Contract procedures manual · Contract procedures manual SM021 Second edition, Amendment 1 Effective from June 2013 Page i Document management plan 1) Purpose This management plan

Contract procedures manual manual number: SM021

© NZ Transport Agency

www.nzta.govt.nz

Second edition

Effective from June 2013

ISBN 978-0-478-40763-4 (print)

ISBN 978-0-478-40762-4 (online)

http://www.nzta.govt.nz/

Copyright information

This publication is copyright © NZ Transport Agency.

Material in it may be reproduced for personal or in-house

use without formal permission or charge, provided suitable

acknowledgement is made to this publication and the

NZ Transport Agency (NZTA) as the source. Requests and

enquiries about the reproduction of material in this

publication for any other purpose should be made to:

NZ Transport Agency

Private Bag 6995

Wellington 6141

The permission to reproduce material in this publication

does not extend to any material for which the copyright is

identified as being held by a third party. Authorisation to

reproduce material belonging to a third party must be

obtained from the copyright holder(s) concerned.

Disclaimer

The NZTA has endeavoured to ensure material in this

document is technically accurate and reflects legal

requirements. However, the document does not override

governing legislation. The NZTA does not accept liability for

any consequences arising from the use of this document. If

the user of this document is unsure whether the material is

correct, they should make direct reference to the relevant

legislation and contact the NZTA.

More information

Published 2013

ISBN 978-0-478-40763-1 (print)

ISBN 978-0-478-40762-4 (online)

If you have further queries, call our contact centre

on 0800 699 000 or write to us:

NZ Transport Agency

Private Bag 6995

Wellington 6141

This document is available on the website at

www.nzta.govt.nz


Contract procedures manual SM021

Second edition, Amendment 1


Page i

Document management plan

1) Purpose

This management plan outlines the updating procedures and contact points for the document.

2) Document information

Document name Contract procedures manual

Document number SM021

Document availability This document is located in electronic form on the NZ Transport Agency website at

www.nzta.govt.nz

Document owner Project Services

Document sponsor Highways and Network Operations group

3) Amendments and review strategy

All corrective action/improvement requests (CAIRs) suggesting changes will be acknowledged by the

document owner.

Comments Frequency

Urgent amendments

(minor revisions)

Updates incorporated immediately they occur. As required

Review

(major revisions)

Amendments fundamentally changing the content or structure of the document will

be incorporated as soon as practicable. They may require coordinating with the

review team timetable.

At least annually

Notification All users that have registered their interest by email to [email protected] will be

advised by email of amendments and updates.

Immediately

4) Other information (at document discretion)

There will be occasions, depending on the subject matter, when amendments will need to be worked

through by the review team before the amendment is actioned. This may cause some variations to the

above noted time frames.

5) Distribution of this management plan

Copies of this manual management plan are to be included in the NZ Transport Agency intranet.

http://www.nzta.govt.nz/publications/index.html

NZ Contract procedures manual SM021



Page ii

Preamble

The content of the NZ Transport A Contract procedures manual (manual)

is based on the current best business practice. The manual will continue to

evolve and is subject to revision.

The manual owner shall be advised of any proposed amendments to ensure continuous

improvement in best practice. Where amendments are wished for, email proposed

amendments to the below address or write to the manual owner.

While all care has been taken in formulating this manual, the NZTA Board accepts no

responsibility for failure in any way related to the application of this manual, or any

reference documents noted in it. There is a need to apply judgement in each particular

set of circumstances.




Page iii

Record of amendments

Amendments will be made to this manual periodically and recorded on this amendment control sheet. If you

wish to be notified by email when any amendment is made, please email [email protected] with your contact

details name, organisation and email address. Please also ensure that any subsequent changes to these contact

details are notified.

All individuals seeking to rely on the Contract procedures manual (SM021) or to implement it have a duty

to ensure that they are familiar with the most recent amendments. Note: minor amendments are not always

identified.

Amendment number

Description of change Effective date Updated by

1 Manual revised to Second Addition Amendment 1. Updates to part A and B. Full details of amendments are provided , Contract procedures manual.

July 2013 Richard Crawforth (Part A) / Katherine Scapolo (Part B)

PQM simple + price deviation adjustment

This is a trial evaluation method for professional service tenders only and is not included in the SM021 manual.

Please see PQM simple+PDA memos (T:\Region\Manuals and Forms\SM 021 Contract Procedures

Manual\PQM simple with PDA) for further information.

Queries/feedback

Any queries/feedbacks on this edition should be sent to [email protected] .

mailto:[email protected]





Page iv

Table of contents

About this manual ix

Part A HNO procurement procedures introduction 1

1.0 Approval to proceed with a contract 5

1.1 Overview 5

1.2 Approval to proceed with contract 5

1.3 Procurement strategy 5

2.0 Request for tender (RFT) preparation 9

2.1 RFTs 9

2.2 Delivery model 11

2.3 Selecting a supplier selection method 12

2.4 Price/Non-price attributes selection 15

2.5 Pre-qualification for PW (PW only) 18

2.6 Liability and insurance for PS contracts (P only) 25

2.7 Insurance, bonds and retention for PW contracts (PW only) 27

2.8 Checking of contract documents 32

2.9 Shortlisting procedures 33

2.10 Interactive tender process 34

2.11 Commercial in confidence 35

2.12 Base estimate to be included in the RFT 35

3.0 Advertising and issuing of tender documents 36

3.1 Issuing of tender documents 36

3.2 Release of tender details 37

3.3 Communication during the tender period 37

4.0 Tender closing procedures 39

4.1 Tenders register and box 39

4.2 Remote tender closing 39

4.3 Receipt of tenders 41

4.4 Processing of late tenders 41

4.5 Opening of tenders 42

4.6 Preparation of the schedule of tenders received 44

4.7 Opening the price envelope 46

4.8 Modification and withdrawal of tenders 46




Page v

5.0 Tender evaluation 47

5.1 Evaluation policy general 47

5.2 Conformity, tags and clarification 53

5.3 Dealing with comments on the base estimate received from tenderers 55

5.4 56

5.5 Subconsultants/Subcontractors and consortia 57

5.6 Non-price attribute evaluation 57

5.7 Supplier selection methods 65

5.8 Reports and recommendation 68

5.9 Approval to open price envelopes 69

5.10 Consider commercial issues prior to contract award 70

5.11 Approval to award contract 71

5.12 Preferred tenderer status 72

5.13 Tender debrief meetings 73

6.0 Contract award procedure 74

6.1 Contract file 74

6.2 Signing of contract documents 75

6.3 Who may sign the contract agreement 77

6.4 Who may sign the bond (PW only) 79

6.5 Assignment or novation of contracts 80

7.0 Contract payments 83

7.1 Introduction 83

7.2 Liquidated damages (PW only) 83

7.3 Application of liquidated damages delegations (PW only) 83

8.0 Contract close 84

8.1 Introduction 84

9.0 Appendices part A 86

Part B Internal operations procurement procedures 143

1.0 Overview 149

1.1 Introduction 149

1.2 Minor administrative purchases 150

1.3 Selection of procurement approach 151

1.4 Preparation of tendering documentation 154

1.5 Service delivery/contract model 155

1.6 Selection of supplier selection method 156




Page vi

1.7 Process and timing 157


1.9 Confidentiality 165

2.0 Advertising and issue of procurement documents 166

2.1 Release of documents and information 166

2.2 166

3.0 RFP/RFT closing procedures 167

3.1 Overview 167

3.2 Tender register and box 167

3.3 Submission of proposals/tenders 167

3.4 Processing of late responses 168

3.5 Opening of responses 170

3.6 Pre-evaluation administration 171


3.8 Modification and withdrawal of responses 172




4.3 Dealing with comments received from proposers 177

4.4 177


4.6 Non-price attribute assessment 178

4.7 Presentation of proposals 181

4.8 Recommendation report 181

4.9 Post-evaluation administration 182

4.10 Release of information post-tender 182

5.0 Award of contract 183

5.1 Negotiation and development of contract documentation 183

5.2 Development of formal contracts 184

5.3 Liability and insurance for consultant contracts 186

5.4 Insurance, bonds and retention for office accommodation works

(Works) 187


6.0 Signing of contract 189





Page vii

6.2 Signing the contract 189

7.0 Contract management 190

7.1 Contract confidentiality 190

7.2 Assessing the performance of the supplier 190

7.3 Process for managing contracts 190

7.4 Contract variations 191

7.5 Process for contract variations 192

7.6 Assignment or novation 192

7.7 Changes after contract awarded 193

7.8 Where a change in control involves an assignment or novation or

subcontracting 194

7.9 Ending a contract 194

7.10 Contract evaluation reviews 194

7.11 Record keeping 194

7.12 Health and safety requirements of contractors 195

8.0 Alternative procurement options 196

8.1 Emergency procurement 196

8.2 Master Agreements 196

8.3 Syndicated procurement 197

8.4 All-of-government contracts 197

9.0 Appendices Part B 198




Page ix

About this manual

General

Status of this

manual

This manual details the procedures for procuring. The manual is split into two

parts:

Part A contains procedures relating to the contracting of professional services and

physical works and will generally be used for works contracted by the

Highways and Network Operations (HNO) group.

Part B contains procedures for the procurement of goods and services related to

internal operations, and will generally be used by all groups (other than HNO) and for

expenditure from administration budgets.

Overview part

A

Part A details procedures for implementing the requirements of the Procurement

manual. It also covers the administrative requirements for contracts involving payments

for professional services and physical works.

The purpose of part A is to ensure compliance with the Procurement manual, the

Government Roading Powers Act 1989, the Land Transport Management Act 2003 and

may be issued from time to time in

relation to procurement.

Procedures relating to professional services (PS) or physical works (PW) only:

PS: This manual distinguishes procedures and requirements for PS only by referencing

the paragraphs/sections with PS as has been done for this sentence.

PW: This manual distinguishes procedures and requirements for PW only by

referencing the paragraphs/sections with a PW as has been done for this sentence.

Procurement of services and the purchasing of goods not subject to the

Procurement manual and funded by the administration budget should be done in

accordance with part B of this manual.

The provisions of part A are mandatory for all HNO contracts. Where questions or

matters as to its application arise, the guidance of the appropriate Procurement Support

team should be sought.

Wherever a financial limit is indicated in this manual it shall be exclusive of Goods and

services tax (GST).

Overview part

B

Part B deals with the procurement and contracting procedures associated with the

internal operations of the NZTA:

Any procurement that supports its day to day operations, including the procurement

of office supplies, vehicles and office equipment.

Procurement for the provision of decision-making advice that has an indirect impact

on transport infrastructure, which may include policy and strategic advice, education

and safety research.

Procurement of goods and services that support our obligation to provide New

Zealanders with access to the land transport system, such as manufacture and

distribution of licence plates, manufacture and distribution of media labels for

vehicles and bulk processing of letters for drivers and vehicle owners.

Procurement of advertising campaigns, communication and publications.




Page x

Overview part

B continued

In general these activities will be conducted in accordance with the Procurement

manual, procurement procedure 2: Planning and advice.

If you are unsure whether your procurement activity resides under part A or part B of this

manual, please email [email protected].

Legal services team.

Associated

manuals and

references

All advertising, tendering, closing of tenders, tender evaluation and acceptance of

tenders shall comply with the latest issue and any subsequent amendments or additions

of the following publications:

the

Project management manual (SM011)

State highway control manual (SM012)

Cost estimation manual (SM014)

State highway professional services contract proforma manual (SM030)

State highway construction contract proforma manual (SM031)

State highway maintenance contract proforma manual (SM032)

Prequalification for physical works application pack

HNO Portfolio Procurement Strategy

Manual of accounting policies and procedures

New Zealand Standard 3910:2003 Conditions of contract for building and civil

engineering construction (NZS 3910:2003)

Conditions of contract for consultancy services (CCCS) August 2009

This manual and any other applicable instruction issued.

Electronic copies of appendices to this manual can be found in: T:\Manuals and

Forms\Contract Procedures Manual\...




Page xi

Terminology

Adjusted evaluation

price

The tendered price less schedules fixed amounts and, the supplier quality premium (SQP) and alternative tender

premium (ATP).

Alternative tender Defined as a tender proposing alternative methods, forms or materials which might produce a different quality or

durability but within the scope specified in the request for tender (RFT).

Alternative tender

premium

Defined as the difference in price that the tendering authority is prepared to pay for the product offered by an

alternative tender compared to the minimum standard product specified in the RFT . Used in the evaluation of

alternative tenders in PW contracts.

Approved funding

allocation

This is the current approved funding allocation shown in the State Highway Project Financial Management System

(PROMAN) against the work unit that will fund this contract. It is the figure that is to be compared with the expected

contract estimate (which includes the tender price) to determine if the allocation is sufficient to award the contract.

Note that for multiple phase PS contracts this allocation will be for the first phase only and will therefore be less than

the expected contract estimate. It is expected that a separate allocation for the NZTA-managed costs will have been

set up against a separate work unit, and is not to be funded from this approved funding allocation, which will fund the

contract only. In the case of construction contracts this approved funding allocation excludes the NZTA-managed

costs, consent monitoring fees and all PS fees.

Asset manager Reference is made in this manual to the asset manager. For the purposes of this manual, this position will be held by

the officer or individual with delegated authority from the appropriate national office or regional manager. The asset

manager has responsibility for the development and/or delivery of the contract (network operations).

Base contract

estimate

The total sum of the elements that make up a contract estimate and including provisional sums but not including

escalation, a contingency allowance or the NZTA-managed costs (refer to SM014).

Base project phase

estimate

The sum of all base contract estimates making up the phase and including the NZTA-managed costs but still excluding

escalation and contingency allowance.

Type of quality- Procurement manual.

Closed contest Limited number of tenderers invited to submit a tender without public advertisement of contract.

Delegated authorities

schedule

The Delegated authorities schedule is a quick reference guide which list those delegated authorities (e.g. group

managers, Board) who are authorised, for example, to approve advertising, open price envelopes (at different contract

value level), for both PS and PW contracts.

Evaluation estimate Used in the evaluation of tenders is the base estimate less all scheduled fixed amounts including provisional sums,

contingencies and the NZTA-managed costs.

Expected estimate The base estimate including an allowance for contingency but excluding the NZTA-managed costs.

Note that escalation is only included in the expected estimate when it is used for funding applications. Reference to

expected estimate in this manual will generally include allowance for escalation (refer to SM014).

Expected contract

estimate

This is the expected estimate for the contract (prepared by the NZTA for PS contracts and by the consultant for PW

contracts), and includes an allowance for escalation and appropriate contingency but excludes the NZTA-managed

costs, consent monitoring fees and all PS fees for construction contracts. It is stated as the Expected Contract

Estimate figure on forms G, H and I in SM014.

Expected project

phase estimate

The sum of all expected contract estimates making up the phase (which include escalation and contingencies) and

including the NZTA-managed costs (consent monitoring fees and PS fees for construction phases).

Group Manager HNO For the purposes of this manual, although reference is made to this position, an officer designated by the appropriate

national office manager may have appropriate delegated powers and duties. The Group Manager of HNO is authorised

to approve contracts as set out in the Delegated authorities schedule.




Page xii

Index Used in price quality method (PQM) simple and PQM special. Refers to the result of multiplying the non-price

attribute grade with the non-price weight.

Limited invitation to

tender

Limited number of tenderers invited to submit tender without public advertisement of contract. Referred to as closed

Procurement manual.

Manager PS For the purposes of this manual, although reference is made to this position, an officer designated by the Group

Manager of HNO may have appropriate delegated powers and duties as provided for in this manual and the Delegated

authorities schedule.

Maximum risk

consequence

Used in PQM special and refers to the sum of all the risk premiums associated with the individual risk parameters.

Monetary values Monetary values quoted or implied in this manual are in New Zealand dollars and shall be exclusive of GST.

National Manager PS For the purposes of this manual, although reference is made to this position, an officer designated by the appropriate

national office manager may have appropriate delegated powers and duties and is authorised to make contract

recommendations and approvals as set out in the Delegated authorities schedule in this manual.

Net present value The whole life value of the project when all future benefits and costs (such as maintenance) are evaluated and

discounted in accordance with the procedures outlined in the current version of the Economic evaluation manual.

Non-price attribute Refers to the quality attributes used in the tender evaluation marking forms: relevant experience, track record,

relevant skills, resources and methodology.

Non-price attribute

weight

Refers to the total weight provided for the non-price attributes. The sum of the non-price weight and the price weight

has to be 100 percent.

Procurement manual

Procurement manual defines procurement procedures to be used for all contracts funded from the

National Land Transport Fund.

PACE Performance Assessment by Coordinated Evaluation (PACE) is the performance evaluation system used by the NZTA

to assess contracts.

Pre-qualification

classification level

The pre-qualification system includes four pre-qualification classification levels A through D. Level A is the highest

classification and D the lowest.

Price weight This is the weight given to the price attribute when evaluating a tender. The sum of the non-price weight and the price

weight has to be 100 percent.

Project manager For the purposes of this manual, this position will be held by the officer or individual with delegated authority from the

appropriate national office or regional manager. The project manager has responsibility for the development and/or

delivery of the project (capital improvements).

PROMAN Financial Management system used by the HNO group.

PQM special Price q

Procurement manual.

PQM simple Price quality method simple is a type of price quality supplier selection method as referred to in

Procurement manual.

QUEST Health and safety training scheme.

Request for tender

(RFT)/Request for

proposal (RFP)

A document that details the contract requirements and conditions for tendering.

Risk parameter Used in PQM special. Refers to certain risk factors or attributes that can affect the costs. Generally sourced

from the risk register.




Page xiii

Risk premium Used in PQM special. Refers to the dollar premium assigned to each risk parameter. It represents the maximum costs

that can occur if a risk was not managed properly (assessed by the tendering authority).

Sponsor For the purposes of part B of this manual is the internal NZTA person for whom the contract is being arranged and

who maintains oversight of the area of the NZTA business where the output of the contract will be applied.

State Highway

Manager

For the purposes of this manual, this position will be held by the officer or individual with delegated authority from the

appropriate national office manager and may have appropriate delegated powers and duties. The State Highway

Manager has regional responsibility for land transport management and is authorised to make contract

recommendations and approvals as set out in the Delegated authorities schedule in this manual.

Supplier quality

premium

difference in quality between tenderers.

Supplier selection

method

Method of supplier selection previously known as evaluation method.

Target price Procurement manual.

Team administrator For the purposes of part B of this manual this position will be held by the Corporate Support team administrator that

has the responsibility for administering tenders on behalf of the Corporate Support Procurement team.

Tendering authority Refers to the agency tendering a contract.

Tenders secretary For the purposes of this manual, this position will be held by the officers or individuals with delegated authority from

the appropriate national office or regional manager to undertake the administration of the tender process and the

maintaining of the tender/contract records within the office.

Traditional delivery

model

Procurement manual.

Weighted sum The sum of all the non-price att

Weighted sum

margin

The result of deducting the lowest weighted sum from all other weighted sums and inclusive (i.e. the lowest weighted

sum will be zero). This forms a relative comparison between tenderers. Used in PQM simple and PQM special.




Page xiv

Abbreviations

AOG All-of-government

ATMS Advanced traffic management systems

ATP Alternative tender premium

CCCS Conditions of contract for consultancy services (August 2009)

CCTV Closed-circuit television

GETS Government Electronic Tendering Site

HNO Highways and Network Operations group

KPIs Key performance indicators

LPC Lowest price conforming

MRC Maximum risk consequence

MSQA Management, surveillance and quality assurance

NCCE National certificate in civil engineering

NPV Net present value

NTT Notice to tenderer

NTST Notice to specific tenderer

NZS 3910:2003 New Zealand Standard 3910:2003 Conditions of contract for building and civil engineering construction

NZTA NZ Transport Agency

PACE Performance Assessment by Coordinated Evaluation

PET Pre-qualification Evaluation team

PI Professional indemnity

PL Public liability

PQM Price quality method of tender evaluation

PS Professional services

PSMC Performance-specified maintenance contract

PW Physical works

RCA Road controlling authority

RFI Request for information

RFP Request for proposal

RFT Request for tender

ROI Register of interest

Risk and insurance sub-VAC Risk and insurance sub-Value Assurance Committee

SIA Statement of Interest and Ability

SOMAC Standard maintenance contracts

SQP Supplier quality premium

TET Tender Evaluation Team

VAC Value Assurance Committee

VAG Value assurance gate

Contract procedures manual SM021 Part A



Page 1

Part A HNO procurement procedures introduction

1.0 Approval to proceed with a contract 5

1.1 Overview 5

1.2 Approval to proceed with contract 5

1.3 Procurement strategy 5

2.0 Request for tender (RFT) preparation 9

2.1 RFTs 9

2.2 Delivery model 11

2.3 Selecting a supplier selection method 12

2.4 Price/Non-price attributes selection 15

2.5 Pre-qualification for PW (PW only) 18

2.6 Liability and insurance for PS contracts (PS only) 25

2.7 Insurance, bonds and retention for PW contracts (PW only) 27

2.8 Checking of contract documents 32


2.10 Interactive tender process 34

2.11 Commercial in confidence 35

2.12 Base estimate to be included in the RFT 35

3.0 Advertising and issuing of tender documents 36

3.1 Issuing of tender documents 36

3.2 Release of tender details 37


4.1 Tenders register and box 39

4.2 Remote tender closing 39

4.3 Receipt of tenders 41



4.6 Preparation of the schedule of tenders received 44





Section Page




Page 2


5.3 Dealing with comments on the base estimate received from tenderers 55

5.4 56


5.6 Non-price attribute evaluation 57

5.7 Supplier selection methods 65

5.8 Reports and recommendation 68

5.9 Approval to open price envelopes 69

5.10 Approval award contract 70

5.10 Approval award contract 71

5.11 Preferred tenderer status 72

5.12 Tender debrief meetings 73

6.0 Contract award procedure 74


6.2 Signing of contract documents 75

6.3 Who may sign the contract agreement 77

6.4 Who may sign the bond (PW only) 79

6.5 Assignment or novation of contracts 80

7.0 Contract payments 83

7.1 Introduction 83

7.2 Liquidated damages (PW only) 83

7.3 Application of liquidated damages delegations (PW only) 83

8.0 Contract close 84

8.1 Introduction 84

9.0 Appendices part A 86




Page 3

Part A deals with procurement of professional services (PS) and physical works (PW) and:

provides administrative guidelines

defines actions/processes that are to be undertaken, and

describes the required documentation for each.

Each action/process undertaken must be documented in a clear and orderly manner.

Contract process The NZ Transport Agency (NZTA) follows a process in tendering, awarding and administering

contracts for PS and PW. The procedures for each stage of this process are discussed in the

following relevant sections.

Process chart The following diagram identifies the stages in the tendering and contract administration process

for PS and PW.

RFT preparation

Advertising and issuing

tender documents

Tender closing

procedures

Contract award

procedures

Contract close

Contract payments

Approval to proceed

with a contract

Tender evaluation




Page 4

Part A: Delegated authorities schedule

* or RMT.

NOTE:

1) Value assurance gate (VAG) process approvals are in addition to delegated authority approvals. It is the

responsibility of the project manager/asset manager to ensure all steps required under the VAG process are

undertaken as given in SM011.

2) Delegations are valid for contract estimates and tender prices under the 95th percentile of the NLTP budget. If

values are over 95th percentile of the NLTP funding refer to the HNO Consolidated Instrument of Sub

delegations.

3) Stated levels of delegation to approve contract variations are cumulative.

PS

Value limit up to $0.5 million up to $2 million up to $5 million over $5 million

Procurement strategies Highway Manager BUDMT* VAC

Advertise tenders Highway Manager

Open price envelopes Highway Manager National Manager Network Outcomes

Contract award (including

approval and execution of the

contract)

Highway Manager VAC

PS Contract variations

Value limit up to $0.2 million up to $0.5 million over $0.5 million

Contract variations of original

contract value (including

execution of any written variation

to give effect to the variation)

PM/CM Highway Manager National Manager Network Outcomes

PW

Value limit up to $5 million up to $20 million over $20 million

Procurement strategies Highway Manager BUDMT* VAC

Advertise tenders Highway Manager

Open price envelopes Highway Manager National Manager Network Outcomes

Contract award (including

approval and execution of the

contract)

Highway Manager VAC

PW Contract variations

Value limit up to $2 million up to $5 million over $5 million

Contract variations of original contract

value (including execution of any written

variation to give effect to the variation)

Project

manager/Contract

Manager

Highway Manager National Manager Network

Outcomes




Page 5

1.0 Approval to proceed with a contract

1.1 Overview

1.1.1 Introduction Before any tender can be advertised, sufficient financial approval must be held to cover

the base estimate, contingencies, escalation, resource consent modification fees and the

NZTA-managed costs. There must also be intent to complete the proposed works. The

intention would usually be that the project would form part of the National Land

Transport Plan (NLTP).

1.1.2 Authority to

contract

The NZTA's authority to enter into contracts is provided for in section 25 of the Land

Transport Management Act 2003.

1.1.3 Types of

contracts

The NZTA can be the principal for the following types of contract:

state highway PS contracts

state highway PW contracts, including:

state highway design construct contracts where the contractor both designs and

constructs the work

performance-specified maintenance contracts (PSMC).

1.2 Approval to proceed with contract

Contract numbers shall be obtained from the tenders secretary. If a consultant is

preparing the request for tender (RFT) a contract number will be provided on request to

the project manager.

Approval to proceed with the engagement of a supplier is required from the appropriate

manager once the RFT has been prepared. The forms given in appendix I for PS and

appendix II for PW, are to be used for this purpose. It is the responsibility of the project

manager or the asset manager, and not the tenders secretary to ensure that this form is

completed and the necessary approvals obtained.

1.3 Procurement strategy

Procurement manual requires a procurement strategy to be completed for

every project prior to tendering. The purpose of the procurement strategy is to document

the strategic context and considerations in the choice of delivery model, supplier

selection method and other key procurement criteria. The strategies should as a

minimum include:

description of what is being purchased

assessment of the competition in the supplier market




Page 6

assessment of the markets capability to deliver the outputs

assessment of the available delivery models and reasoning for the use of the one

adopted.

The content and detail required in the strategies is dependent of the project size and risk.

The diagram below illustrates the procurement strategy hierarchy and the strategies

required for different types of project.

Portfolio procurement strategy

Stage 2 –

Procurement plan(s)

for individual

contract(s)

Stage 1 – Regional asset

management procurement

strategies

Stage 1 – Large project

procurement strategies

Stage 1 – Regional block

procurement strategies

Stage 2 – Basic

procurement plan(s)

for individual

contract(s)

Stage 2 – Large

project rocurement

plan(s) for individual

contract(s)

1.3.1 Procurement

strategies for

state highway

improvement

projects

The Highways and Network operations (HNO) group has two procurement strategy routes

which are outlined below.

1. Procurement strategies for projects with estimated <$5 million

Projects with estimates <$5 million require a basic strategy which outlines the delivery

model, supplier selection method, key tender information, budget and funding allocation.

These details are recorded by completing appendix I of PS or appendix II of PW. The high-

level information for these projects will be contained in the regional block project

procurement strategy. A regional block project procurement strategy template (appendix

XXVI) should be used as the basis of the strategy and has guidance notes to assist in its

development.

2. Procurement strategies for projects with estimated >$5 million

Projects with estimates >$5 million require strategies with a greater level of detail

regarding the procurement methods chosen and at two points in the project development.

The first procurement strategy is required at the initial stages of the project after the initial

investigation phase has been complete. This is called the stage 1 strategy and outlines the

high-level consideration in the choice of delivery model and the details of PS procurement

as applicable. The stage 1 procurement strategy template (appendix XXVIII) should be

used as the basis of the strategy and has guidance notes to assist in its development. The

second strategy is call the stage 2 strategy and is required before the procurement of PW.

The strategy confirms the delivery model determined in the in the stage 1 strategy is still

correct and provides details of the procurement of the PW supplier. The stage 2

procurement strategy template (appendix XXIX) should be used as the basis of the

strategy and has guidance notes to assist in the development.




Page 7

1.3.2 Procurement

strategies for

state highway

asset

management

projects

Regional asset management procurement strategies

Each region should produce a high level strategy for all asset management projects.

For further details and the latest procurement Strategy template please contact the

Project Services team.

Asset management project procurement strategies

This strategy contains the projects specific information for each project such as

delivery model, supplier selection method, key tender information, budget and funding

allocation and can cover both PS and PW depending on the tendering programme. For

further information and the latest asset management project procurement strategy

Template contact the Project Services team.




Page 9

2.0 Request for tender (RFT) preparation

2.1 RFTs

2.1.1 Introduction This topic deals with the procedures to be followed during the preparation of RFTs.

The RFT should be carefully tailored to each project so it may be easily understood and

clear to a competent and experienced supplier.

If specific information is required in a tender that would not be normal for an

experienced tenderer to supply, then it must be clearly stated as a requirement in the

RFT.

The relevant mandatory require Procurement

manual must be followed as applicable.

PS: RFTs are generally prepared by the NZTA. The project manager or the asset

manager may use a consultant to undertake the preparation or assist in this

process.

PW: RFTs are generally prepared by the network management, project or other

consultant separately engaged by the NZTA as appropriate.

2.1.2 Where a

consultant is

used

Any consultant who prepares an RFT shall be precluded from tendering for that contract.

2.1.3 Proforma

contract

documentation

Proforma contract documentation for PS (State highway professional services contract

proforma manual (SM030)), PW --- capital (State highway construction contract proforma

manual (SM031)), and PW --- maintenance (State highway maintenance contract proforma

manual (SM032))are issued as standard documentation and must be used as the basis

for the respective RFTs.

2.1.4 Short-form

contract

agreement

Where the direct appointment or closed contest procurement processes are used:

PS: the standard form contract (SM030) must be used as the basis for the RFT.

PW: the minor works contract proforma as detailed in SM031 must be used as the

basis of the RFT.

When either of these procurement methods are used the project manager or the asset

manager must still ensure that appendices I and V, and all supporting information such

as a contract estimate, are prepared and the necessary approvals obtained.

2.1.5 Contract

document

deposit

An NZTA officer responsible for preparation of the RFT or person named as project

manager, or asset manager in the RFT shall determine whether a refundable deposit is

required when issuing tender documents to prospective tenderers. This deposit is to be

refunded on return of the documents in good condition or on receipt of a valid tender.

The sum charged is typically limited to costs of printing and distribution.

2.1.6 National

register of

consultants

(PS only)

The NZTA National Office maintains a national register of consultants, according to

their field of expertise, class of work and areas of operation. Any consultant shall be

permitted to submit a new entry to the register or update their existing entry at anytime.

The register will be updated monthly.




Page 10

2.1.7 Number of

tender

submissions

The RFT must specify the number of copies of each submission that must be submitted. The project manager or the

asset manager should select the appropriate number to ensure that two clear copies are retained for inclusion in

the signing sets and that each member of the Tender Evaluation team (TET) has a copy. Making additional copies

of tenders received is undesirable and should be avoided as far as possible.

2.1.8 TET members

to be named

The names of the individuals forming the TET are to be stated in the RFT for transparency

purposes.

2.1.9 Alternative

tenders

Every RFT must state whether alternative tenders will be considered or not. If alternative

tenders will be considered, the RFT must clearly articulate the scope for alternative

tenders. A non-alternative tender must also be submitted if an alternative tender is

submitted.

Provision should be made in the RFT to require tenderers to consult with the NZTA

regarding their alternative proposal prior to tender closure. This may be done through

interactive meetings or submitted directly to the NZTA. The information presented in the

consultation is to be kept strictly confidential.

The alternative tender must be clearly identified and presented with sufficient

information to allow the alternative to be evaluated.

It is important to emphasise that alternative tenders must still conform to the specified

contract scope. The RFT must stipulate that alternative tenders include the following:

A statement to the effect that it is submitted as an alternative tender.

A general description of the physical nature and a clear statement of the scope of the

alternative proposed.

The alternative product details, design, proposed methodology and how it differs from

the method or product specified in the RFT.

The benefits and/or disadvantages, and evidence of previous success.

The social and environmental advantages and/or disadvantages, and evidence that

tangible benefits to the client can be derived from them.

The experience and current capabilities of the tenderer to implement the works.

The risks to the NZTA and consequential flow on effects.

Whether the alternative tenders may be considered in combination with their own

non-alternative tender or other conforming alternative tenders.

The price (in the price envelope).

Alternative proposals submitted in response to the RFTs must be treated as being of

potential advantage to that tenderer. Detail of any innovative ideas from such proposals

must not be revealed in any revised RFT in relation to the project where re-tendering is

invited.

2.1.10 Price envelopes Each tenderer is only to submit one price envelope, tender form and schedule unless

expressly requested by the NZTA or where alternative tenderers are permitted.

Contract procedures manual SM021 Part A Appendix VI



Page 11

2.2 Delivery model

2.2.1 Types of

delivery model

The types of delivery model commonly used are:

traditional (staged delivery)

design construct (design and build)

full delivery (shared risk) early contractor involvement (ECI), competitive alliance

and project alliance

supplier panel.

For further information on delivery models the Project management manual

(SM011) and the Procurement manual should be referenced.

2.2.2 Selection of

delivery model

Project risk and potential for innovation are the key criteria for selecting a

procurement, or development and delivery model. There is no definitive point for moving

from one procurement model to the next, rather the trend is to move to less traditional

delivery models as the potential for innovation and transfer of risk to the supplier

increases.

When the quantum and severity of risk that can be allocated to the supplier is low, and

the potential to add value or innovate is also low, use of a traditional model is preferable.

As potential for both innovation and transfer of risk to suppliers increase, the design and

construct model becomes preferable. The full delivery model is preferable over the

design and construct model when the potential for both innovation and transfer of risk

to the supplier are high. This concept is illustrated in the figure below:

Delivery model selection diagram

For further information on delivery model selection refer to SM011 and the Procurement

manual.


First edition, Amendment 1


Page 12

2.3 Selecting a supplier selection method

2.3.1 Introduction The Procurement manual refers to supplier selection methods and explains the parameters for their use. Tender evaluation for each method shall be in accordance with the requirements of the Procurement manual.

2.3.2 Direct

appointment

method

Direct appointment is an expedited procedure of evaluation that may only be used for contracts valued at $200,000 or less and where the risk that the works or services will not be satisfactorily completed is low. The direct appointment method can be used for contracts which are valued over $200,000 if it can be shown that greater value for money can be obtained by using this method as stated in the Procurement manual section 10.11. The Manager Project Services will consider value for money arguments on a case by case basis and recommend approval to the HNO Value Assurance Committee (VAC) via endorsement of a Procurement Strategy. Direct appointment is the preferred method of engaging suppliers for contracts valued at $200,000 or less.

PS: The procedure would normally involve negotiation with one consultant, selected

for the appropriate class of work from the national register of consultants, using

the short-form contract agreement detailed in SM030. Alternatively a

simple request for a methodology and price, from one consultant selected for the

appropriate class of work from the national register of consultants, using the

short-form contract agreement. If consideration is given to more than one

supplier the procedures prescribed in the Closed Contest supplier selection

method must be followed.

PW: The invitation to tender may be brief but must be in writing and include tender

information and a specification of the work to be done. For PW contracts the minor

works contract proforma as detailed in SM031 should be used with amendments

as appropriate. . If consideration is given to more than one supplier the procedures

prescribed in the Closed Contest supplier selection method must be followed.

2.3.3 Closed contest

method

The closed contest method is an expedited procedure of supplier selection that is typically used on contracts valued up to $400,000. It should only be used where the scope of work required is well defined and as a result there is a high confidence that the price will be less than $400,000 and the risk of unsatisfactory completion of the work is low. The invitation to tender must be in writing and include tender information and a specification of the work to be done. The evaluation of tenders should be consistent with either the LPC, PQM simple or Brooks Law supplier selection methods detailed in this manual. Where available a minimum of three suppliers must be invited to tender.

PS: Consultants should in first instance be selected from the national register of

consultants.

PW: Contractors should in first instance be selected from the register of pre-qualified

contractors.

