A new chapter in public sector procurement. Client guide. sidframework.co.uk

Transcription

1 A new chapter in public sector procurement Client guide sidframework.co.uk

2 Framework members The Framework has been procured through a fully compliant OJEU process. OJEU Notice published on 16 October Contract award notice , published on the 25 August Through this process five constructors have been appointed as Framework Members. Membership of the Framework is as follows: Bouygues UK Elizabeth House 39 York Road London SE1 7NQ E info@bouygues-uk.com W bouygues-uk.com CCG 1 Cambuslang Road Cambuslang Investment Park Glasgow G32 8NB E admin@c-c-g.co.uk W c-c-g.co.uk Morgan Sindall Kent House Market Place London W1W 8AJ E info@msinvestments.co.uk W msinvestments.co.uk Wates Wates House Station Approach Leatherhead Surrey KT22 7SW E info@wates.co.uk W wates.co.uk Wilmott Dixon Suite 401 The Spirella Building Bridge Road Letchworth Herts SG6 4ET E jim.brunt@primeplace.co.uk W willmottdixon.co.uk 2 sidframework.co.uk

3 Contents Introduction 4 The Framework 4 Accessing the Framework 5 Use of the Framework by relevant bodies 6 Flexibility 7 Call off processes 7 Pre-selection 7 Tender evaluation 11 Access fees 13 Framework management 14 Framework Manager duties 14 Value and duration of the Framework 14 Client duties 15 Brokers 16 E-tendering 17 Instruction procedures 17 Due diligence 18 The procurement process 18 3 sidframework.co.uk

4 Introduction The main aim of the Social Infrastructure Development (SID) Framework is to deliver social infrastructure using the development value of surplus public or third sector assets and to make the procurement of a developer as quick and efficient as possible for the Client. The Framework has been procured through a fully compliant OJEU process. Five constructors have been appointed as Framework members. This guide should be read in conjunction with the Framework member prospectus. The Framework Public or charitable bodies (Clients) will identify land assets for transfer to the Framework Member. Clients can then use value generated from developing those assets to deliver tangible benefits using the same Framework Member as part of one coherent deal, across multiple sites or in different locations, and negating the need for multiple procurements. A key dimension of the Framework will be to deliver both the released capital and service/ assets at pace. The Framework is intended to be used for the procurement and development of surplus sites for residential housing and other uses, and for the construction of additional social assets on other sites within the Client s ownership. This will include all activities necessary to design, finance, develop and construct community assets to include civic estate, further education colleges, nursing care homes and facilities, civil engineering, emergency services (eg police and fire), housing, and associated energy and other infrastructure. The development of surplus public, community and charitable sector assets will include but not limit: l raising of development finance l taking development risk l obtaining planning permission l supply chain management l design and construction of community assets and associated infrastructure l refurbishment and remodelling of community assets l development and disposal of sites l demolition, site remediation and enabling works to prepare sites for residential or mixed-use development l self-build enabling as part of a larger development l site management l construction project management. 4 sidframework.co.uk

5 Accessing the Framework The Framework is accessible by all public bodies and charitable organisations within the boundary of the United Kingdom as identified in the remainder of this document. Clients will identify land for transfer and shape an outline scheme and development brief prior to engaging a Framework Member, generally through a mini-competition process. Clients may choose to work through a third party adviser or Broker to provide the resources and capacity to develop the project so it is sufficiently defined to allow for a mini-competition. The benefit of using a third party Broker is that, in some circumstances, projects can be worked up at risk with no direct upfront cost to the public authority. Should the project proceed, the costs of working up the scheme can be reimbursed to the Broker from the development gain generated through the project. Public authorities may of course choose to do this work in-house or seek external professional support on an upfront fee basis. At the mini-competition stage, Framework Members will be required to confirm that they have no actual or potential conflicts of interest with the Client or Broker, should one be involved in the project. Once selected, further to the mini-competition process, the Framework Member will be offered an option or conditional sale agreement on a site or sites by the Client and will then stimulate value by developing and delivering a scheme which incorporates, for example, new build housing, but which also may include delivery of additional public asset/s on other sites remaining in the Client s ownership. This may, for example, include the provision of new school buildings wholly, or partly funded by the housing development, or the delivery of wider public benefits, such as supporting the creation of local social enterprises, as part of the deal. The Framework Member and the Client will share any additional value created. 5 sidframework.co.uk

