D1 Contracts for Services Over EU Threshold

Background

All contracts for services expected to cost more than £113,057 (EU Threshold) must be issued by Procurement Group (PrG), using contract processes set out in Her Majesty's Government's (HMG) public procurement regulations (derived from the European Union (EU) Procurement Directives. The purpose of the Directives is to open public procurement markets to international competition thereby increasing opportunities for all suppliers and service providers. This reinforces HMG policy on value for money through fair, open and transparent competition.

All Consultancy (Administration spend only) above £20,000 must be approved by the SoS.

The regulations cover:

• Contracts for services, supplies & works
• Those services, which must be purchased through procedures, set by the Directives (Part A services), and those, which may be excluded (Part B Services)
• Financial thresholds (adjusted every two years) above which competition is required: Current Thresholds: Services and Supplies - £113,057  Works - £4,348,350
• Certain Research & Development and Telecommunications Services have a financial threshold of £173,934 - please seek further guidance from PrG
• Four contracting Procedures - open, restricted, (the norm for DFID contracts), competitive dialogue and negotiated.

• All Consultancy (Administration spend only) above £20,000 must be approved by the SoS or a designated departmental minister. Submissions to SoS must be in the prescribed format detailed in the Resourcing Policy and Procedures guidance.
  Task assigned to: All Staff, Local Contract Officer
• The mandatory requirements to ensure a fair, open and transparent competitive process are:
  • Business must be advertised through the Official Journal of the European Union (OJEU)
  • Advertisements must specify which procedure is to be used
  • The required output, and criteria for the selection of tenderers and award of contract must be advertised and adhered to
  • Minimum timescales must be adhered to
  • Competition, to achieve best value for money, must not be distorted by the development of specifications or terms of reference in favour of one product or supplier
  • Contract award notices must be placed in OJEU
  • Unsuccessful applicants or tenderers must be debriefed if requested.
    Task assigned to: Project Staff
• A requisition must be raised on ARIES for all procurement of services.
  This must include details of Quest numbers for the Terms of Reference (TORs) and all other relevant documents in the workflow comments field. The TORs must be completed in accordance with Terms of Reference guidance.
  The ARIES requisition and the completed TORs, together form an authorisation for PrG, or a Local Contract Officer (LCO), to proceed with the procurement of services.
  Task assigned to: All Staff, Local Contract Officer, Project Staff
• PrG must be commissioned to tender, award and manage contracts with an anticipated value in excess of the EU financial thresholds. Any proposed exceptions to this requirement must be agreed with the Head of PrG.
  Task assigned to: Local Contract Officer, Project Staff
• Any subsequent contract amendment must adhere to the EU Aggregation Rules that prohibits the splitting of requirements into smaller units in order to avoid the application of regulations. Consult with PrG as necessary.
  Task assigned to: Local Contract Officer, Project Staff
• Duty of care to suppliers must be considered and addressed at the beginning of the procurement process.  An initial risk assessment must be competed to determine if the intervention is Low/Medium/High risk. Those identified as Medium/High risk require SCS level approval before proceeding with a procurement and the procurement process must include an assessment of supplier capability to take on their Duty of Care responsibilities.  The country risk register must be updated and monitored regularly. Suppliers should be updated as necessary as part of on-going contract management.