   1. less than £25,000 (excluding VAT) or 15% (excluding VAT) of the original annual Contract Value (whichever is the lesser), the variation must be authorised by the relevant Chief Officer authorised to do so in accordance with the Officer Scheme of Delegation, or an officer in receipt of a formal sub delegation, provided that the value of the Contract post-variation remains below the relevant PCR or CCR Threshold;
   2. equal to or greater than £25,000 (excluding VAT) or 15% (excluding VAT) of the original annual Contract Value (whichever is the lesser), the variation must be authorised by the Director of Commissioning – Integrated Health & Care (or his or her delegate) or the Head of Supplier Management
8. In respect of Contracts equal to or above the PCR Threshold, or within the scope of the PCR 2023, any variation which is not provided for within the terms and conditions of the Contract. must be authorised by the Director of Commissioning – Integrated Health and Care or the Head of Supplier Management. The assessment of whether or not a variation is permitted under this Rule shall be done so in accordance with Regulation 72 of PCR 2015, Regulation 13 or 14 of the PSR 2023 or Regulation 43 of CCR 2016, as applicable. 
9. In respect of contracts above £5,000 (excluding VAT) in Contract Value (excluding VAT), officers must ensure that any agreed variations and/or extensions are communicated to the Contract Management Team and the Contract Management Team shall record all such variations and extensions on the Contracts Register.