Exemptions from the monetary limits above may be granted by the National Manager PS in cases where increased value for money can be achieved using this method. To gain exemption the National Manager PS must approve the Procurement Strategy for the contract.




Page 13

2.3.4 Lowest price

conforming

(LPC) tender

method

PS: This method may be applied to PS where the scope of service required is well

defined and as a result there is a high confidence that contract price will be

$400,000 or less. It is expected that the use of this method for PS supplier

selection would be rare.

PW: This method may be used on projects up to a value of $5 million. It can be used for

projects of higher value that are deemed to be straightforward, low-risk works. The

LPC method can be used in conjunction with pre-qualification. If prequalification is

used some or all non-price attributes may be omitted.

Where LPC is used the base estimate must be included in the RFT for transparency purposes.

2.3.5 Target price

method

(purchaser

nominated price)

This method may be used where outputs are difficult to specify or quantify and should typically only be used for strategy studies, feasibility studies, transportation studies, and investigations. The RFT specifies the price to be paid for the contract.

2.3.6 Brook's law

method (type

of quality-

based method)

PS: This method may be used where there is a risk that the assignment will not be

completed adequately by some consultants and the best quality consultant

available, at a negotiated reasonable cost, must be engaged.

For particularly complex projects or contracts having outputs that are difficult to

specify precisely law method may be used.

Note that a simplified Brook s law method may be used for contracts valued at

$200,000 or less (expedited procedures).

PW: This method may be used where a full delivery procurement model has been

selected and the project outputs are difficult to specify.

The approval of the appropriate State Highway Manager or National Manager as

appropriate is required prior to the use of Brook s law evaluation for either PS or

PW tenders.

Note: The law method is a type of quality-based supplier selection method. Other

variants exist and are used by the HNO group with the appropriate approval.

2.3.7 PQM simple

(type of price

quality

method)

Price quality method (PQM) simple uses a mathematical model to translate the non-

price attribute grades of each tenderer to an explicit dollar value, the supplier quality

premium (SQP). The SQP shows how much the NZTA is prepared to pay to secure a

higher quality tender relative to the lowest quality tender.

This method may be considered for use on all PS and PW contracts.

Generally alternative tenders are not to be provided for in PS contracts however where

the project manager/asset manager determines a benefit in allowing for alternative

tenders, PQM simple may be used. Alternative tenders, where allowed, are valued using

a dollar premium known as the alternative tender premium (ATP).

Note that a simplified procedure may be used for contracts valued at $200,000 or less

(limited invitation to tender).

For transparency purposes, the base estimate must be specified in the RFT, as it will be

used in the calculation of the SQP.

Refer to appendix XXV for guidelines on pre-tender preparation required for the tender

evaluation process prior to the issue of the RFT. The evaluation procedure is described

in section 5 Tender evaluation of this part.




Page 14

2.3.8 PQM simple

(type of price

quality

method)

continued

PQM simple has two contract proforma variations for PW tenders:

PQM simple (basic) which does not provide for alternative tenders.

PQM simple (advanced) which provides for alternative tender submission and

evaluation, interactive tendering, consultative processes and cooperative

approaches. Other differences are in insurance, surety, resource consent, quality

plan and probity requirements.

Note: These are not different supplier selection methods.

2.3.9 PQM special

(type of price

quality

method)

PQM special is typically used where there is high importance placed on quality and the

reduction of risk. PQM special allows for a more discerning quality and risk valuation to

be undertaken especially for larger projects.

This model also translates the non-price attribute grades of each tenderer to an explicit

dollar value, the SQP. However, unlike PQM simple, the SQP is extracted from a risk

profile.

The SQP still shows how much the NZTA is prepared to pay to secure a higher quality

tender relative to the lowest quality tender but with PQM special, there is a higher

emphasis on risk issues.

This supplier selection method may also be used for smaller contracts where the

complexity of the project or quantum of risk warrants a greater focus on specific areas

in the evaluation.

The following must be specified in the RFT for PQM special:

Risk parameters.

SQP for a nominal 10 percent difference in non-price attributes for each risk

parameter and the total.

The base estimate for transparency purposes, even though it is not used in the

tender evaluation.

These inputs must be prepared prior to the issuing of the RFT. Refer to the guidelines in

appendix XXV for more details. The evaluation procedure is shown in section 5 Tender

evaluation of this part.

Alternative tenders where allowed are valued using a dollar premium known as the

ATP.

PW: PQM special should be used in conjunction with pre-qualification for all PW

tenders.

The approval of the appropriate State Highway Manager or National Manager PS as

appropriate is required prior to the use of PQM special.

2.3.10 Pre-

qualification

with PW

tenders (PW

only)

Pre-qualification can be used for all PW tenders.

Where pre-qualification is used, the project manager/asset manager must nominate

one or more of the pre-qualification categories and levels required to tender.

The project manager/asset manager shall consider the scope of work, nature, special

features of the works, the NZTA's objectives and the risk profile of the works for each

contract when selecting which categories and level of pre-qualification to specify.




Page 15

2.4 Price/Non-price attributes selection

2.4.1 Price/Non-

price

weighting

selection

When using a price quality supplier selection method it is important to select the

correct price/non-price weighting. A sensitivity analysis should be undertaken to

determine the price/non-price weightings. It is suggested that the SQPs generated for

a range non-price attributes grades be considered. The supplier market and the likely

non-price attributes grade variance should also be considered. Previous tenders may

give an indication of the likely range in non-price attributes grades. The graphs and

table below illustrate the SQP generated for a range of variances in non-price attributes

scores and non-price weightings.

SQP sensitivity testing for PS tenders

SQP sensitivity testing for PW tenders

0

10

20

30

40

50

60

70

80

2 4 6 8 10 12 14 16 18 20

Non-price attributes score range

SQP

as %

of e

valu

atio

n es

t'

Price Weight 20%

Price Weight 25%

Price Weight 30%

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

20.0

2 4 6 8 10 12 14 16 18 20

Non-price attributes grade range

SQP

as %

of e

valu

atio

n es

t' Price Weight 50%

Price Weight 60%

Price Weight 70%




Page 16

Price/Non-price

weighting selection

continued

The graphs are read by selecting the non-price attributes score range you wish to consider on

the x-axis and reading the SQP as percentage of the evaluation price for the different price

weightings from the y-axis (e.g. for PS with non-price attributes score range of 10 the SQPs are:

price weight 20% = 40% of evaluation est. = 30% of evaluation est.

price weight 30% = 23% of evaluation est.

The analysis can be used to consider the potential SQPs generated by the different non-price

weighting and select the correct weighting depending on the premium the NZTA is prepared to

pay for a higher quality supplier on the project.

This analysis should also be available to the TET prior to the evaluation, so they can understand

the SQP generated from the non-price attributes grades. Sharing this analysis with the TET

should mean adjustments to the calculated SQPs as part of the sanity check are less frequent.

Selection of price/non-price weightings for HNO contracts must be within the ranges shown in

the table below unless approval is obtained from National Manager PS via an approved

procurement strategy.

Type of works being tendered Allowable total non-price attributes weighting range

PS 70-80%

PW 30-50%

2.4.2 Non-

price attributes

selection

Procurement manual defines six non-price attributes which can be used in price

quality and quality-based evaluations. The HNO group routinely uses five of these non-price

attributes (NPAs):

relevant experience

track record

relevant skills

methodology, and

resources (PW only).

The sixth of the non-price attributes, financial viability, is only available for use on HNO

contracts with the approval of the National Manager PS.

The use of the five core non-price attributes in evaluations is explained in section 5.7 (part A) of

this manual.

The use of relevant skills, methodology and relevant experience attributes is mandatory for all PS

and PW contracts when using a price quality or quality based evaluation method (without

prequalification). The use of track record is optional for both PS/PW contracts and use of

resources is optional for PW contracts. However the mandatory requirement to use NPAs does

not apply when using prequalification (i.e. any of the NPAs may be omitted when using

prequalification).

The default position for all NZTA PW contracts is to include one or more prequalification levels.

The following table provides guidance on the correlation between the prequalification level, the

The NPAs

selected should also reflect the associated specific contract risks that are also linked to the

selection of an appropriate prequalification level.




Page 17

Non-price

attributes

selection

continued

Prequalification level

Recomm

ended supplier

selection methods

Non-price attribute options Recom

mended num

ber

NPA

s

Relevant

experience

Track record

Relevant skills

Resources

Methodology

A (>$20M) PQM 4-5

A PQM 2-3

B LPC/PQM 0-2

C LPC 0-1

D LPC 0

Exceptions to the above are permitted, but with the expectation that most contracts would

operate within the recommended number of NPAs. The supplier selection methods used

with prequalification are explained in section 2.5.6 (part A) of this manual.

When using a price quality evaluation method in combination with a limited number of

NPAs, the NPAs utilised become more sensitive. It is important that sensitivity testing is

done in selecting an appropriate overall quality price weighting (e.g. a quality weighting of

higher than 30% on a PW contract is not likely to be appropriate for contracts with two or

less NPAs selected).

The choice of NPAs and their weightings should be based on the contract specific characteristics, including risk and size. It is recommended that any NPA included is given a minimum weighting of five percent when used for PQM evaluations.




Page 18

2.5 Pre-qualification for PW (PW only)

2.5.1 Registration

of

contractors

for pre-

qualification

The pre-qualification registration system for contractors has been devised to ensure that

only contractors who have demonstrated their ability to perform to the predetermined

standards, can tender for the PW contracts on state highways. Pre-qualification is

suitable for most PW contracts.

For example, where work is of a highly specialist nature, resulting in insufficient pre-qualified

contractors being able to undertake the work and leading to lack of competition, then the

project manager/asset manager may elect not to require pre-qualification.

Pre-qualification shall not be used for PS contracts.

2.5.2 Work

categories

The pre-qualification system classifies contractors according to their ability to meet

specified quality levels within four PW categories. Each work category has four possible

quality levels, where A is the highest and D is the lowest, to give 16 prequalification

classification levels:

Classification level

Work categories A B C D

1. Routine and minor works 1A 1B 1C 1D

2. Surfacing 2A 2B 2C 2D

3. Bridge construction 3A 3B 3C 3D

4. Construction 4A 4B 4C 4D

2.5.3 Classification

levels

The classification levels are determined by the technical complexity of the project, the cost,

risks involved, the type of temporary traffic management that is anticipated, the

environmental issues and sensitivities that must be considered, the health and safety

management system that must be followed, and also the type of partnering that the project

may require.

The project manager/asset manager will determine what classification level the contractors

should have successfully met to satisfy the project requirements. For any contracts that

include work which crosses more than one category (e.g. construction and surfacing), the

project manager/asset manager may elect to require pre-qualification for more than one

classification level.

The four levels are:

Level A is the highest classification. Typically, level A projects:

Need the highest quality management system to ISO 9000.

Technically complex requiring specialist appreciation and understanding.

Involve full partnering and cooperation with all parties.

Complex and sensitive environmental management issues.

Are considered high risk.

Capable resources and experience to carry out projects usually over $5.0 million

(indicative only).




Page 19

Classification

levels continued

Level B:

Quality management system having certification to QEST and TNZ: TQS1 and

evidence of working towards ISO 9000 certification.

Technically complex requiring technical appreciation and understanding.

Limited surveillance required and the contractor adheres to the principles of

partnering.

Complex environmental management issues.

Are considered medium to high risk.

Capable resources and experience to carry out projects estimated at between

$2.5 and $5.0 million (indicative only).

Level C:

Quality management system that provides current certification to QEST and

TNZ: TQS1.

Not technically complex but requiring technical appreciation and

understanding.

Minimum surveillance on cooperation and pro-active partnering.

Simple environmental management issues.

Are considered low to medium risk.

Capable resources and experience to carry out projects estimated at between

$0.5 and $2.5 million (indicative only).

Level D is the lowest classification and applies to those projects that:

Need only a simple level of quality control.

Technically simple, routine or repetitive.

Minor levels of surveillance and support.

Does not involve sensitive environmental management issues.

Are considered low risk.

Capable resources and experience to carry out projects usually less than $0.5

million.




Page 20

2.5.4 Work

categories

Contractors are classified in accordance to their expertise in four work categories that

may include some or all of the following scopes of work. The list given is only a

guideline and may not be exhaustive in covering all the works requirement:

1. Routine and minor works

Pavement maintenance:

o Patching and repairs, including potholes.

o Shoulder maintenance, including flanking.

o Routine maintenance and repair of surface water channel, and subsoil

drainage.

o Stream clearing and debris removal, to maintain water courses through

culverts.

o Repair minor scour in water channels and other drainage facilities.

o Renewal or installation of culverts with a diameter less than or equal to

600 millimetres. Repair dropouts and/or slips that do not require restriction

of a traffic lane, provided they do not need urgent attention to remove a

threat to road safety or the road structure.

o Repair to scour, degradation or aggradations threatening roads, bridges or

other roading-related structures which has accumulated over time.

o Repair to any other deficiency which has developed from events occurring

over a period of time.

o Replacement of wearing and running course metal on unsealed roads.

o Grading of unsealed roads

Traffic services

o Provision and maintenance of signs and road markers.

o Provision and maintenance of pavement markings.

o Operation and maintenance of traffic signals.

o Operation and maintenance of traffic monitoring equipment, such as area-wide

traffic control systems and closed-circuit television (CCTV).

o Operation and maintenance of emergency telephones on motorways.

o Maintenance of guardrails and sight rails.

o Replacement of traffic signal and surveillance equipment with an equivalent but

state of art facility.

Carriageway lighting

o Provision and maintenance of operation of lighting on local roads.

o Provision and maintenance of operation of lighting on state highways.

o Provision and maintenance of operation of belisha beacons and floodlights at

pedestrian crossings.

Vegetation control

o Protection planting projects.

o Toe weighting of unstable slopes.

o Drainage installed to drain incipient slips.

o New works which protect existing roads from sea or river damage.

Amenity/safety maintenance

o Snow clearing and ice control.




Page 21

o Vegetation control.

o Litter collection on rural roads.

o Removal of, protection against, graffiti on roading structures.

o Removal and cleaning up crash debris and spillages (excluding hazardous

substances which are responsibility of emergency services).

o Cleaning channels, sumps and cesspits.

Traffic management

o Provision and operation of advanced traffic management systems (ATMS).

o Provision and operation of variable message signs.

o Provision and operation of local area traffic management schemes.

o Provision and operation of surveillance devices.

o Provision and operation of weighing devices.

Minor safety

o Small isolated geometric improvements.

o Intersection improvements.

o Traffic calming measures.

o Lighting improvements.

o Power pole relocation.

o Provision of guard railing.

o Sight benching to improve visibility.

o Pedestrian crossings.

o Stock underpasses.

o Formation of trailer parks.

2. Surfacing

Reseals/seal extension

o Conventional chip reseals including second coat seals.

o Void filling seal coats.

o Texturing seals.

o Other approved special purpose chip seals.

o Asphaltic surfacing.

3. Bridge construction

Bridge maintenance/repairs

o Repair of bridge retaining walls.

o Replacement of timber decks.

o Replacement of damaged or deteriorated structural members.

o Sand blasting and painting of structural members.

o Foundation protection.

.




Page 22

Bridge construction

o Replacing bridge structure.

o Widening an existing bridge.

o New bridge

Work categories

continued

4. Construction

Rehabilitation/pavement treatment

o Removal and replacement of the existing pavement material.

o Rip and relay.

o Chemical stabilisation.

o Unbound granular overlays not exceeding 70 millimetres over high spots.

o Treatments involving ripping and/or reshaping, including stabilisation of the

existing pavement material.

Drainage improvements

o Repair and replacement of kerb and channel.

o Installation of water channels and subsoil drainage.

o Renewal or installation of culverts with a diameter greater than 600

millimetres.

o Routine maintenance and repair of surface water channel and subsoil drainage.

o Stream clearing and debris removal; to maintain water courses through

culverts.

Road construction

o New road realignments.

o Re-grading.

o Widening.

o Intersection improvements

o Approaches to bridge renewals.

o New retaining structures.

o Tunnels.




Page 23

2.5.5 NZTA Operator

rating system

To be eligible for prequalification contractors must have at least a 4 star rating on the

prequalified, failure to do so will trigger a performance review as detailed in section 2.5.9.

For further information on the NZTA Operator Rating System go to www.nzta.govt.nz

(http://nzta.govt.nz/commercial/assistance/ors/index.html).

2.5.6 Performance

criteria

When applying for pre-qualification contractors are required to supply information with

their application under the following performance criteria:

quality assurance

traffic management

environment management

health and safety

project management

quantum or size of work

cooperation and proactive partnering.

2.5.7 Evaluation

methodology

The supplier selection method used with prequalification will be determined by the

following:

1. For contracts with an estimated out-turn cost of less than $5 million, which are

considered low risk in all aspects, the HNO group will use the LPC supplier selection

method.

2. For contracts with an estimated out-turn cost of less than $5 million, which are

considered complex or high risk, or contracts with an estimated out-turn cost of more

than $4.5 million the HNO group will use the PQM supplier selection method.

2.5.8 Application

for pre-

qualification

registration

For details and information on how to apply for a Pre-qualification application pack refer to the

website www.nzta.govt.nz and search re-qualification application pack .

2.5.9 Review of

c

performance

The Pre-qualification Evaluation team (PET) will use the interim and final performance

assessment by coordinated evaluation (PACE) reports to monitor the performance of pre-

qualified contractors.

monitor the safety performance of prequalified contractors. Contractors must hold a

Performance reviews are undertaken by the PET in consultation with the project manager/

asset manager, supervising consultant and the contractor where performance is inadequate.

2.5.10 Inadequate

performance

Performance is considered inadequate if:

the total PACE score (interim or final) for any of the four main criteria categories

(management, production, health and safety, or administration) average 40 percent or

less, in which case a performance review will be undertaken. Inadequate performance of

subcontractors may trigger review of main cont -qualification.

In addition the PET, in discussion with the project manager/asset manager, will make a

decision on whether a performance review is necessary when:

three or more (in total) of the individual PACE criteria are 40 percent or less,

two or more in any one category are 40 percent or less, or


http://nzta.govt.nz/commercial/assistance/ors/index.html




Page 24

Penalties for inadequate performance can apply to any or all the NZTA egions and involve

any of the following:

Warning any recurrence will lead to automatic suspension or improvement required

with a specified timeframe.

Downgrading supplier downgraded and required to re-submit application to reverse

downgrading.

Suspension pre-qualification withdrawn for a set period (nationally or regionally).

Rescind registration pre-qualification withdrawn for a set period and application must

be resubmitted.

2.5.11 Pre-

qualification

database

The current list of pre-

website (www.nzta.govt.nz/resources/prequalified-contractors/index.html).

http://www.nzta.govt.nz/resources/prequalified-contractors/index.html




Page 25

2.6 Liability and insurance for PS contracts (P only)

2.6.1 General The requirements for liability and insurance, for PS contracts, are set out on the

Highways Information Portal, General and special conditions for the provision of professional

services and in SM030. Insurances are accepted in principal from those insurance

companies on the NZTA-approved list. This list is available on the NZTA website. The

NZTA requires bond and insurance companies to hold an A rating or better from an

approved rating agency. Suppliers wishing to nominate insurers or bond companies not

on this list must first obtain written approval from the risk and insurance sub-

VAC ([email protected]). It is the responsibility to ensure that any bond

or insurance company has an A rating or better from an approved rating agency.

A current list of New Zealand insurers approval rating is available from the rating

schedule available from the Insurance and Superannuation Unit (ISU). The ISU is an

operational unit of the Ministry of Economic Development (www.isu.govt.nz).

2.6.2 Liability and

insurances

For default liability and insurance levels (minimum requirements) refer to section E

General and special conditions of contract (SM030).

Other liability and insurance levels for approval include:

Risk and insurance sub-VAC approval (appendix XXIII for PS)

Some contracts require approval from the risk and insurance sub-VAC prior to

advertising of tender, for example:

contracts where the consultancy fees are estimated in excess of $1 million

tunnels and bridges where the total project estimate exceeds $5 million

any project where the total project estimate exceeds $15 million

all design and construct (refer to PW requirements).

Any other project where the NZTA project manager/asset manager considers it

necessary, e.g. any project that includes unusual or non-standard activities, service

providers in close proximity (gas pipelines, railway) and consultancy services relating to

new technology.

2.6.3 Changed

insurance

requirements

after award

If for any reason the project manager/asset manager believes that insurance

requirements should be amended during the currency of any contract (e.g. if the value of

the contract increases significantly) then such proposed amendments must be first

submitted to the risk and insurance sub-VAC for approval (refer to appendix XXIII for

PS).

2.6.4 Uninsured

consultants

engaged in

minor

contracts

Consultants engaged in minor contracts (up to $200,000) who require insurance, but do

not hold and are not practically able to procure such insurance can be provided with

PI/PL insurance by the NZTA.

NZTA has a facility to purchase $5,000,000 of Public Liability and up to $500,000 of

Professional Indemnity from the NZTA Insurance Broker. Further information and contact

on the Highways Information Portal.

2.6.5 Decreasing or

waiving

insurance

requirements

The NZTA SHM (or equivalent) may decrease or waive the PL and/or PI insurance

requirements where:

the suppliers actions or recommendations are extremely unlikely to have an impact on rd parties; and

the supplier will not be undertaking site visits or working on/near the State Highway;


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Page 26

and

the supplier will not be working from the NZTA office; and

no design work is involved (for example facilitating workshops, minor

phone/internet research, business advice relating only to processes).

Full PI and PL insurance requirements are required where:

the

goals, objectives and 3rd parties; or

the supplier will be undertaking site visits or working on/near the State Highway;

or

design work is being undertaken (for example audits and reviews, major

research/surveys, business advice that could affect strategic direction)

For further advice please contact the Project Services team.




Page 27

2.7 Insurance, bonds and retention for PW contracts (PW only)

2.7.1 Introduction Insurance of the contract works and a contractor s bond are required for a PW contract. This topic details the policies NZTA follows concerning insurance and bonds for PW

contracts.

2.7.2 Insurance The provisions for insurance of the contract works are set out in New Zealand Standard 3910:2003 Conditions of contract for building and civil engineering construction (NZS 3910:

2003) section 8. Current policy concerning the administrative provisions is as follows:

Public liability under section 8.3.1 ($5 million) extended where necessary to include cover required by the Forest and Rural Fires Act 1977, except where special risks

require more cover.

Public liability under section 8.3.2 arising from the use of any motor vehicle not less than $5 million.

For maintenance contracts, including resealing, no insurance of the contract works and materials is required except as noted below.

For construction contracts (rehabilitation, earthworks, bridges, etc) insurance cover

of the contract works and materials is required.

2.7.3 Insurance

certificate

approval

The NZTA requires the insurance company providing the public liability and contract

works insurance cover to sign the insurance certificate. No proof of construction machinery and motor vehicle insurance is required.

2.7.4 Approval for

insurance

levels by risk

and insurance

sub-VAC

Risk and insurance sub-VAC approval (refer to appendix XXIII for PW or ECI).

Some contracts require insurance levels to be approved by the risk and insurance sub-VAC prior to advertising of tender.

The project manager/asset manager shall submit their proposal to the insurer

for review, and thereafter to the risk and insurance sub-VAC for approval (via [email protected]) for the following contracts:

Any contract where the estimate exceeds $15 million.

Contracts for tunnels and bridges where the estimate exceeds $5 million.

All design and construct contracts.

All term maintenance contracts where the individual annual turnover of any one

contract will exceed $10 million. Term maintenance contracts are agreed to be limited to general highway maintenance including pavement reconstruction.

Any other contract where the project manager considers it necessary, e.g. any

project that includes unusual or non standard activities or construction areas of known existing defects such as underlying mines, asbestos dumps.

All contracts where the estimate is less than $15 million but which exceed $15 million

once the tenders have been received must be referred to the risk and insurance sub-VAC prior to work commencing.





Page 28

Approval for insurance

levels by risk and

insurance sub-VAC

continued

Any contract where construction work is contemplated on significant strategic parts of the

NZTA asset, such as, the Auckland Harbour Bridge, Newmarket Flyover, Thorndon

Elevated Motorway, Christchurch Lyttleton Road Tunnel. While the NZTA does not insure

any aspect of the roading network, bridges or tunnels, in such cases it is possible that the

NZTA may need to insure the asset being worked on. Note that this would only apply to

contracts where the structure supporting the asset was being worked upon and there might

be a risk of physical collapse.

2.7.5 Changed

insurance

requirements

after award risk

and insurance

sub-VAC

approval

If for any reason the project manager/asset manager believes that insurance requirements

should be amended during the currency of any contract (e.g. if the value of the contract

increases significantly) then such proposed amendments must be first submitted to the risk and

insurance sub-VAC for approval.

2.7.6 Bonds A contractor's performance bond may be required under NZS 3910:2003 section 3.1. This

provides the NZTA security to ensure performance of the contractor's obligations under the

contract agreement. This may include completing the work to the specified standard and breach

of contract, e.g. through wrongful termination. The bond is usually released within five days of

practical completion.

The contractor in addition may offer a bond in lieu of retentions as under NZS 3910:2003 clause

12.3.3.

Alternatively, a contractor may be eligible to apply to join the global bond scheme. If a

global bond can be obtained, it can be used for contracts with a tendered sum of up to

$20 million refer to global bond policy.

This will negate the requirement for a performance bond or a bond in lieu of retentions.

2.7.7 Bonding policy The following are the bonding policies for PW contracts with bond values rounded to the

nearest $1000:

1. Except as set out in 5 below, for contracts with an estimated cost of less than $100,000

and/or duration of less than three months, no bond is required.

2. Except as set out in 4 and 5 below, contracts with an estimated cost in excess of

$100,000 and less than $1 million, a 10 percent bond is required.

3. Except as set out in 4 and 5 below, contracts with an estimated cost in excess of

$1 million, a 10 percent bond on first $1 million and a five percent bond thereafter are

required.

4. For contracts that have very special characteristics such as complexity or for very large

maintenance contracts the requirements for additional bonds are to be submitted to the

risk and insurance sub-VAC for approval. Any proposal for additional bonds must not be

greater than the reasonably expected loss to the NZTA in the event of the contractor

defaulting.

5. For contracts in excess of $20 million the appropriateness of the proposed bond is to be

considered by the risk and insurance sub-VAC for approval.

6. No performance bond is required for term maintenance contracts including reseal

contracts unless they are performance-based contracts.




Page 29

2.7.8 Amendments to

standard PW bond

forms

The NZTA PW contracts use performance bonds and bond in lieu of retention forms

provided in NZS 3910:2003.

Some bond providers require amendments to the NZS 3910:2003 bond forms making

them on demand and enabling multiple draw downs.

The following amendments to the NZS 3910:2003 standard bond forms are acceptable

to the NZTA:

tly and severally held and bound to the principal in

the sum of NZ$XXXXX and bind themselves, their successors and assigns jointly and

severally for the payment of that sum and the sureties undertake that they will pay to

the principal any amount demanded by the principal provided the demand by the

should at no time exceed NZ$XXXXX in the aggregate.

Notwithstanding any other provision of this bond, the sureties may pay to the principal

an amount equal to its maximum liability under this bond less any moneys previously

paid, or such lesser amount the principal may specify. Any such payment will result in

this bond being null and

2.7.9 Bond in lieu of

retentions

retention

amounts

For all contracts the bond value shall be the applicable contract retentions set out below

plus a further 10 percent of that figure.

For construction contracts the maximum amount of retention is $200,000. The amount

to be retained from monies owing to the contractor is:

10% for the first $200,000

5% for the next $800,000, and

1.75%of the amount in excess of $1 million.

For large construction contracts, over $20 million in value, the capped retention limit of

$200,000 is not considered adequate. For such contracts the consultant is to make a

recommendation in regard to the appropriate level of retention to the project manager

who will in turn seek approval of this amended maximum retention amount from the risk

and insurance sub-VAC before the tender is advertised.

For maintenance contracts the maximum amount of retention is $100,000. The amount

to be retained from monies owning to the contractor is:

5% the first $200,000

2.5% for the next $800,000, and

1% for the amount in excess of $1 million.

2.7.10 Global bond

policy

Any contractor may apply to join the global bond scheme if the contractor has

a:

1. current contract with the NZTA

2. track record of having had at least one current contract with the NZTA at all

times during the last three years, and

3. track record of no bond being called upon by the NZTA within the last six years.

Global bonds are approved at the discretion and can be applied for by

contacting [email protected].

If a global bond is obtained, this will ordinarily replace both the requirement for a

performance bond and the need to offer a bond in lieu of retentions under NZS

3910:2003. However, the global bond may only be used for contracts with a tendered





Page 30

sum up to

$20 million, as after that amount, project specific bonds will be required.

Contractors who do not wish to participate in the global bond scheme or are not eligible

to do so will have to provide a project specific performance bond and/or a bond in lieu

of retentions for the amount stated in the contract documents.

responsibility to ensure they have a current global bond and this is at the correct level

for the contracts covered by the bond. Failure to provide or renew a current global bond

at the correct level will result in the engineer retaining payment to the value of the

project specific bond and retentions for each contract under the scheme until a valid

project specific bond or global bond is provided.

The terms of any global bond obtained must be contained in a deed, and must:

provide that the bond amount will be automatically reinstated to the full amount of

the global bond amount every time the bond is called upon by the NZTA

provide

successors and assigns to pay to the NZTA on written demand at any time after the

date of this deed any sum

2.7.11 Global bond

amounts

For policy regarding global bond amounts and how this is determined is available in the

Highway Infromation Portal website (http://hip.nzta.govt.nz/technical-

information/insurance/physical-works/global-bond)

2.7.12 Cancellation of

global bond

If any contract within a global bond agreement is called upon by the NZTA during the

lifetime of the agreement, the tenders secretary must notify [email protected].

The NZTA will then consider either renewing or cancelling the agreement upon expiry

date.

If the NZTA or the contractor chooses to cancel the global bond agreement it is the

current global bond register at agreement expiry date are covered by individual

performance bonds and bond in lieu of retentions.

2.7.13 Global bond

procedures

Refer to global bond procedure flow chart for assistance to tenders secretaries,

consultants and contractors with regards to notification of contracts to add or release

from the global bond register.

Refer to appendix XXVII for global bond release letter.

2.7.14 Insurance and

bond

companies

Bonds and insurances are accepted in principle from those insurance companies and

banks on the NZTA-

requires bond and insurance companies

rating agency.

Suppliers wishing to nominate insurers or bond companies not on this list must first

obtain written approval from the NZTA Finance and Corporate Services Manager. It is the

or better from an approved rating agency.

schedule available from the ISU. The ISU is an operational unit of the Ministry of

Economic Development (www.isu.govt.nz).

http://hip.nzta.govt.nz/technical-information/insurance/physical-works/global-bond

http://hip.nzta.govt.nz/technical-information/insurance/physical-works/global-bond


http://www.isu.govt.nz/




Page 31

2.7.15 Global bond procedure flow chart

Step 1: Execution of Global Bond Agreement and Register

The NZTA National Office to advise NZTA’s tenders secretaries with instructions.

The NZTA’s tenders secretary to inform consultants of Global Bond for the said contractor and instruct them to replace

existing performance bonds and bonds in lieu of retentions with the new ‘Agreement’ and ‘To whom it may concern bond

letter’ on contract file.

Step 2: Ongoing procedures: Adding and releasing contracts from Global Bond Register

Consultant to confirm in writing to the NZTA’s tenders secretary all new contracts to be covered under the contractor’s

Global Bond Agreement detailing: contractor, contract number, name and value, the NZTA’s regional office and contact

person, contract start date and expected date of practical completion.

The NZTA’s tenders secretary to update contract file and notify [email protected] of contract details for updating

the contractor’s Global Bond Register.

Contract completion

Consultant to inspect project with the NZTA’s project manager, and upon satisfaction issue the Certificate of practical

completion. Consultant to forward the certificate, including the expiry date of the defects liability period to the NZTA’s

tenders secretary, to place on contract file. The NZTA’s tenders secretary to notify [email protected] to update

contractor’s Global Bond Register.

Consultant to issue Defects liability

certificate for contract and request the

NZTA’s tenders secretary to issue a

release letter to the contractor with copy

of Defects liability certificate.

Contract removed

from contractor’s

Global Bond

Register.

The NZTA’s tenders secretary to issue

release letter with Defects liability

certificate and notify

[email protected] to update the

contractor’s Global Bond Register.




Page 32

2.8 Checking of contract documents

2.8.1 Introduction The contract documents prepared must be thoroughly checked. This topic discusses the responsibilities of the personnel involved for each category of contract.

2.8.2 Checking PS: The appropriate manager must ensure that all contract documents prepared in-house or by a consultant are thoroughly checked to ensure that all requirements are covered and that the estimate is appropriate.

PW: The consultant responsible for the preparation of the contract documents must ensure that the contract documents are in compliance with the Procurement manual. The project manager/asset manager, in general terms only, check the scope of the work and estimate.

Note: It is the responsibility of the project manager/asset manager to ensure all steps required under the VAG process have been undertaken prior to tendering a contract.

2.8.3 Tendering

period

Adequate time, generally no less that 12 working days, must be allowed for the preparation of tender submissions.

2.8.4 Where two

envelopes are

used

For supplier selection m law which use a two-envelope system, clear instructions must be given in the RFT as to the identification of the two envelopes in which the tenderers return the tender.

2.8.5 Where tenders

close

Instructions must be given as to the location of the office(s) where tenders will close including, if required, provision for remote tender closing.




Page 33

2.9 Shortlisting procedures

2.9.1 Benefits of

shortlisting

If used correctly shortlisting prospective suppliers carries out three important functions:

It reduces the cost of tendering for the industry, by reducing the number of full submissions.

It ensures only high quality suppliers are selected for the work.

It reduces the administrative burden of evaluating tenders.

Note: If used incorrectly shortlisting can increase the burden on suppliers and evaluators by introducing a second tier of submissions/evaluations.

2.9.2 When to

shortlist

Analysis of the supplier market is required to determine if shortlisting is required. Incorrect overuse of shortlisting can narrow the market as it acts as a barrier to entry. Analysis of the supplier market should include:

an assessment of the likely tenderers

an assessment of the quality of supplier required and the likely cost of the tender process to the NZTA and the supplier

an assessment of the tenderers ability to meet the required quality standard and deliver the contract outputs successfully.

At this point a preliminary decision on if shortlisting is likely to be required can be made. The final decision on if shortlisting is required is made using the factors described above once ROI have been taken and tenderers are known.

For further description on the factors influencing the decision to shortlist see the Procurement manual.

2.9.3 The shortlisting

process

All suppliers who have registered interest and are eligible to tender are requested to

submit a Statement of Interest and Ability (SIA). The SIA shall be evaluated using a

subset of the attributes in the Procurement manual. Prospective tenderers must be advised

that no other evaluation information is to be submitted with the SIA. On the completion

of the SIA evaluation, all prospective tenderers must be advised of the shortlisted

tenderers. Debriefs, if carried out, must be offered to all tenderers and should not occur

until after the tender has been awarded. For the tender process shortlisted tenderers

must then be requested to provide information on all non-price attributes, including those

submitted for the SIA, for evaluation.

If shortlisting is to be used typically three tenderers will be taken though into the full

tender process (this may be extended to four in some cases). However if the TET is not

able to clearly distinguish between tenderers at the shortlist margin (i.e. grades between

the two are ⋜ 1.0) then they may take the next placed tenderer through the full tender

evaluation process also.

On award of the contract, all unsuccessful suppliers shall be informed as prescribed in the

Award of contract section of this manual (part B).




Page 34

2.10 Interactive tender process

2.10.1 Benefits and

use of the

interactive

process

The interactive tender process provides a useful means of communication between the

client and tenderer during the tender period. The individual interactive meetings are

commercial in confidence, non-contractual in nature and will not be minuted.

Interactive tender meetings will generally be used for large, complex, high risk projects.

They are always used on design construct, ECI and alliance projects.

