Presentation on theme: "PURCHASING Delivering Value For Money. UWE Purchasing The University spends in excess of £220 million a year. Approx £92m of this is on non-pay spend."— Presentation transcript:
UWE Purchasing The University spends in excess of £220 million a year. Approx £92m of this is on non-pay spend such as computers, desks, services and estates (of which £75m can be influenced by ourselves) Our job is to help make sure that the University spends this budget correctly and obtains value for money.
UWE Purchasing The Purchasing Team is responsible for: Advice, guidance and training on purchasing and procurement matters Producing official University purchase orders Managing tenders Managing and issuing University Purchase Cards Negotiating prices and payment terms Equipment disposals Savings and value for money
What is Purchasing? The ‘Classic’ definition is:- To obtain goods/ services of the right QUALITY. At the right PRICE In the right QUANTITY. From the right SOURCE. Delivered to the right PLACE. At the right TIME.
Why are we here? To enable UWE to make maximum use of our non-pay resources in order that we may minimise purchasing costs and achieve value for money in the delivery of goods and services to our internal customers whilst contributing to the overall corporate strategy of the University.
Why are we here? UWE is classed as a Public Body Majority of our funding comes from public funds (via HEFCE) Public Bodies are obliged to ensure tax payer’s money is spent sensibly
Why are we here? UWE’s spend is regulated by: The European Public Procurement Directives The Public Contracts Regulations 2006 Our own financial regulations
Why are we here? The Purchasing Team ensures UWE expenditure complies with our own financial regulations and European / UK Legislation The Head of Procurement is directly accountable to the UWE Board of Governors
The Rules and Regulations As we are subject to European Procurement rules and the following spend thresholds apply: £5,000+ :-3 quotes or Single Action Waiver (SAW) required (excluding Estates purchases, which have a threshold of £10,000) £30,000 :- Tender exercise required with Purchasing involvement £50,000:-Estates tender threshold £172,514:- UK Law states that an EU tender exercise must be completed. Timescale 3-6 months for supplies and services. £4,322,012:-EU tender threshold or building or works.
Aggregation These figures are aggregated over: Total contract period Value of expenditure by supplier or value of expenditure by product type (eg: stationery) 48 months (if no contract period specified)
Authorisation Levels If an order totals £5,000 or over and is accompanied by a SAW, Purchasing will send it to the Directorate for authorisation (excluding Estates orders). Any order totalling £50,000 or over will need to be sent by Purchasing to Management Accounts to check for funding. Any order for an untendered supplier totalling £50,000 or over Purchasing will send to the Directorate for authorisation. Any order totalling £100,000 or more for a supplier that has gone through a formal tendering process either with UWE, the SUPC or the Government Procurement service will also need to go to the Directorate for authorisation.
Authorisation Levels Orders below £5,000: Authorised by the Purchasing Team Orders between £5,000 and £30,000 with 3 Quotes: Authorised by Purchasing Team Orders between £5,000 and £30,000 with SAW: Authorised by Purchasing Team and Directorate Orders over £50k will need additional authorisation from Management Accounts to confirm available budget.
Authorisation Levels Additional levels of authority are required when: The value of the order increases Insufficient evidence of Value For Money Financial procedures have not been followed The level of financial risk is higher than normal Remember: the more levels of authority required for an order, the longer the order will take to reach your supplier..!
Unofficial Ordering Suppliers should not be engaged to supply goods or services until they have received an authorised UWE purchase order. The Consequences…. We cannot pay supplier invoices that do not have an official UWE purchase order number. The supplier does not get paid Since March 2013 we are liable for additional charges if supplier invoices are not paid within 30 days from date of invoice (Late Payment of Commercial Debts Act)
Tender Regulations Guidance from the EC states that any tender, whether above or below the EU limit needs to be advertised to a degree sufficient to enable the services market to be opened up to competition. Any tender above the EU threshold must have a 10 day standstill period between the award of the contract and the contract start date to allow any objections to be made. Unsuccessful tenderers have the legal right to challenge EU tender awards.
Order Process Requisition raised by originator on P2P Electronic requisition authorised by budget holder Dean/Head of Service to authorise if above budget holders authority level & below £10,000 Management Accounts to check funds are available if above £50,000 Purchasing to ensure requisition is compliant and authorise Directorate to authorise if untendered and above £50,000, tendered and above £100,000 or with a Single Action Waiver Purchase Order emailed directly to supplier
Suppliers Before placing an order check that the supplier is set up on Agresso, if not is an alternative supplier available that we already use? If you need to set up a new supplier complete a new supplier form and send to purchasing with a copy of their headed paper or proof of address.new supplier form Individuals or sole traders may need to complete an online HMRC Questionnaire in order to determine whether they are self employed or should be paid through UWE payroll.
Sourcing your Supplier Try to use contracted suppliers Suppliers on approved framework contracts should have preferential pricing and terms Details of HE sector framework contacts can be found on the Generic e-Marketplace (UniBuy) formerly known as GeM www.unibuy.com
uniBuy UniBuy is the HE sectors online contract management database and is available for the storage of local agreement information and also for accessing regional and national agreements.. Generic eMarketplace
Information Required on Requisitions What is being ordered - description Not – “the supply of goods” or “As per your invoice ABC123”. But – “the supply of right handed desk” or “Paul Smith and Anne Jones, Bristol – Monaco, 12-23/05/2013”. How Many? i.e.. 10 cases, 5 printers, 3 days, 2 people etc. How much is it? Write as per item required: Not – “maintenance of fax machines at £1000”. But – “maintenance of 10 fax machines at £100 each”. When are the items required? i.e.. Dates of flights, if order is urgent state the date supplies are needed by.