6 Use of the Framework by other relevant bodies The Framework Agreement will be open to the entire public sector, other public bodies, such as the Police, Fire and Rescue Service, NHS Bodies and registered charities within the UK and to those central government departments and their agencies that wish to use it. Any bodies described below may utilise the resulting Framework Agreement from the commencement date. Local Authority Councils: County, Unitary, District, Borough and Metropolitan Councils l (Parish and Community Councils are also permissible users) Central Government departments and their agencies: l Educational establishments: Nursery School, Primary School, Middle or High School, Secondary School, Academy, Special School, Pupil Referral Unit (PRU), Further Education, College, University. l l l l Police, Fire and Rescue, Maritime and Coastguard Agency emergency services: NHS bodies, the HSC (Northern Ireland) and Ambulance Services: l l l l l l l l l NHS bodies, Scotland and Wales NHS and Ambulance Service: l l l Registered charities: Registered social landlords: Government-funded, not-for-profit organisations that provide affordable housing. They include housing associations, trusts and cooperatives. l l l l 6 sidframework.co.uk

7 Flexibility Call off processes Pre-selection Clients will approach NPS Group to discuss requirements and potential to use the Framework. Key project outcomes, requirements, cost, time, and key drivers will be established at this stage and the service requirements agreed. The Client will execute the Access Agreement. The call off process will then commence. There will be subsequent support from the NPS Group Framework management team in evidencing delivery of the strategic initiatives and measurement of KPIs. There will also be a debrief session. A call off Contract will be awarded using either a mini-competition or a direct call off negotiation process. There are two routes the process can take: Route one: direct call off (through negotiation) Route two: mini-competition In order for Clients to access the Framework, an Access Agreement will need to be in place between NPS and the relevant Client.The call off process will commence with an Expression of Interest. NPS Group anticipate tender lists for each project to consist of all Framework Members. Framework Members invited to participate in a mini-competition or negotiate a direct call off will be required to: l satisfy both NPS Group and the Client with regard to its technical capability and capacity to satisfactorily deliver a Project (this assessment will take account of the Framework Member s recent performance as part of the Framework) l satisfy both NPS Group and the Client that it can deliver the Project within acceptable Tendered Rates if it were to subsequently enter into a Project Call Off Agreement. This assessment will consider issues such as financial standing, workload, turnover, as well as the size and the characteristics of the Project in question l demonstrate that it has achieved an acceptable standard following a health and safety assessment l demonstrate that it has achieved an acceptable standard in relation to their processes and procedures with regards to records, supply of information and forecasts l confirm that it wishes to participate in the mini-competition/direct call off in question. l the Client reserves the right to require that the Framework Member enters into a Parent Company Guarantee and/or Performance Bond as appropriate/ necessary to the delivery of a particular Project. 7 sidframework.co.uk

8 Route one: direct call off (through negotiation) Fully developed scheme has been prepared. Qualifying body wishes to negotiate direct with a single Framework Member. Access SID Framework Call Off Process Project Delivery Contact Framework Manager to discuss requirements Complete detailed project brief Confirm single Framework Member interest Carry out pre-selection due diligence checks on Framework Member Carry out negotiation Pre-start meeting using SID standard templates and documents Client team manages pre-construction requirements and site performance Confirm procurement service requirements Finalise KPIs and employment and skills plan Tender evaluation and report Framework Manager collates KPIs, employment and skills plan data Agree access fee and sign access agreement Contract award Complete project call off agreement Contract completion and handover Apply, negotiate and secure planning consents if not already in progress 8 sidframework.co.uk

