Presentation on theme: "INDUCTION TRAINING SEIO"— Presentation transcript:
1INDUCTION TRAINING SEIO Implementation: Tendering, Procurement and Budget Support
2Training ObjectivesOverall the training will provide basic information on EU contracting procedures so that these can be taken into account when preparing implementation plans, sequencing and monitoring of future IPA Actions.Specifically, the training will explain:the PRAG and its relationship to the EU Financial Regulation;contract types and their uses;required documents for each contract type and procurement procedurecontract value and its effect on procurement procedurestime taken to complete the various procurement procedures and how to incorporate this into the development of realistic implementation plansrequirements for budget support
3ContractsContracts are the normal legal basis for the disbursement of IPA finances (there are others e.g. Delegated Agreements, Sector Budget Support)In EU pre-accession funds a distinction is made between procurement contracts and grant contracts.In procurement, the clients requirements are specified in contract documents (e.g. Terms of Reference for consultants).By contrast, in grant schemes the client explains the problems and potential grant contractors make proposals to address these problems. The client chooses the best proposal and awards the grant i.e. The grant awardees design the solutions and not the clients (as in procurement).
4PRAGPractical Guide to Contract Procedures for EU External Actions (PRAG)Regulation No. 966 /2012 of the European Parliament and the Council on the Financial Rules applicable to the general budget of the UnionCommission Delegated Regulation No. 1268/2012 of 29 October 2012 on the Rules of Application of Regulation No 966/2012 of the European Parliament and Council on the financial rules applicable to the general budget of the Union
5Types of Contract and Associated Documents IPA Action DocumentSERVICESTerms of ReferenceProcurementSUPPLIESTechnical SpecificationsWORKSBills of QuantityServicesStudies - identification and preparation of projects, feasibility studies, economic and marketing studies, technical studies, evaluations and audits (Global price)Technical assistance - the service provider has an advisory role, directs or supervises a project, or providing expert services defined in the contract (fee-based)The combination - defined as resources and productSuppliesPurchase, lease or rental of assets (equipment).During the delivery of the equipment may be required installation and maintenance productsWorksPerformance, or design and construction that result in the building or work of civil engineers who themselves are sufficient to meet the economic or technical function.Twinning (Twinning: 1-2 MEUR and Twinning light: up to EUR)Cooperation tool between a Public Administration in a Partner/ Beneficiary country and the equivalent institution in an EU Member StateIt consists of sending to Serbia at least one resident adviser ( months)- RTA- and a number of medium and short-term missions, all to be carried out by public officials of the EU Member State institutionKey features is the concept of mandatory results: both the Serbian and the EU partner commit themselves to work towards a commonly agreed result, which should be measurable and precise.Includes at least some elements of approximation to the EU acquisGrantsDirect payments of non-commercial natureGrants contract is used for the grant scheme as direct donation for local and regional authorities and civil society organizationsDirect AgreementsFor particular tasks with specific organizations like UNHCR etc.GRANTSGuidelines for Applicants
6International call for proposals Local call for proposals Tendering ProceduresSERVICES>€300,000International restricted procedure< €300,000 but > €20,0001.Framework contracts2.Competitive negotiated procedure< €20,000Single tenderSUPPLIES> €300,000International open procedure<€300,000 but > €100,000Local open procedure<€100,000 but > €20,000Competitivenegotiated procedureWORKS>€5,000,0001.International open procedure 2.International restrictedprocedure<€ 5,000,000 but > €300,000< € 300,000 but > €20,000 Competitive negotiated procedureGRANTS>€2,000,000International call for proposalsLocal call for proposalsFor any amount in cases of urgencyDirect grantLocal open postupakOvaj postupak se sprovodi za nabavke koje su > EurKoji su koraci u okviru ovog postupka:Najava (contract forecast) nije obaveznaObjava nabavke (procurement notice) se objavljuje samo o zemlji. Komisija objavljuje samo referencu te procedure na svom web site-uPodnošenje ponuda (minimum 30 dana od objave nabavke u lokalnim novinama\medijima)Evaluacija prispelih ponuda (oko 30 dana)rocedure (Otvoreni postupak u zemlji)Competitive negotiated procedure (konkurentni postupak)Ovaj postupak se sprovodi za nabavke koje su Eur > EurNema javnog oglašavanja za nabavkuUgovorna strana pozove, po svom izboru, min. 3 dobavljača da dostave ponude za dobavljanje robeDobavljači imaju rok od 30 dana da daju