Archived decisions

    6. Legal and Corporate Requirements Relevant to the Engagement of External Consultants

    6.1 The award of contracts for the provision of professional services is subject to European procurement regulations. From 31st January 2006, these requirements are set out in the Public Contracts Regulations 2006. Prior to this, the requirements were set out in the Public Services Contracts Regulations 1993. The changes between the two sets of regulations do not impact on the matters covered by this report. The requirements relevant at the time are referred to in this report as the "EU Procurement Regulations".

    6.2 The EU Procurement Regulations set out certain procedures that must be followed in the procurement of certain services by public bodies, including local authorities. The services covered include computer and related services, and management consultancy and related services, where the value of the contract is beyond a stated threshold. The threshold is 211,000 Euros, which equates to around £147,000. The Regulations provide the basis for the tendering procedures in the Council's own Standing Orders on Contracts, the principle being that compliance with Standing Orders will ensure that the EU Procurement Regulations are complied with where applicable.

    6.3 The purpose of Standing Orders is threefold:

    6.3.1 to ensure that the Council obtains best value in the way it spends

      money, so that in turn it may offer best value services to the public;

    6.3.2 to comply with the laws that govern the spending of public money; and

    6.3.3 to protect individuals from undue criticism or allegation of wrongdoing.

    6.4 Standing Order (SO) 2.1 states that:

    "Purchases must be aggregated whenever possible. On no account should any requirement be split in an attempt to avoid using the proper procedure under these SOs or EU procurement rules."

    6.5 SO 2.5 states that:

    "Call-off or framework contracts for supplies and services should be used where they exist, regardless of value."

    6.6 The threshold values in Standing Orders were revised by full Council on 24 May 2007. However, the values referred to in this report are those that have applied at all material times in this case.

    6.7 SO 6.1 provides that, for contracts valued at over £15,000 but at or below £75,000, at least three tenders must be invited. Tendering procedures should be similar to those carried out for transactions valued at over £75,000, but with the relevant Chief Officer acting in the place of the Head of Corporate and Legal Services.

    6.8 SO 7 provides that, for transactions valued over £75,000 a formal tender process must be conducted in the manner outlined. One of three procedures (open, restricted, or negotiated) should be selected. For contracts of this value, tenders are to be returned centrally, to the Head of Corporate and Legal Services, and the form of contract used is to be determined in consultation with the Head of Corporate and Legal Services. The principle is that for higher value, higher risk contracts, there is greater involvement by the Head of Corporate and Legal Services and Legal Practice, to ensure that in such cases, the Council's interests are legally protected.

    6.9 Under the open procedure, public notice is given inviting expressions of interest from potential contractors. After an initial period for response, an invitation to tender is sent to all parties expressing an interest. The restricted procedure is similar to the open procedure, except that an invitation to tender is issued to no less than five parties expressing an interest who meet relevant selection criteria. The negotiated procedure is only used in exceptional cases with the agreement of the Head of Corporate and Legal Services.

    6.10 There are specific provisions regarding process for receipt and opening of

        tenders, evaluation and award. Also, Paragraph 14.4 of the Council's Constitution states that any contract entered into over a value of £75,000, which is not under seal, must be signed by two persons authorised by the Head of Corporate and Legal Services, or the Head of Corporate and Legal Services and one other person so authorised. This is so that higher value, and higher risk, contracts can be checked centrally within the Chief Executive's Department, to ensure that all necessary authority has been obtained and all correct procedures followed, before the contract is actually made.

6.11 It is possible to grant exceptions from following Standing Orders in certain

cases. Where the value of the contract is over £15,000 but at or less than

      £75,000, it is the Chief Officer who may give approval, in writing. For

      contracts at a value over £75,000, but at or below £500,000, approval of the

      Chief Executive is required. For contracts of a value over £500,000, the

      approval of the relevant Executive Member is required. An exception should

      be obtained where it is proposed to invite only a single tender in any case.

      In all cases, the approval to apply an exception must be given prior to the

action being taken.