9 Route two: mini-competition Fully developed scheme has been prepared. Access SID Framework Call Off Process Project Delivery Contact Framework Manager to discuss requirements Complete detailed project brief Confirm Framework Member interest Carry out pre-selection due diligence checks on Framework Members Carry out mini-competition Pre-start meeting using SID standard templates and documents Client team manages pre-construction requirements and site performance Confirm procurement service requirements Finalise KPIs and employment and skills plan Tender evaluation and report Framework Manager collates KPIs, employment and skills plan data Agree access fee and sign access agreement Contract award Complete project call off agreement Contract completion and handover Apply, negotiate and secure planning consents if not already in progress 9 sidframework.co.uk

10 Example: Journey of an undeveloped project through the Framework (either route one or route two) Basic client project details in outline form are known. Access SID Framework Project Development Call Off Process Project Delivery Contact Framework Manager to discuss requirements Develop concept and undertake feasibility assessment* Project inception Develop outline brief and appoint design team Obtain site specific information, surveys and reports Confirm Framework Member interest Carry out pre-selection due diligence checks on Framework Members Pre-start meeting using SID standard templates and documents Complete detailed project brief Project scoping Design development and cost checks Carry out negotiation or mini-competition Client team manages pre-construction requirements and site performance Confirm procurement service requirements Is project viable? YES Client approval? YES Finalise KPIs and employment and skills plan Tender evaluation and report Framework Manager collates KPIs, employment and skills plan data NO NO Contract award Agree access fee and sign access agreement END END Complete project call off agreement Contract completion and handover *Client appoints approved broker or commissions its own feasibility and design development work Apply, negotiate and secure planning consents if not already in progress 10 sidframework.co.uk

11 Tender evaluation NPS Group will carry out a mini-competition using the process set out. The tender documents will require that a Framework Member submits a response that includes a priced tender and a quality submission. Evaluation criteria used for the case study within the original Invitation to Tender (ITT) will be carried forward to mini-competitions for development and construction work procured through the Framework, although the criteria may be varied to suit the nature of the individual construction or development projects. The table below details the approach to this. The exact weightings of the evaluation criteria and sub-criteria to be used will be detailed within each Project Specific Invitation to Tender. The following illustrates some of the factors that may influence the weightings defined: l where qualitative factors have less overall importance, financial offer may be weighted higher l where qualitative factors have greater importance, financial offer may be weighted lower l where the relative importance of the qualitative factors change, the evaluation criteria may be varied to reflect this. Quality and Financial evaluation at minicompetition stage will use sub-criteria similar to that used in the Framework tender evaluation which will be applied pro rata to the Tender weighting of Price/Quality selected. Table showing extent of variability of evaluation criteria from ITT to mini-competition evaluation Financial evaluation at the mini-competition stage will focus on the land value rather than on the constituent parts, i.e. build costs, sales values and overheads and profit. The Key Commercial Parameters, submitted as part of the financial proposal, will establish a set of parameters that Framework Members will have to meet as a minimum when submitting a response to any mini-competition. Framework Members may at that stage offer more advantageous commercial position for the public sector Client, but may not offer a less advantageous position. Framework ITT weighting Quality 50% 30-70% Financial Offer 50% 30-70% Total Score 100% 100% Mini-competition Project Specific Tender weighting range 11 sidframework.co.uk

