Part 3 Restraints and qualificat

							LATE Business Paper for the Ordinary Meeting of Snowy River Shire Council to be held on Tuesday 18 January 2005

10.4: TENDER: SUPPLY OF GOODS AND MANAGEMENT SERVICES FOR THE OPERATION OF JINDABYNE HOLIDAY PARK

NOTES RELATING TO TENDERING Tendering Council‟s requirements and responsibility with regard to tendering are defined within the Local Government Act 1993, and the Local Government (Tendering) Regulation 1999. Detailed advice has been provided to Councils on tendering through the release of the Department of Local Government‟s Competitive Tendering Guidelines 1997. Why Tender? Section 55 of the Local Government Act 1993 requires that Council invite tenders for situations involving any of the following contracts: (a) A contract to carry out work that, by or under any Act, is directed or authorised to be carried out by the council, (b) A contract to carry out work that, under some other contract, the council has undertaken to carry out for some other person or body, (c) A contract to perform a service or to provide facilities that, by or under any Act, is directed or authorised to be performed or provided by the council, (d) A contract to perform a service or to provide facilities that, under some other contract, the council has undertaken to perform or provide for some other body, (e) A contract for the provision of goods or materials to the council (whether by sale, lease or otherwise), (f) A contract for the provision of services to the council (other than a contract for the provision of banking, borrowing or investment services), (g) A contract for the disposal of property of the council, (h) A contract requiring the payment of instalments by or to the council over a period of 2 or more years, (i) Any other contract, or any contract of a class, prescribed by the regulations. Tendering is undertaken to ensure accountability and open decision making in the spending of public monies and the management of public assets.

Business Paper: Ordinary Council Meeting - Tuesday 18 January 2005

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LATE Business Paper for the Ordinary Meeting of Snowy River Shire Council to be held on Tuesday 18 January 2005

Competitive tendering does not affect the accountability that a council has for providing quality services to the community. Council members and staff always have responsibility for ensuring that a service is being provided effectively, whether it be through in-house providers or contractors. Competitive tendering relies on competition to achieve greater efficiency and better quality service provision. Competitive tendering takes advantage of the competitive marketplace in an attempt to obtain the best value for the community. Council is accountable for the „stewardship‟ of community assets. For example Council is accountable for the way in which it designed the contract, the level of performance specified, for the selection of an appropriate contractor and for monitoring compliance with the contract terms. It is only the physical delivery of the service which the council has delegated through contracting. The principle of open decision-making is closely linked to accountability. Council should strive to conduct the competitive tendering process in as open a way as possible because the community has a fundamental right to know how the council is proposing to manage and deliver its services. The Local Government (Tendering) Regulation 1999 protects the confidentiality of tender documents themselves (cl 20) but this does not necessarily require the assessment of tenders to be conducted in a closed meeting. Given that the delivery of a service may be out-sourced, it is even more important that Council be seen to be acting with integrity and impartiality. Nothing in the Local Government Act or the Tendering Regulation requires that the final contract must be kept confidential. The public has a valid interest in a contract that governs services that are to be provided to them, or which are paid for by rate revenue. Council may need to protect commercially sensitive information or the intellectual property of a contractor. However, if the contract does disclose such matters, the relevant provisions may be protected while the rest of the contract is made available. Generally, there is no reason to protect clauses detailing the performance standards/specifications to be met, reporting/compliance requirements, enforcement provisions and conditions of staff. Such information may therefore be made publicly available. This also applies to the contract amount, which will be publicly accessible in council‟s annual report. The Tendering Process The tender processes which councils have available are set out in section 55 of the Local Government Act 1993 and the Local Government (Tendering) Regulation 1999. Council must follow one of the three tender methods outlined in

Business Paper: Ordinary Council Meeting - Tuesday 18 January 2005

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LATE Business Paper for the Ordinary Meeting of Snowy River Shire Council to be held on Tuesday 18 January 2005

the Regulation and comply with all associated procedures. There is no distinction between a competitive tendering process and any other.

Criteria for selecting a tender Under clause 18 of the Regulation, Council must accept the tender which: “having regard to all the circumstances ... appears to it to be the most advantageous”. It is left to council to determine what criteria contribute to the most advantageous tender. It is not merely a question of price but also of quality, service and so on. Departmental of Local Government advice notes that councils are not able to apply an „across the board‟ local preference policy to all tenderers. A local tenderer may of course be the most beneficial to council in the individual circumstances. Other important parts of the Local Government Act which Council should be aware of are:  - a council cannot delegate a decision to accept a tender. Subsequent tasks such as post tender negotiations and signing may be delegated.  - a council must report contract amounts, contractors‟ names and the nature of the goods/services in its annual report, for contracts over $100,000. Like any other function of council, tendering processes must be able to stand up to independent scrutiny. Tendering processes under the Local Government Act are the minimum that council needs to consider. Council‟s design of a contract, the calling of tenders, assessment, decision-making and monitoring must be fair and impartial, and must be seen to be impartial by the community and tenderers alike. Acceptance of tenders After considering the tenders submitted for a proposed contract, Council must either: (a) Accept the tender that, having regard to all the circumstances, appears to it to be the most advantageous, or (b) Decline to accept any of the tenders.

Business Paper: Ordinary Council Meeting - Tuesday 18 January 2005

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