Selection

What is this about?

Selection (‘qualitative selection') describes the assessment of supplier suitability against exclusion grounds and the council's selection criteria (financial and technical).

In two-stage procurement routes like the restricted procedure, competitive procedure with negotiation, competitive dialogue and innovation partnership, selection takes place at the first ‘pre-qualification stage'. However, in an open procedure the invitation to tender states which supplier suitability information is required and it is provided with the tenders. 

The new regulations have changed the selection rules. Generally the changes, which are outlined below, are positive, for example clarifying the role of references in assessing professional and technical ability.

Note that the ‘Lord Young' rules also apply to the assessment of supplier suitability for both above-threshold and below-threshold procurement and for EU procurements above certain thresholds they mandate a standard pre-qualification questionnaire (PQQ). 

An EU standard PQQ, known as the ‘European Single Procurement Document' (ESPD) is to be introduced in 2016.

What is new?

Under the new regulations suppliers make a ‘self-declaration' (in the form of the ESPD, see below) regarding exclusion grounds and selection criteria, the idea being that only the winning tenderer should be required to provide evidence (such as certificates) to back this up.

However, councils can still ask for evidence to be provided at any point in the procedure where necessary for the proper conduct of the procedure.

It has to be questioned whether in any two-stage procurement route a council would be willing to proceed to the next stage solely on the basis of a self-declaration.

Suppliers can be excluded at any stage of the procurement procedure if evidence comes to light. This is no longer confined to the pre-qualification stage.

 

Suppliers should not be excluded if they have provided sufficient evidence of ‘self-cleaning' (i.e. demonstrated that concerns have been addressed adequately). The regulations give examples of self-cleaning measures.

Mandatory exclusion lasts for five years. Discretionary exclusion can be for up to three years.

There may be more suppliers who fulfil exclusion and selection requirements than the council want to invite to tender. Under the new regulations, the objective and non-discriminatory rules and criteria that will be used to reduce the number (e.g. PQQ scoring system) must be set out in the contract notice or invitation to confirm interest. In practice, the detail is probably best included in the PQQ itself. 

Exclusion grounds

Terrorist offences, child labour and other forms of human trafficking (including, in the UK, Modern Slavery Act 2015 offences) are new mandatory exclusion grounds.

Where there has been a binding decision regarding non-compliance with tax or social security obligations, exclusion is mandatory. In other circumstances, it is discretionary.

A number of new grounds for discretionary exclusion have been added (see also anti-fraud and corruption):

• Significant or persistent deficiencies in the performance of a substantive requirement' which led to early termination, damages or a comparable sanction.
• Non-compliance with social, labour or environmental legislation (‘cross-cutting social clause')
• Conflict of interests.
• Distortion of competition through prior involvement in preparation of the procurement procedure (market engagement).
• Serious misrepresentation when supply information or withholding information or not providing supporting documents.
• Unduly influencing the decision-making process, obtaining confidential information conferring an advantage or negligently providing misleading information.

Exclusion on conflict of interest or distortion of competition grounds should only take place if other, ‘less intrusive' measures are an inadequate remedy. 

Selection criteria

Selection criteria continue to relate to - 

•  Suitability to pursue a professional activity (e.g. registration requirements)
•  Economic and financial standing
•  Technical and professional ability.

In an SME-friendly measure, turnover requirements are now capped at twice the contract value. However, the council can depart from this in justified cases (reasons must be given in the procurement documents or regulation 84 report).

Suppliers can be required to demonstrate a sufficient level of experience by suitable references from past contracts.

If it is established that a supplier has conflicting interests ‘which may negatively affect the performance of the contract' it can be assumed that the supplier does not possess the required professional ability (see anti-fraud and corruption).

The regulations describe the evidence (‘means of proof') which councils can require in relation to exclusion grounds and selection criteria.

It is intended that an EU database known as eCertis will become the primary source for certain forms of evidence (e.g. certificates from national authorities). However, the regulations have deferred compulsory use of eCertis until October 2018.

European Single Procurement Document

In 2016 the European Commission will introduce a standard form for the European Single Procurement Document (ESPD).

The aim is that the ESPD should be available exclusively in electronic form. However, the regulations have deferred that until April 2017.

Councils must accept the ESPD (a self-declaration regarding exclusion and selection criteria which provides links to supporting documents) at the pre-qualification or tender stage depending on the procurement route.

Suppliers will be able to reuse an ESPD which has already been used in a previous procurement provided they confirm it is up-to-date.

The council can still require the supplier to provide any of the supporting documents (evidence) at any stage where necessary for the proper conduct of the procedure. This supporting information must be obtained and checked before a contract is awarded.

However, the supplier cannot be asked for this evidence if the council already holds a copy of the document or can obtain it from a national database or the like (for example, the Welsh Government considers that SQuID will fulfil this role).