The key purpose of the meetings is to:

clarify the intent and improve the standard of the RFT to ensure both parties are

aligned on the specified requirements

provide a forum for an open exchange of information and ideas

allow additional information transfer to more clearly identify risk, so it can be better

managed

align client and suppliers objectives, and

allow the tenderer to put forward conceptual design ideas for design construct

contracts, or alternative tender proposals and for the client to provide feedback on

Where an interactive tender process is to be used, the process proposed must be clearly

documented in the RFT.

Participants in the interactive meetings may distribute information during the meeting

but these must be returned to the tenderer. It is important that all tenderers are given

equal time and access to the TET during the interactive process.

Changes (or clarifications) identified by a tenderer as a consequence of individual

interactive meetings must be formally submitted by the tenderer through a separate

request for clarification. The tenders secretary will subsequently issue a notice to

tenderer or notice to specific tenderer as appropriate.

Generally tenderers are provided with the RFT and invited to an initial combined

interactive meeting with the TET and advisors, where the process to be followed and the

contract objectives are explained. Tenderers initial queries are also discussed.

Following the combined interactive meeting a meeting timetable for individual

interactive meetings will be agreed with tenderers.

Interactive meetings with individual tenderers should be timed logically within the

tender period phase. The timing should allow tenderers the opportunity to compile

appropriate questions and to incorporate information received into the tender

submission.

A note should be recorded in the contract file identifying the name of the tenderer, TET

members present, location and time of the interactive meetings held.




Page 35

2.11 Commercial in confidence

Meetings or other communications between tenderers and the NZTA may be

deemed to be commercial in confidence.

commercially sensitive information the tenderer can request and upon agreement of

the TET the communication may be given commercial in confidence status, and the

NZTA will respond by way of notice to specific tenderer.

Tenderers shall notify the NZTA of the name and contact details of the person within

their own organisation with whom the NZTA will direct all communications during

the tender period.

Communications that are commercial in confidence between a tenderer and the

NZTA must be in writing, issued separately and clearly marked that they are

ommercial in confidence and for the attention of the NZTA representative as listed

in the tender document.

The NZTA will respect commercial in confidence communications. However, where a

significant event arises, which in the NZT

tender and/or contract process, the NZTA reserves the right to inform all tenderers

by notice to tenderer or to terminate the tender process. If the NZTA deems this to

be the case it will communicate with the tenderer who raised the commercial in

confidence matter to seek their agreement (in writing) to relax the commercial in

confidence status. If the tenderer does not agree, the NZTA will decide whether the

communication should be the subject of a general communication to all tenderers.

2.12 Base estimate to be included in the RFT

For purposes of transparency, accuracy and to allow tenderers to comment the

estimate is to be included in the RFT for all contracts unless the target price supplier

selection method is used. The base estimate is used in the calculation of the SQP for

PQM simple and it is therefore important that the most up to date estimate is

included in the RFT.

The TET shall not amend the Base Estimate after close of tenders without the

advice/approval of the Manager Project Services.




Page 36

3.0 Advertising and issuing of tender documents

3.1 Issuing of tender documents

3.1.1 Introduction After the RFT has been prepared, approval to proceed to engage a supplier is to be sought and tender documents issued. Tenders shall be advertised unless the supplier is directly appointed, contract is subject to a closed tender process or where the national register of consultants is used.

3.1.2 Administrative

procedure

approval to advertise

The procedure below must be followed regardless of whether the contract is being

advertising or not. Where the tender process is being managed by a consultant the

following provisions shall apply unless amended by the consultants PS contract.

Step Action

1 Approval to proceed with the tender must be sought by the project manager/asset manager for PS

contracts or by the consultant for PW contracts. The forms to be completed are as follows:

PS: Request for approval to proceed to engage a consultant form (appendix I). PW: Request for approval to proceed to engage a contractor form (appendix II).

2 Where applicable, the project manager/asset manager must notify the risk and insurance sub-VAC

in writing before advertising, using appendix XXIII for PS and PW or ECI (refer to sections 2.6 and

2.7 for guidance).

3 For PS contracts the project manager/asset manager shall forward to the tenders secretary:

The completed Request for approval to proceed to engage a consultant for the provision of PS form including approval to advertise by the State Highway Manager.

Attachments stipulated on the form.

Document to be issued to prospective tenderers.

For PW contracts the consultant shall forward to the project manager/asset manager for the

State Highway Manager approval, three full working days prior to the required deadline for

advertising, the following:

Completed Request for approval to proceed to engage a contractor for the provision of PW form.

One final copy set of tender documents.

All accompanying documentation as required by standard PS specification design and project documentation, clause 5 or network management equivalent.

A draft of the information required for the GETS advertisement.

The tenders secretary will send a copy of the approved appendix II form to the consultant.

4 For PS contracts the tenders secretary shall ensure sufficient documents are available for issue

and send a notification via email to all consultants registered on the national register of consultants

to undertake the work being contracted. The contract may also be advertised using GETS under the

direction of the project manager.

For PW contracts the project manager shall instruct as appropriate the tenders secretary or

consultant to proceed with the advertising of the contract on GETS.

5 The tenders secretary for PS contracts/the consultant for PW contracts shall issue the contract

documents and maintain a Register of tender documents issued professional services and physical works (appendix III). In addition appendix IV Register of tenders is provided for the

tenders secretary to use to record the status of all contracts out to tender, i.e. whether it has

closed, is under evaluation, or has been awarded. When issuing RFT via post or email an

acknowledgement of receipt should be requested. If receipt is not acknowledged within a




Page 37

reasonable period the tender secretary/consultant should alert the project manager/asset manager

and investigate.

3.1.3 Approval to

engage a

contractor

without

advertising

(PW only)

Where a contract is not advertised, as provided for elsewhere in this document (section

2.3 Selecting a supplier selection method), and the contractor is selected from the

register of pre-qualified contractors, the Request for approval to proceed to engage a

contractor for the provision of PW form shall be completed and forwarded to the State

Highway Manager together with accompanying documentation as appropriate. On

approval by the State Highway Manager the original or fax copy of the form signed by

the State Highway Manager is to be returned to the consultant.

3.2 Release of tender details

Details of tenderers must not be released to any external organisation other than the

NZTA consultant who is assisting with the tender. If requests for tenderers

information are received from prospective subconsultants/subcontracts the details of

these interested parties should be given to registered tenderers with a brief

description of their interest.

3.3 Communication during the tender period

3.3.1 Process for

communicating

during the

tender period

Communication during the tender period outside of a prescribed interactive tender process

will be in writing (this includes facsimile and e-mail communication, which may include

attachments). Communications will be issued by the person nominated as the contact

person in the tender documents, this should be someone outside of the TET and will

normally be the Tender Secretary for PS contracts.

PS: The officer responsible for preparation of the RFT (usually the person named as the

project manager/asset manager in the RFT) shall be responsible for all advice given

to tenderers during the tender period and for the issue of notices to tenderers, such

notices would normally be issued by the tenders secretary on behalf of the project

manager/asset manager. All communication with prospective tenderers shall be

adequately documented including formal notices to tenderer, a copy of which shall be

retained by the tenders secretary at time of issue. The tenders secretary is not to

issue a notice or to give any advice without the approval of officer responsible for the

tender.

PW: The officer responsible (usually the consultant Team Leader) for RFT preparation

shall be responsible for all advice given to tenderers during the tender period and for

the issue of notice to tenderers. All communication with prospective tenderers shall

be adequately documented including formal notice to tenderers, a copy of which shall

be sent to the tenders secretary at time of issue. The consultant acting as the tenders

secretary is not to issue a notice or to give any advice without the approval of the

officer responsible for the tender.

The format of notice to tenderers is given in appendix XXI.




Page 38

3.3.2 Control of

notices

It is the responsibility of the NZTA or consultant officer responsible for the tender to

ensure that the content of all notices is correct. It is the responsibility of the person

issuing the notice to ensure that the notice is sent to the correct tenderer.

Tenders that will have a substantial number of notices to specific tenders (NTST)

issued dealing with commercial in confidence issues should ensure appropriate

controls and safeguards are in place to prevent issue of information to the wrong

tenderer. Tenders generally requiring these additional controls are Design &

Construct and Alliance contracts.

The suggested method of additional control is to applying a unique password to each

tenderer throughout each tender process. All commercial in confidence

documents/notices will then be password protected with this unique password. If an

email/notice is inadvertently sent to the wrong tenderer it can then not be opened by

that tenderer. Alternative methods of control should be discussed with the Project

Services Team prior to the start of the tender process.




Page 39

4.0 Tender closing procedures

4.1 Tenders register and box

4.1.1 Register of

tenders

A register of tenders must be maintained by the tenders secretary. When the

completed Request for approval to proceed to engage a consultant for the provision of PS or

contractor for the provision of PW form is forwarded to the tenders secretary, the details

of the form must be entered into the register of tenders. The Register of tenders form as

given in appendix IV is to be used and retained on file. The tenders secretary shall take

care to ensure this register is kept confidential (especially from other tenderers).

4.1.2 Tenders box The box for the receipt of tenders is to be placed in a prominent position in the office

reception, preferably near the enquiry counter. Tender box must be displayed

prominently on the box.

4.1.3 Maintaining the

tenders box

During the receipt of tenders the tenders box must be securely locked to prevent

unauthorised access. The tenders secretary shall be responsible for the security of the

tenders and access thereto. The tenders secretary shall be responsible for ensuring

tenders are not deposited in the tenders box after the closing time and that any late

tenders are appropriately endorsed.

4.2 Remote tender closing

4.2.1 Project

manager/

Asset manager

to ensure

appropriate

arrangements

The project manager/asset manager shall be responsible for the determination of remote

sites for the receipt of tenders, the overall administration of the process and compliance

with the NZTA requirements. The tenders secretary will be responsible for ensuring the

arrangements for the closing of tenders at remote tender boxes and the tender delivery to

the NZTA office.

4.2.2 Offices where

remote tenders

may close

The RFT documentation must clearly describe the name of the business, street address

and postal address of the offices where tenders may be submitted and that they should be

addressed to the Tenders Secretary, NZ Transport Agency. The outer envelope must be

marked on the outside with the contract number and name and the name of the tenderer.

PS: Tenders may close at an NZTA office other than the NZTA office responsible for the

administration of the tender remote tender box(s).

PW: Tenders may close at an NZTA office other than the NZTA office responsible for the

administration of the tender remote tender box(s). In special circumstances it may

be appropriate for tenders to close in the offices of a consultant. In such a case it is

o ensure that the appropriate

than the NZTA office responsible for the administration of the tender remote

tender box(s).




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4.2.3 Closing of

tenders

Remote tender closing at RFT nominated offices shall be simultaneous. The

administration of the process at the remote office shall be by an NZTA authorised

person who shall ensure that the tenders box, closing procedure, including late tenders,

and the forwarding of tenders to the tenders secretary all conform to the NZTA

requirements.

The authorised person shall open the remote tenders box after the closing time while

ensuring any late tenders are appropriately endorsed.

A schedule of the tenders received with the names of tenderers only shall be

immediately forwarded to the tenders secretary, together with all the envelopes

received.

Should the name of the tenderer not be marked on the outer envelope the envelope

shall be sent unopened to the tenders secretary at the NZTA office responsible for the

administration of the tender.

4.2.4 Carriage of

tenders

Tenders shall be packaged and forwarded as soon as possible by courier to the tenders

secretary responsible for the administration of the contract.

Alternatively the tenders secretary of the NZTA office responsible for the

administration of the contract may instruct, with written confirmation, that the non-

other persons as the tenders secretary may nominate. This may be for example to a

specialist evaluator or the NZTA National Office personnel.

The price envelope and remaining originals of the non-price attributes (proposal,

excluding price) for each tenderer shall be immediately forwarded to the tenders

secretary as above.




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4.3 Receipt of tenders

4.3.1 Introduction Tenders can be received

by mail

by courier, or

in person.

Note that tenders submitted by facsimile or email directly to the office

where tenders close will not be accepted unless expressly provided for

in the tender documents.

4.3.2 Receiving

tenders

The table below shows what to do when receiving tenders.

If tender is received . . . then . . .

by mail, courier or in person and is endorsed to

the effect that it contains a tender

place it in the tenders box.

in a plain envelope: open the envelope

write the name of person who opened it

contract name and number and tenderer on the envelope

reseal it and place it in the tenders box.

in an envelope addressed other than to the

tenders secretary:

endorse it as to where, when and who received

pin the envelope to the tender, and

hand it together with the tender to the tenders secretary or other authorised person who will reseal, appropriately endorse and place it in the tenders box.

late refer to topic on Processing of late tenders in this

section.

4.4 Processing of late tenders

4.4.1 Introduction All documentation required, as part of a tender must be received in the tenders box by

the tender closing time. However in practice there will on occasion be tenders that are

late and the rejection of which would be unreasonable. Where the late delivery of the

tender was due to extreme circumstances or beyond the control of the tenderer and that

the lateness would not have allowed the tenderer to materially change their tender then

it should be accepted. Where advice is requested from the probity auditor in regard to a

late tender the tenders secretary must ensure that this advice is provided in writing and a

copy retained on the contract file.




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4.4.2 Procedure Follow this procedure when a late tender is received.

Step Action

1 The tenders secretary must endorse late tender received ..... pm ... /... / ... on the envelope and together with

a witness initial the endorsement.

2 Enter the name of the tenderer at the bottom of the Schedule of tenders received and endorse late .

3 The tenders secretary, in consultation with the TET leader, shall determine and note the reason for the tender

being received after the closing time.

4 The TET leader must make a report/recommendation to the State Highway Manager regarding any late

tenders. The State Highway Manager must give approval to consider or reject the tender. Where it is deemed

that it was not beyond the control for the tenderer to deliver their tender by closing time, the late tender shall

be rejected and returned to the tenderer with the envelope unopened. The tenders secretary must attach the

Notice of late tender (appendix XVII) and copy placed on file.

Where the TET leader/State Highway Manager cannot decide whether or not to accept the late tender or

would like advice they will contact the Manager Project Services who will decide on the appropriate action.

5 The TET leader may decide that a late tender is deemed acceptable, on being subject to the following tests:

Note: To accept a late tender in all cases, there must be proof that the carriage of the tender was beyond the

control of the tenderer at tender closing time.

If then

the full tender would arrive and be placed in the

tenders box before the tender closing time in the

normal course of

with the agreement of the TET accept the late tender

and document the reasons for doing so.

4.5 Opening of tenders

4.5.1 Introduction Opening of tenders, is completed in conjunction with the preparation of a schedule of

tenders received. These procedures relate to the security of the tenders during the

opening process.

4.5.2 Tender

opening rules

The tenders secretary must open the tenders in the presence of a witnessing officer. No

one else should be present. It is essential that the witnessing officer remain present from

the time the tenders box is opened and tenders examined, to the completion of tender

identification (by stamping, initialling, etc). The process should be undertaken without

interruption and in a secure area preventing any other person from seeing the tenders. A

witnessing officer is any person so authorised by the State Highway Manager or

National Manager PS.

4.5.3 Time and date

stamping

Time and date stamping and initialling of tenders is required on the tender form and the

contract pricing schedule. This is the responsibility of the tenders secretary. The stamp

used must make it clear that this is a record of when the tender was opened




Page 43

4.5.4 Procedure The tenders secretary shall follow the following procedure when opening tenders.

Note: Tenders must be initialled by both the tenders secretary and witnessing officer.

Step Action

1 Examine the envelope and use the table below to decide what action to take.

endorsed as containing a tender closing on a

subsequent date

return the tender to the tenders box.

unendorsed (and is therefore opened) and contains a

tender for some other work:

write a note recording name of the person who opened the tender and when it was opened

endorse envelope with contract number, name and closing date

together with witnessing officer sign envelope, and

reseal and return to the tenders box.

2 Check if the tender comprises two, separate sealed envelopes.

then

one envelope open the envelope, time and date stamp, and initial

the tender form and the contract pricing schedule.

two separate sealed envelopes open the one endorsed as Non-price attributes or Methodology (where shortlisting is used), time and date stamp, and

time and date stamp and initial the envelope endorsed Price . Store the envelope in a secure location without opening.

Note: If the envelope endorsed Price is opened, the

tenders secretary must reseal it and initial the

envelope.

3 If a tender required to be submitted in two separate envelopes is submitted in one envelope then:

check for specific requirements in the RFT

seal the tender form and contract pricing schedule in a separate envelope, note the error of the tenderer and the action taken and initial the envelope, and

advise the State Highway Manager of the action taken.




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4.6 Preparation of the schedule of tenders received

4.6.1 Introduction Within 24 hours or as soon as tenders from remote tender boxes have been received,

the tenders secretary must prepare a Schedule of tenders received professional services

and physical works (appendix V) for each tender closing.

4.6.2 Policy The Schedule of tenders received professional services and physical works must be treated

as confidential and kept from perusal by staff members not involved in the tender

administration and the public.

Where in conjunction with the conforming tender, alternatives are offered by a tenderer,

the entire tender must count as one tender. This is for the purpose of noting the number

of tenders received.

4.6.3 Procedure The tenders secretary shall complete the following procedure.

Step Action

1 Complete a Schedule of tenders received (appendix V) to include amount of tender for one-envelope

tenders only.

2 Together with witnessing officer initial the Schedule of tenders received form.

3 File the Schedule of tenders received form and originals of information from tenderers in contracts file.

4 Complete a Checklist by tenders secretary prior to tender evaluation professional services and physical works (or prior to each stage of the tender evaluation where two envelopes are provided) as given in

appendix VI, for each tender. File the checklist in the contracts file.

5 Package:

copy of the completed Schedule of tenders received form

copy of the completed Checklist by tenders secretary prior to tender evaluation form

copies of any information that a tenderer has provided

copies of all tenders (non-price attributes) received.

6 Forward this package to the officer responsible for the evaluation of the tenders.

Note: The tenders secretary shall in consultation with the project manager/asset manager, ensure two sets of

each tender are available for signing sets.

7 Enter the date of this action in the register of tenders.

In completing the Checklist by tenders secretary prior to tender evaluation (appendix VI) the

tenders secretary should do the following:

Check each tender to identify any obvious non-conformity with the RFT (including any

prequalification requirements stated in the RFT), Procurement manual or this

manual.

Where, in a two-envelope tender evaluation procedure, the price has been included in

the non-price envelope the tender is prima facie non-conforming and may be rejected in

consultation with the TET leader.

Where the tenders secretary identifies such price information and believes it has been

included by mistake, he/she may, with the authority of the tenderer, remove all

references to the price contained in the non-price envelope before forwarding the non-

price information to the TET. The TET leader should be consulted prior to any action.

If the price is not detected by the tenders secretary and gets to the TET then the tender

will be non-conforming and must be rejected by the TET.




Page 45

Tenderers are not entitled to rely on the to correc

errors.

Check that each tender submission received conforms to the page limit and font size

specified in the RFT. Where the tender submission has more than the specified number

of pages of information, or the font size was non-conforming the tenders secretary must

remove the last additional page(s) to the specified limit and retain these without the TET

seeing them. The TET leader should be given a list of all pages removed and a brief

description of the content.

Check additional pages removed do not contain any page(s) that are clearly identified as

tags and clarifications. If such pages are identified, ensure that they are noted to the TET

leader.

Procedure continued The additional pages will be given to the TET leader after the TET has completed the

non-price attribute evaluation. All pages (including those additional to the limit) of the

accepted tenderers submission will form part of the contract agreement with the

successful tenderer.

Note any tags that are clearly identified. (Additional and less obvious tags included

within the tender information might only be able to be identified by the TET).

Discuss with the TET leader any non-conformances or additional information identified

in the checklist (appendix VI). Agree on the action required. If the tender is rejected

advise the tenderer of the action taken by way of appendix XVI Non-conformity rejection.

Attach Schedule of tenders received form (appendix V) to each of the tender evaluation

sets, including the Potential conflict of interest/bias declaration (appendix IX).




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4.7 Opening the price envelope

4.7.1 For two-

envelope

tenders

On receipt of the completed form F Evaluator summary of all non-price attributes (or form G

with the non-price attribute information completed), and approval of the project manager/

asset manager via the Request for the price envelopes to be opened form (appendix XXIV), the

tenders secretary shall open the price envelopes, time and date stamp the contract pricing

schedules in the presence of a witnessing officer (being any person so authorised by the State

Highway Manager or National Manager PS) and complete the file copy of Schedule of tenders

received (appendix V) by inserting the amount of tenders.

Note: Refer to the delegated authority schedule for approval required to open the price

envelope/s.

4.7.2 Tags in the

price envelope

If the price envelope is found to contain tags, that appear to constitute an unauthorised

alteration or qualification of the RFT, the tenders secretary should consult with the TET

leader. With the consent of the TET leader the tenders secretary should request the tenderer

to remove unacceptable tags. Refusal to remove unacceptable tags will result in the tender

being rejected.

4.7.3 Arithmetic

check

An arithmetic check of the accuracy in the extensions of rates and addition for the preferred

tenderer shall be carried out by the tenders secretary or other appropriate person prior to

award.

For LPC, law and the two-envelope methods the preferred tender only is

arithmetically checked following evaluation.

4.7.4 Tender

documentation

A copy of the Schedule of tenders received form (appendix V), completed with the amount of

tenders, together with copies of the tender forms and contract pricing schedules shall be

forwarded (by courier or hand deliver) to the TET leader.

4.8 Modification and withdrawal of tenders

4.8.1 Modification of

tenders

A tenderer may modify their tender after tender submission provided the modification is

in writing and received prior to the closing time.

4.8.2 Withdrawal of

tenders

A tenderer may withdraw their tender at any time prior to issue of a tender acceptance

notice.




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5.0 Tender evaluation

5.1 Evaluation policy general

5.1.1 Introduction This topic describes the procedure and process to be followed in the evaluation of

tenders.

The objective of the evaluation process must be to maintain a level playing field on

which all willing tenderers can compete. The process must be conducted with utmost

integrity because of the importance of contracts to tenderers and the fact that public

money is involved. To that end, the TET and those in the NZTA dealing with them must:

act in good faith

act fairly as between bidders

provide the same information to all tenderers

not ignore or depart from manual processes

assume every action and inaction will be publicly scrutinised

always be aware that they will be judged with the benefit of hindsight.

In achieving its objective, the NZTA must ensure:

selection of appropriate people for the TET

implementation by those people in a way that demonstrably delivers integrity

any conflicts between the manuals being used are identified and resolved

lack of knowledge of the process requirements by any member of the TET are

identified and addressed.

The NZTA reserves the right to change the TET for any reason at any time during the

tender evaluation process on condition that the tender prices have not yet been opened.

If the TET members were named in the RFT then all tenderers shall be informed in

writing of the new TET members.

PW: The NZTA project manager/asset manager must ensure that an appropriate

NZTA representative is involved in the tender evaluation process as a member of

the TET where the PW contract estimate exceeds $5 million or the State

Highway Manager considers it necessary to include an NZTA representative

based on the particulars of the individual contract.

5.1.2 Evaluation

process and

policy

The evaluation must be undertaken fairly and impartially in accordance with the

requirements of

the Procurement manual

this manual, and

the RFT.




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5.1.3 Confidentiality

of evaluation

process

Information relating to the examination, clarification, evaluation and comparison of tenders

and recommendations concerning the award of contracts shall not be disclosed to

tenderers or other persons not officially concerned with such processes, until award of the

contract to the successful tenderer has been announced. The information disclosed shall

then be only as prescribed in the Award of contract section of this manual.

Any effort by a tenderer to influence the NZTA in the process of examination, clarification,

evaluation and comparison of tenders, and in decisions concerning award of contract, may

result in the rejection of the tender concerned by the NZTA.

All communication with tenderers from the time of closing of tenders until the award of the

contract shall be through the tenders secretary accept where during the course of tender

evaluation the TET may request additional information or clarification as described in

section 5.3 Conformity, tags, clarification and alternative tenders in this manual.

5.1.4 Prior

to the

commencement

of the tender

evaluation

process

Each member of the TET and each advisor to the TET must be properly familiar with the

following:

the evaluation procedure which is to be used, and the precise criteria for evaluating

tenders by this method

the RFT, current Conditions of contract for consultancy services (CCCS) and/or current

NZS 3910:2003 conditions of contract and all manuals which are applicable to the

tender evaluation, and, in particular, the specific provisions of these documents

his/her individual responsibilities in relation to the tender evaluation

the restrictions on the TET which, for example prevent it redefining attributes or

creating new ones

TET members should be informed on the roles and processes before the evaluation

commences

each individual who will be involved in the tender evaluation process must take

reasonable steps to ensure that there are adequate procedures in place to ensure that

his/her obligations under the relevant documents can be performed (e.g. do they have

all the relevant manuals, sufficient time and availability to meet as a TET, etc)

each individual will complete the Potential conflict of interest/Bias declaration form

(appendix IX) and submit to the TET leader (refer Conflict of interest section below).

5.1.5 Credentials

of evaluators

Requirements for the TET are that they shall:

include at least two persons who have the appropriate skills, experience and standing in

the industry (three for more complex contracts)

include a person (not necessarily the TET leader but who will have a senior role on the

team) has an appropriate level of knowledge of the work being purchased under the

contract and holds the qualification of National Certificate in Civil Engineering Asset

Management (Competitive Pricing Procedures) (or other NZTA-approved qualification)

for the evaluation of tenders with an estimated contract value over $200,000

not include any member who may have any interest in an organisation tendering for the

project being evaluated

the TET leader shall be the recommending officer

the TET leader shall not be the tender approving officer.




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5.1.6 Conflict of

interest

All members of the TET and advisors to the TET are required to proactively declare any

actual or potential conflicts of interest or risk of bias to the TET leader as they arise.

Prior to commencing the evaluation of the tender documents The TET leader must

ensure that all TET members and advisors, including themselves, do not have any

conflict of interest or risk of bias with any individual or organisation tendering:

The TET leader is to ensure that each TET member and advisor including themselves

complete the Potential conflict of interest/Bias declaration form (appendix IX) prior to

tender evaluation.

The TET leader will evaluate all declarations. If the TET leader determines that a

potential conflict or risk of bias has arisen they should either remove the TET

member/advisor from the tender process or give approval for them to remain with

appropriate mitigation. If the TET leader is unable to determine on the course of

action to be taken they should contact the Manager PS for approval.

If any there are any queries the TET leader can contact the Manager PS at the NZTA

National Office to discuss.

Where the conflict or risk of bias in question concerns the TET leader, continued

involvement as the TET leader must be approved by the Manager PS. If necessary

the Manager PS will discuss any issues or concerns with the probity auditor.

If there is a conflict of interest which enforces a change in the TET members, then

this must be addressed immediately to replace the TET member and a notice to

tenderers issued to all tenderers informing them of the change.

5.1.7 Types of

conflict of

interest

The types of potential conflicts that could arise are highlighted below:

Works or services carried out in the recent past for any of the potential tenderers

and any work carried out in relation to the tenders themselves.

Any personal relationship by virtue of spouse or close friend that a person has to any

personnel of any potential tenderer.

Any pecuniary (financial) interest that a person has in the potential tenderers. This

could be in terms of major shareholdings, financial arrangements.

Any managerial relationship that a person has in regard to any potential tenderer,

such as a seat on the Board.

Although a past business relationship in which a TET member/advisor may have had

contact with the potential tenderer does not of itself indicate that a conflict of

interest exists, TET members/advisors should be encouraged to declare all

situations which may be perceived as indicating that they may have a bias in respect

of that tenderer (either for or against). Failure to disclose may give the NZTA

grounds to revoke their appointment and could invalidate the tender process, with

consequent material costs involved.

If you have any interests as those described above/on appendix IX or generally similar in

nature but not strictly covered by its wording, then you should discuss it with the TET

leader. If you are the TET leader and have any interests as those described above/on

appendix IX, or generally similar in nature but not strictly covered by its wording, then

you should consider discussing it with the Manager PS.

An interest that is nothing more than an interest in a publicly available managed fund or

passive investment product that may have interests in listed PS or PW tenderers.




Page 50

5.1.8 Evaluation

process to be

complied with

The TET in undertaking the evaluation must ensure that the tender evaluation process as

described and detailed in the RFT is followed and documented as required.

5.1.9 Details to be

recorded

Details of any phone call, discussion or meeting between the TET member and any other

person (e.g. referees, other TET members, officers of the tendering authority) which relates

to the evaluation of the tender is kept on file as a file note duly dated and signed by its author.

TET members should take care to ensure that all such written material or file records do not

contain comments which are derogatory to any tenderer.

5.1.10 Referee check Where a tenderer is required by the RFT tenderer provides the names of any referees in

support of his tender, the TET is encouraged to contact all such referees. This will normally

be done by telephone. Where appropriate the TET may nominate a suitably qualified

individual, not a member of the TET, to contact a referee(s) on behalf of the TET. In such a

case this individual is required to comply with all the referee check requirements as specified

below, that would otherwise be carried out by the TET.

In making reference checks with referees, a TET should ensure the following:

Where efforts to contact a referee have been unsuccessful a detailed record should be

kept of the attempts to contact that referee.

Where an individual member of the TET contacts the referee, that team member must

report back to the rest of the team on the referees comments.

Detailed notes must be kept of any comment or opinion offered by a referee.

The TET member who contacts the referee must ask questions in a neutral and balanced

way and not lead the referee in any way.

The TET member must ensure that he/she attempts to get a balanced view from any

such referee.

5.1.11 During the

tender

evaluation

process

Each member of the TET must be familiar with the principles of fairness and acting in

good faith which include ensuring that:

all information is accurate and up to date. Where information comes from outside the

tender documents it must be assessed for reliability

only relevant information is considered and irrelevant information is excluded (to be

determined by reference to the RFT, and the relevant evaluation manuals)

views about tenderers which are relied upon in the decision-making process can be

substantiated

information before TET that is not considered relevant is clearly identified as having

been disregarded

with the difference between clarification of tenders as opposed to negotiation of

tenders which may lead to the improper improvement of bids during the evaluation

stage

the TET and other NZTA personnel are taking care to ensure that the evaluation

process is properly documented

the TET evaluation reports are accurate, and not made inaccurate by omissions or

selective quoting

others not on the TET do not become involved in the process

they do not engage in any practice that may give one tender an advantage over




Page 51

another.

5.1.12 Tenderer

presentations

Consideration should be given to the desirability of all tenderers making presentations on

their tender bids. If the TET feel that tender presentations may be required this should be

highlighted in the RFT. The TET will decide if presentations are required. Where tenderer

presentations are required these will take place after close and before completion of the

tender evaluation.

The objective of the presentation is to:

highlight key aspects of the submission

introduce key team members.

Tenderers shall not provide new information in their presentations. Participants in the

presentation may distribute resources during the meeting but these must be returned to

the tenderer.

Each tenderer shall conduct their presentation on the assumption that the TET has no

knowledge of the content of the submission.

The TET will be permitted to ask questions seeking clarification only.

A note should be recorded in the contract file identifying the name of the tenderer, TET

members present, location and time of the presentations held.

5.1.13 One conforming

tender

Should only one tender be received for a project, or there is only one conforming tender,

the evaluation process as stated in the RFT shall be followed to ensure the tender is

acceptable.

Negotiation with the tenderer is acceptable provided the scope of work is not altered and

the final negotiated price does not exceed the tendered price.

5.1.14 Pre-letting

meeting

In the event that the TET has outstanding concerns regarding any aspects of the preferred

tender, a pre-letting meeting should be held to address these. Meetings should be held

once the preferred tenderer has been identified and before any contract acceptance has

been made. Acceptance and decline notifications should not be sent out until after the

successful conclusion of the pre-letting meetings and approval to award the contract has

been obtained.

the contract and seeking assurance the tenderer has fully understood and is committed to

delivering the required outputs. Other issues which may be discussed are any areas of the

tender which the TET feel are potentially weak and may lead to issues with contract

delivery, or increased risk.

5.1.15 Negotiation with

preferred tenderer

when quality-based

supplier selection

method has been

used

If tenders have been evaluated using a quality based method the pre-letting meeting(s) are

also used for negotiation of the contract terms including price and risk allocation. It is

important to have an approved negotiation strategy in place prior to the first meeting. This

will allow the meeting to be productive and give a clear direction as well as align the

. If a proposed price

has been submitted as part of the tender, an analysis on this should be done prior to the

pre-letting meeting and the negotiation strategy updated as required. For further

information on negotiation see the Project management manual (SM011).




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5.1.16 Negotiation with

preferred tenderer

when price or price

quality supplier

selection method

has been used

Negotiation with the preferred tenderer (irrespective of the number of conforming

tenders received) is acceptable provided:

the negotiation is consistent with the RFT

negotiation is limited to contract terms (including price, i.e. loading of price schedule)

and must not extend to negotiation for the best price (where competition between

suppliers has been used to do that), and

the changes to the contract must not be so extensive that the tender process can no

longer be said to have tested the market.

In general negotiations should be focused on agreeing mitigation for any risk areas

highlighted in the tender process and aligning the contracted parties on the required

outcomes and outputs.

5.1.17 When tender

price varies

from the

estimate

In the event that the recommended tender price varies from the estimate by 10 percent or

more the recommending officer must provide justification why the tender is

recommended.

The project manager/asset manager must endorse the recommendation and confirm that

sufficient funds are available.

5.1.18 Tender

evaluation time

frame

The TET should make every effort to complete the evaluation as soon as possible after

tender closing.

If the evaluation of tenders has not been completed within two months of the tender

closing date, the project manager/asset manager must ensure that all tenderers are

advised in writing whether or not each of their tenders is still under consideration.

5.1.19 Crown entities

tendering for

the NZTA s

contracts

There is no legal restriction on Crown entities tendering for the NZTA contracts. The

Procurement manual requires that where a tender conforms to the procedural and

substantive requirements of an RFT, the NZTA must consider that tender. The NZTA is

bound to consider all conforming tenders that are submitted in response to its RFTs,

regardless of whether they are submitted by private contractor or by a Crown entity.




Page 53

5.2 Conformity, tags and clarification

5.2.1 Checklist by

tenders

secretary

To assist in evaluating tenders and maintaining conformity, the Checklist by tenders

secretary prior to tender evaluation (appendix VI) for each tenderer shall be referred to prior

to the TET undertaking the evaluation to ensure that all comments noted by the tenders

secretary are taken into account.

Where the removal of additional pages is identified, the TET leader will follow procedures

as set out in the non-price attributes assessment.

5.2.2 Review of tags Each page of the tender document should be checked by the TET for changes not

authorised by any notice to tenderers. Any such change will be considered as a tag.

Qualification of the RFT whether explicit or contained in the body of the tender shall be

regarded as a tag.

Tags shall be dealt with in accordance with the requirements of the RFT or in the absence

of any specific requirements they shall be dealt with as follows:

The tenderer shall be requested to remove tags that are unacceptable to the NZTA,

without amendment to the tender price. The tender is to be rejected if the tenderer

refuses to remove unacceptable tags.

If tags are found on the tender form or any contract pricing schedule or otherwise

included in the price envelope, the tenderer shall be requested to remove the tags.

Unacceptable tags in the price envelope cannot be considered and the tender is to be

rejected if the tenderer refuses to remove them.

5.2.3 Clarification Clarification of a tender to establish conformity with the RFT or for any other reason can be

obtained during tender evaluation. Any additional information provided which attempts to

improve the tender shall not be included for evaluation purposes.

However should a tender not include information of a minor nature requested in the RFT

and it is required to complete the evaluation, then the tenderer should be advised and

invited to supply it. In considering the additional information the TET should take page limit

requirements into account.

Any request for clarification or additional information and the response to it should be in

writing. Such response is to be received by the NZTA within 24 hours of request and may

be provided by email, facsimile, courier, hand delivery or post. Requests should be along

the lines of please provide more information on ........ rather than worded in such a way as

to allow the tenderer to judge compliance.

Requests for additional information or clarification shall be issued out of the same office

that issued the RFT or the office undertaking the evaluation. Such requests will normally be

issued by the TET leader and should include clear reference to the RFT clauses under which

clarity is being sought.