12 Other financial parameters (not included in the Key Commercial Parameters), will be developed during the mini-competition process and be benchmarked against relevant indices as part of that evaluation process. NPS Group and the Client will evaluate the submissions received as follows: 1. Any response may be discounted without further consideration (subject to this being provided for in the instructions for tendering) if it: l is withdrawn by a Framework Member l does not comply with the requirements of the instructions for tendering l is so much higher in price than the lowest priced response that it would be unable to score high enough overall marks to be selected for the Project (even if it obtained a maximum quality score and the lowest priced response were to receive a zero quality score) 2. Any responses not discounted will be assessed in accordance with the project quality specific selection criteria. 3. The scores of the responses evaluated will then be ranked, with the highest scoring response being ranked first. Following the ranking of the responses, NPS and the Client may: l award the Project to the highest ranking Framework Member l not award the Project and elect to re-run the mini-competition l elect to procure the Project outside of the Framework or not proceed with the Project. NPS Group and the Client may, either prior to issuing tender documents or during the response period, opt to provide briefing sessions so as to respond to queries and clarify issues relating to the mini-competition. NPS Group will use an e-tendering system to manage all mini-competitions. All opportunities offered to Framework Members from Clients, will be offered via this system. Framework Members must not accept mini-competition opportunities unless they are offered through this system.the Framework Member selected through the process will be appointed by the Client (independently of NPS Group) through a separate contract comprising separate project specific contractual agreements that will be put in place at the conclusion of the minicompetition. The call off contract will include (but not be limited to): l a Property Agreement l a Project Call Off Agreement l a Development Agreement provided l and the JCT Standard Form of Building Contract with Contractor s Design (together with ancillary documents including collateral warranties and/ or Private Company Guarantee). 12 sidframework.co.uk

13 Access fees Framework Members will be notified by NPS Group of the Framework Access Fee applicable to the Project when they are invited to tender. The Framework Access Fee will be listed as a separate item on the tender summary for the Project. Up to 3m = 2.5% 3m 10m = 1.5% 10m 20m = 0.75% Above 20m = 0.5% (Capped at 150,000) Construction Cost 13 sidframework.co.uk

14 Framework management The Framework will be managed by NPS Group. Contact details are as follows: SID Framework Manager NPS Group Gateway Plaza Sackville Street Barnsley S70 2RD E: T: W: sidframework.co.uk Framework Manager duties The Framework Manager duties are to: l provide procurement advice relating to the development l carry out employment and skill plan co-ordination/monitoring l provide briefings on Framework procedures in relation to the Client s first project call-off l provide post-project Call-Off Agreement advice regarding Framework operation only l carry out performance measurement and management l provide standard documents (including call-off pro-formas, typical scoring regimes, tender documentation and contract administration forms) l provide briefing documentation and meetings for tenderers l collate responses to clarification requests from tenderers l submit clarifications from evaluators l provide an evaluation report and recommendations based on tender submissions. NPS Group will have no liability for works procured by public bodies and charitable organisations using the Framework. Value and duration of the Framework The Framework will run for a period of 4 years ending on 30 July It is likely that many of the projects procured through the Framework will have long build-out durations and it is anticipated that some of these will take longer than 4 years to complete. The social outcomes that form part of this Framework may only be capable of achievement over longer periods of time than 4 years. It is anticipated that the Framework may be used to procure up to 3bn of development and construction with projects ranging from 3m - 50m in value. 14 sidframework.co.uk

15 Client duties The duties of the Client are to: l complete a detailed Project Brief l appoint a Broker (if required) l confirm procurement service requirements l provide project specific documentation as required to complete a call off process. This may include: l Site plan l Land title information l Indicative scheme layout l Project programme l Project financial model l User brief l Design brief l Outline/detailed design if necessary for planning application l Stakeholder management plan l Liaison with statutory bodies l Planning Development Brief l Soft Market Testing l Site Surveys l Risk Management Plan l agree access fee and sign Access Agreement l provide/carry out project specific due diligence checks on Framework Members (financial appraisal, insurances, health and safety) 15 sidframework.co.uk

