National Commissioning & Contracting Training Conference 9th - 10th June 2016 “Been There, Tendered That, Got the Contract!” Contract Models & Effective Tendering Practices Rakesh Mistry Commissioning Manager Childrens Commissioning Team

COMMISSIONING STRUCTURE Do you have a structure? What does it look like? How does it all fit together? Where are the links?

Why is procurement important? With budget overspends on external spending A significant growth in partnerships with private and voluntary sector suppliers it has never been more important to get procurement right. Pressure to improve performance on procurement is mounting because: • procurement can play a critical role in the delivery of strategic objectives, including the improvement of services. • savings realised through more efficient procurement can be channelled into priority services. • authorities are accountable for achieving Best Value and are open to legal challenge under the EC public procurement directives and the UK procurement regulations. • inadequate planning and contract failures can result in financial loss, poor outcomes for CYP and damage to the authority’s reputation. • poor practices in design and procurement result in time and cost overruns and poor quality. • unnecessary ‘red tape’ and excessive timescales are costly for authorities and suppliers alike.

Contracts Residential Block Contract Birmingham Fostering Framework West Midlands Fostering Framework Externalisation of Childrens Homes Short Breaks – Fostering Fostering Recruitment Children Centres Residential Schools Supported Accommodation Social Impact Bonds

New Contract Planning Demand Analysis Supplier/Provider Analysis What do you want from the contract? What are you trying to achieve? What procurement options are open to you? Supplier/Provider Analysis Are any of your current providers able to develop their services to meet the requirements of this new contract? Are providers interested in taking on this project? Market Analysis Are there sufficient capable providers in the market to meet your needs? What are the unconsidered consequences of letting this contract on existing local and regional arrangements?

Contract Types What type of contract? Spot Purchasing Cost & Volume Block Contract Framework Contract (Local / Regional) Payment by Results Contract Social Impact Bonds

Contract Design Objective Type of Service Number of providers Length of contract Options Appraisal Stakeholders Project Team Supplier Involvement EU Procurement Directives Public Contracts Regulations 2015

CONTRACT MODEL 1 2 T I E R KEY The letters represent different providers. The columns are age specific lists ranked according to the price / quality split Placement Request Age? Select Appropriate Age Band T I E R 0-4 Years 5-10 Years 11-15 Years 16-18 Years A B C D E A F G J B B E D A J G D C H I Offer to Tier 1 Providers first 1 F G H I J C D E I H F G C H I A F B E J If there is no match, offer to Tier 2 2 If there is still no match to be found Spot Purchase using West Mids Approved Providers 8

Tendering Open Restricted Negotiated Competitive Dialogue Dynamic Purchasing Systems

INVITATION TO TENDER (ITT) Tender Document Instructions for Tendering Tender Statement List of Contract Documents Financial References Statement of Insurance Tender Evaluation Tenderers Proposals / Method Statements Tender Pricing Summary Milestones Mid Tender Interviews Not evaluated Information shared

Tendering Evaluation Evaluation criteria should be published in contract notices and the invitation to tender. They must not be changed during the procurement process. Contracts should not be awarded on the basis of lowest initial price alone. There must always be an assessment of quality and costs A tender evaluation model including objective criteria for the assessment of cost and quality should be prepared in advance of procurement.

Tendering Evaluation Quality Price Tender Document Interviews Presentations Site Visits Children & Young People Price

SCORING OF TENDERS Weighted Scores Quality Assessment Price Assessment Site Visit - 25% Presentation - 10% Interviews - 15% Quality Assessment Highest weighted score = 100% Price Assessment Lowest weighted score = 100% Overall Assessment Total of Quality & Price

PRE-CONTRACT AWARD Risk Analysis Notification to unsuccessful tenders Heads of Service Operational managers Notification to unsuccessful tenders Alcatel Case (EU case law) Standstill period Breach of contract

Commissioning Manager 0121 464 4198 rakesh.j.mistry@birmingham.gov.uk Rakesh Mistry Commissioning Manager 0121 464 4198 rakesh.j.mistry@birmingham.gov.uk