If the evaluators are unable to undertake a meaningful evaluation because a significant

amount of information requested in the RFT has not been supplied and/or there is a record

of the tenderer being continually requested to submit further details by way of clarification,

then the tender may be deemed non-conforming and rejected. The supply of an entire

attribute cannot on any sensible interpretation be called clarification. The TET must

consider the integrity of the process and the possible prejudice of other tenderers in

providing their tenders by a deadline.

In the clarification process, no change in the price or substance of the tender shall be

sought, offered or permitted.




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5.2.4 Alternative

tenders

Alternative tenders shall only be considered for evaluation where they are expressly

provided for in the RFT and a non-alternative tender has also been submitted (unless

expressly stated otherwise in the RFT).

If provision has been made in the RFT for tenderers to consult with the NZTA regarding

their alternative proposal prior to tender close, the NZTA reserves the right to reject any

alternative tender that has not been pre-consulted.

If an alternative tender offers an end result, which is outside the scope of the RFT, then it

is non-conforming and shall be rejected. In the rare situation when an alternative tender

is outside the scope of the RFT but offers a better outcome, the NZTA may consider

declining all the tenders and re-inviting tenders based on a revised RFT. The revised RFT

must not reveal the detail of any innovative idea used in the alternative tender. This

situation can be avoided by having a more outcome focused scope.

Alternative tenders are valued using a dollar premium known as the ATP.

The ATP may be positive, negative or zero. Non-alternative tenders shall have an ATP of

zero dollars, because the tender is offering the product to the standard specified in the

RFT.

The ATP evaluation must consider the net present value (NPV) of the end result offered

by the alternative tender in comparison with the minimum standard, i.e. the ATP is the

difference between the NPV of the alternative and the NPV of the non-alternative. The

assessment should consider whole-of-life cost associated with the alternative.

The ATP evaluation will also consider the social and environmental advantages and/or

disadvantages to identify whether tangible benefits for the client can be derived.

Alternative tender evaluations must be clearly documented, and only the total ATP

figure will be entered into the forms or spreadsheets. Refer to appendix XXV for an

example (shown in the example calculation using PQM simple).

5.2.5 Request for

additional

pages removed

After the TET has completed the non-price attribute evaluation, the TET leader must

request any additional pages that have been removed:

The TET leader will consider the information in the additional pages removed to

ensure that they contain no tags or issues that require clarification.

The TET leader must deal with these issues before opening the price envelope. Any

information included in these additional pages is not to be considered in the non-

price attribute evaluat -price attribute evaluation should not be

revised after these pages are seen.

All pages (including those additional to the limit) of the accepted tenderers submission

will form part of the contract agreement with the successful tenderer.




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5.3 Dealing with comments on the base estimate received from tenderers

Where the base estimate is stated in the RFT tenderers are able to comment on the

base estimate accuracy up to 4pm, five working days prior to tender close, through

the following process:

1. Comment is to be directed to the probity auditor nominated in the RFT.

Tenderers must not provide their comment directly to the NZTA or anyone

other than the probity auditor.

2. The probity auditor must immediately advise the nominated authority upon

receipt of any comment. The probity auditor will filter any sensitive

identity to the response given.

3. The nominated authority shall consider the comment and:

o if the comment strongly identifies any significant issue(s), the nominated

authority may proceed to step 4 or take immediate action as in step 5

o if the comment does not indicate any significant issue(s), the nominated

authority shall advise the probity auditor who will then advise the tenderer

that the matter will not be pursued further. No other details or justifications

shall be provided.

4. The nominated authority may ask the probity auditor to invite other tenderers

(who have not previously commented) to submit their comment as soon as

possible. The probity auditor shall not reference any detail or comment from

other tenderers in the correspondence.

5. The nominated authority will further consider the information and, if deemed

necessary, issue instructions to tenderers (notice to tenderer) before tenders

close. These may include extending the tender period, suspending the tender

or re-tendering.

The probity auditor must:

be an independent party

filter out any sensitive information before passing the comment to the nominated

authority

not

ensure that any other sensitive information is not passed to tenderers or TET.

The Probity Auditor is Peter Davies, Director, Specialist Audit and Assurance

Services, Audit New Zealand Level 2, 100 Molesworth Street Thorndon, PO Box 99,

Wellington 6140, mobile: +64 21 222 4824, fax: +64 4 496 3195, email:

[email protected]

The nominated authority will be the Manager PS unless otherwise indicated.

The nominated authority must:

be an independent party

not reveal any price sensitive information to the TET

not reveal the identity of any tenderer(s) who have made comment

not

not seek advice from the TET, project manager/asset manager, expert advisors or





Page 56

consultant before seeking advice from the National Manager PS or probity auditor.

5.4 Tenderers key personnel

Once tenders have been submitted, tenderer requests for substitution of named (nominated) key personnel shall only be considered after award of the contract. Approval of a substitution may be granted if replacement is by a person of equivalent or better skills and qualifications and is to the satisfaction of the NZTA.




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5.5 Subconsultants/Subcontractors and consortia

5.5.1 Subconsultants/

Subcontractors

In particular, when assessing attributes, the attributes of the subconsultants/subcontractors must be included. The detail expected in the tender should be in proportion to the amount of work to be carried out. For example, a short

s attributes. In considering additional information the TET should take page limit requirements into account.

A tenderer who proposes to subcontract any significant portion of the work should still have an appropriate organisational and management structure.

5.5.2 Consortia This is similar to the subconsultant/subcontracting situation except that the consortium would jointly sign the tender and therefore have a closer involvement in the management and organisation of the contract. Although close evaluation is necessary, a group of contractors may complement each other well and enhance the quality of the overall tender.

5.6 Non-price attribute evaluation

5.6.1 Introduction When evaluating non-price attributes, deliberations shall relate to the RFT and the contract requirements.

When allocating the grades for non-price attributes, care must be exercised not to award higher grades just because a tenderer's capabilities exceed those required for implementation of the project. For example, if only one excavator is necessary to complete drainage work within the scheduled period, the ownership of one excavator and demonstrating access to a backup excavator should obtain a high score the ownership of fifty excavators does not warrant the award of a higher grade.

Any factual information available to the TET may be used in determination of non-price attributes. However, the TET shall not be obliged to look beyond the tender submissions.

Information supplied by the tenderer must be in accordance with the RFT.

5.6.2 Non-price

attribute

evaluation

Non-price attributes shall be evaluated as specified in the RFT and in accordance with the Procurement manual.

Each of the tenderers submitted non-price attributes are evaluated, where a tender attribute grade of 35 or less is given, the tender becomes non-conforming through having graded less than the minimum quality threshold required on an attribute. (Note that some contract documents may have specified a higher threshold.) No further evaluation of non-price attributes for that tender is to take place. Any tender deemed non-conforming shall be excluded from being entered into the evaluation summary forms of appendix VII for determination of the lowest adjusted evaluation price. The price envelope should be retained unopened pending any formal challenge unless requested to be returned.




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Non-price attribute

evaluation continued

Grading of each non-price attribute should be in increments that give the appropriate

level of flexibility considering the value of the contract and the possible SQP generated

(e.g. increments of five points).

On completion of the evaluation of the non-price attributes, the evaluators shall stand

back and undertake an overall review to verify from the information available, that:

for a pass/fail evaluation, the tenderer can be expected to complete the project

adequately and safely

for a price/quality evaluation, the grade awarded is reasonable, particularly in

comparison with grades awarded to other tenderers

Financial resources are not to be included in any weighted attributes. Where there is

doubt that the tenderer has sufficient financial resources to complete the contract, the

matter shall be taken up with the State Highway Manager upon completion of the

evaluation and prior to award of contract.




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5.6.3 Use of tender

evaluation

forms for price

quality grading

The Evaluation summary forms and guidelines for professional services and physical works

(appendix VII) are to be used as appropriate during tender evaluation. The purpose of

using standard forms is to ensure uniformity in evaluation and contribute to consistent

and transparent evaluation.

The tender evaluation forms for PS contracts may be found in SM030. For PW

maintenance type contracts the forms are provided in the standard maintenance

contracts (SOMAC) documentation (SM032). For PW capital contracts forms are

provided in the standard documentation (SM031).

The following describes the use of these forms:

The project manager/asset manager selects and briefs the TET (others may be

involved in this briefing as required).

Where not identified in the RFT, tenderers at their request are entitled to the names

of the TET members during the tender, or during the evaluation process.

The project manager/asset manager ensures TET members are provided with sets of

pre-formatted forms corresponding to the number of tenders received, copies of the

tenders and a copy of the RFT. Pre-formatted forms will have included, as

appropriate, the contract name and number, attribute weights, personnel titles as

described in the personnel schedule listed on the relevant skills form, resource

factors on the resources form and factors to be graded against on the methodology

form.

Note: Attribute, subattribute, personnel and methodology factor weights are

determined by the project manager/asset manager and indicated in the RFT.

TET members independently read and evaluate the tenders then grade the non-price

attributes noting their overall rating for each attribute. Each TET member records

their reasoning behind their attribute grade allocation, the key differentiations.

Note: Sufficient time must be allowed for this step prior to the TET meeting.

The TET meets and grades are recorded on the Evaluation summary forms and

guidelines for professional services and physical works form (appendix VII), or on an

electronic white board from which copies can be made, or on an electronic

spreadsheet.

The attributes for each tenderer are then agreed by consensus and recorded in the

highlighted box.

A TET member should be nominated to be responsible for summarising and

recording the essential reasoning behind the agreed grades of each non-price

attribute (to be used in the evaluation report) and for ensuring that all evaluation

forms and comments are correctly filed.

Use of tender

evaluation forms for

price quality grading

continued

An overview is made, by the TET, of all tenderers grades verifying that grades awarded

are appropriate and reasonable, particularly with respect to grades awarded to other

tenderers and if necessary other recent contracts. The State Highway Manager may also

give a review of the relativity.

If required, grades are adjusted by agreement with the TET leader finalising grades if no

consensus can be reached.

Note: All documentation used during the evaluation process including all marking sheets

and all documents written or received by the TET during the evaluation, should be

retained on the contract file to ensure tenderers can properly receive feedback on their

tender submissions if requested. All such documentation is to be retained for a period of

seven years after completion of tender evaluation after which it may be destroyed unless




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notice of any claim or dispute relating to the TET process has been received.




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5.6.4 Non-price

attribute

definitions,

comments and

descriptions

The definition of each non-price attribute is to be found in the Procurement manual.

The following supplementary comments to those contained within the Procurement manual

are provided for guidance in attribute evaluation.

Note: The attribute descriptions included within contract proforma manuals (SM030, SM031

and SM032) for use in the RFT may be amended only in exceptional circumstances and with

the approval of the National Manager PS.

5.6.5 Relevant

experience

Tenderers adaptability as well as specific experience in technical and non-technical areas

relevant to the project should be considered. Recent experience is regarded as more valuable

than historic experience and adaptability of tenderers existing experience should be

considered.

Where relevant, it should also be determined whether the tenderer is able to make the

change from large scale to small-scale work or from one large contract to many small

contracts and vice versa.

The evaluators should carefully consider the relevant experience with regard to newly formed

firms taking into consideration that new employees/personnel may contribute to the relevant

experience of a company/newly formed firm.

Details supplied should be sufficient to demonstrate overall experience and capability (gives

a measure of a tenderer s adaptability) as well as specific experience in the technical areas

relevant to the project.

The TET is en

5.6.6 Track record Based on track record determined from completed projects, it is necessary to determine

whether the tenderer is likely to perform satisfactorily if awarded the contract. Unsatisfactory

performance on a contract constitutes unsatisfactory track record.

Personnel within newly formed firms may contribute to the track record of a company.

Great care is required in grading this attribute where the information required is not

adequately provided and the TET does not have comparable direct knowledge of and

information on all tenderers performance. Efforts should be made to validate information

provided by previous clients on tenderers past performance both good and bad. It is often

necessary to look beyond the information supplied for records of the tenderer's performance.

Care must be taken to ensure that one poor/very good performance is not taken out of

context and allowed to overshadow the assessment of this attribute.

The TET shall make use of the

performance.

performance in conjunction with verbal reference from project manager/asset manager, and

then it shall only be seen as an input into the track record evaluation, not the sole means of

measuring track record.

There will be instances where tenderers submit project(s) for track record, some with interim

PACE evaluations, others with final PACE evaluations, or non-NZTA projects with no PACE

evaluations. In these instances the TET shall make a judgement on how to use the

information from the PACE database. It is recommended that referees are asked to complete

a PACE questionnaire (either by telephone, or in writing) which is then used in the tender

evaluation. Care shall be taken to benchmark any interim or referee generated evaluations to

any final evaluations submitted




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Track record

continued

Any PACE records referred to shall be printed and kept in the contract file.

Consideration should be given to the local and national mix of projects put forward by

the tenderers. The maximum number of projects and their relevance to track record

should be as defined in the RFT.

Evaluators should determine, from the project descriptions and grade accordingly the

level of project compliance with required quality standards, reasons for exceeding or

being under budget and reasons for completion on date other than due date.

The TET is encouraged to contact the referees provided in the tender.

PW: The tenderers safety record, as may be provided in supporting information, may

be used in support of determination of compliance with quality standards.




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5.6.7 Relevant skills Nominated personnel are generally to be evaluated on an individual basis however

others nominated may be evaluated collectively as appropriate.

It is necessary to determine whether the qualifications and training and practical

experience of the proposed personnel is sufficient to achieve the output quality required.

Both technical and management experience and training should be evaluated as

appropriate to position. Care should be taken in exercising credit for national or

international expertise and the influence these personnel may have on project outputs.

For this purpose reference should be made to the individual curriculum vitae provided

ensuring these are up to date and agree with the information provided in the tender as

appropriate.

A comparative evaluation of the proposed time commitment to the project and focus for

individual nominated personnel is required. The area of particular focus should be

described.

5.6.8 Resources

(PW only)

Resources relate only to the equipment, including facilities and intellectual property

proposed to be used by the tenderer in the PW contract.

Financial resources should not be included in the evaluation of resources except to the

extent that it impacts upon the provision of plant or labour.

It is necessary to determine whether:

the tenderer is proposing sufficient reliable plant and equipment of the right type to

undertake the work (including subcontractors and independent tradespeople)

the tenderer's proposed labour resources are sufficient (including subcontractors and

independent tradespeople)

the materials proposed for use in the contract meet the RFT requirements

there is sufficient back up for emergencies.

For maintenance projects, it is necessary to determine whether the proposed labour

resource is sufficient to cover the geographical area of the works and meet response

times. It is also necessary to determine that the location of the tenderers proposed

depot(s) and that they are sufficient to provide the required service.

If

should be determined whether:

there have been appropriate increases in resources

the company can sustain further expansion.

Indication of acceptability of resources can be determined by checking monthly

expenditure on completed projects undertaken by the tenderer. If the project requires

substantially higher monthly expenditure but no indication is given of additional

resources being available, clarification should be sought.

For a tenderer with an adequate track record, care should be exercised before failing on

this attribute. Normally it is appropriate to request further information.

Tenderers may tender for more work than they can expect to undertake at any one time.

However, care needs to be exercised, where a tenderer appears to be successful in

tendering for a relatively high number of contracts.

The NZTA may, in the RFT, require tenderers to supply a list of all outstanding tenders

with the NZTA and other organisations

complete due to insufficient resources, clarification should be sought




Page 64

Resources

(PW only) continued

Plant and equipment proposed for the installation and maintenance of temporary lighting,

signing and guarding, should be adequate and compatible with the traffic management

plan submitted under methodology and the probable temporary lane closures.

5.6.9 Methodology It is necessary to determine whether the tenderer is proposing an appropriate methodology

for the type of work detailed in the RFT and whether the submission focuses on the needs

of the project.

The tenderer s understanding of the nature of the project, the client s needs and the means

and methods whereby the desired results can be achieved in a practicable and efficient

manner, should be assessed. Tenders must describe how they will complete the contract

works on time and to the standards specified in the contract documents.

The risk and the effect of an innovative approach to the project requirements may deserve

merit, but any effect on other or future projects should be determined.

Knowledge of contract area should be adequately demonstrated and factors that may

affect the project outcomes should be identified.

A work programme subdivided into elements or phases of the project as appropriate,

including the identification of any key points requiring interface with the client/and client

approval to proceed, should accurately reflect the project requirements.

How risks are proposed to be identified, assessed and managed so as to minimise

additional costs to the client and the proposed strategy to ensure 'no surprises in financial

management and reporting should be described.

Proposed reviews and quality assurance measures should be adequately detailed and

assessed in terms of their application as required in the RFT.

The following factors are often considered as part of the methodology evaluation:

The appropriateness of the tender programme of works showing start and finish dates

of major activities.

The division of work (own forces, subconsultants/subcontractors or independent

trades-people) and how the labour resources are allocated to each work activity

(scheduled item).

Proposed planning and programming.

Proposed communication: within the company, and/or between site staff and the

engineer.

Proposed recording, reporting and invoicing.

The key elements identified in the project quality plan.

A statement of knowledge of local conditions.

Demonstration of an understanding of the contract requirements, knowledge of

performance assessment, and any innovation.

And the following as noted:

PS: The proposed supervision of construction should be assessed to determine whether

it is adequate for the type of work to be implemented.

PW: The means of managing traffic during implementation of the project.




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5.7 Supplier selection methods

5.7.1 Introduction This topic discusses the procedures and processes to complete the evaluation of

tenders for different supplier selection methods with reference being made to the

Procurement manual. The LPC method, Brook s law method, PQM and client-

nominated price are discussed.

The officer responsible for the evaluation of the tenders shall ensure receipt of the

original of the completed Schedule of tenders received form, the completed Checklist by

tenders secretary prior to tender evaluation form, copies of any information that a

tenderer has provided, copies of all tenders (non-price attributes) received.

The implication of late tenders and non-conforming tenders should be considered at

the commencement of evaluation, for each method.

A report and recommendation is made to the appropriate manager/delegated

authority on each tender evaluation using the Schedule of tenders received (appendix V)

and other forms and reports as stated for the supplier selection method used.

All tenders, individual TET forms and comments, summary forms and tender

documents are retained on the contract file.

5.7.2 LPC method This one envelope method comprises two stages with the first being the ranking of

tenders in ascending order based on price. The second stage consists of evaluating the

non-price attributes commencing with the highest ranked (lowest price) tenderer from

the first stage. This process shall continue until an acceptable conforming tender is

determined. The contract shall only be awarded to the highest-ranking (lowest price)

tenderer who obtains a pass on all non-price attributes.

Tender summary lowest price conforming tender method: final evaluation form (appendix

VIII) should be used in the evaluation with all non-price attributes being assessed on a

pass or fail basis. The TET must, prior to the evaluation of the non-price attributes for

any tender, clearly define the cut off between a pass and a fail.

To ensure proper price comparison of tenders, the adjusted tender price shall be

determined for alternative tenders and acceptable tags. The adjusted tender prices

shall be compared with non-alternative tender prices to determine the tender ranking

in ascending order based on prices.

If the lowest tender price is significantly greater than the estimate, the reason should

be determined if possible and an allocation adjustment made before the contract is

awarded. Negotiation with the preferred supplier is permitted provided it is carried out

Procurement manual

appendix C and section 10.12).

of work to be performed under the contract, or other tenders, the tenderer must be

requested to confirm the tender price before award.

If the lowest tender price is unacceptable or upon request of confirmation is withdrawn

then the tender with the next lowest tender price should be evaluated.

Approval to award the contract should be gained from the delegated authority using

appendices VIII and V.




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5.7.3 law

method

The following discusses aspects of the process for undertaking tender evaluation in

accordance with the Brook s law method. The simplified Brook s law method uses a

system of ranking that must be specified in the RFT for non-price attributes but is

otherwise similar to the Brook s law method.

The evaluation of non-price attributes shall be undertaken as required in this section

of the manual using the weight assigned to each attribute in the RFT, for indices

calculation.

This two-envelope system has three stages comprising the evaluation of non-price

attributes, calculation of indices for each non-price attribute and summation of the

indices for each tender and finally price negotiation with the tenderer with the scoring

the highest overall index.

The agreed non-price attribute tenderer grades are transferred from form F to form I,

both forms are given in appendix VII. Form I should be used for the evaluation of non-

price attributes and calculation of indices to determine the preferred tenderer.

Once evaluation of non-price attributes has been completed the TET and delegated

authority sign and date the TET report 1, and printout of form I. Once approved, the

project manager/asset manager should use appendix XXIV to request opening of

the price envelope of the preferred tenderer.

The project manager/asset manager must have a strategy in place for negotiation

prior to tender close. Documented assistance for writing this negotiation strategy

resides in SM011 work procedure 5. The HNO Project Services team can be contacted

for further support.

If a single tender is received, the strategy for negotiation must be approved by the

delegated authority to award the contract prior to proceeding with negotiation.

If negotiations cannot be successfully concluded with the highest scoring tenderer,

the advice of the delegated authority to open price envelopes should be sought prior

to opening the price envelope of the second ranked tenderer and entering into

negotiations.

The objective of the negotiation is to reach a fair price for an agreed quality of service

which may involve a trade off between quality, methodology, resources to be applied

and price.

Care must be exercised during negotiations not to nullify the evaluation of non-price

attributes completed in the first stage. This could result from proposed changes in

key personnel or tenderers methodology. Other tenderers could be compromised if,

as a consequence of negotiation of the tender, a change in key personnel is accepted

or there are reductions in the scope of work.

Once negotiations have been successfully completed the TET and delegated authority

sign and date the TET report 2, printout of form I and appendix V to approve the

award of the contract.

5.7.4 PQM simple

method

Before starting the evaluation please refer to the sensitivity analysis (section 2.5)

which should have been undertaken to select price/non-price weightings. The

-price attributes.

The ultimate aim of the non-price attribute evaluation is for the TET to agree an SQP

for each tender which is a true reflection of the value in comparison to the other

tenders received.




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The tender evaluation process for PQM simple is as follows:

First, open envelope 1 and evaluate the non-price attributes. Transfer the agreed non-

price attribute tender grades from form F to form G (appendix VII). Calculate the

following for each tender:

1. Indices = non-price attribute grades [0.0 - 100.0] x weights [30 - 80] / 100

2. Weighted sum = Sum of all indices [30 - 80]

3. Weighted sum margin [30 - 80] = each weighted sum lowest weighted

sum

4. SQP ($) = base estimate* ($) x weighted sum margin [30 - 80]/price weight

[10 - 70]

* Remove any amounts fixed by the NZTA from the estimate, e.g. provisional

sums.

Note: The range indicated in [ ] denotes the maximum possible range of the figures.

The weight assigned to each non-price attribute is given in the RFT. The total non-

price attribute weight is a minimum 30, and the price weight is maximum 70.

HNO contracts for PS are to have a non-price attributes weight of between 70

percent and 90 percent, and PW contracts are to have a the non-price attributes

weight of between

30 percent and 50 percent. Approval of the non-price attributes weightings outside

the above levels is required from Manager Project Services prior to advertising the

contract.

An electronic spreadsheet (form G of appendix VII) is provided in the technical

(www.nzta.govt.nz).

the SQP calculated for each tender to confirm that the

respective SQPs represent the amount that the NZTA is prepared to pay to secure

one tender, relative to another. If the TET is not satisfied with any SQP, they are

entitled to adjust the SQP. Where an SQP is adjusted the TET must record the

calculation of the adjusted SQP and provide justification for the adjustment.

If there are any alternative tenders, proceed to calculate the ATP as discussed in

section 5.2 Conformity, tags, clarification and alternatives in this manual (part A).

The ATP evaluation must be shown.

sign and date the TET report 1 and printout of form G. The project manager/asset

manager must then use appendix XXIV to request the opening of the price envelopes

(envelope 2). All contract pricing schedules are reviewed for tags. Where any

Complete form G with the tender prices (less schedule fixed amounts). Deduct the

SQP (and ATP) from the respective evaluation prices. The tender with the lowest

adjusted evaluation price shall be the preferred tender. The TET and the delegated

authority again sign and date the TET report 2, and final printout of form G and

appendix V to authorise the beginning of the award process.

Finally, the TET leader makes a recommendation for acceptance on the Schedule of

tenders received (appendix V) to the appropriate manager and delegated authority,

depending on the value of the contract. Refer to appendix XXV for a guideline on the

use of PQM simple.





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5.8 Reports and recommendation

5.8.1 Tender

report and

recommendation

The Schedule of tenders received form (appendix V) shall be used in reporting the evaluation

results and the recommendation.

The report and recommendation to the appropriate delegated authority, shall include

comment on the rational and key points contributing to:

the non-price attributes grade for each tenderer (grades to be included)

why any tender failed any non-price attribute

the acceptance or rejection of tags and late tenders

the recommendation to accept a tender that is not the lowest in price, and the

acceptance of a tender where the tender price varies from the estimate of cost of work

by 10 percent or more as applicable.

On receipt of the report, the tenders secretary should note the date received in the register

of tenders. The tenders secretary must carry out an arithmetic check to confirm the

accuracy in the extensions of rates and additions for the tenderer to whom award is

recommended and confirm that this has been done by signing appendix V.

In the event that the tenders secretary discovers errors and/or omissions in a tender, the

tenders secretary may, in consultation with the TET, without advising the tenderer of the

errors and/or omissions, request the tenderer confirm the tender without correction.

Where such confirmation is not received the tender may be rejected.

All tender schedules must be properly filled in, on the original forms, to the satisfaction of

the tenders secretary, including schedules where provided in the RFT. Schedules

considered by the tenders secretary to be improperly filled in (e.g. rates not provided

where required in the schedule), may in consultation with the TET, result in the tender

being rejected.

Where the tenders secretary and/or the TET discovers a tender contains errors in

extension of unit rates or summation of items such as to vary the tendered sum, the

tenders secretary will draw the error to the attention of the tenderer and invite the

tenderer to confirm the tendered sum notwithstanding the error. Where such confirmation

is not received, the tender may be rejected.

If the tendered rates are found to contain any errors in extension of unit rates or in

summation, such as to vary the tendered sum, then the tenders secretary shall adjust the

rates, after consultation with the TET and tenderer, to agree with the tendered sum. The

adjusted rates shall then become the contract rates for payment. If agreement cannot be

reached as to the adjustments, then the tender shall be rejected.

The TET should then make the recommendation to the appropriate delegated authority.

Appendix XXIV is to be used to obtain this approval and after approval has been given

appendix XXIV should be submitted to the tenders secretary to request the opening of rice

envelopes.

The delegated authority may approve award if the contract value is within funding

allocation and within their approval limit via appendix V.




Page 69

5.8.2 Late tenders The evaluation report should include the reasons why the tender was accepted or

rejected.

5.8.3 Non-conforming

or rejected

tenders

Reasons for disqualification of any tender shall be reported and may include a tender

that has been failed on any non-price attribute or a tender that was the preferred tender

but was rejected because of failure to withdraw unacceptable tags.

5.8.4 Final evaluation

forms

Tender evaluation reports, are to be accompanied by a completed report form for the

particular methodology used as follows:

For the LPC tender method, the Tender summary lowest price conforming tender

method: final evaluation (appendix VIII) shall be completed.

For the PQM, the Schedule of tenders received (appendix V) shall be completed. The

tenders shall be ranked in order of the highest overall index.

5.9 Approval to open price envelopes

5.9.1 Delegation to

open price

envelopes

Refer to the delegated authority schedule (introduction to part A) for delegation to open

price envelopes.

Prior advice is required when there are any features in the recommendation, which are

unusual or controversial. These situations are to be brought to the attention of Group

Manager HNO before approval is given to accept the contract.

Advance notice is to be given when urgent approval of a tender is required.

Verbal advice of approval shall be followed up in writing.

Note that it is the responsibility of the project manager/asset manager and not the

tenders secretary to ensure that appendix V is completed and the necessary approvals

are obtained.

5.9.2 Approval to

open price

envelopes

National office approval is required as per the HNO-delegated authority table in this

manual:

Stage 1 following evaluation of non-price attributes and prior to opening price

envelopes.

Stage 2 following opening of price envelopes and prior to award of contract. When

submitting tenders for national office approval, the following information and

completed forms must accompany the request for acceptance:

the completed Schedule of tenders received (appendix V)

the weight allocated to each attribute

the key issues the TET dealt with.

Prior advice is required when there are any features in the recommendation, which are

unusual or controversial. These situations are to be brought to the National Manager PS

attention before approval is given to accept the contract.

Advance notice is to be given when urgent approval of a tender is required.

Verbal advice of approval shall be followed up in writing.

Note that it is the responsibility of the project manager/asset manager and not the




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Approval to open price

envelopes continued

tenders secretary to ensure that appendix V is completed and the necessary

approvals are obtained.

5.10 Consider commercial issues prior to contract award

Following opening of price envelopes and prior to contract award the TET must

review the preferred tenderers schedule of prices and satisfy themselves that it does

not contain any oddities or commercial issues. Examples of areas to consider:

Front loading of the tender price in a PS three phase contract, e.g. is the pricing

schedule balanced and not loaded in the investigations and reporting phase?

Sensible and meaningful pricing of tendered lump sum items, e.g. is the lump sum

price for as-built drawings appropriate?

If the TET is concerned that the schedule of prices is not balanced or it contains other

commercial issues then they should hold a pre letting meeting with the preferred

tender (advice on commercial issues is available from the Project Services team). The

pre letting meeting should be used to discuss these concerns and rectify them to the

satisfaction of the TET.

5.11 Approval to award contract

5.11.1 Procedure The following procedure applies when accepting a tender. The tenders secretary undertakes

this task from step 2.

Step Action

1 The project manager/asset manager should ensure that sufficient financial approval is held to cover the

accepted tender price including provisional sums and contingencies (except price contingency). If the

contract price exceeds the available allocation the contract cannot be awarded until additional funding is

sought and approval given.

2

of a tender does not require national office approval pass all required information to State Highway

Manager for approval. Once approval has been given

go to step 3.

of a tender requires national office approval send all required information to project service at national office

project services will fax/email the region responsible for the contract, and

upon receipt of the fax/email go to step 3.

3 Issue the appropriate acceptance notice and decline notices, upon receipt of the approved tender schedule.

tender acceptance notice (appendix X for PS and appendix XII or XIV for PW)

tender decline notice (appendix XI for PS and appendix XIII or XV for PW)

rejection notice on basis of non-conformity (appendix XVI).

4 If all tenderers have a fax/email, fax/email a copy of the tender acceptance notice to the successful tenderer

and tender decline notices to unsuccessful tenderers.

If an unsuccessful tenderer does not have a fax/email, post all tender decline notices.

If the successful tenderer does not have a fax/email, post tender acceptance notice and all tender decline

notices.

5 edules to [email protected] Please use the email title format Price Schedules <<Contract Name>> <<Winning Tenderers Name>> <<Contract/work type (PW Lump Sum, PW M&V, PS I&R, Competitive Alliance etc)>>.





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5.11.2 Disclosure

of contract

prices

The provisions of the Official Information Act 1982 govern disclosure of information

on tendering and contract matters. The Procurement manual (section 5.5) sets

out the minimum information which should be provide.

On award of the contract, all tenderers are to be advised of the following:

Name of successful tenderer.

Price and SQP of successful tender (submitted price preceding any negotiation).

law tenders) where three or

more conforming tenders are evaluated.

Range of grades for each non-price attribute, where three or more conforming

tenders are evaluated (PQM).

For each tenderer, their individual non-price attribute grade (PQM).

For each tenderer, their individual SQP and the range of SQPs (PQM).

The NZTA shall not be required to provide any further information regarding details of

tenders or details of how the evaluation was arrived at.

ding pricing schedules

shall be archived in accordance with the policy for archiving.

Following award of the contract, spare copies of the unsuccessful tenderers non-price

attribute documents shall be promptly destroyed in a secure and confidential manner.

Tender envelopes shall be securely retained on the contract file where there is reason

to believe these may be required in evidence due to unusual circumstances or tenders

were late.

Contract documents shall be retained on the contract file and on completion of the

contract shall be archived as above.

See appendices for template acceptance and decline letters.

5.12 Preferred tenderer status

5.12.1 When should

preferred

tenderer status

be given

Suppliers are often involved in a number of tender processes nationally at any one time.

If a TET has completed its tender evaluation and reached consensus on the favoured

tender but the contract cannot yet be awarded for whatever reason the favoured

tenderer should then be given preferred tenderer status. This will allow all tenderers to

make informed decisions on other tender proposals they are working on and will also

provide the preferred tenderer with an earlier indication of the pending contract award.

For example, if there is a need for Board approval to award the contract, or to first

negotiate an acceptable price or contract terms with the favoured tenderer, then the

favoured tenderer should be given preferred tenderer status.

The TET must seek approval from the officer with the delegated authority to approve

the contract award or Manager Project Services, to announce the preferred tenderer. As

soon as this approval is obtained the TET leader should verbally inform all tenderers of

their status, i.e. either preferred or not preferred. They may also advise tenderers who

are not preferred, the name of the tenderer who is preferred. Within 24 hours of such

verbal advice the tenders secretary must formalise this status in writing (email, fax or

letter) to each tenderer.




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When should preferred

tenderer status be

given continued

Formal advice of status will include the following:

The tenderers current status - either preferred or not preferred.

The name of the tenderer who is preferred.

An indication of the likely contract award date.

A reminder that any work undertaken by the preferred tenderer before contract

award is at their risk (preferred tenderer only).

See Notice of preferred tenderer form (appendix XXII).

Formal advice should specifically not include any advice on any non-price attribute,

SQP, ATP, price information or ranking of tenderers. This information is to be

released only when the contract is awarded.

5.13 Tender debrief meetings

After the tender process is complete and the contract awarded, it is important the all

tenderers are given the opportunity to discuss their tenders with the TET. This will

benefit all parties to the process and provide opportunity for continuous

improvement.

It is important that noncompliance in tender submissions are discussed and details of

any pages removed and not considered in the evaluation are provided to the

tenderers.

A note should be recorded in the contract file identifying the name of the tenderer,

TET members present, location and time of the debrief held.

Where significant delay is likely between announcing preferred tenderer status and

awarding the contract, tender debriefs should be offered to tenderers prior to decline

of tenders.




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6.0 Contract award procedure

6.1 Contract file

6.1.1 Introduction A contract file must be maintained for each contract let in a regional office.

The NZTA will maintain a full file with all papers for PS contracts. For PW contracts the

consultant must maintain a full file with all papers concerning the contract for PW

contracts.

This topic discusses the contents of the contract file.

6.1.2 Contract

procedures

In maintenance of the contract file, the file number must correspond with a sequential

number in the register of tenders.

PS: The contracts are administered by the NZTA, therefore the full contract file is

held in the NZTA office. This contract file must contain all relevant information

relating to the administering of that contract in addition to that stated below.

PW: The file must contain all relevant correspondence that will adequately monitor

the contract. This file need not include other papers concerning the contract.

These papers will be included in the full file maintained by the consultant.

6.1.3 Information

in contract file

PS: Contract files must include the following information for PS contracts:

estimate

approval to proceed to engage a consultant form

copies of all notices to tenderers

the Schedule of tenders received form (appendix V) and evaluation report

unsuccessful tenders

copy of the successful tender and supporting papers

copy of the tender acceptance and decline notices

final construction report

report

correspondence on the contract generated in the regional office and any other party

correspondence to and from the consultant pertinent to the contract

the signed contract document (where this is too big to be placed on the contract file,

it may be kept separate but in such cases, the contract file must indicate where the

signed contract document is held.




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Information in contract

file continued

PW: Contract files must include the following information for PW contracts:

liquidated damages pre-assessment

estimate

request for approval to proceed to engage a contractor for the provision of PW form

copies of all notices to tenderers

the Schedule of tenders received form

unsuccessful tenders

copy of the successful tender and supporting papers

copy of the tender acceptance, decline and non-conformity notices

certificate of practical completion

certificates of practical completion of a separable portion

defects liability certificates

final construction report

report performance

correspondence on the contract generated in the regional office, and between the

consultant and any other party

correspondence to and from the consultant pertinent to the contract

the signed contract document (where this is too big to be placed on the contract file,

it may be kept separate but in such cases, the contract file must indicate where the

signed contract document is held).