ponuduEvaluacija prispelih ponudaSingle tender (princip jedne ponude)Ovaj postupak se sprovodi za nabavke koje su Eur > 0 EurKontaktira se jedna firma koja će da da ponudu,Rok za dostavljanje ponude je stvar odluke Ugovarača, preporuka minimum 7 danaEvaluacija prispele ponude (7 dana)For services with a value of less than or equal EUR the Contracting Authority may simply pay against invoices without prior acceptance of a tender.Restricted procedureAll service contracts worth € 300 000 or more must be awarded by restricted tender procedure following international publication of a contract prior information notice and a contract noticeFor supplies with a value of less than EUR 2 500, the Contracting Authority may pay on the basis of an invoice without prior acceptance of a tender
7Procurement Procedure Contracting TimesContract TypeProcurement ProcedureAverage Time TakenSERVICEInternational Restricted Tender(9)-12 monthsFramework(3)-5 monthsSUPPLIESInternational Open Tender9 monthsLocal Open Tender6 monthsWORKS12+ months9-12 monthsGRANTSInternational Call for Proposals+ monthsLocal Call for Proposals(6)-9 months
8Service Contracts: International Restricted Tender Procedures Prepare ToRNegotiations with ECPublication of Procurement NoticeEstablish Sort List and prepare tender dossierTender preparation /submissionTender evaluation, prepare Evaluation Report and contract dossierContract SignatureMonths123456789101112
9Service Tender Dossier A. Instructions to the tenderersLetter of invitation to tenderInstructions to tenderersB. ContractContract, Special ConditionsTerms of ReferenceOrganisation and MethodologiesKey ExpertsGeneral Budget breakdownConditions for service contractsC. Other informationShortlist noticeAdministrative compliance gridEvaluation gridD. Tender submission form
10Supply Tender Dossier A. Instructions to the tenderers Letter of invitation to tenderInstructions to tenderersb. ContractContractSpecial conditionsAnnexesGeneral conditions for supply contractsTechnical specificationsBudget breakdownModel for performance guaranteeModel for advance guaranteeC. Other informationGlossary of termsAdministrative compliance gridEvaluation gridD. Tender submission form
11Works ContractsWorks contracts cover construction, there are many national ‘standard’ forms of contract. Despite this, the EC have standardised on the use of an international contract format developed by the Federation Internationale des Ingenieurs-Conseils (FIDIC). It should be noted that IFIs (WB, EBRD) have their own standard documents which must be used by recipients.The most commonly used forms of contract available under FIDIC are:Conditions of Contract for Works of Civil Engineering Construction(The ‘Red Book’)Conditions of Contract for Design –Build and Turnkey(The ‘Orange Book’)Conditions of Contract for Electrical and Mechanical Works(The ‘Yellow Book’)Short Form of Contract(The ‘Short Form’).
12Works Tender DossierMost works contract dossiers contain the following documents:The Tender (Contractor’s offer)The General Conditions of Contract (FIDIC Part I)The Conditions of Particular Application (FIDIC Part II Clauses)The Technical SpecificationsThe Design Documents (Drawings)The priced Bill of Quantities /Schedule of RatesAny other document forming part of the contract e.g. letters of clarification
13Bills of Quantity (BoQ) An itemised list showing the number/ quantity of items required to complete the works, the units of measure, the rate per unit of quantity and the consequent total cost for that item.The BoQ may contain a number of bills classified by structure, trade, or standard method of measurement. In turn each bill will be broken down into separate items covering all elements of the works. The total number of items can be many hundreds.During construction the quantity of each item is re-measured and using the Contractors quoted unit rates, the value of the actual works completed by the Contractor is measured
14Role of the ‘Engineer’One of the main aims of Contractors, whilst making every effort to complete the works according to the contract, is to maximise profits wherever possible.This means the Contractor will interpret contract provisions to maximise advantage e.g. providing the cheapest materials to meet the minimum requirements in the specifications or by requesting frequent time extensions.Under FIDIC conditions an independent ‘Engineer’ must be appointed to supervise the works and to ensure that they are carried out according to the contract. The Engineer issues ‘Take Over’ and ‘Default Liability’ Certificates when the works are completed
15Responsibilities of the Employer Ensure that the works are legally acceptableAppoint the EngineerDefine the scope of the Engineer’s responsibilitiesEnsure that the site is freely availableProvide for the Contractor's needsPay the ContractorConsult with the Engineer on contractual obligations e.g. delays (time & cost to Contractor); rejection (cost to Employer); default of the Contractor (cost to Employer) before determining the amount due.