16 Brokers To engage successfully with the Framework, many public and charitable bodies may find it helpful to use the services of a Broker. A Broker will provide the resources and capacity to develop the project or scheme so it is sufficiently defined to allow for a call off process through the Framework. This may also give the potential for the Client to de-risk the scheme prior to procuring a Framework Member by carrying out due diligence and, in some cases, securing planning permissions, thereby increasing the potential development gain and social value. This additional support can, in some circumstances, be provided without a direct upfront cost to the Client and can include the following: l working at risk to assess viability of an existing scheme or schemes l identifying and assessing opportunities to develop surplus land l options appraisals to deliver housing and public assets both on individual surplus sites and as a portfolio of opportunities l carrying out development appraisals and identifying how to secure best value for sites in financial terms and in respect of delivering a positive social impact from their redevelopment l developing initial scheme designs and engaging relevant stakeholders l commissioning site surveys and securing pre-planning application advice l preparing and submitting planning applications including supporting planning consultation activity l producing a development brief and proposals that Framework Members can respond to through soft market testing l obtaining necessary approvals from regulatory bodies such as government ministers for release of public land l acting as an agent for the Client in procuring through the Framework, including developing the procurement strategy and documentation and evaluating bids l providing best value for services to the client. The Client will be responsible for appointing a Broker (if required). Contact the Framework Manager for more information on the appointment of a Broker. l carrying out initial planning assessments and feasibility studies 16 sidframework.co.uk

17 E-tendering system NPS Group will use a web based e-tendering system to administer the procurement process. Instruction procedure For a sufficiently defined project the Client must submit to NPS a Project Brief together with the following: l site location l site boundaries showing area for provision of the public asset and areas for development and sale l title information (including title report). The Client must also submit to NPS, any of the following relevant information that it is in possession of as at the date of instruction: l topographic surveys l geo-technical and utility survey details l ecology and archaeological reports l flood risk Assessments l noise/vibration/air quality reports l planning consent and s106 agreements if available l accommodation schedule and scheme designs l employers requirements l relevant policies. 17 sidframework.co.uk

18 Due diligence The procurement process The Framework has been procured through a fully compliant OJEU process. OJEU Notice published on 16 October Contract award notice , published on the 25 August The first stage of the process was the issue of a Pre-Qualification Questionnaire (PQQ) with an accompanying Memorandum of Information. The PQQ was used to establish the experience and capabilities of the prospective Framework Members. Questions were asked on: l Business and Professional Standing l Insurances l Equal Opportunity and Diversity l Health and Safety l Quality and Environmental Accreditation l Financial Standing l Business Capabilities l Maximising social value from infrastructure projects l Delivering community assets l Capacity and Resources Track Record From this stage 10 constructors were short listed and invited to submit their tender proposals. Bidders were provided with a case study for a fictional housing development and school redevelopment scheme based in the South East of England. Although fictional, the case study was based on a real life scenario. Bidders were asked to demonstrate how they would deliver and price the scheme, including any additional social dividend or benefits. Tenders were assessed against the following evaluation criteria: Evaluation Criteria Summary Quality 50% Design and Construction Approach 15% Site Management 7% Housing Development Optimisation 15% Delivering Social Value 10% Framework Promotion 3% Financial 50% Offer for the Housing Land 15% Ancillary Works Costs 15% Key Commercial Parameters 20% Overage Methodology Pass/Fail Questions on business capabilities covered the following: l Experience and Technical Ability l Development gain through financed social infrastructure 18 sidframework.co.uk

19 The financial evaluation covered key financial parameters: l Profits on private sales units l Profits on affordable rented units (eg social rented, affordable rented) l Profits on intermediate affordable units (eg shared ownership, equity discount market sale) l Overheads and profits on build costs for public sector assets (eg school buildings) l Overheads on public sector assets l Profits on public sector assets l Overheads and profits on build costs for market housing (including the affordable element) l Overheads on market housing l Overheads on affordable housing l Profits on market housing l Profits on affordable housing l Development management fees (where additional or separate from overhead and profit) l Development management on market housing l Development management on affordable housing l Preliminaries l Prelims for public sector assets l Prelims for housing l Contingency l Contingency for public sector assets l Contingency for housing These parameters are the maximum or minimum (as appropriate) that a Framework Member will have to meet when submitting a response to a project call off. The delivery partner may at any stage offer a more advantageous commercial position to the Client but may not offer a less advantageous position. 19 sidframework.co.uk

20 Contact SID Framework Manager E: T: W: sidframework.co.uk 20 sidframework.co.uk