6.1.4 Maintenance

contracts (PW

only)

After contract award a copy of the contractors operational requirements and pricing

schedule, prepared under SOMAC, must be forwarded to the NZTA

Operations Engineer at national office by the tenders secretary.

6.2 Signing of contract documents

6.2.1 PS Contracts Two sets of the contract documents should be assembled and checked for

completeness as follows:

the RFT

the contract agreement form completed ready for signing

the tender form and tendered pricing and personnel schedules (original and copy(s))

bound into signing sets, superseding the blank pages shown in the RFT

the letter of acceptance, notices to tenderers, tender clarification queries and

responses, interview minutes and any other tendering or agreement related

correspondence bound into section E of the RFT

photocopies of the general and special conditions, the contract management

specification and the relevant standard specifications bound into section F of the

RFT.

6.2.2 Sets of

documents for

PS (PS only)

There must be two signed sets of documents for PS. Other sets may be required

for working purposes. The original NZTA set of documents must be held in

secure storage. This may be used if arbitration is necessary on the contract




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6.2.3 Sets of

documents for

PW (PW only)

NZS 3910:2003 section 2.7 covers the procedural requirements of the principal

and the contractor in the execution of the contract agreement. Three sets of

documents are required for distribution in accordance with the requirements.

The consultant has the responsibility for assembling and arranging the signing of

contract documents.

The set of documents to be held by the NZTA must be the original documents.

This set of documents must be returned to the tenders secretary when the

contract has been signed. The tenders secretary must hold the documents in

secure storage and these documents can be used if arbitration is necessary on the

contract.

6.2.4 Procedure PS: The tenders secretary must ensure the following tasks are completed for

the signing of contract documents (including short-form contract

agreements).

PW: The consultant responsible for the contract must ensure the signing of the

contract documents is completed in accordance with the following

procedure.

Ste

p

Action

1 Assemble the signed sets of contract documents securely together ensuring the documents are

complete and all pages are in order.

2 Number the pages in each section. Note: Each page number will be the unique identifier for that

page.

3 Index the document as given in the following table.

Note: The contract documents must contain an index under the cover sheet. The index must

reference all sections and pages that form the contract document. The title of each section must

be entered in the index showing the number of pages that form the section.

Example: General conditions for the provision of PS, pages i-iii and 1-10.

If the contract

is one document index it as in the example given above.

consists of individual

documents

enter each document individually on the index and number the

document, e.g.

Tender form page 1

Letter to tenderer page 1

4 Ensure the index page(s) of each set is signed.

Note: This must be done by all persons who will be signatories to the contract. The signing of all

pages is not required.

5 Sign the contract.

Note: This must be done by the delegated authority.

Note: The tenders secretary must ensure that all sections of each signing set of the contract documents

are securely attached to form one document.




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6.3 Who may sign the contract agreement

6.3.1 Introduction This topic discusses the procedure NZTA will follow when signing the contract

agreement where the supplier is a,

company

partnership

joint venture

individual.

In all cases of doubt or difficulty, get legal advice as failure to achieve binding

execution can leave the NZTA without remedies.

6.3.2 Company Where the supplier is a company, the contract agreement must be signed by either:

1. two or more directors of the company (whose signatures need not be

witnessed)

2. if there is only one director, by that director whose signature must be witnessed

3. if the constitution of the company so provides, a director and another person, in

which case both signatures must be witnessed, or

4. a person appointed as the attorney of the company (copy of power of attorney

and a certificate of non-revocation required).

The two most common styles are:

XYZ CONSULTANTS LIMITED

Director

Director

or:

XYZ CONSULTANTS LIMITED

Director

signature:

Name:

Occupation:

Address:

Secretary

signature:

Name:

Occupation:

Address:

While common seals are no longer a legal requirement they are still sometimes used.

Sometimes a power of attorney is used. The attorney binds the company, but only to

the kind of document involved. The extent of the power must be checked. The attorney

must give a certificate of non-revocation.




Page 78

Company continued A copy of the power of attorney and the original certificate of non-revocation must be

attached to the document.

A person held out by a company as having authority to sign on its behalf can bind a

company. However there can be issues as to whether it is the company or the person

If the

contract is significant (for either party) then the more formal levels of execution

described above must be used, unless documentation of the authority to bind the

company is provided.

6.3.3 Partnership Where the supplier is a partnership, the contract agreement may be signed by any of the

partners.

If there is any doubt about the authority of the person signing, the authority of the

particular person involved must be checked.

Generally any partner can bind a partnership to a contract in the usual course of the

partnership business. The execution style should be:

___________________________________

Signed by X as a member of the XYZ

Partnership who, by signing warrants that he/she has authority to bind the XYZ

Partnership.

___________________________________

signature

Name:

Occupation:

Address:

If the contract is particularly significant or outside the normal scope of the partnership,

then each partner must be required to sign.

It is always essential to ensure that the proper description of the partnership is shown.

(There may be several with slightly different names.)

6.3.4 Joint ventures There is no fixed rule for joint ventures as their ability to enter into contracts is governed

by the individual agreement creating the joint venture. A joint venture is not a legal

entity in its own right.

When contracting with a joint venture, a check must always be made with the joint

venture to find out what the correct procedure is for that particular joint venture.

6.3.5 If joint venture

is a company

A common practice is for a joint venture to form a company as an administrative vehicle

for contracts. In this case the usual rules for limited liability companies are followed.

6.3.6 If joint venture

is not a limited

liability

company

A joint venture can be a combination of companies or partnerships or even a mix of

companies and partnerships.

If the joint venture is not a limited liability company, then as a general rule an authorised

representative of each joint venture party must sign.




Page 79

6.3.7 Individuals Contracts dealing with individuals must be signed by the individual. It must be noted that

individuals sometimes use trading names.

Example: John Smith may use the trading name John Smith Roadmarking. A trading name is

not a legal entity and in such a case the individual must sign his/her name. The signature

must be witnessed, and the witness must add name, occupation and address.

6.4 Who may sign the bond (PW only)

6.4.1 Introduction A bond is a deed and some different rules apply. This topic discusses the procedures

NZTA follows when signing bonds where the contractor is a:

partnership

joint venture

individual.

In all cases of doubt or difficulty get legal advice as failure to achieve binding execution

can leave the NZTA without remedies.

6.4.2 Limited liability

company

As for execution of a contract, except that a person held out by the company should not

execute.

Execution should be by:

two directors

one director and secretary (if constitution permits)

power of attorney (banks frequently execute this way).

6.4.3 Partnerships As for execution of a contract. As giving bonds is not usually part of the normal business

of most partnerships, ordinarily every partner must sign.

6.4.4 Joint ventures There is no fixed rule as to how joint ventures enter into deeds. It will depend on the

provisions contained in the agreement creating the joint venture or the status of the

various joint ventures.

6.4.5 Individuals As for execution of a contract. The person giving the bond must be advised in writing to

take independent advice before executing the bond.

6.4.6 Contractor also Both the contractor and the bond giver must execute the bond and the executions must

be witnessed where required.




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6.5 Assignment or novation of contracts

6.5.1 Introduction This section sets out the procedure NZTA will follow when a company:

1. changes their name

2. seeks the rmission to assign (either wholly or in part) its rights or

obligations under the contract to another consultant, or

3. has a material change in effective control of the consultant itself (e.g. its shares

are sold to another party, or the company amalgamates with another) or where

company.

The NZTA may be at risk where there is ineffective or inappropriate assignment or

novation of a contract rights that results in:

non-transfer of contractual liabilities

breach of contract

the Procurement manual process being subverted.

The NZTA should seek legal advice, or consult the Project Services team in all cases of

doubt or difficulty, as failure to achieve the valid assignment or novation can leave the

NZTA without remedies, or weaken its commercial position. Deed templates are

available from the Project Services team.

6.5.2 Change of

name

Where the supplier changes its name, but nothing else changes there are no legal

consequences. The supplier has an obligation to:

1. provide the NZTA with notification in writing of its new name, and

2. provide the NZTA with written confirmation that the change in name will have no

effect on the substance and delivery of the contract.

The project manager/asset manager must ensure that where a change in name is

observed the matter is followed up with the consultant to determine if a change in

control has also occurred.

PW: [A change of name by itself means that there is no change in the legal entity, so

there is no need to provide for the carryover of liabilities/bonds/insurance. A

simple change of name is rare, as the change is normally an indication of a change

of control. If a change of control has also occurred, change of control provisions

below will be applicable].

6.5.3 Change in

control after

contract award

A buy-out of the supplier by another company (either shares or assets), an

amalgamation, a transfer of majority shareholding or a change in the effective

management or control of the consultant (including changes to a partnership) may

impact upon the substance and delivery of the contract, particularly in the case where

key personnel exit. The consultant has an obligation to do the following:

1. Fully inform the project manager/asset manager of the changes (as soon as

practicable, and preferably before they take effect). The NZTA may have the

right to terminate the contract if it wishes and claim consequential costs and

expenses from the supplier.

2. Seek and obtain the

contractual obligations or novation of the contract to the new party. If consent is

not given in accordance with the specified process, the NZTA has the rights

specified in (1).




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6.5.4 Assignment or

novation

The NZTA will only consent to assignment or novation if the process set out below is

followed and it is satisfied that its interests, the integrity of the procurement process will

not be compromised, and that any existing bonds and insurances are confirmed or

appropriate substitutions made.

In an assignment the original supplier should ordinarily remain responsible for

performance under the contract unless that is clearly inappropriate (e.g. the incoming

party is stronger and willing to take on liability for past events) and that continued

liability must be documented.

It is important that the assignment or novation is specifically addressed so that if there

are difficulties later, there is not a dispute about whether it is the original party or the

assignee that is liable. Specifically if the original party is excused, the new party must be

expressly stated to be liable for past events. At this point, the assignment is materially

the same as a novation.

In a novation the original supplier ceases to have any ongoing involvement. Issues as to

the time when a liability arises can therefore be material. Generally, novation should not

be accepted unless there is substitution of a clearly stronger party and there is no risk to

the integrity of the procurement process. The incoming (or novated) party must

acknowledge responsibility for everything done or not done by the original party.

6.5.5 Changes prior

to contract

awarded

Where the project manager/asset manager becomes aware of a material change or

change in control of a tenderer, at any time during the tender process before a contract

has been awarded, the project manager/asset manager shall do the following:

1. Send a letter to the tenderer, asking them to confirm that the personnel named in

the tender bid will remain the same and that there is no material change in

cir

bid for and demonstrate how this is so.

2. If there is a change of control, check whether the other relevant party has also

tendered for the contract. If so, seek advice from the

6.5.6 Changes after

contract

awarded

Where the project manager/asset manager becomes aware of a material change to or

change in control of an existing supplier, or receives a request for NZTA to consent to

assignment or novation of an existing contract the project manager/asset manager shall

do the following:

1. Request details of the (proposed) change in control from the consultant and

details of the proposed new key personnel.

2. Assess whether the new party is at least as able to perform the contract.

If so, the project manager/asset manager shall obtain the consent of their SHM

to request from the supplier a deed of assignment or novation of the contract for

approval by the NZTA (such approval to be given by the State Highway

Manager). This deed must clearly transfer all the rights and obligations of the

contract to the new party, and state that from the date of the deed, the NZTA is

entitled to deal only with the new party in relation to all matters. The new party

must be clearly bound in respect of past acts or omissions of the original party

and liable for them and any rectification required as it was the original party.

If it is assessed that the new party is as not able to perform the contract as, the

project manager/asset manager shall refer the matter to the appropriate State

Highway Manager. If the State Highway Manager determines that it is

appropriate, require the consultant to provide a deed of assignment or novation.

In this case, the original party would not be fully released.




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Changes after contract

awarded continued

3. Check whether the new party unsuccessfully tendered for the contract. If so, seek

4. Check that replacement bonds (if any) and insurances are in place or that the

relevant deed assignment includes the assignment or novation (as appropriate) of

existing bonds and insurances

It is very important to respond to notice, even informal, of any events that might

amount to assignment or novation. This is because the

inferred from conduct or acquiescence, and in those cases its position might not be

adequately protected.

Where approval of assignment or novation is not recommended legal advice should

be sought regarding termination of the contract.

6.5.7 Where a change

in control

involves an

assignment or

novation,

subcontracting

The The NZTA's

consent to this should always expressly prohibit the subconsultant/subcontractor assigning

or novating its rights and obligations in relation to the particular tender, The consent should

require notice of changes of control, and include a provision that the NZTA may amend or

withdraw its consent if those types of arrangements occur.




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7.0 Contract payments

7.1 Introduction

This stage in the contract process involves making contract payments.

PS: Contract payments, for work performed by a consultant, are made at the time

and in the manner as set out in the general and special conditions for the

provision of PS and the contract documents.

PW: Contract payments, for work performed by a contractor, are made in the time

and manner as set out in NZS 3910 and the contract documents. The Contract

payment voucher and tax invoice application which is linked to PROMAN

(SAP once active) shall be used during the course of making payments to

contractors.

7.2 Liquidated damages (PW only)

Liquidated damages are daily amounts to be deducted from contract payments when

practical completion is not achieved by the contract completion date as calculated

from the NZTAs direct daily costs and provided for in the contract documents.

Under its general conditions the NZTA has the right to deduct liquidated damages

from any monies payable to the contractor in terms of the contract between them.

Commercial judgement is to be used in deciding whether to recover liquidated

damages or not while considering their actual value in relation to the cost of recovery

and the maximisation of the value to the crown. The NZTA, as the contract principal,

has the sole authority to make deductions and therefore the discretionary power to

vary the amount of liquidated damages to be deducted.

7.3 Application of liquidated damages delegations (PW only)

Liquidated damages calculated by the project manager are to be approved by the

State Highway Manager prior to approval to proceed with the engagement of a

contractor.

Under delegated authority of the general conditions of contract, the principals

contract rate when a contract proceeds beyond its completion date.

Liquidated damages proposed to be varied or waved by the project manager, must be

approved by the State Highway Manager and endorsed by the Group Manager HNO.




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8.0 Contract close

8.1 Introduction

8.1.1 PS contract

closure (PS

only)

Contract closure for a PS contract occurs with the issue of a PS contract completion

notice, PSF/5b (SM030) to the consultant on satisfactory supply of all deliverables. A

copy of this certificate should be retained on the contract file.

If for any reason the project manager/asset manager wishes to terminate a contract due

to poor performance, before satisfactory supply of all deliverables, then a report must first

be prepared setting out the reasons for such recommended action for Group Manager

HNO endorsement and the NZTA Chief Executive approval. Without such approval a

contract cannot be terminated.

8.1.2 PW contract

closure (PW

only)

Contract closure for a PW contract occurs with the issue, by the engineer to the contract,

of a defects liability certificate for the contract works to the contractor and the NZTA as

set out in NZS 3910:2003 and the contract documents.

Any other reports required by the PS contract, e.g. contract performance report shall be

completed by the consultant and copies forwarded to the NZTA.

If for any reason the project manager wishes to terminate a contract due to poor

performance, before satisfactory supply of all deliverables, then a report must first be

prepared setting out the reasons for such recommended action for Group Manager HNO

endorsement and the NZTA Chief Executive approval. Without such approval a contract

cannot be terminated.

8.1.3 Release of

performance

bond

When the NZTA receives a copy of the certificate of practical completion for the whole of

the works from the consultant, the tenders secretary must obtain the agreement of the

project manager prior to the release of the performance bond. The consultant should

advise the project manager of the impending issue of a certificate of practical completion

to ensure the release of the bond within five working days of the receipt of

such certificate.

The tenders secretary must advise the contractor and the contractor s surety by written

notice of their release from the performance bond or reason for withholding release of the

bond with any conditions as to release, as provided by the consultant and agreed by the

project manager. This should be done within five

receipt of the certificate of practical completion.

Alternatively, if contractor is under a global bond scheme, the tenders secretary shall

notify [email protected] that a certificate of practical completion has been issued

for the said contract and expected end of defects liability period (refer global bond

procedure flow chart section 2.8 part A of this manual).

8.1.4 Release of bond

in lieu of

retentions

When the NZTA receives a copy of the defects liability certificate from the consultant, the

tenders secretary must obtain the agreement of the project manager prior to the release of

the bond in lieu of retentions. The consultant should advise the project manager of the

impending issue of a defects liability certificate within five

receipt of such certificate to ensure the release of the bond in lieu of retentions on issue of

the defects liability certificate.

ty by written

notice of their release from the bond in lieu of retentions on issue of the defects liability





Page 85

certificate.

Alternatively, if contractor is under a global bond scheme, the tenders secretary shall notify

[email protected] that a release letter has been issued for the said contract can be

removed from the global bond Register.





Page 86

9.0 Appendices part A

Schedule of appendices

Appendix Page Title

I 87 Request for approval to proceed to engage a consultant

II 88 Request for approval to proceed to engage a contractor

III 89 Register of tender documents issued (PS and PW)

IV 90 Register of tenders (PS and PW)

V 91 Schedule of tenders received

VI 92 Checklist by tenders secretary prior to tender evaluation (PS and PW)

VII 92 Evaluation summary forms and guidelines for PS and PW (7 pages)

VIII 100 Tender summary lowest price conforming tender method: final evaluation

IX 101 Potential conflict of interest/Bias declaration

X 102 Tender acceptance notice PS

XI 103 Tender decline notice PS

XII 104 Tender acceptance notice for physical works contract (LPC)

XIII 106 Tender decline notice for physical works contract (LPC)

XIV 107 Tender acceptance notice for physical works contract (PQM)

XV 109 Tender decline notice for physical works contract (PQM)

XVI 110 Rejection notice on basis of non-conformity

XVII 111 Rejection notice on basis of late tender

XVIII 112 Tender acceptance notice for professional services contract target price method)

XIX 113 Tender decline notice for professional services contract and target price method)

XX 114 Contract payment voucher and tax invoice

XXI 115 Notice to tenderers

XXII 116 Notice that a preferred tenderer has been selected

XXIII 117 Request for approval of insurance amounts for:

professional services (2 pages)

physical works (2 pages)

ECI (2 pages)

XXIV 126 Request for the price envelope to be opened

XXV 127 PQM guidelines (4 pages)

XXVI 131 Regional block project procurement strategy template (3 pages)

XXVII 134 Release of contract from global bond register letter

XXVIII 135 Large project stage 1 procurement strategy template (6 pages)

XXIX 141 Large project stage 2 procurement strategy template (2 pages)

Contract procedures manual SM021 Part A Appendix I



Page 87

Request for approval to proceed to engage a consultant

The tenders secretary NZTA File ref:

Date:

Project name

Contract number SH/SHs

Tenderers to be sought from national register of consultants Yes No If no, why?

Draft advertisement checked, approved and attached

Tender to be advertised using

Date to be advertised

Supplier selection method to be used (include price/non-price attribute weightings)

Closed Contest/PQM/Brook’s Law/Target Price

Price % RE % TR % RS % Meth %

TET members proposed (note qualified evaluator)

Tenders close at 4pm Date: Location:

Request for tender document checked and accepted

Risk and insurance sub-VAC approval for insurance obtained Yes No N/A

Contract base estimate checked approved and accepted Yes No

Appropriate contingencies and escalation allowance applied Yes No

Approved funding allocation (for current phase(s)) Phase(s) in contract I&R D&PD SD&PD MSQA $

Approved funding adequate Yes No

Project plan approved Yes No

Does this appendix constitute the stage 1 procurement strategy (for contracts with an expected construction estimate <$5 million). If no attach the stage 1 procurement strategy (for contracts with an expected construction estimate >$5 million).

Yes No

The above details are certified correct:

The above estimate is within funding allocation and the contract is recommended for advertising/consultant engagement.

Project manager/Asset manager

Date

Recommending manager Date

The above contract is approved for advertising/consultant engagement:

State highway manager Date

Contract procedures manual SM021 Part A Appendix II



Page 88

Request for approval to proceed to engage a contractor

The tenders secretary NZTA File ref:

Date:

Project name Contract No. SH/SHs

Title of PROMAN work unit to be linked to the contractor

Draft advertisement checked, approved and attached

Tender to be advertised using

Date to be advertised

Supplier selection method to be used (include price/non-price attribute weightings and prequalification level)

Closed Contest/PQM/Brook’s Law/Target Price

Price % RE % TR % RS % Res % Meth %

TET members proposed (note qualified evaluator)

Tenders close at 4pm Date: Location:

Request for tender document checked and accepted

Risk and insurance sub-VAC approval for insurance obtained

Yes No N/A

Contract base estimate checked approved and accepted Yes No

Appropriate contingencies and escalation allowance applied Yes No

Approved funding allocation (for current phase(s)) $

Approved funding adequate Yes No

Contract duration

Delivery model Traditional / Design-Construct / Full delivery

Contract type (i.e. M&V, LS, ECI or Alliance)

Period of defects liability

Liquidated damages (from calculation sheet PSF6a) $ per day

Authority to enter land has been obtained Yes No

Provisions of Resource Management Act (RMA) 1991 complied with Yes No

Design fully complies with all RMA consent conditions Yes No

Cultural requirements identified and requirements incorporated into RFT Yes No

Archaeological authority granted and requirements incorporated into RFT Yes No

Does this appendix constitute the stage 2 procurement strategy (for contracts with an expected construction estimate <$5 million). If no attach the stage 2 procurement strategy (for contracts with an expected construction estimate >$5 million).

Yes No

The above details are certified correct:

Engineer to the contract Company Date

The above estimate is within the funding allocation and the contract is recommended for advertising/contractor engagement:

Project manager/Asset manager

Date

Recommending manager Date

The above contract is approved for advertising/contractor engagement:

SH Manager

Date

NZ Tran Contract procedures manual SM021 Part A Appendix III



Page 89

Register of tender documents issued (PS and PW)

Contract number: Closing at: on

File number: Contract name:

Set number

Tenderers name Address Contact name

Fax number Issued Returned Notice to tenderers

1 2 3 4 5 6

1

2

3

4

5

6

7

8

9

10

11

12

Note: This form is not to be shown to tenderers or the public.

Contract procedures manual SM021 Part A Appendix IV



Page 90

Register of tenders (PS and PW)

PS PW

(Tick appropriate box)

Contract number

Contract name Closing

date Base estimate

Number of tenders received

TET and Advisors (add

date documents were issued)

Type of approval

received and date

Name of successful tenderer

Contract award value

Date accepted

Note: 1) this form is not to be shown to tenderers or the public. 2) A spreadsheet register which contains the fields above as a minimum may be used in place of this appendix

Contract procedures manual SM021 Part A Appendix V



Page 91

Schedule of tenders received

Region: Closing date: Supplier selection method:

Contract name: Contract number:

PS Phase(s) in contract: I&R D&PD MSQA

A) Base estimate (for current phase):1 $

B) Tender price (for current phase):1 $

C) NZTA-managed costs, fees and contingency allocation $

D) Total allocation required (B+C) (for current phase): $

E) Approved Allocation (for current phase): $

PW

Engineers base estimate: $

Expected construction phase estimate including MSQA, NZTA- managed costs, risks contingency and escalation:2

$

Approved allocation: $

Name of tenderer Amount of

tender Comment on late tenders, tags, non-price attribute failure, etc

1

2

3

4

5

6

Tenders received by:

Date:

Tenders opened by:

Date:

Witnessed by:

Witnessed by:

An arithmetic check has been carried out for the tenderer to whom award is recommended.

Tenders secretary: Date

Required funds are available and I concur with the recommendation in the tender evaluation report to accept the tender of:

Project manager Date

Recommending manager (Details certified correct) Date

State Highway Manager Date

1 Forms G, H or I (Cost estimation manual (SM014)) – Expected contract estimate for current PS phase, based on the preferred tenderers price.

2 Form I (SM014) – Expected construction phase estimate, based on the preferred tenderers price.




Page 92

Checklist by tenders secretary prior to tender evaluation (PS and PW)

Contract number: PS

Contract name: PW

Tenderer:

Supplied Comment

Yes No N/A

1* Completed and signed tender form

2* Completed and signed schedule of quantities

3 Non-price attributes

Relevant experience

Track record

Relevant skills (personnel)

Resources (plant, equipment, materials) PW only

Methodology

4 Prequalification certificate included

5 Subconsultants/subcontractor details

6 Tenderers programme

7 Notice(s) to tenderers acknowledged NTT Nos.

NTST Nos.

8 Obvious tags that are clearly identified/tags and clarification statement

9 Tender submission conforms with page limit in RFT (See procedure in section D for dealing with pages that exceed the specified limit.)

10 Any other file notes (eg items removed, number of pages exceeded, font size, blank pages)

11 TET Potential Conflict of Interest Declarations approved and on file

* Note: In two-envelope tender processes these can only be checked once the price envelope is opened after completion of the non-price attribute evaluation.

Non-price information Price information

Signed Date Signed Date

Tenders secretary Tenders secretary

Signed Date

TET leader

Contract procedures manual SM021 Part A Appendix VII

Page 1 of 7



Page 93

Evaluation summary forms and guidelines for PS and PW

Contents Page

Evaluator summary of all non-price attributes: PS and PW (Tender evaluation form F) 94

Price quality method simple: PS and PW (Tender evaluation form G) 95

Price quality method special: PS and PW (Tender evaluation form H) 96

Brook’s law method: PS (Tender evaluation form I) 97

Non-price attribute grading (Attribute and sub-attribute grades) 98

Guidance to evaluators on the usage of evaluation forms A to I

Note: Forms A to D may be found in SM030, and A to E in SM031 AND SM032.

99


Page 2 of 7



Page 94

Evaluator summary of all non-price attributes: PS and PW Form F

Contract no: Contract name: TET names

Region: Date: Agreed grade

Tenderer Relevant experience Track record Relevant skills Resources Methodology

Evaluator attribute grades are averaged or agreed and entered in the highlighted box.


Page 3 of 7



Page 95

Physical Works Professional Services

Contract For:

Region:

Contract No:

Date:

Weighting

100%

Each Tenderer's Weighted sum - Lowest Weighted sum

Weighted Sum Margin x Evaluation Estimate / Price Weight

Confirm SQP & record justification for any adjustments

ATP evaluation must be shown and recorded

May not be altered once the price envelope is opened

TET Signature

Date

TET Name

Adjusted Evaluation Price is the Evaluation Price less the SQP and ATP. The preferred Tenderer is the Tenderer with the lowest Adjusted Evaluation Price

TET Signature

Date

TET Name

The assessment above reflects the evaluation of the TET. All TET members have completed and signed appendix IX –

Potential Conflict of Interest/Bias Declaration:

Please fill in the green fields only

Remove Provisional Sums (or any other Schedule fixed amounts in the RFT)

from the Tender Prices and Estimate

Appendix VII

Form G

Price Quality Method Simple

TET's agreement on the calculated or adjusted SQP and ATP, and calculations verified correct:

Base Estimate (1)

Delegated Authority

Tenderer's Full Name

Date

Less all Schedule Fixed Amounts

Evaluation Estimate

Final adjusted and justified SQP (or none)

Lowest Weighted Sum

Relevant Skills

Track Record

Non-Priced Attributes Weighted Sum

Tenderers Indices (Grade x Weight)

ENVELOPE 2 Price Evaluation

Weighted Sum Margin

Supplier Quality Premium (SQP)

SQP + ATP

Non-Price Tenderers Grades from Form F

Price Weight

Methodology

Adjusted Evaluation Price


Evaluation Price

ENVELOPE 1 Non-Price Evaluation

Tender Price

Resources

Alternative Tender Premium (ATP)

Tenderer

Relevant Experience

Date

Authorisation to open price envelopes:

Delegated Authority

Signature

Note:This spreadsheet allows up to 10 tenderers to be evaluated. First unprotect the worksheet by selecting "Tools", "Protection", "Unprotect". Highlight column I and N, and select "Unhide". Repeat the same for Column

S and X, and row 35 and 40. (1) Refer to Terminology Section of CPM for definition of Base Estimate.

Authorisation to begin award process:

Signature

Contract procedures manual SM021 Part A Appendix XII



Page 96

Physical Works Professional Services

Contract For:

Region:

Contract No:

Date:

Weighting

Weighted sum x Maximum Risk Consequence

Each Tenderer's Risk Premium - Lowest Risk Premium

Confirm SQP & record justifications for any adjustments

Value of Product Premium where provided for in RFT

ATP evaluation must be shown and recorded

May not be altered once price envelope is opened

TET Signature

Date

TET Name


TET Signature

Date

TET Name

Relevant Skills

Track Record

Relevant Experience


Evaluation Price

Tender Price

Estimate

Lowest Risk Premium

ENVELOPE 2 Price Evaluation

Risk Value

Supplier Quality Premium (SQP)

SQP + TCA + ATP

Tangible Cost Adjustment (TCA)(2)

Tenderer


Resources




Base Estimate (1) (Not used in calculations)


Maximum Risk Consequence

Final adjusted and justified SQP (or none)

Alternative Tender Premium (ATP)

Methodology

Adjusted Evaluation Price


Date

Delegated Authority

Tenderer's Full Name



Non-Price Tenderers Grades from Form F Tenderers Indices (Grade x Weight)


Appendix VII

Form H

Price Quality Method Special


from the Tender Prices and Estimate

Delegated Authority

Signature

Date

Note:This spreadsheet allows up to 10 tenderers to be evaluated. First unprotect the worksheet by selecting "Tools", "Protection", "Unprotect". Highlight column I and N, and select "Unhide". Repeat the same for Column

S and X, and row 35 and 40. (1) Refer to Terminology Section of CPM for definition of Base Estimate. (2) TCA only apply to Design and Construct Contracts

Signature


Page 5 of 7



Page 97

Contract For:

Region:

Contract No:

Date:

Weighting

10%

10%

25%

40%

TET Signature

Date

TET Name


TET Signature

Date

TET Name

May not be altered once price envelope is opened

ENVELOPE 2 Price of Highest Overall Weighted Sum Tender


Highest Overall (Adjusted) Weighted Sum

Non-Price Tenderers Grades from Form F

Methodology


from the Tender Price and Estimate

Appendix VII

Delegated Authority

Tenderer Full Name

Form I

Brook's Law Method

Date




Base Estimate (1)


Evaluation Estimate

Tenderers Indices (Grade x Weighting)

Adjusted (Manual) Evaluation Price


Price for Negotiation


Tender Price of Highest Overall Weighted Sum

Tender

Relevant Skills

Track Record


Final (Manual) Adjusted Weighted Sum

Tenderer

Relevant Experience


Delegated Authority

Signature

Date

Professional Services

Note: This spreadsheet allows up to 10 tenderers to be evaluated. First unprotect the worksheet by selecting "Tools", "Protection", "Unprotect". Highlight column I and N, and select "Unhide". Repeat the same for Column

S and X, and row 35 and 40. (1) Refer to Terminology Section of CPM for definition of Base Estimate.


Signature

NZ Transp Contract procedures manual SM021 Part A Appendix VII

Page 6 of 7



Page 98

Non-price attribute grading

The following supplements the definitions in the NZTA’s Procurement manual – provided to assist evaluators in distinguishing

between the terms used on tender evaluation forms and the allocation of an appropriate grade.

A scale of 0 to 100 is to be used, generally in steps of 5 and the groupings defined below.

90, 95 or 100 – Excellent: Only awarded when all requirements are met in an outstanding manner.

Other definitions include: extremely related, superlative, significantly within

budget, consistently ahead of deadline, directly applicable.

75, 80 or 85 – Good: Where requirements are fully covered in all material aspects.

Other definitions include: very related, exceeds requirements, well within

budget, frequently ahead of deadline, very related.

60, 65 or 70 – Above average: Where requirements are adequately covered.

Other definitions include: particularly related, requirements fully met, within

budget, occasionally exceeds.

50 or 55 – Average: Adequate with some deficiencies which are not likely to have any adverse

effect.

Other definitions include: related, acceptable, on budget, on time, meets

requirements.

40 or 45 – Below average: Barely adequate and would need minor improvement if selected.

Other definitions include: barely related, needs improvement, exceeds

budget, misses deadline, adequate.

35 or less – Poor: Generally unacceptable and ruled out of further consideration.

Other definitions include: not related, unsatisfactory, significantly exceeds

budget, frequently misses deadline, barely adequate.


Page 7 of 7



Page 99

Guidance to evaluators on the usage of evaluation forms A to I

Form A – Relevant experience and form B – Track record

Enter the tenderer name, evaluator name and date, and the description of the five tenderer-nominated projects. For each sub-

attribute enter a grade for each project. From the average of these grades, multiplied by the subattribute weight derive a total

subattribute grade. If other than average of grades the process should be documented. From the subattribute totals calculate the

attribute grade. If no subattribute weights have been specified, the evaluator should still consider the importance of each sub-

attribute when deriving an attribute total and document the process.

Form C – Relevant skills

Enter the tenderer name, evaluator name and date, and the names relating to each of the consultant's personnel from the

personnel schedule. For each subattribute enter a grade for each person. Each evaluator should consider the relevance of other

tenderer-nominated personnel and any other personnel requirements which, from the contract documents should be included for

scoring and, the adequacy of nominated personnel in relation to technical/managerial qualifications and experience as required

for the position nominated for. After having considered these issues a total subattribute shall be derived and the process should

be documented. Use subattribute weights and personnel weights, if specified, to calculate the attribute grade. If no personnel

weights have been specified, the evaluator should still consider the importance of each position when deriving an attribute total

and document the process.

Form D – Methodology

Enter the tenderer name, evaluator name and date. Enter a grade for each of the factors listed. Evaluators should consider the

importance to the contract of each factor when deriving the rating and any weight given. Factor grades are multiplied by the

weighting (where given) and the results summed to determine the overall grade.

Form E – Resources

Enter the tenderer name, evaluator name and date. Enter a grade for each of the factors listed. Evaluators should consider the

importance to the contract of each factor when deriving the rating and any weight given. Factor grades are multiplied by the

weighting (where given) and the results summed to determine the overall grade.

Form F - Evaluator summary of all non-price attributes

Enter TET member’s names in upper box relative to where their grades are entered on the summary form. Enter the date and

names of tenderers. Enter each evaluator grade for each attribute against the appropriate tenderer.

Where evaluator grades are of similar ranking for each subattribute for each tenderer the grades for each attribute may be

averaged and entered in the highlighted box. If there are marked differences between evaluator grades or rankings are

divergent, a review of subattribute scoring may be required to identify the differences and agree a similarly-ranked grade.

All tenderers final grades are over-viewed by the TET to ensure that they are reasonable and appropriate when compared with

each other and as appropriate other recent contract evaluations.

Forms G and H – Price quality method simple and Price quality method special

Forms G and H are designed as spreadsheets and used to calculate consultant/contractor non-price indices, SQP and preferred

tenderer.

Guidelines to use of the price quality method and example calculations are to be found in appendix XXV.

Form I Brook’s law method: PS

Forms I is designed as a spreadsheet and used to calculate the tenderer with the highest overall weighted sum of non-price

indices and preferred tenderer. The form provides for the preferred tenderers price to be entered and final negotiated price.

Note: Forms A to D may be found in SM030 and forms A to E in SM031 and SM032.

NZ Trans Contract procedures manual SM021 Part A Appendix VIII



Page 100

Tender summary lowest price conforming tender method: final evaluation

Contract number: Contract name:

Name of tender (ranked in price order)

Non-price attributes (P= Pass F= Fail)

Amount of tender

RE* TR* RS* M* R*

1

2

3

4

5

6

7

8

* RE = relevant experience, TR = track record, RE = relevant skills, M = Methodology, R = Resources.

The assessment above reflects the evaluation of the TET. All TET members have completed and signed appendix IX Potential conflict of interest/Bias declaration


TET signature Signature

Date Date

TET name Delegated authority

Contract procedures manual SM021 Part A Appendix IX



Page 101

Potential conflict of interest/Bias declaration

If your answer is ‘yes’ to any of the following questions, then you have a potential conflict that may require mitigation. For more information on how to complete this form or the process for handling potential conflicts of interest refer the Conflict of interest section in this manual.