Information Required on Requisitions Ask yourself: if someone looked at the information you entered for your requisition- would they know what you ordered and how the cost was broken down? Your information needs to be clear in order for the Purchasing Team to Authorise it. Your requisition may also be subject to a random check by our external auditors.
Attachments to Requisitions In addition to the order details required on P2P requisitions, it is sometimes necessary to provide supporting documentation, such as: Copies of relevant tender documentation Emails providing supporting information Copies of quotes along with a completed summary of quotations form These can be attached as electronic documents to your P2P requisition
Call off Orders Must have ‘start’ and ‘end’ dates. Must state the cost of the service/goods. Check aggregated values across all sites - Do you need to get new quotes/tender Don’t automatically renew with last years supplier. - Check out the market place. - Find out who others are using. - How much have prices gone up. - Valid for the whole order period.
Call off Orders (cont.) Plan ahead - renewals if done correctly, will take time, e.g. For contracts commencing in August begin looking in June. Offer suppliers longer ‘contract’ periods. - longer commitment = better rates. For a range of goods/services always attach to the requisition a pricing schedule. - valid for the whole order period.
Call Off Orders examples BAD EXAMPLE “Supply of plastic bags, £10,000” GOOD EXAMPLE “Supply of plastic bags during the period 01/08/13 to 31/07/14, prices as per the attached schedule, firm for 12 months, £10,000” OR 1,000 Yellow BagsSize x Price £10 / 1,000 5,000 White BagsSize y Price £11 / 1,000 4,000 Black BagsSize z Price £ 8 / 1,000 Goods to be called off as required up to 19/05/2013 When looking at an order, you should always be able to tell what you bought and how much each item cost.
Cheque With Orders These should ONLY be requested where the supplier will NOT invoice. If an invoice has already been received, do NOT request a cheque with order, but raise a confirmation order. If a cheque is required, you MUST complete ALL of the total cost boxes on the requisition, especially the VAT and total cheque amount boxes. If VAT is to be paid give the VAT registration number if the supplier is not set up with it. Check if they will take a ‘credit card’ order before requesting a cheque with order.
Quotes and Single Action Waivers A Single Action Waiver is only used to explain why competitive quotes/tenders have not been obtained.Single Action Waiver i.e. equipment maintenance It is NOT acceptable to use a SAW to say that the supplier gives the lowest price. In that case evidence of quotes must be shown.
Single Action Waiver or Single Source? Is there a difference? Yes!! Single source – not possible to obtain goods/services anywhere else SAW – there are multiple supply sources but we are choosing this one because…………………
Single Action Waivers Requisitions with Single Action Waivers take longer to authorise Requisitions where quotes have been obtained are usually authorised more quickly
Audits Purchasing is subject to a twice yearly audit by both internal and external auditors to compare our processes against the rules laid down in the Financial Regulations. Your requisitions and attachments may be subject to an audit inspection.
Purchase Cards UWE has over 145 purchase cards in circulation Used for low value transactions (< £500) Ideal for online transactions All cards managed by the Purchasing Team See Fin 19 - Purchase Card RegulationsFin 19 - Purchase Card Regulations
Purchase Cards Faculty Finance staff may have higher transaction limits Increased limits are available if travelling abroad- completion of Overseas Transaction Level Request form required Merchant categories set by suppliers banks- not all categories are automatically open to use Monthly random statement checks – audit requirement
Low Value Purchase Orders Average cost of raising a purchase order from origination through to paying the invoice is circa £70 to £100 per purchase order. Will the supplier take payment by Purchase Card? If this a regular supplier, can a call-off order be raised (e.g. for a year’s worth of goods / services)?
Whole Life Costs When purchasing equipment, don’t just consider the cost of buying the equipment itself: Equipment capital costs +Service/maintenance charges +Costs of consumables +Energy costs +Disposal costs =Whole Life Costs The lowest initial capital costs may not be the most cost effective option over 3 – 5 – 7 years.
Sustainability When buying goods, the following sustainability considerations should be taken into account: Whole life cost of equipment ownership Disposal costs Local sourcing Environmentally friendly options Local supplier – SME’s Equalities and diversity – CSR Sustainable Purchasing Policy (www)
Disposal of Equipment Equipment not needed by a department can be removed in a variety of ways: Transfer to an alternative department Sale to an external third party Sale to students or staff Disposal If disposal is required, a Disposal of Equipment form needs to be completed and returned to Purchasing. Selling equipment to staff or students should only be used after all other options have been exhausted.Disposal of Equipment All computer equipment will be dealt with by IT Services -they should be contacted to arrange collection. For more information, please check the Purchasing and Environmental Management websites.Environmental Management Surplus equipment can be advertised for re-use within UWE using the WARPiT re- use portal.
Further information If in doubt or you need to know more then contact Purchasing or go to our web-site: www.uwe.ac.uk/finance/ purchasing/welcome We are here to help
The Team Helen Baker82239 Head of Procurement Andrew Parsons83959 Purchasing and Contracts Manager Louise Murray81635 Purchasing & Payments Customer Services Manager Ani Drewery 82227 Purchasing Officer Rosie Hale86686 Purchasing Assistant