16SPD: Implementation Planning SECTOR TITLE2014201520162017201820192020Q3Q4Q1Q2ACTION 1PCC/IIActivity 1.1P Activity 1.2…..ACTION 2 P CActivity 2.1Activity 2.2P = programming (period when the IPA action programme is expected to be adoptedC = procurement and grant award procedureI = implementation period
17Contracting & Disbursement Deadlines Deadline for concluding the Financing AgreementThe final date for the signature of the Financing Agreement is X+1 (where X=year in which budgetary commitment was made). Conclusion of FA=year NContracting deadlineThe end date for the signature of contracts (including grant contracts) is 3 years from the date of conclusion of the Financing Agreement i.e. N+3Deadline for the execution of contractsThe end date by which contracts (including grant contracts) must be finished is 3 years from the contract signature. The contracting deadline for the FA=N+3+3Disbursement deadlineThe end date for making payments to contractors is 1 year after the deadline for executing contracts i.e. N+3+3+1Final date for the implementation of the Financing AgreementThe end date for closure of the Financing Agreement is 8 years. After this date no financial transactions can be made legally under the Financial Agreement concerned
18Programme Intervention Logic OperationsActivitiesResultsCollective rural projectsReinforcement of rural producersSpecific ObjectivesImproved productivityOverall ObjectiveLand consolidationIncreased revenuesModernisation and adaptationDevelopment of existing activitiesImproved farming toolsJobs created & safeguardedStopping rural exodusAttraction of outside companiesNew activities (tourism)Industrial buildings for new companiesBetter living conditionsImproved value of natural areasBetter image of rural areasRestoration of the environment / rural landscape
20What is Budget Support (BS)? BS is a method of delivering financial assistance which normally has 4 steps:(Sector) Policy DialogueFinancial Transfers (in ‘tranches’) to National Treasury AccountPerformance AssessmentCapacity DevelopmentBS is delivered by means of ‘Sector Reform Contracts’.
21Political and Economic Focus of IPA-BS Compliance with the political criteria should be the primary focus of IPA2 BS. In particular, assistance should support preparations for acquis chapters 23 and 24 (The ‘Rule of Law’)For the economic criteria, the main focus of IPA2 BS should be on supporting the establishment of a functioning market economy (Copenhagen Criteria: i.e. ‘The ability to withstand the pressures of the internal market’)
22Assessment of Eligibility Assessment takes place at 2 stages in the programme cycle.During programme preparation: assessment of relevance (are key constraints /weaknesses addressed?) and credibility (realism, institutional capacity, track record, political commitment)During programme implementation: assessment of progress made in policy implementation (benchmarked against reform commitments)
23Risk Management Framework Risk management is an internal assessment of risk levels based on the analysis of replies to questionnaires in 5 categories, namely:PoliticalMacroeconomicDevelopmentalPublic Financial ManagementCorruption /FraudThere are 4 risk levels:LowModerateSubstantialHighBeneficiaries are expected to define their risk response by means of ‘Mitigation Measures’ (these are monitored)
24Whether to Provide BS?The EC decision on providing BS is based on 3 assessments:Assessment of political commitment to a reform agenda (in line with EU accession)Assessment of eligibilityAssessment of risks and mitigation measures
25Variable Tranches: Performance Reserves ‘A Performance Monitoring System and related disbursement criteria is at the heart of any budget support operation’ (EC)BS disbursements are of 2 sorts:Base (or fixed) tranches: these are linked to eligibility criteriaVariable tranches: these are intended to create an incentive for improved performance and are based on performance indicators.The EC limit (cap) the use of variable tranches to avoid unpredictability /volatility of disbursements. Typically, Sector Reform Contracts cover commitments for 3 years with an upper limit of 40% variable tranches
26Variable Tranche (Performance) Indicators The following principles should be applied:Targets and indicators should be Coherent with sector problem analysis and programme objectivesWhilst combined indicators may be used, the emphasis should be on ResultsNumber of indicators should be limited to a maximum of 8 per Tranche (to avoid loss of policy focus)Indicators, targets and assessment methodology should be defined during programme preparation