Name: Contract name: Contract number:

Conflict/Bias examples Yes No Comment (must include where you answer ‘yes’)

1. Have you or your organisation carried out works or services for any tenderer (or member of its group) in the last two years?

2. Do you have a family and/or personal relationship with any tenderer (or member of its group)?

3. Are you employed by, or do you have a professional relationship with, or hold any office with any tenderer, including executive relationships such as director or Board member?

4. Are you or your organisation currently involved or about to be involved with any tenderer in submitting another tender to the NZTA or any other party?

5. Are you advising any party that is in a dispute with any tenderer?

6. Have you been a witness for or against any tenderer, or an expert witness in proceedings involving any tenderer in the past two years?

7. Do you or your organisation have a financial or other relevant interest in any tenderer (or member of its group)?

8. Are you or your organisation a creditor or do you hold any security over any tenderer (or member of its group)?

9. Does any company, trust, or other organisation in which you hold office, or over which you have any material influence, have an interest as described in this manual Conflict of interest section?

10. Without making specific enquiry, to the best of your knowledge does any member of your immediate family have an interest described in this manual Conflict of interest section?

Signature: Date:

Agreed mitigation/method to remove potential conflicts of interest:

Approval for member to remain on team – TET leader name: Signature: Date:

Contract procedures manual SM021 Part A Appendix X



Page 102

Tender acceptance notice PS

Reference:

Date

Name

Company

Postal address 1

Postal address 2

Postal address 3

Dear Sir/Madam

Acceptance notice for professional services contract NZTA (Contract number)

On behalf of the NZ Transport Agency, I advise that your tender to undertake the contract work described above and referred to in

your tender for the sum of $XXXXX (amount in words) excluding GST, is accepted.

I also advise that (Name of Project Manager) of this office has been appointed Project Manager under this contract.

Your attention is directed to the need for early compliance with the requirements of Clause 6 of the General Conditions of Contract,

and Clause 2.7(c) of the Special Conditions of Contract regarding obligations relating to insurances. Please provide certificates of

insurance prior to commencing the contract works.

The NZ Transport Agency received <no.> conforming tenders. The range of prices of conforming tenders is from $XXXXX to

$XXXXX excluding GST. (Note: only include range information for price where three or more conforming tenders are evaluated.)

The range of non-price attribute grades, supplier quality premiums and your own grade and supplier quality premium, as applicable,

are as follows: (Note: only include range information for non-price attributes where three or more conforming tenders are evaluated.

The range of supplier quality premiums shall also be given even when only two tenders are evaluated.)

Attributes Range of grades or premiums Own grade or premium

Relevant experience

Track record

Relevant skills

Methodology

Supplier quality premium

Yours faithfully Tenders Secretary for <appropriate> Manager


Part A Appendix VII

Page 3 of 8



Page 103

Tender decline notice PS

Reference:

Date

Name

Company

Postal address 1

Postal address 2

Postal address 3

Dear Sir/Madam

Decline notice for professional services contract NZTA (Contract number)

On behalf of the NZ Transport Agency, I thank you for your tender to undertake the above contract work and advise that it is hereby

declined.

The successful tenderer is (Name of successful tenderer) at a tendered sum of $XXXXX (amount in words) excluding GST.

The NZ Transport Agency received <no> conforming tenders. The range of prices of conforming tenders are from $XXXXX to

$XXXXX excluding GST. (Note: only include range information for price where three or more conforming tenders are evaluated.)

The range of non-price attribute grades and supplier quality premiums, and your own grade and supplier quality premium, are as

follows: (Note: only include range information for non-price attributes where three or more conforming tenders are evaluated. The

range of supplier quality premiums shall also be given even when only two tenders are evaluated.)


Relevant experience

Track record

Relevant skills

Methodology



Reference:




Page 104

Acceptance notice for physical works contract (LPC)

Reference:

Date

Name

Company

Postal address 1

Postal address 2

Postal address 3

Dear Sir/Madam

Acceptance notice for physical works contract NZTA (Contract number)

On behalf of the NZ Transport Agency, I advise that your tender to undertake the contract work described above and referred to in your tender for

the sum of $XXXX (amount in words) excluding GST is hereby accepted.

<<Guidance note: include the following clause when contract base estimate is less than $50 million; NZTA will include all these project under

Principal Arranged Insurance.>>

Your attention is directed to the need for early compliance with the requirements of Sections 2.7, 3.1 and 8 of the General Conditions of Contract

regarding execution of the Contract Agreement, provision of a Contractor’s Bond and obligations relating to insurances. Your attention is drawn to

the General Conditions of Contract Clause 8.5.4 requiring you to deposit the certificate of insurance, in the form set out in the Eleventh Schedule

as appropriate, with the Engineer prior to commencement of the contract works.

<<Guidance note: include the following clause when contract base estimate is more than $50 million OR where contract specific insurances are

required. Your attention is directed to the need for early compliance with the requirements of Sections 2.7, 3.1 and 8 of the General Conditions of

Contract regarding execution of the Contract Agreement, provision of a Contractor’s Bond and obligations relating to insurances. Your attention is

drawn to the General Conditions of Contract Clause 8.5.4 requiring you to deposit the certificates of insurance, in the form set out in the Seventh,

Eighth and Eleventh Schedules, with the Engineer prior to commencement of the contract works. The Contractor is required to submit their

insurance policy to be reviewed by NZTA, and may be required to be amended should any policy not meet the contract requirements. If satisfactory

insurance policies are not put in place then NZTA may at its option exercise its powers under Conditions of Contract Clause 8.5.7, and the Contract

will be required to be included in the NZTA PAI programme.

In accordance with clause 10.1 of the General Conditions of Contract and the Instructions for Tendering the agreed contract period for the

construction of the contract works is from <enter date> or <enter number of working days, from possession of site> to <enter date>. In accordance

with clause 5.4 of the General Conditions of Contract, subject to compliance with the requirements of paragraph two above the Contractor shall be

entitled to possession of the site on <enter date>.

The NZ Transport Agency received <no> conforming non alternative tenders and <no.> conforming alternative tenders. Listed below are the

names of other conforming tenderers in alphabetical order:


Part A Appendix VII

Page 3 of 8



Page 105

Following are the prices (excluding GST) of unsuccessful tenderers in ascending order: (Note: only include list of prices when 3 or more conforming

tenders are evaluated.)

Yours faithfully

Tenders Secretary

for <appropriate> Manager

cc. NZTA Consultant

[email protected]


Contract procedures manual SM021 Part A Appendix XIII



Page 106

Decline notice for physical works contract (LPC)

Reference:

Date

Name

Company

Postal address 1

Postal address 2

Postal address 3

Dear Sir/Madam

Decline notice for physical works contract NZTA (Contract number)

On behalf of the NZ Transport Agency, I thank you for your tender to undertake the above contract work and advise that it is hereby

declined.

The successful tenderer is <name of successful ternderer> at a tendered sum of $XXX (amount in words) excluding GST.

The NZ Transport Agency received <no> conforming non alternative tenders and <no> alternative tenders. Listed below are the names of other conforming tenderers in alphabetical order:

Following are the prices (excluding GST) of unsuccessful bidders in ascending order:

(Note: only include list of prices when three or more conforming tenders are evaluated.)


Contract procedures manual SM021 Part A Appendix XIV



Page 107

Acceptance notice for physical works contract (PQM)

Reference:

Date

Name

Company

Postal address 1

Postal address 2

Postal address 3

Dear Sir/Madam

Acceptance notice for physical works contract NZTA (Contract number)

On behalf of the NZ Transport Agency, I advise that your tender to undertake the contract work described above and referred to in your tender for

the sum of $XXXXX (amount in words) excluding GST, is accepted.

<<Guidance note: include the following clause when contract base estimate is less than $50 million; NZTA will include all these project under

Principal Arranged Insurance. >>



the General Conditions of Contract Clause 8.5.4 requiring you to deposit the certificate of insurance, in the form set out in the Eleventh Schedule

as appropriate, with the Engineer prior to commencement of the contract works.

<<Guidance note: include the following clause when contract base estimate is more than $50 million OR where contract specific insurances are

required.>>



the General Conditions of Contract Clause 8.5.4 requiring you to deposit the certificates of insurance, in the form set out in the Seventh, Eighth

and Eleventh Schedules,, with the Engineer prior to commencement of the contract works. The Contractor is required to submit their insurance

policy to be reviewed by NZTA, and may be required to be amended should any policy not meet the contract requirements. If satisfactory

insurance policies are not put in place then NZTA may at its option exercise its powers under Conditions of Contract Clause 8.5.7, and the

Contract will be required to be included in the NZTA PAI programme.

In accordance with clause 10.1 of the General Conditions of Contract and the Instructions for Tendering the agreed contract period for the

construction of the contract works is from <enter date> or <enter number of working days, from possession of site> to <enter date>. In

accordance with clause 5.4 of the General Conditions of Contract, subject to compliance with the requirements of paragraph two above the

Contractor shall be entitled to possession of the site on <enter date>.

The NZ Transport Agency received <no> conforming non alternative tenders and <no> conforming alternative tenders. Listed below are the

names of other conforming tenderers in alphabetical order:

The range of non-price attribute grades, supplier quality premiums, alternative tender premiums, and your own grade, supplier quality premium

and alternative tender premium, as applicable, for each non-price attribute are as follows: (Note: only include range information for non-price

attributes and alternative tender premiums where 3 or more conforming tenders are evaluated. The range of supplier quality premiums should still

be given even when only 2 tenders are evaluated).




Page 108

Attributes Range of grades or premiums 9.1.1.1.1.1.1 Own grade or premium

Relevant experience

Track record

Relevant skills

Methodology


Alternative tender premium

9.1.1.1.1.1.2 Following are the prices of unsuccessful conforming non-alternative tenders in ascending

order:

(Note: only include list of prices when 3 or more conforming tenders are evaluated.)

9.1.1.1.1.1.3 Tender price excluding GST

Yours faithfully

Tenders Secretary

for <appropriate> Manager

cc. NZTA Consultant

[email protected]


NZ Tran Contract procedures manual SM021 Part A Appendix XV



Page 109

Decline notice for physical works contract (PQM)

Reference:

Date

Name

Company

Postal address 1

Postal address 2

Postal address 3

Dear Sir/Madam

Decline notice for physical works contract NZTA (Contract number)

On behalf of the NZ Transport Agency, I thank you for your tender to undertake the contract work described above and advise that it is hereby declined.

The successful tenderer is <name of successful tenderer> at a tendered sum of $XXXXX (amount in words) excluding GST and with an SQP of $XXXXXXX.

The NZ Transport Agency received <no.> conforming non alternative tenders and <no.> alternative tenders. Listed below are the names of other conforming tenderers in alphabetical order:

The range of prices of conforming tenders are from $XXXXXX to $XXXXXX excluding GST. (Note: only include range information for

price where three or more conforming tenders are evaluated.)

The range of non-price attribute grades, supplier quality premiums, alternative tender premiums, and your own grade, supplier

quality premium and alternative tender premium, as applicable, for each non-price attribute are as follows: (Note: only include range

information for non-price attributes and alternative tender premiums where three or more conforming tenders are evaluated. The

range of supplier quality premiums should still be given even when only two tenders are evaluated).


Relevant experience

Track record

Relevant skills

Resources

Methodology


9.1.1.1.1.1.4 Following are the prices of unsuccessful conforming non-alternative tenders in ascending order:

(Note: only include list of prices when three or more conforming tenders are evaluated.)

Tender price excluding GST


Contract procedures manual SM021 Part A Appendix XVI



Page 110

Non-conformity rejection

Reference:

Date

Name

Company

Postal address 1

Postal address 2

Postal address 3

Dear Sir/Madam

Rejection notice on basis of non-conformity for contract NZTA (Contract Number)

On behalf of the NZ Transport Agency, I wish to inform you that your tender to undertake the works described above is rejected on

the basis that it was a non-conforming tender as defined in the NZTA’s Procurement manual. In the evaluation it was determined that

the tender was not consistent with the requirements of the RFT in that there was <for example, no information relating to the

Methodology Attribute provided>. This was contrary to the requirements of clause <for example? Tendering Information> of the RFT.

Your tender was graded less that 35 on <that attribute> at which point it became a non-conforming tender and no further evaluation

was undertaken. You are referred to the non-price attribute evaluation section in the NZTA’s Contract procedures manual (SM021)

and section << >> of the RFT which requires that a tender that is graded 35 or less on any non-price attribute must be excluded from

further consideration.

The successful tenderer was <name of successful tenderer> at a tendered price of $XXXXX (amount in words) excluding GST.

If you would like to receive a tender debrief please contact the Tender Secretary.


Contract procedures manual SM021 Part A Appendix XVII



Page 111

Notice of late tender

Reference:

Date

Name

Company

Postal address 1

Postal address 2

Postal address 3

Dear Sir/Madam

Notice of late tender for contract NZTA (Contract Number)

On behalf of the NZ Transport Agency, I wish to inform you that your tender to undertake the works described above was declared to

be a late tender and therefore was rejected.

Consideration was given to the reason provided for the tender being received after the closing time but was, with the concurrence of

the NZTA State Highway Manager, deemed unacceptable.

You are referred to the late tenders reference in the NZTA’s Procurement manual and NZTA policy on late tenders as explained in

our Contract procedures manual (SM021).

Please find enclosed your unopened tender.


Contract procedures manual SM021 Part A Appendix XVIII



Page 112

Acceptance notice for professional services contract (Brook’s law and target price method)

Reference:

Date

Name

Company

Postal address 1

Postal address 2

Postal address 3

Dear Sir/Madam

Acceptance notice for professional services contract NZTA (Contract Number)

On behalf of the NZ Transport Agency, I advise that your tender to undertake the contract work described above and referred to in your tender, is accepted for the sum of $XXXXX (amount in words) excluding GST.

I also advise that (Name of Project Manager) of this office has been appointed project manager under this contract.

Your attention is directed to the need for early compliance with the requirements of Clause 6 of the General Conditions of Contract, and Clause 2.7(c) of the Special Conditions of Contract regarding obligations relating to insurances. Please provide certificates of insurance prior to commencing the contract works.

The NZ Transport Agency received <no> conforming tenders.

The range of non-price attribute grades and your own grade are as follows: (Note: only include range information for non-price attributes where three or more conforming tenders are evaluated)

Attributes Range of grades Own grade

Relevant experience

Track record

Relevant skills

Methodology


Contract procedures manual SM021 Part A Appendix XIX



Page 113

Decline notice for professional services contract (Brook’s law and target price method)

Reference:

Date

Name

Company

Postal address 1

Postal address 2

Postal address 3

Dear Sir/Madam

Decline notice for professional services contract NZTA (Contract Number)

On behalf of NZ Transport Agency, I thank you for your tender to undertake the above contract work and advise that it is hereby

declined.

The successful tenderer is (Name of successful tenderer) at a tendered sum of $XXXXX (amount in words) excluding GST and a

total non-price attribute grade of XX.

The NZ Transport Agency received <no.> conforming tenders.

The range of non-price attribute grades and your own grade are as follows: (Note: only include range information for non-price

attributes where three or more conforming tenders are evaluated.

Attributes Range of grades Own grade

Relevant experience

Track record

Relevant skills

Methodology


Contract procedures manual SM021 Part A Appendix XX



Page 114

Contract payment voucher and tax invoice application

Note: The contract payment voucher and tax invoice application is linked to PROMAN (SAP when activated) and has

guidance/instruction as part of the application.

This manual will provide graphics from the application windows once SAP has been activated.

Contract procedures manual SM021 Part A Appendix XXI



Page 115

Notice to tenderers

Note: If issued by consultant replace the NZTA logo with consultant’s logo.

Reference:

Date

Name

Company

Postal address 1

Postal address 2

Postal address 3

Dear Sir/Madam

Contract number NZTA (contract number)

Contract description:

Notice to tenderers number:

Please acknowledge receipt of this notice within 24 hours and with your tender.


Contract procedures manual SM021 Part A Appendix XXII



Page 116

Preferred tenderer notice

Reference:

Date

Name

Company

Postal address 1

Postal address 2

Postal address 3

Dear Sir/Madam

Notice that a preferred tenderer has been selected on contract number <insert contract number> This letter is to inform you that <insert company name> has been selected as the preferred tenderer on contract number <insert contract number>. The NZ Transport Agency (NZTA) will now hold a pre-letting meeting with the preferred tenderer in accordance with the instructions for tendering. Following the award of contract, tender acceptance/decline letters will be issued and the opportunity to attend a tender debrief meeting will be provided. The NZTA wishes to thank all parties for their patience during this ongoing tender evaluation period. Yours faithfully Tenders Secretary for <appropriate> Manager

Contract procedures manual SM021 Part A Appendix XXIII



Page 117

Request for approval of insurance amounts PS contracts

To: <<Guidance note: This memo should be sent to AON ([email protected]), their comments incorporated and endorsement gained prior to being submitted to the Risk and Insurance sub-VAC.>> [email protected] (on behalf of Risk and insurance sub-VAC)

CC:

From:

Date:

NZTA reference: NO file reference: R/1 – 0002

Regional file reference: [File Number]

Subject: Insurance levels: [Project Name]

1. Purpose

To seek the Risk and insurance sub-VAC approval for the proposed insurance levels for [Project Name], [Project Phase] in

accordance with the NZTA’s Contract procedures manual (SM021), Liability and insurance section.

2. Action/Deadline

Risk and insurance sub-VAC to endorse the proposed insurance levels below, or propose an alternative course of action by

10am [day and date].

<<Guidance note: Provide adequate time frame, 1 week if possible. If shorter time frame required please make clear your

required time frame.>>

3. Insurance amounts proposed for [Project Name]

Description Value

Limitation of liability

(CCCS 6.2)

$[amount] (note default amounts in the NZTA proforma document)

<<Guidance note: Limitation amount will generally be in accordance with SM030 General and special conditions of contract. Project Manager to advise Risk and insurance sub-VAC where different, and why.>>

Duration of liability

(CCCS 6.4)

[x years] from the date of completion of the services (note default duration is

6 years).

<<Guidance note: Duration will generally be in accordance with SM030 General and special conditions of contract. Project manager to advise Risk and insurance sub-VAC where different, and why.>>

Professional indemnity

(CCCS 6.5)

$[amount] with at with at least one automatic reinstatement of the minimum amount per 12-month period of insurance (note default will be for the amount specified for limitation of liability).

Public liability

(CCCS 6.5)

$[$ amount]] million (note default value $5 million).





Page 118

Base estimate of PS fees $[amount] over a period of [‘x’ months/years]

Base estimate of PW (if applicable)

$[$ amount] million.

4. Background

Provide brief description of project phase, eg this phase is for the design of the 10km four-lane upgrade with one interchange

structure for…… Phase period will be for ‘x period’, construction start anticipated to commence {date] and expected to run

for ‘x period’).

Tenders for this contract close [contract closure date]

5. Project risk profile

This is the critical part of the submission to the Risk and insurance sub-VAC.

Attach the latest project risk register.

Ensure a rigorous assessment of risk has been undertaken, variations from the norm (to which our standard requirements are geared) identified, and recommendations on the exceptions made.

Identify significant risks at a project level including any planned treatments and existing controls.

Specific attention must be paid to geotechnical and seismic assessments and a specific statement identifying the

assessed risk or unknowns must be included.

Where the risks are yet to be assessed, then make a statement to this effect.

6. Insurance background

Prior to submitting this memo to the NZTA PS Project Support team via [email protected] , the project manager must obtain our insurers approval for the public liability cover. Contact Aon risk services (Russell Bell, 04 819-4004, 027 472 1012, [email protected]). Russell will advise what information the insurers require, this will vary between projects.

The NZTA’s insurer (QBE) is fully aware of this project, and have confirmed with Aon that the standard liability policy

deductibles shall apply for this contract. <<Amend as appropriate.>>

7. Recommendation

That Risk and insurance sub-VAC approve the insurance levels currently stated in the contract documents.

Prepared by: << Project Manager/Asset Manager>>

Name: _____________________ Signed: ____________________ Dated: __________

Endorsed by NZTA’s Insurance Broker:

Name: _____________________ Signed: _____________________ Dated: __________

Approved by the Risk and Insurance sub-VAC:






Part A Appendix VII

Page 3 of 8



Page 119


Name: ____________________ Signed: _____________________ Dated: __________




Page 120

Request for approval of insurance amounts PW contracts

To: <<Guidance note: This memo should be sent to AON ( [email protected]), their comments incorporated and endorsement gained prior to being submitted to the Risk and Insurance sub-VAC.>> [email protected] (on behalf of Risk and insurance sub-VAC)

CC:

From:

Date:




Purpose

To seek the Risk and insurance sub-VAC approval for the proposed insurance levels for [Project Name] in accordance with the

NZTA’s Contract procedures manual (SM021), Liability and insurance section.

Action/Deadline

Risk and insurance sub-VAC to endorse the proposed insurance levels below, or propose an alternative course of action by 10am

[day and date]. <<Guidance note: Provide adequate time frame, 1 week if possible. If shorter time frame required please make

clear your required time frame.>>

Insurance amounts proposed for [Project Name]

Description Value


(NZS 3910:2003 Part A 8.4.1a and Part B 8.4.2)

Clause 8.4.1a

$ (amount) (note default values in the NZTA proforma document)

Clause 8.4.2

State reinstatement(s) of PI Policy required ( note refer to default values in the NZTA proforma document

<<Guidance note: If contract period is greater than 3 years, OR contract value is greater than $50M, OR a Bridge construction cost is greater than $10M, then change highlighted “one automatic reinstatement” to “a minimum of two automatic reinstatements” >>

Project manager to advise Risk and insurance sub-VAC where different, and why.

Public liability (NZS 3910:2003 8.3)

$(million $ amount) (note default value $5 million)

Motor vehicle 3rd party ( NZS 3910:2003 8.3)

$(million $ amount) (note default value $1million)

Contract works (NZS 3910:2003 8.1)

The contract price

- plus (percentage)% demolition and disposal

- plus (percentage)% professional fees

- plus (percentage)% for items to be incorporated and not included in contract sum

- plus (percentage)% of contract price for increased construction costs.

This equates to $(amount) based on the expected estimate (note no default value in the NZTA proforma document).

Contractors plant (NZS 3910:2003 8.2)

All plant with market value > $(thousand $ amount) (note default value $50,000).





Page 121

Contractors bond (NZS 3910:2003 3.1)

$ (million $ amount) (note no default value in the NZTA proforma document).

Guidance note: Bond amount will generally be in accordance with the NZTA’s Contract procedures manual (SM021) section 2B. Project manager to advise Risk and insurance sub-VAC where different, and why.

Retention (NZS 3910:2003 12.3.1)

Contracts >$20 million require the retention amounts approved by the Risk and insurance sub-VAC. Best practice for such projects is for contractor to acquire a bond in lieu of retention.

If any of the above insurances are not included in the project, enter ‘not applicable’ in the value column.

Background

(Provide brief description of project, eg this project is a conventional 10km four-lane upgrade with one interchange structure.)

Tenders for this contract close (contract closure date).

Project risk profile





Specific attention must be paid to geotechnical and seismic assessments and a specific statement identifying the assessed

risk or unknowns must be included.


Insurance background


The NZTA’s insurer (QBE) is fully aware of this project, and has confirmed with AON that the standard liability policy deductibles shall apply for this contract. (amend as appropriate)

Recommendation














Page 122






Page 123

Request for approval of insurance amounts ECI contracts

To: <<Guidance note: This memo should be sent to NZTA’s insurance advisor AON (, [email protected]), their comments incorporated and endorsement gained prior to being submitted to the Risk and Insurance sub-VAC.>> [email protected] (on behalf of Risk and insurance sub-VAC)

CC: Project Services (ECI Procurement Manager)

From:

Date:




Purpose

To seek the Risk and insurance sub-VAC approval for the proposed insurance levels for [Project Name] in accordance with the

NZTA’s Contract procedures manual (SM021), Liability and insurance section.

Action/Deadline

Risk and insurance sub-VAC to endorse the proposed insurance levels below, or propose an alternative course of action by 10am

[day and date]. <<Guidance note: Provide adequate time frame, 1 week if possible. If shorter time frame required please make

clear your required time frame.>>

Insurance amounts proposed for [Project Name]

Description Value

Phases which insurance approval is being sought (SP1, 2 and/or 3)

Guidance note: state phases which insurance approval is being sought and give brief description of works included in those stages (e.g.- SP1 – Investigation and Reporting). Approval for subsequent stages will be required before they commence.

Base estimate of PS fees SP 1 = $[amount] over a period of [‘x’ months/years], and/ or SP 2 = $[amount] over a period of [‘x’ months/years],

and/or SP 3 = $[amount] over a period of [‘x’ months/years]

Base estimate of PW (if

applicable)

SP 3 = $[$ amount] million.


(NZS 3910:2003

Part A 8.4.1a and Part B 8.4.2 – SP 1, 2 and 3)

Clause 8.4.1a

$ (amount) (note default values in the NZTA proforma document)

Clause 8.4.2

State reinstatement(s) of PI Policy required ( note refer to default values in the NZTA proforma document)

<<Guidance note: If contract period is greater than 3 years, OR contract value is greater than $50M, OR a Bridge construction cost is greater than $10M, then change highlighted “one automatic reinstatement” to “a minimum of two automatic reinstatements” >>

Project manager to advise Risk and insurance sub-VAC where different, and why.

Guidance note: Contractor can be required to increase the level of PI insurance held as they move through the project development stages (SP 1, 2 and 3). PI insurance may also be purchased which is inclusion of previous design work. Prior to submitting please discuss PI requirements/level with the Project Services Team.>>

Public liability (NZS 3910:2003 8.3)

$(million $ amount) (note default value $5 million)

Guidance note: PL insurance levels can be increased as the contractor progresses through SPs..

Motor vehicle 3rd party ( NZS 3910:2003 8.3)

$(million $ amount) (note default value $1million)

Contract works (NZS 3910:2003 8.1 – SP 3

The contract price <<





Page 124

Only) - plus (percentage)% demolition and disposal

- plus (percentage)% professional fees

- plus (percentage)% for items to be incorporated and not included in contract sum

- plus (percentage)% of contract price for increased construction costs.

This equates to $(amount) based on the expected estimate (note no default value in the NZTA proforma document).

Contractors plant (NZS 3910:2003 8.2 – SP 3 Only)

All plant with market value > $(thousand $ amount) (note default value $50,000).

Contractors bond (NZS 3910:2003 3.1 – SP 3 Only)

$ (million $ amount) (note no default value in the NZTA proforma document).

Guidance note: Bond amount will generally be in accordance with the NZTA’s Contract procedures manual (SM021) section 2B. Project manager to advise Risk and insurance sub-VAC where different, and why.

Retention (NZS 3910:2003 12.3.1)

Contracts >$20 million require the retention amounts approved by the Risk and insurance sub-VAC. Best practice for such projects is for contractor to acquire a bond in lieu of retention.

If any of the above insurances are not included in the project, enter ‘not applicable’ in the value column.

Background

(Provide brief description of project, eg this project is a conventional 10km four-lane upgrade with one interchange structure.) Include project stage SP 1, 2 or 3 and description of the extent of works to be undertaken under the insurance levels to be approved.

Tenders for this contract close (contract closure date).

Project risk profile





Specific attention must be paid to geotechnical and seismic assessments and a specific statement identifying the assessed risk

or unknowns must be included.


Insurance background


The NZTA’s insurer (QBE) is fully aware of this project, and has confirmed with AON that the standard liability policy deductibles shall apply for this contract. (amend as appropriate)

Recommendation











Page 125






Contract procedures manual SM021 Part A Appendix XXIV



Page 126

Request for the price envelope to be opened

TO: PS

PW

PQM

Brook’s law method

Delegated authority approval obtained:

Yes No

(tick appropriate box)

CC:

FROM:

DATE:

PROJECT NAME:

SUBJECT:

Opening of price envelopes

Contract Number NZTA has been evaluated. Form F: Evaluator summary of all non-price attributes has been completed and is attached.

PQM - Please open all the price envelopes.

Brook’s law method - Please open only the price envelope from the following tenderer: (Name of tenderer)

(tick appropriate box)

Recommendation

Project manager signature: Date:

NZ Tr Contract procedures manual SM021 Part A Appendix XXV



Page 127

PQM guidelines

PQM simple

Introduction

PQM simple is a formula-based evaluation. It distinguishes the difference in quality between tenderers by translating the non-price

attribute grades to an SQP. The SQP is defined as ‘the amount that the tendering authority is prepared to pay to secure a higher-

quality tender relative to the lowest quality tender’.

PQM simple is available for use for in both PW and PS contracts. The same steps and guidelines apply for both contract types. The

price weighting is limited as follows:

PW price weights of 50% – 30% are permitted

PS price weights of 20% – 30% are permitted.

Pre-tender preparations

Prior to issuing the RFT, the project manager should investigate and assign weightings to the non-price attributes and the price.

Once these and the estimate have been established, the SQP that will be obtained for a specific grade margin should be analysed

for sensitivity. For example if the non-price attribute grade margin between two tenders is 10% and this results in a SQP of $10,000,

does this represent the additional amount that the client is willing to pay to secure such a tender? Care should be taken to ensure

this sensitivity is understood and is appropriate, particularly where a very high weighting is placed on the non-price attributes.

Dependent on the size and complexity of the contract, the tendering authority may wish to associate this SQP with an analysis of the

risks. Where the SQP determined in too high/low, the non-price and the price weightings should be revised to ensure a suitable SQP

will be obtained. The non-price and price weightings may not be altered after the close of tenders.

Contract estimate

For PQM simple, the base estimate must be included in the RFT to add transparency to the evaluation process. Tenderers should be

encouraged to comment on the accuracy of the base estimate through the contracts-nominated probity auditor.

The evaluation estimate used in the calculation shall not include amounts fixed by the tendering authority (e.g. provisional sums).

SQP sanity check

Under PQM a ‘sanity check’ must be completed on the calculated SQPs and ATPs before the opening of the price envelope. The

TET must satisfy itself that the relevant differences between tenderer’s SQPs are realistic and represent the difference in price that

the tendering authority is prepared to pay. If the TET is not satisfied with the SQP as calculated, they may replace the SQP with an

adjusted figure but must clearly record all changes and provide justification for each change. Such adjustments should be used to

refine the SQP determined through the non-price attribute assessment.

The SQP and ATP may not be altered once the price envelope is opened. After deducting the SQP and ATP values from the

submitted tender prices, the supplier with the lowest adjusted evaluation price is the preferred supplier.

ATPs

Each alternative tender is to be separately evaluated and an ATP determined for each. ATP is defined as ‘the difference in price that

the tendering authority is prepared to pay for the product offered by an alternative tender compared to the minimum standard product

specified in the RFT’.

Example calculation using PQM simple

For a PW contract with the following basic data: Base estimate (minus provisional sums) = $100,000.00; price weight = 70%; non-

price attributes = relevant experience (10%), resources (5%) and methodology (15%).

Weighting Non-price attribute Tender A Alternative A Tender B Tender C

10% Relevant experience 90 90 80 70




Page 128

5% Resources 90 90 80 70

15% Methodology 90 95 80 70

NPA weighted sum 27.00 27.75 24.00 21.00

70% Price

Non-price attribute weighted sum margin * 6.00 6.75 3.00 0.00

Supplier quality premium $8571.43 ** $9642.86 $4285.71 $0.00

ATP $0.00 $5000.00 $0.00 $0.00

SQP + ATP $8571.43 $14642.86 $4285.71 $0.00

Tender price *** $90000.00 $97000.00 $92000.00 $87000.00

Adjusted evaluation price $81428.57 $82375.14 $87714.29 $87000.00

*Weighted sum margin = deduct the lowest non-price attribute weighted sum from each of the non-price attribute weighted sums. ** For example, tender A SQP = Evaluation estimate x (weighted sum margin / price weight)

= 100,000.00 x 6.00 / 70 = $8571.43

***Remove any amount fixed by the tendering authority from the submitted tender prices.

Tender A has the lowest adjusted evaluation price, and is therefore the preferred tenderer. Note that the ATP and SQP remain final once the price envelope has been opened. Adjustments are not permitted once the price envelopes are opened. The detailed ATP evaluations and calculations must be separately documented.

PQM Special

Introduction

This method of tender evaluation is suitable for complex projects or projects where many significant risks have been identified that

could impact on the successful outcome of the project. It distinguishes higher quality suppliers by calculating SQPs from a value

determined in a risk-based assessment. The basic process is summarised as follows.

High-quality

bid

Reduced

risk

Potential

benefits to

the client

Client willing

to pay more

to secure

this bid

Higher

SQP

Pre-tender preparations

Prior to issuing the RFT, the tendering authority must investigate the choice of non-price attributes and their weightings. The

minimum quality threshold for the non-price attribute grades are then set considering factors such as the complexity of the project,

the short listing process (if any) etc. Suppliers failing to reach this minimum quality threshold for any one NPA will be deemed non-

conforming and rejected. The maximum risk consequence (MRC) must also be determined, as described below.

Theoretically, a tenderer with a perfect non-price attribute grade of 100 will be able to successfully deliver a contract with the highest

possible quality and the least possible risk, producing maximum benefits and savings for the Client. These “maximum benefits and

savings” are represented by a figure termed the MRC. The MRC is the total of the worst case scenario related costs associated with

each risk. The risks included in this assessment are generally sourced from the risk register (based on NZTA’s Risk management

process manual (AC/Man/2)), and should all be risks that the supplier has an ability to influence.

Preferred tenderer

Contract procedures manual SM021 Part A Appendix XXV



Page 129

The tendering authority must investigate and assign a maximum value to each risk. The sum of each risk’s maximum costs forms the

MRC. The MRC equals the SQP for a 100% range. An example is provided as follows.

Risk SQP for a 10% NPA range*

Environmental Issues $0.2

Third Party/Stakeholder $0.1

Traffic management $0.3

Quality control $0.3

Safety $0.1

Design $0.2

Project management $0.2

Total SQP for a 10% non-price attribute range $1.4 million

* Note the corresponding MRC = SQP for a 100% NPA range = $1.4 million x 10 = $14 million.

To ascertain the worst case value of each risk, consider items such as:

additional full time staff to manage the crisis

extra legal fees, time delay costs and traffic delay costs

serious accidents involving the public or workers

poor quality of work will require extra construction or maintenance

poor public relations will require extra consultation and communication.

Once the MRC has been determined, the tendering authority must analyse the sensitivity of the SQPs obtained for specific grade

margins. For example, the difference in non-price attribute grades between two tenders is 10% and the resultant SQP is $1.4 million,

does this represent the amount that the client is willing to pay to secure such a tender? If it does not, revisit the risks and the

associated worst case values until an appropriate SQP is obtained. The MRC cannot be altered following the close of tenders.

The process also requires that tender evaluation marking forms consider the risks identified in this analysis and be aligned

with these risks, e.g. given that traffic management has been assigned a $0.3 million value for the worst-case scenario, 21% of the

MRC, specific references to traffic management should be added to the relevant experience, track record, technical skills and

methodology non-price attributes, and their combined weighting should approximate 21%.

No limitation is placed on the size of the MRC under the PQM special tender evaluation method.

The RFT for PQM special is required to disclose: the risks, SQP for a nominal 10% range in non-price attributes for each risk, and

the total for a nominal 10% range in non-price attribute (as shown in the above table). This disclosure will help convey the specific

risk issues that the Client wishes a supplier to focus on in their tender submission.

SQP calculation

PQM special translates non-price attribute grades to a SQP-based on a predetermined risk value as shown below.

0% C B A 100%

MRC

A

B

$C

NPA grade (%)

SQP deducted from

B’s tender price

SQP deducted from

A’s tender price

Risk value ($)

Contract procedures manual SM021 Part A Appendix XXV



Page 130

Using the non-price attribute grade, the corresponding risk value is calculated based on the MRC, as determined prior to the close of

tenders. The SQP is then calculated by using the lowest risk value as the zero benchmark.

SQP ‘sanity check’

A ‘sanity check’ of each tender’s SQP must be undertaken to confirm that the SQP is reasonable and representative. A detailed

check may be done by going through the list of risks given in the RFT. For each tender, examine how well each tenderer handles

each risk in their tender submission, allocate an appropriate risk value, and compare the resultant SQP with the SQP from the non-

price attribute evaluation.

If the TET is not satisfied with the SQP as calculated, they may replace the SQP with an adjusted figure but must clearly record all

changes and provide justification for each change. Such adjustments should be used to refine the SQP determined through the non-

price attribute assessment. The SQP for each tenderer must be finalised before the opening of the price envelope.

Example calculation using PQM special

For a physical works contract with the following basic data: non-price attribute = track record (30%), resources (20%), methodology

(50%); and the predetermined MRC is $15 million.

Weighting Non-price attribute Tender A Tender B Tender C

30% Track Record 80 80 50

20% Resources 80 90 70

50% Methodology 90 80 70

Non-price attribute weighted sum (%) 85.0 82.0 64.0

Risk value ($)* $12.75M $12.3M $9.6M

Lowest risk value ($) $9.6M

SQP ($) $3.15M $2.7M $0.00

Tender price ** $30.0 $29.0 $28.0

Adjusted evaluation price $26.85M $26.3M $28.0M

* Risk value ($) for tender A = non-price attribute grade x MRC /100 = 85 x $15 million /100

= $12.75 million

**Remove any amount fixed by the tendering authority from the submitted tender prices.

Note that $3.15 million is the maximum differential price that the client is willing to pay to secure the highest quality tender (A)

compared with the lowest quality tender (C).

Alternative tenders are evaluated in the same way as that shown in the example calculation for PQM simple.

Preferred tenderer

NZ Transport Agenc Contract procedures manual SM021 Part A Appendix XXVI



Page 131

Procurement strategy for block projects <<insert region/description>>

<<This template has been developed to be used for both standalone and packaged block project PS and PW. Delete as appropriate

to approach>>

1. Purpose

The purpose of this procurement strategy is to:

document the key considerations made in the selection of a delivery model and projects for term contracts within <<insert

region/area>>, or document the key considerations made in the selection of delivery models for block projects within <<insert

region/area>>

confirm the high level details in the approach to be taken to procurement

ensure the procurement of term contracts complement each other, or ensure the procurement of block projects complement

each other

ensure NZTA project management resources are optimised

ensure the strategy for the procurement of PS and PW are supported from the outset

ensure competition for professional services, within the market place is optimised and finite resources within the region are

managed.

2. Background

2.1 Description

<<List the high level objectives of the projects and the type of works to be undertaken.>>

<<For term/packaged contracts - Describe the key factors considered in the grouping of projects (i.e. topography, traffic volumes,

urban / rural etc) >>

2.2 Status

<<Include a brief description of the status of critical aspects of the packages OR projects such as: funding, statutory approvals,

property acquisition, consultation, investigations including geotechnical data, scheme assessment, etc>>

Regional funding allocation as of ???? 2010

Term contract or projects 2009/10 2010/11 2011/12 2012/13

???? term contract or ???? project

$?.? million $?.? million $?.? million $?.? million

Regional funding allocation as of ???? 2010

Term contract or block project

Contract status Contract value capped at $

Status of projects within contract

Designation status

Consents and other statutory approvals.

Property acquisition

status

???? term contract

Awarded

??.?? 2010

$?.? million 1 Study and 2 I&R

??? TBC? Complete?

Contract procedures manual SM021 Part A Appendix XXVI



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2.3 Projects portfolio

<<Describe other projects due for tender/design during the same period, including where possible consideration of both internal and

external projects, at both a regional, and national level, if they are likely to cause any capacity constraints etc>>

<<Include consideration of the expected tenderers for the respective PS and PW tenders. >>

<< Include reference to and attach the latest regional block project programme as appropriate.>>

<<For term - list projects within term contracts stating year to be commenced and estimated fee. List the same details for other

applicable projects programmed for the area>>, i.e. –

Breakdown of <<insert region>> term contracts for PS.

The base projects are those projects upon which the original term contract will be tendered and is therefore the initial component of

that term contract.

Additional projects are identified from the NZTA’s annual plan and three year forecast, and have been attributed to each contract.

<<As a guide the value of the additional/negotiated projects added to the contract should be limited to the value of the base

projects>>

<<insert name>> term contract

2009/10 Base projects

<<insert project name>> Fee $???



Sub total $??????

2010/11 Negotiated

<<insert project name>> Fee estimate $?????


Sub total $???????

2011/2012



Sub total $??????

2012/2013

<<insert project name>> Fee estimate $??????

<<insert project name>> Fee estimate $??????

Sub total $????????

Total 2009/2013 $???????????

<<describe the volume of other PS projects which are programmed for the duration of the term contracts and any implications this

has on the supplier market.>>

3. Procurement method assessment

<<Describe the reasoning for the selection of the proposed procurement method for the various packages or projects and the

advantages of packaging or not packaging the works>>

Contract procedures manual SM021 Part A Appendix XXVI



Page 133

Include a consideration, where relevant against each of the following criteria:

scale

complexity / scope for innovation

programme constraint

market conditions <<describe how packaging the contracts will affect the supplier market.>>

risk (quantum and type)

stakeholders

client involvement, control and capability

focus on non-cost success (e.g. social and environmental)

tangible demonstration of value for money

flexibility to deal with change.

4. Procurement method details

Accordingly, the <<term agreement>> method is the preferred approach for the procurement the professional services on block

projects.

<< Additional information on the method selected (i.e. contract duration, timing, other key factors)>>

<<If applicable - explain if additional projects are planned to be added to the term contracts and how this will be done>>

Prepared by:<<Regional Project Manager>> Signed: ____________________ Dated: __________

Endorsed: <<State Highway Manager>> Signed: _________________ Dated: __________

Agreed: <<National Manager PS / Manager Project Services>>

Signed: _____________________ Dated: _________

Contract procedures manual SM021 Part A Appendix XXVII



Page 134

NZTA file reference:

Date

The Manager

Contractor name

Contractor address

Attention:

Dear Sir/Madam

Notice in respect to <contractor name> global bond

We hereby advise the following contract has been released from the <contractor name> global bond:

Contract number: XXXXX

Contract name: XXXXX

NZTA region: XXXXX

NZTA contact person: XXXXX

Please find attached a copy of defects liability certificate for this contract.

We will ensure your global bond register is updated accordingly, and that this contract will no longer be included on the global bond.

Yours faithfully Tenders Secretary for <appropriate> Manager Enc. Copy of defects liability certificate cc. (consultant) [email protected]


Contract procedures manual SM021 Part A Appendix XXVIII

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Page 135

Large project stage 1 procurement strategy

<<insert project name>>

1. Purpose

The purpose of this stage 1 procurement strategy is to:

document the key considerations made in the selection of a delivery model for the <<insert project name>> project, and

confirm the high level details in the approach to be taken to procurement.

2. Background

2.1 Description:

<<List the high level objectives of the project, its key features, and the major scope items>>

<<Note the latest project out-turn cost estimate and the allocation for the design phase>>

<<Summarise the key programme dates, or attach the most recent risk adjusted programme, based on the selected delivery

model>>

<< Summarise how the project fits into the national/regional state highway plan and the key drivers and objectives behind the

project (i.e. priority)>>

2.2 Status

<<Include a brief description of the status of critical aspects of the project such as: funding, statutory approvals, property

acquisition, consultation, investigations including geotechnical data, scheme assessment, etc>>

2.3 Large projects portfolio

<<Describe the tie-in with other projects due for tender/construction during the same period, including where possible

consideration of both internal and external projects, at both a regional, and national level, if there are likely to be any capacity

constraints etc>>

<<Include consideration of the expected tenderers for the respective PS and PW tenders>>

3. Key project characteristics and risks

The following project characteristics or risks have been identified as key to the decision on the most appropriate procurement

model:

<<insert a list of the top 5 –10 project issues considered most relevant to the selection of the most appropriate delivery

model, and provide a description of each:

o for example, a healthy designation is available to us which may open the door to significant geometric

innovation…..

o a substantial construction start required by June 2011 requiring that we progress the project development phase

expeditiously…..>>

4. Procurement model assessment

<<Make an assessment of the relative merits of the various PW delivery models available, in comparison to the project key

characteristics, risks, programme constraints, and the market assessment.


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Include a consideration, where relevant against each of the following criteria:

Scale.

Complexity/Scope for innovation.

Programme constraint.

Market conditions.

Risk (quantum and type).

Stakeholders.

Client involvement, control and capability.

Focus on non-cost success (e.g. social and environmental).

Tangible demonstration of value for money.

Flexibility to deal with change.

OPTIONAL: use the model selection matrix, attach the output, and explain the logic used in applying weightings etc.>>

<< For the two or three most appropriate models list the advantages and disadvantages of each model for the project being

considered. Then state the selected model and summarise the key reasons (see listed advantages and disadvantages for

models at the end of this template). Describe how best value for money will be obtained through the selected delivery model

and supplier selection process>>

5. Procurement details

Accordingly, the <<traditional, ECI, DC, competitive alliance, pure alliance>> delivery model is the preferred approach for this

project.

5.1 PS

<< Describe the proposed procurement process, i.e. the approach proposed to the tender of the D&PD phase is .... >>

<<Examples of details required are:

non-price attribute weightings

TET members including nominated qualified evaluator

timeframes

current estimate, etc.

5.2 PW

<< Describe the proposed procurement process, i.e. the approach proposed to the tender of the construction works is ….>>

<< State outline/high level information on the process, i.e. timeframes. This information will have detail added and be

confirmed in the stage 2 strategy>>


Endorsed: <<State Highway Manager>> Signed: _________________ Dated: __________

Agreed: <<National Manager PS/Manager Project Services>>

Signed: _____________________ Dated: _________

NZ Transport Contract procedures manual SM021 Part A Appendix XXVIII

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Generic information on delivery models should be adapted on a project specific basis

Traditional

Scale – suitable for both small, medium and some large scale projects.

Complexity/scope for innovation – little scope for innovation and not suitable for complex projects.

Programme constraint – design must be fully completed prior to tendering resulting in a later construction start.

Market conditions – due to low risk transfer, well defined outputs and low tendering costs competitive tendering can be achieved.

Risk (quantum and type) – suitable for low to medium risk profiles.

Stakeholders – the client has design control so retains the majority of responsibility.

Client involvement, control and capability – the client retains design control and site supervision.

Focus on non-cost success (e.g. social and environmental) – the NZTA retains control during the design process and have the

ability to value non-cost success.

Tangible demonstration of value for money – due to the competitive tender process it is relatively straightforward to demonstrate

value for money in the construction phase.

Flexibility to deal with change – little flexibility to deal with change. Variations can be costly.

Advantages:

Allows for strong competitive bidding.

The design is completed prior to letting the PW contract so the outputs are known at the outset of the contract and the client

has a high level of control.

Low procurement costs for both supplier and purchaser.

Disadvantages:

In the event of a risk occurrence the client retains responsibility which may result with the construction phase having a higher

cost.

Coordination between design/construction suppliers and stakeholders can be more complex, and increases NZTA resources.

Few incentives to optimise the design.

Separation of contractor and designer limits innovation and build-ability.

Later site start date as detailed design must be complete before site works starts.

Design errors can be costly to the client.

D&C

Scale – suitable for medium to large scale projects.

Complexity/scope for innovation – lots of scope for innovation and suitable for complex projects.

Programme constraint – detailed design is completed after construction is started so earlier construction start/finish dates are

possible.

Market conditions – high-risk transfer and medium to high tendering costs limit the number of contractors/designers able to

tender. This can mean fewer contractors awarded contracts.

Risk (quantum and type) – suitable for medium to high risk profiles

Stakeholders – the client has little design control post tender so the contractor/consultant must take the lead in negotiations and

liaison.

Client involvement, control and capability – the contractor has design control post tender and responsibility for MSQA during

construction.

Focus on non-cost success (e.g. social and environmental) – the NZTA retains control during the design process and have the

ability to value non-cost success.

Tangible demonstration of value for money – proposed tender designs are assessed for tangible cost benefits and assigned a

premium. This should ensure the successful design achieves the best value for money possible.


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Flexibility to deal with change – the detailed design is completed as construction is ongoing so variations can be accommodated

into the design. However changes in scope can be costly.

Advantages:

High risks associated with constructability such as complicated traffic management, and working close to live lanes along the

motorway can be addressed in the detailed design phase in consultation with the contractor.

After the specimen design has been completed the detailed design and construction can be let as a lump sum contract,

transferring potential risks to the contractor who is best placed to manage them.

Works can be competitively tendered giving price tension.

Increased potential for build-ability and design innovation.

The NZTA requires less design resource.

Disadvantages:

Specimen design, designations, resource consents and property purchases must be in place prior to tendering the detailed

design and construction. This means a later site start date compared to ECI or alliance models.

Letting separate portions as design and construct contracts is not practical as it can lead to design conflicts.

Procurement cost for both the client and supplier are higher.

Minimum standard designs are encouraged.

Greater risk transfer to supplier may increase costs.

Post contract variations and scope changes can be costly.

Flexibility is reduced after award.

The number of potential suppliers is reduced due to tendering costs and risk transfer.

ECI

Scale – suitable for medium to large scale projects.

Complexity/scope for innovation – lots of scope for innovation and suitable for complex projects.

Programme constraint – detailed design, designation, consents and property purchase can be completed after construction is

started so earlier construction start/finish dates are possible compared to traditional and D&C models.

Market conditions – generally low-medium tendering cost should allow a range of interested contractors/consultants to tender.

Due to the contractors high level of commitment in the investigation and design phase some contractors may be less interested

in tendering during periods of high workload.

Risk (quantum and type) – suitable for medium to high risk profiles. The construction portion of the contract is let on a D&C basis

so the contractor has the responsibility for the detailed design.

Stakeholders – the client retains design control until the D&C phase is awarded. At this point the contractor/consultant must take

the lead in negotiations and liaison.

Client involvement, control and capability – the contractor has control of the detailed design and responsibility for MSQA during

construction.

Focus on non-cost success (e.g. social and environmental) – the NZTA retains control during the preliminary design process and

have the ability to value non-cost success.

Tangible demonstration of value for money – an independent parallel estimate is conducted on the specimen design prior to

award of the D&C phase to ensure a competitive construction price is achieved. The specimen design is developed in

conjunction with the NZTA and in consideration of project requirements.

Flexibility to deal with change – the ECI model allows for design and scope changes to be incorporated before the D&C portion

of the contract is let.


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Advantages:

High risks associated with constructability such as complicated traffic management, and working close to live lanes along the

motorway can be addressed in the design phase in consultation with the contractor.


The ECI model will enable the staged design and construction to occur concurrently allowing an earlier start on site works

There is currently a strong buyers market with some contractor’s known to have very light order books. This should assist in

ensuring a competitive PW price.

The ECI model allows the NZTA to retain control over the project during development. This is considered of high importance

as final scope is dependent on consent and alteration designation processes.

ECI allows stakeholder consultation to continue and be fed into the design as portions of the works are commenced on site.

After the specimen design has been completed the detailed design and construction can be let as a lump sum contract,

transferring potential risks to the contractor who is best placed to manage them.

Disadvantages:

Decreased competition on price may result in higher PW costs.

Competitive alliance/Alliance

Scale – suitable for large and very large projects

Complexity / scope for innovation – suitable for complex projects. The shared risk/profit model drives innovation form all parties

Programme Constraint – site works can begin as the design is developed allowing earlier construction start and finish dates to be

achieved

Market conditions – the potential for the contractor and consultant to share in cost savings driven by good performance means

this model should be attractive to suppliers in most market conditions.

Risk (quantum and type) – this model is suitable for low, medium and high risk projects.

Stakeholders -

Client involvement, control and capability

Focus on non-cost success (e.g. social and environmental)

Tangible demonstration of value for money

Flexibility to deal with change – cost reimbursable and TOC means this model has flexibility to deal with variations and scope

changes.

Advantages:

Suitable for delivery of large complex projects.

Allows the exact scope to be developed as the project progresses.

High risks associated with constructability such as complicated traffic management and working close to live lanes along the

motorway can be addressed in the design phase in consultation with the contractor.


The shared cost saving model and joint responsibility drives a high project team performance.

The model allows site works to start before the detailed design has been finished cutting overall project duration.

The cost of tendering for proponents is relatively low compared to project size.

Integrates specialist suppliers/designers into one delivery team giving improved co-ordination and promoting efficiency.

Risks are managed by the party most capably with shared exposure.

The client does not pay a premium for transfer of risks which may not occur.

Pricing transparency.


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Disadvantages:

Decreased competition on price may result in higher PW costs.

The procurement process and subsequent project involvement requires substantial/senior NZTA resources.

Requires significant resources from the successful consortium to manage the contract.

The NZTA’s ability to make unilateral project decisions is restricted.

Contract procedures manual SM021 Part A Appendix XXIX

Page 1 of 2



Page 141

Large project stage 2 procurement strategy

<<insert project name>>

1. Purpose

The purpose of this stage 2 procurement strategy is to:

reconfirm the delivery model to be used for the project

provide a brief update on the project status, and

document details of the procurement strategy to be applied to the procurement of suppliers for the PW.

2. Objectives

<<List the high level objectives of the project, and its key features or major scope items, OR attach the stage 1 procurement

strategy and note any changes>>

3. Reconfirm the delivery model

We have reassessed the analysis made in the stage 1 procurement strategy, and reconfirmed the preferred delivery model is

<< traditional, ECI, DC, competitive alliance, pure alliance>>

<<Update any information which may affect the delivery model selection or assumptions made in the first strategy (i.e.

property purchase)>>

OR

We have reassessed the analysis made in the stage 1 procurement strategy, and changed our preferred delivery model as

follows…<<detail the change, and the rationale behind it>>

4. Project status

The following table details the status of the key aspects of the project development.

Item

Status Comment (as required)

Consents, designation and other statutory approvals

Scope and standards sub-VAC

Design peer review

Road safety audits

PW RFT development

Property acquisition

RMC sign-off of insurance values

<<insert others as required>>

<<Describe any other aspect related to the current project status, not readily described above>>

NZ Transport Agenc Contract procedures manual SM021 Part A Appendix XXIX

Page 2 of 2



Page 142

5. Budget

The design estimate (<<insert date>>) or the is $x.xM (expected) and $x.xM (95th%ile).

Either construction funding has been confirmed to the level required by the design estimate or a construction funding request

is planned for the x Board meeting.

The cashflow forecast for the project is as follows.

Year

$(M) X.x X.x X.x X.x X.x $(M)

<<Describe any other financial issues of note>>

6. Procurement details

The following details the specific procurement strategy for the procurement of the physical works supplier for this project.

Item

Approach Comment (as required)

Enabling works packages <<for ECI state potential areas of early site works>>

Date of advertisement

Registration of interest or short-listing processes

RFT review process

Tender period

Number of interactive meetings

Tender evaluation team

Supplier selection method

Target award date

<<insert others as required>>

<<Describe the anticipated interest from the market….>>

<<Describe any other aspect related to the procurement of the PW suppliers, not included above, including any outstanding

issues or significant risks to procurement>>


Endorsed: <<State Highway Manager>> Signed: ____________________ Dated: __________

Agreed: <<National Manager PS/Manager Project Services>>

Signed: _____________________ Dated: _________

Contract procedures manual SM021 Part B



Page 143

Part B Internal operations procurement procedures

1.0 Overview 149


1.2 Minor administrative purchases 150

1.3 Selection of procurement approach 151

1.4 Preparation of tendering documentation 154

1.5 Service delivery model 155

1.6 Selection of supplier selection method 156

1.7 Contracting process 157


1.9 Confidentiality 165

2.0 Advertising and issue of procurement documents 166

2.1 Release of documents and information 166

2.2 Contact with suppliers 166


3.1 Overview 167

3.2 Tender register and box 167

3.2 Submission of proposals/tenders 167



3.6 Pre-evaluation administration 171






4.3 Dealing with comments received from proposers 177

4.4 Prop 177


4.6 Non-price attribute assessment 178

4.7 Presentation of proposals 181

4.8 Report and recommendation 181

Section Page


Page 5 of 5



Page 144

4.9 Post-evaluation administration 182

4.10 Release of information post-tender 182

5.0 Award of contract 183

5.1 Negotiation and development of contract documentation 183

5.2 Development of formal contracts 184

5.3 Liability and insurance for consultant contracts 186

5.4 Insurance, bonds and retention for office accommodation works

(Works) 187


6.0 Signing of contract 189


6.2 Signing the contract 189

7.0 Contract management 190

7.1 Contract confidentiality 190

7.2 Assessing the performance of the supplier 190

7.3 Process for managing contracts 190

7.4 Contract variations 191

7.5 Process for contract variations 192

7.6 Assignment or novation 192

7.7 Changes after contract awarded 193

7.8 Where a change in control involves an assignment or novation or

subcontracting 194

7.9 Ending a contract 194

7.10 Contract evaluation reviews 194

7.11 Record keeping 194

7.12 Health and safety requirements of contractors 195

8.0 Alternative procurement options 196

8.1 Emergency purchasing 196

8.2 Standing offers 196

8.4 Syndicated procurement 197

8.5 All-of-government contracts 197

9.0 Appendices - Part B 205




Page 145

Part B: Delegated authorities schedule

The delegation for signing supplier contracts is outlined under the various delegated authority documents on the

intranet.

The delegated authority for other procurement activities is listed below.

Activity Delegated authority

Procurement plan for direct appointment less than $100,000 Cost centre manager

Procurement plan for direct appointment over $100,000 Sponsor or group manager

Approval to shortlist Sponsor or group manager

Approval to award Sponsor or group manager

Contract variation up to 20 percent of contract value Cost centre manager

Contract variation up over 20 percent of contract value See purchasing delegations above

http://onramp/Who-we-are/Delegations/Pages/Levels-of-delegation-.aspx




Page 146

Introduction This part B

provides administrative guidelines

defines actions/processes that are to be undertaken, and

describes the required documentation for each process.

Each action/process undertaken must be documented in a clear and orderly manner.

Advice can be sort from the Corporate Procurement team on any stage of the procurement

process in Part B of this manual [email protected]

This part B, should also be read in conjunction the Procurement Manual for activities funded

through the National Land Transport Programme.

Contract

process

The NZ Transport Agency (NZTA) follows a process in tendering, awarding and

administering contracts for internal operations. The procedures for each stage of this

process are discussed in the following relevant sections.

Procedures for contracting an agent to act on behalf of the NZTA to provide NZTA services

to the public, are not subject to SM021, but follow their own approved procedures for

agency relationships.

Purpose of

tender

evaluation

process

The purpose of the tender evaluation process is to select a consultant or contractor so as to

enable award of a contract.

Process chart The following diagram identifies the stages in the tendering and contract administration

process for internal operations.

RFT/RFP preparation

Advertising and issuing

tender documents

Tender closing

procedures

Award of contract

Contract close

Contract payments

Approval to proceed

with a contract

Tender evaluation

Signing of contractService delivery

Restriction on

purchasing

Employees may incur costs provided:

proper regard has been made to reasonable economy and efficiency

the cost is based on the best possible estimates

properly allocated funds are available in an approved budget to meet the costs

the costs have been allocated to the correct expenditure code (as set out in the NZTA

chart of accounts) and that expenditure code is one to which their delegation applies

the costs comply with all relevant NZTA instructions and directives.

Where an individual exercises their financial delegation, they may also exercise their

purchasing delegation provided at least two people are involved in each transaction to

mitigate any hint of collusion. In addition to getting approval to incur costs from someone

with appropriate financial delegation, employees must also get approval from someone with





Page 147

the appropriate purchasing delegation, outlined on the previous page.




Page 148

Value for money One of the four key outcomes of the NZTA is value for money. Best value for money involves

balancing:

the right quality and quantity

delivery at the right place and time

sustainability, and

price.

Recognising that the weightings of these may vary from contract to contract.

Sustainable

procurement

Sustainable procurement means that when buying goods and services, organisations

practising sustainable procurement will consider:

strategies to avoid unnecessary consumption and manage demand

the environmental credentials of the goods and services they purchase

minimising environmental impacts of the goods and services over the whole of life of the

goods and services

help foster a viable market for sustainable products and services by supporting

businesses and industry groups that demonstrate innovation in sustainability

including compliance with legislative obligations

to employees

value for money over the whole of life of the goods and services, rather than just initial

cost.

Employees must consider whole-of-life costs from the commencement to termination of a

contract when considering the value of a contract. Staff must be aware of the total contract

value, i.e. the total cost of the contract throughout the duration of the term of the contract.

Principles of

Procurement

A refreshed statement of Principles of government procurement has been approved by

Cabinet in July 2012 [Sec Min (12) 10/5]. The aim is to provide a plain English statement of

Principles that is easier for both agencies and suppliers to understand and apply. It is

essential that all government agencies take the Principles into account when buying goods

and services. The new statement of Principles is as follows.

View a more detailed explanation of the Principles [153 KB PDF]

http://www.business.govt.nz/procurement/pdf-library/a3-principles-of-government-procurement-final.pdf

http://www.business.govt.nz/procurement/pdf-library/a3-principles-of-government-procurement-final.pdf




Page 149

1.0 Overview

1.1 Introduction

1.1.1 Introduction -house professional

Transport Management Act 2003 (LTMA). It is not relevant to transport infrastructure

activities conducted under part A of this manual.

1.1.2 Contractor

vs. employee

The NZTA engages several types of contractors:

A contractor filling a role that could be undertaken by an employee.

An individual contractor or consultant to undertake a special project.

A contractor or contracting firm employed to undertake a range of activities such as

repairs and maintenance of buildings.

A contracting or consulting company employed to undertake a project(s).

There is a strict test applied by the Inland Revenue Department (IRD) to determine whether

a contractor is a genuine contractor or is actually an employee. The following table outlines

the test that the IRD applies.

Employee Contractor

Control test The employer controls the hours worked and

how the work is done.

The contractor controls how and when the

work is done.

Fundamental

test

The employer makes the profit or loss from the enterprise.

The employer deducts Accident Compensation Corporation (ACC) premiums and Pay as you earn (PAYE) tax on behalf of the employee.

The employer supplies materials and equipment for the work.

The contractor can make a profit or loss directly.

The contractor pays any tax, ACC levies and insurance directly.

The contractor supplies equipment and materials.

The contractor is free to accept work from a number of sources at the same time.

Integration test The employee is an integral part of the

business. business.

Managers should be are aware of this control test and ensure that the contractor is not an

employee.

Where it can be identified that a contractor needs to be engaged or whether it is unclear

whether the requirement is for a contractor or for employee, the request should be made

through the Corporate procurement team.

All requests to employ a contractor (or consultant) to fill a role that could be undertaken by

an employee refer to the recruitment process on the intranet. Where it is unclear whether

the requirement to employee a contractor is in a role that could be undertaken, or you are

unsure, by an employee then advice should be sought from People and Capability.

http://onramp/Our-people/New-at-NZTA/Managers-resources/Pages/Recruitment.aspx




Page 150

1.1.3 Purchasing

procedures

Purchasing procedures are in place to enable the NZTA to conduct its business

effectively. Therefore, they include:

ensuring goods and services conform to the user requirement specifications

ensuring goods and services are delivered on time

maintaining minimum effective inventory levels

meeting and effectively monitoring required customer service levels

minimising the cost of supply, including distribution

proactively reducing lead-times without reducing performance levels

delegating powers for purchasing goods and services and financial authorisation to

appropriate levels

being aware of the available sources of supply

following ethical practices

reducing waste

ensuring best value for money, and

ensuring processes and procedures comply with relevant legislation and govern

procurement guidelines

1.2 Minor administrative purchases

1.2.1 NZTA

Purchasing

Card

Where the purchase is not related to an existing contract, and a NZTA purchasing card

is held, a NZTA purchasing card should be used for all minor administrative purchases

following the rules set out in the Credit Card Policy.

1.2.2 Petty cash Where a NZTA purchasing card is unavailable, and cannot be ordered in time to satisfy

the need.

Staff must seek prior approval to purchase goods or services by completing a petty cash

application form prior to seeking an advance from the petty cash account and submit

this to the local Corporate support team. Receipts are required to enable reconciliation

of petty cash accounts. Goods and services tax (GST) receipts are required for all

they wish to purchase goods or services using their agency credit card (refer to Credit

Card Policy).

Petty cash should be used for purchases up to $100 whenever practicable.

No formal, written order for purchases up to $100 is required unless a supplier requests

it.

The preference should always be to use a NZTA purchasing card for minor

administrative purchases.

1.2.3 Contract exists Where the purchase is related to an existing contract (e.g. licence plates, post, and

telecommunications) check that the contract covers the scope of your requirement, the

process to engage the supplier set out in that contract must be followed. Contact the

Contract Manager for further guidance

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1.3 Selection of procurement approach

1.3.1 Introduction The path to achieving a contractual agreement may vary according to the complexity of

the contract being sought. In some instances, project managers may have a clear idea of

what exactly they require and the potential providers of that service or supply. At the

other end of the spectrum, the service or supply required may be less clear and there may

be a need to clarify the options (including technology) available.

Purchase value definition: This refers to the total anticipated value of the purchasing with

a supplier for the full term of the relationship. E.g. A four year requirement/relationship

with an annual value of $15,000 would equal a Purchase value of $60,000 for the

purposes of part B.

The tendering process may involve one or more of the following activities:

Request for information (RFI) means a formal RFI to gain a more detailed

understanding of the supplier market and the range of solutions and technologies that

may be available (e.g. audio visual equipment supply for office fit outs).

Registration of interest (ROI) means a registration of interest, a formal process where

participants submit their interest, or their organisations interest, in a project or

projects (may sometimes be referred to as an expression of interest (EOI)).

Request for proposal (RFP) means a process, where vendors participate in a formal

competitive tendering process, either to a restricted number or open to the market.

Generally used for requirements with some flexibility to how the requirements are

delivered. (e.g. supply of office products, supply of label media or market research

surveys). Can be used regardless of value, but the cost to conduct an RFP means it is

less likely to be used for requirements where the value is under $100,000.

Request for tender (RFT) means a formal means of seeking tenders from the market

clearly defined and there is little room for flexibility or innovation (e.g. vehicle

registration plates). Can be used regardless of value, but the cost to conduct an RFT

means it is less likely to be used for requirements where the value is under $100,000.

Request for X (RFx). This is the collective name for any market engagement where a

response with information, a proposal, quotation / tender is being requested. Used

1.3.2 Purchase value

range between

$100 and

$5,000

Low value, low risk purchases should be made using a NZTA Purchasing Card following

the Credit Card Policy.

required approach. Section 1.3.3 may apply depending on the potential commercial risk to

NZTA.


range between

$5,000 and

$100,000

1. Direct appointment

Goods or services of any description between $5000 and $100,000 may be

directly appointed, provided the appropriate level of approval has been obtained

(refer to the Procurement delegation section in this part for the level of delegation

required).

Direct Appointments are not the preferred method of selection. Project

Managers/Sponsors need to satisfy their cost centre managers and Corporate

Procurement by documenting the logic for a direct appointment. Value and/or

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timing are not sufficient justification.

All project managers must have a direct appointment procurement plan completed

and approved by the relevant budget holder and endorsed by their financial

management accountant. Where the value of the contract exceeds that of a cost

centre manager but the budget is held at cost centre level, approval must be

obtained from the person with the delegated authority to commit the NZTA to the

contract. A direct appointment procurement plan template is attached as appendix

1, part B of this manual.

Reasons for Direct Appointment may include

standardisation or compatibility with existing equipment or services is

essential, and can only be achieved through one supplier

there is a legal requirement or directive to use one supplier

the market is a monopoly

an emergency procurement1

A low value, low risk contract may be used as the contractual documentation,

dependant on the complexity of the outputs required. The Corporate procurement

advisor/specialist will provide guidance on the most appropriate set of terms and

conditions to use.

1 See section 8 of this part, which covers emergency purchases. 2 The market must be checked periodically to ensure that this is still the case.




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Purchase value

between $5000

and $100,000

continued

2. Limited invitation/Closed contest

A closed contest is one in which the invitation to tender is limited to a list of

specific proposers.

Closed contests should only be used where:

the scope of work required is well defined and as a result there is a high

confidence that the price will be less than $200,000

the risk of unsatisfactory completion of the work is low

no supplier feels they have been unfairly precluded from the process

there is a limited source of supply2 (the required goods or services are available

from only one source, or only one supplier has the capacity to deliver at the

time required, and this can be adequately attested)

the cost of conducting an open tender outweighs the benefits, and a closed

tender is a more efficient alternative

there is a need for the procurement to be confidential

in an emergency3

A competitive process procurement plan must be completed prior to any

procurement activity being conducted. A competitive process procurement plan

template is attached at appendix 2, part B of this manual:

A written quote must be obtained for all closed contests up to $200,000.

The Corporate procurement team will provide the documentation required to

complete a written quote.

All procurement activity conducted under a competitive process requires a

Potential conflict of interest/Bias declaration form (appendix 7). This form must be

completed by the sponsor, everyone involved in document preparation and all

members of the TET, including any external parties, prior to involvement in the

procurement activity.

3. Open contest

An open contest is one in which an open invitation is extended to potential

suppliers, normally through the Government or NZTA preferred online tendering

site. Within the NZTA, this is the preferred method of tendering. All activity

requiring an open competitive process must be placed on the online tendering site

for the time outlined in the Government Rules of Sourcing 2013.

All procurement activity conducted under a competitive process requires a

Potential conflict of interest/Bias declaration form (appendix 7). This form must be

completed by the sponsor, everyone involved in document preparation, and all

members of the TET, including any external parties, prior to involvement in the

procurement activity.

2 The market must be checked periodically to ensure that this is still the case. 3 See section 8 of this part, which covers emergency purchases.




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1.3.4 Multistage

procurement

processes

In some cases, either the services to be purchased or the size of the market may not be

adequately understood. In these instances, a multistage process may be conducted.

The multistage process may incorporate a number of activities but only the RFP/RFT

stages are able to select a supplier.

In situations where the services need to be identified in more detail, in order to tender, an

RFI process may be conducted. This allows us to request information from the market

without being bound to any further procurement activity,

The RFI may be followed by an ROI process. This process allows us to seek organisations

that have the appropriate skills, experience and resources to register their interest in the

project. This process can be used to shortlist for a RFP/RFT stage however it is not always

the case and all registrants may be taken forward. An ROI or RFI process cannot be used

to determine a supplier.

Once the ROI stage is complete, it is followed by a RFP/RFT. However, it is not necessary

to conduct RFIs or RFP/RFTs if there is a good understanding of the product and the

services or goods required. There may also be a mix of activities, such as RFI to RFP, or

ROI to RFT.

The competitive process, which involves a number of mandatory steps. The Corporate

procurement advisor/specialist will explain the importance of each stage and guide

project managers through that process. Following the process will assist the NZTA to

ensure competition is fair and will enable the NZTA to gain the most cost-effective supply

option.


range over

$200,000

A competitive process is the preferred way to promote open and effective competition for

procurement activity over $200,000. However, the cost of the process (including

advertising, providing documents and evaluating tenders) should be commensurate with

the benefits received.

A competitive process gives all potential suppliers an opportunity to tender.

A competitive procurement plan must be completed and approved prior to the tender

documentation being released by the Corporate procurement team.

Where a short listing process is conducted (whether prior to the release of the RFP/RFT

or arising from a multistage tender process), sponsor endorsement must be gained before

a tender is moved to the next stage of the tendering process.

For all closed and open contests over $200,000 a Corporate procurement

advisor/specialist must facilitate the evaluation process to ensure fairness and

transparency.

1.4 Preparation of tendering documentation

1.4.1 Introduction Before preparing documentation, the project sponsor, people involved in tender

documentation preparation and the evaluation panel members must complete a Conflict of

interest and confidentiality declaration form (appendix 7, part B of this manual) to

a) enable management of potential conflicts to be addressed prior to involvement in the

procurement process, as a potential management approach may be to remove personnel

from the process and

b) ensure all project team members are clear on their obligation related to confidentiality.

Once completed this must be returned to the Corporate procurement advisor/specialist.




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Tendering documents should be carefully tailored to each project to ensure they are easily

understood and clear to a competent and experienced supplier.

If specific information (which it would not be normal for an experienced supplier to

supply) is required, then it must be clearly stated as a requirement in the tendering

documents.

RFP/RFT for administrative or internal operations contracts are generally prepared by the

NZTA. The project manager may use a consultant to undertake the preparation or assist in

this process, ensure they are contracted accordingly, and also complete a Potential conflict

of interest/Bias declaration form (appendix 7).

Tender documents should be reviewed by your Corporate procurement advisor/specialist,

and all relevant subject matter experts e.g. IS for any activity with an IS component

1.4.2 Where a

consultant is

used

Any consultant who prepares any documentation associated with the competitive process is

likely to be precluded from bidding for that contract.

If a consultant is likely to respond, or has indicated an intent to respond, seek advice from

your Corporate procurement advisor/specialist prior to releasing the RFP/RFT to the market.

There is a very real perception that the consultant may have an advantage in preparing their

response, resulting in non compliance with the Principles of Procurement.

1.4.3 Proforma

contract

documentation

Standard NZTA forms of contract are available from your Corporate procurement

advisor/specialist and must be issued with any tendering process. Your Corporate

procurement advisor/specialist will work with the project manager and legal should any

deviation from this be required.

1.4.4 Number of

response

copies

The preferred method of receiving responses is electronically to the

[email protected] mailbox. Should hard copy responses be required work with

your corporate procurement contact to determine how many are required and why.

The RFP/RFT specifies the number of copies of each submission that must be submitted.

The project manager/ Corporate procurement advisor/specialist should select the

appropriate number to ensure that each member of the Tender Evaluation Team (TET) has a

copy. Making additional copies of proposals received is undesirable and should be avoided as

far as possible.

1.5 Service delivery/contract model

1.5.1 Selection of

delivery model

Project risk and potential for innovation are the key criteria for selecting a procurements

delivery and contracting, model. There is no definitive point for moving from one model

to the next, rather the trend is to move to less traditional models as the potential for

innovation and transfer of risk to the supplier increases.

Delivery/Contract models available under this part are:

panel contracts - means a relationship with a group of suppliers that will be used to

deliver a bundle of outputs for a group of activities. This does not imply an exclusive

arrangement between the purchaser and the panel, but is generally considered a

preferred supplier arrangement.

staged, period contracts - means an activity is committed for delivery through one or

more separate contracts between the purchaser and supplier(s), for a fixed period of

time.





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master contracts means a relationship with a supplier for a broad scope of

activities, with agreed terms and conditions and generally rates, but with no

commitment to volumes. Such contracts are committed to through use of a

statement of work, or similar, mechanism. The original procurement plan for such

contracts should indicate an estimated spend value for the life of the contract. This

does not imply an exclusive arrangement between the purchaser and the master

contract, but is generally considered a preferred supplier arrangement.

All contracts must include an expiry date. While the requirement may need to continue

beyond that date, and expiry date enables a forced review of the arrangement through

initiating procurement activity (direct or competitive) to ensure the needs of the NZTA

are still being appropriately met.

1.6 Selection of supplier selection method

1.6.1 Introduction Procurement manual refers to supplier selection methods and explains the

parameters for their use. Evaluation for each method shall be in accordance with the

requirements of the Procurement manual. See appendix C of the Procurement manual for

further information on the process of each method.

Irrespective of the method used for the procurement activity, the project manager must

complete a procurement plan prior to commencing an activity.

Your Corporate procurement advisor/specialist will provide project managers with

appropriate guidance on the process for all procurement activity.

1.6.2 Direct

appointment

See 1.3.3(1) Direct appointment above.

1.6.3 Lowest price

conforming

(LPC) tender

method

This method may be applied to services where the scope of service required is well

defined and as a result there is a high confidence that:

the contract price will be $100,000 or less

best value for money will be obtained by having suppliers compete on price alone

the organisation is not prepared to pay a premium for additional quality.

The preferred supplier is the supplier that offers the lowest price and meets all the

minimum requirements, including quality, as set out in the RFP/RFT.

1.6.4 Purchaser

nominated

price

Purchaser nominated price is a supplier selection method where the organisation requires

outputs that are difficult to specify but it has determined a price that it is prepared to pay

for those outputs and described the desired outcome (in the RFP/RFT). Proposals must

meet the requirements of the RFP/RFT and are evaluated on the basis of quality only. Best

value for money is then obtained by selecting the supplier that provides the best proposal

for the price set out in the RFP/RFT.

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1.6.5 Price quality Price quality uses a mathematical model to translate the non-price attribute grades of

each proposer to an explicit dollar value, the supplier quality premium (SQP). The

SQP shows how much the NZTA is prepared to pay to secure a higher quality tender

relative to the lowest quality tender.

This method may be considered for use on all contracts where a balance between

price and quality needs to be achieved and where the organisation determines that:

best value for money will be obtained by having suppliers compete on both price

and quality, and

selecting the supplier that offers the best combination of the two.

Note that a simplified procedure may be used for contracts valued at $200,000 or

less (expedited procedures).

The price quality weight setting and evaluation tools can be found at price quality

evaluation tools Procurement manual.

1.7 Process and timing

1.7.1 Process

sequence

The sequence outlined on the next page related to the standard process from Business

Case development to signing a contract/s with the supplier/s. The timelines may vary

depending on the complexity of the business requirement, the number of procurement

stages used and any requirement for contract negotiations. The timeline on the next

page assumes a relatively simple activity.

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Process

sequence

continued

Serial Time frame Responsible Activity

[a] [b] [c] [d]

1 1 3 weeks Project manager Produces Business Case (where required).

Defines the user requirement/specification.4

Obtains the necessary financial approvals.

Registers project with the Corporate procurement team.

If a Business case clearly outlines the procurement approach and is reviewed by Corporate Procurement this will constitute a Procurement Plan. If not it is used to produce the procurement plan information required includes evaluation panel, delivery method, supplier selection method and resource allocation.

2 1-3 weeks Procurement staff Registers the project and applies project reference number.

Reviews the Specifications to ensure compliance with the relevant NZTA policies.

Provides relevant templates to project manager to prepare, and provides advice and review during the preparation process as required Develops the evaluation documentation with project manager.

Obtains evaluation weightings from project sponsor and conflict of interest/confidentiality statements from the TET.

3 3-4 weeks Procurement staff Releases tender documentation into the market, as applicable.

Manages the question and answer period.

Registers proposals received and distributes proposals to the TET.

Provide guidance on the minimum time periods for the activity based on the Government Rules of Sourcing 2013.

Facilitate evaluation meetings where the total value of the activity exceeds $200,000.

4 1-2 weeks Evaluation panel The project manager facilitates the evaluation meeting, unless your corporate procurement contact is providing this service (see step 3 above, however your Corporate procurement advisor/specialist may recommend this support for values under the threshold)

Evaluates proposals.

Agrees scoring and shortlist or preferred supplier to the sponsor [and Board if over $2 million].

5 1 week Procurement staff Reviews and forwards evaluation recommendation to the

sponsor to either:

award the contract, subject to necessary approvals by the Chief Executive and/or the NZTA Board for contracts >$1 million and any final negotiations, or

seek further clarification, or

recommend a shortlist, or

recommend negotiations prior to award or

4 All information services procurement activity requiring a competitive process is to be approved by the Chief Information Officer (or other delegated authority) before documentation is released to the market.




Page 159

recommend a re-tender.

6 1-8 weeks Procurement

staff/Project

manager

Notifies the suppliers, both successful and unsuccessful, of the outcome.

Develops contract content in consultation with the project manager and other subject matter experts e.g. legal, IS.

Oversees negotiations with the project manager and preferred supplier.

7 1-2 weeks Project manager/

Delegation holder

Signs the contract or forwards to the relevant authority to

sign.


staff/Project

manager

Prepare and conduct debriefs with all respondents (on

content of response and process), and project team if

relevant (on process).




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Process

sequence

continued

Serial Time frame Responsible Activity

[a] [b] [c] [d]

1 1 3 weeks Project manager Produces Business Case (where required).

Defines the user requirement/specification.5

Obtains the necessary financial approvals.

Registers project with the Corporate procurement team.

If a Business case clearly outlines the procurement approach and is reviewed by Corporate Procurement this will constitute a Procurement Plan. If not it is used to produce the procurement plan information required includes evaluation panel, delivery method, supplier selection method and resource allocation.

2 1-3 weeks Procurement staff Registers the project and applies project reference number.

Reviews the Specifications to ensure compliance with the relevant NZTA policies.

Provides relevant templates to project manager to prepare, and provides advice and review during the preparation process as required Develops the evaluation documentation with project manager.

Obtains evaluation weightings from project sponsor and conflict of interest/confidentiality statements from the TET.

3 3-4 weeks Procurement staff Releases tender documentation into the market, as applicable.

Manages the question and answer period.

Registers proposals received and distributes proposals to the TET.

Provide guidance on the minimum time periods for the activity based on the Government Rules of Sourcing 2013.

Facilitate evaluation meetings where the total value of the activity exceeds $200,000.

4 1-2 weeks Evaluation panel The project manager facilitates the evaluation meeting, unless your corporate procurement contact is providing this service (see step 3 above, however your Corporate procurement advisor/specialist may recommend this support for values under the threshold)

Evaluates proposals.

Agrees scoring and shortlist or preferred supplier to the sponsor [and Board if over $2 million].

5 1 week Procurement staff Reviews and forwards evaluation recommendation to the

sponsor to either:

award the contract, subject to necessary approvals by the Chief Executive and/or the NZTA Board for contracts >$1 million and any final negotiations, or

seek further clarification, or

recommend a shortlist, or

recommend negotiations prior to award or

5 All information services procurement activity requiring a competitive process is to be approved by the Chief Information Officer (or other delegated authority) before documentation is released to the market.




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recommend a re-tender.


staff/Project

manager

Notifies the suppliers, both successful and unsuccessful, of the outcome.

Develops contract content in consultation with the project manager and other subject matter experts e.g. legal, IS.

Oversees negotiations with the project manager and preferred supplier.

7 1-2 weeks Project manager/

Delegation holder

Signs the contract or forwards to the relevant authority to

sign.


staff/Project

manager

Prepare and conduct debriefs with all respondents (on

content of response and process), and project team if

relevant (on process).




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1.7.2 RFP/RFT

process

During a RFP/RFT process, we ask the market to send us their proposals on how we can

best achieve our idea or concept.

The consequences of failing to follow the NZTA RFP/RFT or contract procedures may

include:

unsuccessful suppliers questioning the integrity of the NZTA procedures

suppliers withdrawing from subsequent RFP/RFT lists

inappropriate approaches from suppliers during the RFP/RFT process (e.g. an offer to

modify RFP/RFT prices or conditions)

the NZTA not achieving the most cost-effective purchase

suppliers seeking legal redress for damages or recovery of RFP costs.

If there are any doubts about whether a RFP/RFT is necessary, the matter should be referred

to the Corporate procurement team for consideration6.

The RFP/RFT documentation must clearly state:

the NZTA requirement and desired outcome

the supplier selection method and evaluation process to be used

how price will be determined

what will be valued in the anticipated relationship

the terms and conditions that will apply.

User requirements are to be as open as possible to ensure that the NZTA does not create

unnecessary obstacles to competition.

1.7.3 Weightings Prior to a RFP/RFT being released to the market (open or closed) the weightings must be

determined by the project sponsor (or group manager) and made available in the RFP/RFT

documentation for proposer. Weightings should not be changed once they have been

published.

1.7.4 Contact with

suppliers

Once a RFP/RFT has been issued, enquiries from suppliers must be answered through the

Corporate procurement team. Supplier requests for technical guidance will be forwarded to

the project manager to draft a reply for release by the Corporate procurement team.

During both open and closed contest RFP/RFTs

response will be provided to all suppliers, unless the question directly relates to the

intellectual property of the supplier. It is at the discretion of the Corporate procurement

advisor/specialist whether the question should be responded to.

There is to be no direct contact, related to the RFP/RFT, between members of the project

team and potential respondents. ALL communication must be directed in writing to the

Corporate procurement advisor/specialist in the RFP/RFT documentation until an award

has been made. Any business as usual engagement should be treated with caution, including

accepting gifts and hospitality. Extra care should be taken to record minutes and document

conversations during the procurement process. If in doubt, refer to the Code of Conduct

guide on the intranet.

1.7.5 RFP/RFT

registration

process

When an RFP/RFT closes, if hard copy responses have been requested, your Corporate

procurement advisor/specialist or person authorised by the Corporate procurement team to

act in this role is responsible for clearing the tender box at the closing time and documenting

6 If the Procurement team requires further guidance (such as legal), it will refer the issue to the relevant authority.




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receipt of the proposals.

Storage of responses should have restricted access to ensure confidentiality of information

submitted by respondents.

All RFP/RFT must be registered in a participant register document that includes:

organisation name

contact name

contact email address

contact phone number

date and time received (if soft copy only or received outside close off time), and

notes on submission conformance.

Late proposals may not be admitted, unless there are special reasons for doing so,

particularly if there is evidence to suggest that the supplier has, because of the delay,

received unfair advantage over proposals already received. The reasons a late response has

been admitted or rejected must be recorded.

The register must be signed by the Corporate procurement advisor/specialist and witnessed

by another member of the Corporate procurement team who has been in attendance at the

opening and registering.

Electronic copies will be stored in the electronic document management system.

All proposals received, including facsimile and email proposals, are to be kept secure to

ensure the privacy of commercially sensitive information. To guard against possible

breaches of confidentiality, proposals must not be opened until after the tender closing date

and time. Proposals are to be recorded in the relevant register by the Corporate

procurement team.

Once all proposals have been registered, proposals will be distributed to the TET with final evaluation documentation. Once received, the TET are responsible to ensure:

a) All responses are kept securely at all times, including when you are working away from NZTA premises.

b) Evaluation of each proposal is completed in the time allocated and based on the content of the proposal against the previously agreed criteria.

No discussion is to be held with another member of the TET, the respondent or any other

respondent, in relation to the responses

1.7.6 Health and

safety

requirements in

tender

documentation

Health and safety will be included as a requirement in tender documentation, on a case by

case basis. This will especially be the case where the tender is for services that require the

employment of contractors to undertake activities where the NZTA is the principal under

the Health and Safety in Employment Act 1992. Employees responsible for contracts must

assess whether there is a requirement for health and safety to be included in the contract,

prior to any tender being released.

Contracts will have a health and safety compliance clause included as a standard condition.




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1.7.7 Security and

privacy

requirements

Before issuing a RFP/RFT, the NZTA employees responsible for the contract must consider

whether there are any privacy or security implications. There will be privacy or security

implications if, during the RFP/RFT process or subsequent contract, the contractors or their

employees will require access to classified or sensitive NZTA information, or may view such

material while performing the requirements of the contract (e.g. contractors working on an

database with access to personal file information).

If there are privacy or security implications, the supplier/s concerned, and any

subcontractors, will be required to undergo security vetting procedures to the appropriate

level. This vetting must be undertaken before contracts are signed. Occasionally, this may be

necessary before issuing RFP/RFT s, if the process itself requires access to sensitive

material. Employees should be aware that such clearances might take up to three months,

depending on the level of clearance required.

Exposure of contractors or their employees to sensitive NZTA material, before security

clearances are issued, is a breach of security. Employees that suspect a proposed contract

may have privacy or security implications should contact the Corporate procurement team

for guidance.

1.7.8 Changes to

proposals

An offer by a supplier to reduce the price and/or the terms of their original proposal, which

would place the proposal in a more advantageous position, may be accepted where the

market has changed and these savings are merely being passed on to the NZTA. In such

cases, all suppliers should be invited (through the Corporate procurement team) to review

their responses, based on the new information.

1.7.9 Complaints All complaints received from respondent about the RFP/RFT process must be referred in

the first instance to the National Manager Corporate Support for review.

1.8 Shortlisting procedures

1.8.1 Benefits of

shortlisting

If used correctly, shortlisting prospective suppliers carries out three important functions:

It reduces the cost of responding for the industry, by reducing the number of full

submissions.

It ensures only high quality suppliers are selected for the work.

It reduces the administrative burden of evaluating responses.

Note: If used incorrectly, shortlisting can increase the burden on suppliers and the TET

by introducing a second tier of submissions/evaluations.

1.8.2 When to

shortlist

Analysis of the supplier market is required to determine if shortlisting is required.

Incorrect/overuse of shortlisting can narrow the market as it acts as a barrier to entry.

Analysis of the supplier market should include:

an assessment of the likely proposer

an assessment of the quality of supplier required and the likely cost of the RFP/RFT r

process to the NZTA and the supplier

an assessment of the proposer ability to meet the required quality standard and

deliver the contract outputs successfully.

For further description on the factors influencing the decision to shortlist see section 5.3

of the Procurement manual.

http://www.nzta.govt.nz/resources/procurement-manual/docs/procurement-manual-201109.pdf

http://www.nzta.govt.nz/resources/procurement-manual/docs/procurement-manual-201109.pdf




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1.9 Confidentiality

1.9.1 Commercial in

confidence

Meetings or other communications between potential and actual respondents and the

NZTA may be deemed to be commercial in confidence. Where a communication includes

commercially sensitive, upon agreement of the TET, the communication may be given

commercial in confidence status and the NZTA will respond by way of Notice.

Request must notify the NZTA of the name and contact details of the person within their

organisation to whom the NZTA will direct all communications during the RFP/RFT

period.

Communications that are commercial in confidence between a potential respondent and

the NZTA must be in writing, issued separately and clearly marked that they are

commercial in confidence, and for the attention of the NZTA representative as listed in

the RFP/RFT document.

The NZTA will respect commercial in confidence communications. However, where a

RFP/RFT and/or contract process, the NZTA reserves the right to inform all respondents

by Notice, or to terminate the RFP/RFT process. If the NZTA deems this to be the case it

will communicate with the party who raised the commercial in confidence matter to seek

their agreement (in writing) to relax the commercial in confidence status. If the party

does not agree, the NZTA will decide whether the communication should be the subject

of a general communication to all potential respondents.




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2.0 Advertising and issue of procurement documents

2.1 Release of documents and information

All RFx

protected during and after the procurement process.

Any information released to suppliers may be used only for the purposes of preparing

their response and may not be used for any purpose. The potential respondents are to

be advised that any information provided by the NZTA may only be released by them

to those preparing the response.

2.2 Contact with suppliers

All communication with potential respondents during the RFx process must be

conducted through the Corporate procurement team.

All informal contact with potential respondents during any contracting process is to

be avoided.

All information disseminated to potential respondents must be released to all

potential respondents simultaneously unless it is commercial in confidence.

The templates, provided by the Corporate procurement team, advise potential

respondents

If a RFP/RFT is conducted online, all questions and responses and information on the

successful proposer must be placed using the same online system once the contract

is signed.

The successful suppliers name will normally be provided with the rejection notices to

unsuccessful tenderers. No further information should be supplied until the contract

is signed.

Requests by respondents for additional information must be in writing and forwarded

to the Corporate procurement team. These requests will then be actioned in

accordance with the Official Information Act 1982.




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3.0 RFP/RFT closing procedures

3.1 Overview

3.1.1 Introduction This section discusses the procedures related to RFP/RFT closing.

3.2 Tender register and box

3.2.1 Register of

tenders

A register of tenders is maintained by the Corporate procurement team.

3.2.2 Tenders box The box for the receipt of RFP/RFT is to be placed in a prominent position in the office

reception, preferably near the enquiry counter. Tender box must be displayed

prominently on the box.

Responses for contracts considered to be Administration under section 26 of the LTMA

are to be submitted to the NZTA National Office, Chews Lane tenders box. In the remote

event that an alternative tender box is to be used, the Corporate procurement team will

notify all potential respondents of the change and the location of the alternative box.

3.2.3 Maintaining the

tenders box

During the receipt of RFP/RFT the tender box must be securely locked to prevent

unauthorised access. The Corporate procurement team shall be responsible for

controlling access to the tender box. Where the tender box is other than that at the NZTA

National Office, Chews Lane, the Corporate procurement team will make alternative

arrangements with the relevant office.

The Corporate procurement team shall be responsible for ensuring that any late

responses are appropriately endorsed.

3.3 Submission of proposals/tenders

3.3.1 Introduction Responses may be received only in the form allowed for in the RFx documentation

issued. These may include

by mail

by courier,

by email

by facsimile or

in person.

Note that responses submitted in a form no allowed for in the RFx will not be

accepted.

3.3.2 Receiving tenders The table overleaf shows what to do when receiving responses.




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Receiving

tenders

continued

by mail, courier or in person and is endorsed to the effect that it contains a response

place it in the tender box.

in a plain envelope (without clear indication that it contains a response to RFP/RFT)

open the envelope

write the name of person who opened it

contract name and number and proposer on the envelope

reseal it and place it in the tender box.

in an envelope addressed other than to the Corporate Procurement team or Corporate procurement advisor/specialist

endorse it as to where, when and who received

pin the envelope to the response, and

hand it together with the response to the Corporate procurement advisor/specialist or other authorised person who will reseal, appropriately endorse and place it in the tenders box.

late refer to topic on processing of late responses in this

section.

3.4 Processing of late responses

3.4.1 Introduction All contract documentation required, as part of a response must be received in the tenders

box by the tender closing time. However, there may be occasions where the late delivery of

the response was due to extreme circumstances or beyond the control of the proposer, and

the lateness would not have allowed the proposer to materially change their response, then

it should be accepted. Where advice is requested from the probity auditor in regard to a late

tender the Corporate procurement team must ensure that this advice is provided in writing

and a copy retained on the project file.

3.4.2 Procedure Follow this procedure when a late response is received.

Step Action

1 The Corporate procurement advisor/specialist or person authorised by the Corporate procurement team to act in this role must eninitial the endorsement.

2 Enter the name of the proposer at the bottom of register of proposals (see appendix 4, part B of this manual)

3 The Corporate procurement advisor/specialist or person authorised by the Corporate procurement team to act in this role, in consultation with the project sponsor, shall determine and note the reason for the tender being received after the closing time.

4 Where it is deemed by the Corporate procurement advisor/specialist that it was not beyond the control of the proposer to deliver their tender by closing time, the late tender shall be rejected and returned to the proposer with the envelope unopened. This action shall be noted on the register of proposals.

Where the Corporate procurement advisor/specialist or person authorised by the Corporate procurement team to act in this role cannot decide whether or not to accept the late response they will consult with the Principal Advisor Procurement who will decide on the appropriate action.

5 The Corporate procurement advisor may decide that a late response is deemed acceptable, subject to the following tests:

Note: To accept a late response in all cases, there must be proof that the carriage of the response was beyond the control of the proposer at closing time.




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the full response would arrive and be placed in the tenders box before the closing time in the normal course of events

with the agreement of the TET accept the late response and document the reasons for doing so.




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3.5 Opening of responses

3.5.1 Introduction Opening of responses is completed in conjunction with the preparation of a

schedule of responses received. These procedures relate to the security of the

responses during the opening process.

3.5.2 Time and date

stamping

Time and date stamping and initialling of responses is required on the tender form

and the pricing schedule. This is the responsibility of Corporate procurement

advisor/specialist or person authorised by the Corporate procurement team to act

in this role. . The stamp used must make it clear that this is a record of when the

response was opened.

3.5.3 Procedure The Corporate procurement advisor/specialist or person authorised by the

Corporate procurement team to act in this role shall follow this procedure when

opening responses.

Note: Responses must be initialled by either the Corporate procurement


in this role, and witnessed.

Step Action

1 Examine the envelope and use the table below to decide what action to take.

endorsed as containing a response closing on a

subsequent date

return the response to the tenders box.

unendorsed (and is therefore opened) and

contains a response for some other work

write a note recording name of the person who opened the response and when it was opened,

endorse envelope with contract number, name and closing date,

together with witness sign envelope, and

reseal and return to the tenders box.

2 Check if the response comprises two, separate sealed envelopes.

If the response

one envelope open the envelope, time and date stamp, and

initial the response form.

two separate sealed envelopes -price

shortlisting is used), time and date stamp, and

time and date stamp and initial the envelope ore the envelope in a

secure location without opening.

Note:

opened, the Corporate procurement

advisor/specialist or person authorised by the

Corporate procurement team to act in this role

must reseal it and initial the envelope.

3 If a response, required to be submitted in two separate envelopes, is submitted in one envelope




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then:

check for specific requirements in the RFP/RFT, and

seal the response form and pricing schedule in a separate envelope, note the error of the proposer and the action taken, initial the envelope, and

advise the Principal Advisor Procurement of the action taken.

4 Complete a proposal registration form.

3.6 Pre-evaluation administration

In completing the Proposal close off checklist form by the Corporate procurement

advisor/specialist or person authorised by the Corporate procurement team to act in

this role prior to RFP/RFT evaluation (appendix 5, part B of this manual) the

Corporate procurement advisor/specialist or person authorised by the Corporate

procurement team to act in this role should do the following:

Check each response to identify any obvious non-conformity with the RFP/RFT,

Procurement manual or this manual.

Where, in a two-envelope evaluation procedure, the price has been included in the

non-price envelope the response is prima facie non-conforming and may be

rejected.

Where the Corporate procurement advisor/specialist or person authorised by the

Corporate procurement team to act in this role identifies such price information

and believes it has been included by mistake, he/she may, with the authority of

the proposer, remove all references to the price contained in the non-price

envelope before forwarding the non-price information to the TET.

If the price is not detected by the Corporate procurement advisor/specialist or

person authorised by the Corporate procurement team to act in this role and gets

to the TET then the response will be non-conforming and may be rejected by the

TET.

Proposers are not entitled to rely on the Corporate procurement


in this role to correct the errors.

Note any tags that are clearly identified. (Additional and less obvious tags

included within the response information might only be able to be identified by the

TET).

Any obvious non-conformances or additional information identified in the

checklist must be noted on the checklist. The Corporate procurement


in this role must agree on the action required with the Principal Advisor

Procurement and if any, advise the proposer of the action taken.

Attach proposal registration form to each of the response evaluation packs,

3.7 Opening the price envelope

3.7.1 For two

envelope

tenders

On receipt of both envelopes, the Corporate procurement advisor/specialist or person

authorised by the Corporate procurement team to act in this role will register that both

envelopes have been received, and initial and date stamp the price envelope. The price

envelope will be stored securely until the evaluation of non-price attributes has been




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completed and shall only be opened by the Corporate procurement advisor/specialist.

3.7.2 Tags in the

price envelope

If the price envelope is found to contain tags, that appear to constitute an unauthorised

alteration or qualification of the RFP/RFT, the Corporate procurement

advisor/specialist or person authorised by the Corporate procurement team to act in

this role should consult with the Principal Advisor Procurement. With the consent of

the Principal Advisor Procurement, the Corporate procurement advisor/specialist or

person authorised by the Corporate procurement team to act in this role should

request the proposer to remove unacceptable tags. Refusal to remove unacceptable

tags will result in the response being rejected.

3.8 Modification and withdrawal of responses

3.8.1 Introduction The NZTA procedures, regarding modification and withdrawal of responses by a

proposer, are discussed in this topic.

3.8.2 Modification of

tenders

A proposer may modify their response after submission provided the modification is in

writing and received prior to the closing time.

3.8.3 Withdrawal of

tenders

A proposer may withdraw their response at any time prior to issue of a response

acceptance notice.




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4.0 Tender evaluation

4.1 Evaluation policy general

4.1.1 Introduction This topic describes the procedure and process to be followed in the evaluation of tenders.

The objective of the evaluation process must be to maintain a level playing field on which all

willing proposers can compete. The process must be conducted with utmost integrity

because of the importance of contracts to proposer and the fact that public money is

involved. To that end, the TET and those in the NZTA dealing with them must:

act in good faith

act fairly as between bidders

provide the same information to all proposers

not ignore or depart from manual processes

assume every action and inaction will be publicly scrutinised

always be aware that they will be judged with the benefit of hindsight.

Corporate procurement

advisor/specialist must ensure:

selection of appropriate people for the TET

implementation by those people in a way that demonstrably delivers integrity

any conflicts between the manuals being used are identified and resolved

lack of knowledge of the process requirements by any member of the TET are identified

and addressed.

The NZTA reserves the right to change the TET for any reason and at any time during the

tender evaluation process on condition that the tender prices have not yet been opened. If

the TET members were named in the RFP then all proposers shall be informed in writing of

the new TET members.

4.1.2 Evaluation

process and

policy

The evaluation must be undertaken fairly and impartially in accordance with the

requirements of:

the Procurement manual

this manual, and

the RFP.




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4.1.3 Confidentiality

of evaluation

process

Information relating to the examination, clarification, evaluation and comparison of tenders

and recommendations concerning the award of contracts shall not be disclosed to proposer

or other persons not officially concerned with such processes, until award of the contract to

the successful proposer has been announced. The information disclosed shall then be only

as prescribed in the Award of contract section of this manual.

Any effort by a proposer to influence the NZTA in the process of examination, clarification,

evaluation and comparison of tenders, and in decisions concerning award of contract, may

result in the rejection of the tender concerned by the NZTA.

All communication with proposer during the RFx process until the award of the contract

shall be through the Corporate procurement advisor/specialist or person authorised by the

Corporate procurement team to act in this role except where, during the course of tender

evaluation, the TET may request additional information or clarification as described in

section Conformity, tags, clarification and alternative tenders in this manual

4.1.4 Prior to the

commencement

of the tender

evaluation

process

Each member of the TET, and each member of NZTA's staff involved in the evaluation process

must be properly familiar with the following:

The evaluation procedure which is to be used, and the precise criteria for evaluating

tenders by this method.

The RFP and all other documents that are applicable to the tender evaluation, and, in

particular, the specific provisions of these documents.

His/her individual responsibilities in relation to the tender evaluation.

The restrictions on the TET which prevent it redefining attributes or creating new ones.

TET members should be informed on the roles and processes before the evaluation

commences.

Each individual who will be involved in the tender evaluation process must take reasonable

steps to ensure that there are adequate procedures in place to ensure that his/her

obligations under the relevant documents can be performed (e.g. do they have all the

relevant manuals, sufficient time and availability to meet as a TET, etc).

Each individual will complete the Conflict of interest and confidentiality declaration form,

(appendix 7, part B of this manual) and submit to the TET leader refer Conflict of interest

below.

4.1.5 Credentials of

evaluators

Requirements for the TET are that it shall:

include at least one person who have the appropriate skills and experience for evaluations

under $200,000

include a person (not necessarily the procurement specialist but who will have a senior

role on the team) that has an appropriate level of knowledge of the work being purchased

under the contract

not include any member who may have any interest in an organisation tendering for the

project being evaluated.




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4.1.6 Conflict of

interest

Prior to undertaking any evaluation duties, all members of the TET are required to complete a

Conflict of interest and confidentiality declaration form which shall be lodged in the contract file,

to ensure that the TET members do not have any conflict of interest or risk of bias with any

individual or organisation tendering:

The procurement specialist will evaluate all declarations from TET members. If the

procurement specialist determines that a potential conflict or risk of bias has arisen they

should either remove the TET member from the TET, or contact the Manager Procurement

to seek approval to retain the TET member with appropriate mitigation.

If there are any queries the procurement specialist can contact the Manager Procurement

to discuss.

Where the conflict or risk of bias in question concerns the procurement specialist,

continued involvement as the procurement specialist must be approved by the Manager

Procurement. If necessary, the Manager Procurement will discuss any issues or concerns

4.1.7 Communication

with proposer

All communication with proposer from the time that the RFP/RFT is released until the

contract is awarded shall be conducted through the Corporate procurement team.

4.1.8 Evaluation

process to be

complied with

The TET in undertaking the evaluation must ensure that the tender evaluation process as

described and detailed in the RFP is followed and documented as required.

4.1.9 Details to be

recorded

Details of any phone call, discussion or meeting between a TET member and any other person

(e.g. referees, other TET members, officers of the tendering authority) which relates to the

evaluation of the tender is kept on file as a file note duly dated and signed by its author. TET

members should take care to ensure that all such written material or file records do not

contain comments which are derogatory to any proposer.

4.1.10 Referee checks Where a proposer is required by the RFP to provide the names of any referees in support of

their proposal, the TET is encouraged to contact all such referees. This will normally be done

by telephone or email by the Corporate procurement advisor/specialist.

In making reference checks, the TET/ Corporate procurement advisor/specialist should

ensure the following:

Where efforts to contact a referee have been unsuccessful, a detailed record should be

kept of the attempts to contact that referee.

Where an individual member of the TET contacts the referee, that team member must

Detailed notes must be kept of any comment or opinion offered by a referee.

Questions must be asked in a neutral and balanced way, without leading the referee in any

way.

4.1.11 During the

tender

evaluation

process

Each member of the TET must be familiar with the principles of fairness and acting in good

faith, ensuring that:

all information is accurate and up to date. Where information comes from outside the

tender documents, it must be assessed for reliability

only relevant information is considered and irrelevant information is excluded (to be

determined by reference to the RFP, and the relevant evaluation manuals)

views about proposers, which are relied upon in the decision-making process can be

substantiated

information before the TET that is not considered relevant is clearly identified as having




Page 176

been disregarded

th

the TET/ Corporate procurement advisor/specialist is taking care to ensure that the

evaluation process is properly documented

the TET evaluation reports are accurate, and not made inaccurate by omissions or

selective quoting

others, not on the TET, do not become involved in the process

they do not engage in any practice that may give one tender an advantage over another.

4.1.12 One conforming

tender

Should only one tender be received for a project, or there is only one conforming tender,

the evaluation process as stated in the RFP shall be followed to ensure the tender is

acceptable.

Negotiation with the proposer is acceptable provided the scope of work is not altered and

the final negotiated price does not exceed the tendered price.

4.1.13 Negotiation

with preferred

proposer

Negotiation with the preferred proposer (irrespective of the number of conforming tenders

received) is acceptable provided:

the negotiation is consistent with the RFP

the negotiation is limited to contract terms (including price) and must not extend to

negotiation for the best price (where competition between suppliers has been used to

do that), and

the changes to the contract must not be so extensive that the tender process can no

longer be said to have tested the market.

Negotiation is to be used with caution, and in a positive relationship style rather than a

negative way.

In general negotiations should be focused on agreeing mitigation for any risk areas

highlighted in the RFP/RFT process and aligning the contracted parties on the required

outcomes and outputs.

A negotiation planner is available from the Corporate procurement team.

4.1.14 Tender

evaluation time

frame

If the evaluation of responses has not been completed within the period specified in the

RFP/RFT, the project manager/ Corporate procurement advisor/specialist must ensure

that all proposers are advised in writing.

4.1.15 Crown entities

tendering for

the NZTA

contracts

There is no legal restriction on Crown entities tendering for the NZTA contracts. The

Procurement manual requires that where a response conforms to the procedural

and substantive requirements of the RFP/RFT, the NZTA must consider that response. The

NZTA is bound to consider all conforming responses that are submitted, regardless of

whether they are submitted by a private contractor or by a Crown entity.

4.2 Conformity, tags and clarification

4.2.1 Checklist To assist in evaluating responses and maintaining conformity, the checklist by Corporate

procurement advisor/specialist or person authorised by the Corporate procurement team

to act in this role prior to evaluation for each proposer shall be referred to prior to the TET

undertaking the evaluation to ensure that all comments noted by the procurement

specialist/team administrator are taken into account.

4.2.2 Review of tags Each page of the response document should be checked by the TET for changes not




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authorised by any notice to proposer. Any such change will be considered as a tag.

Qualification of the RFP/RFT whether explicit or contained in the body of the response

shall be regarded as a tag.

Tags shall be dealt with in accordance with the requirements of the RFP/RFT or in the

absence of any specific requirements, they shall be dealt with as follows:

The proposer shall be requested to remove tags that are unacceptable to the NZTA,

without amendment to the response price. The response is to be rejected if the

proposer refuses to remove unacceptable tags.

If tags are found on the response form or any pricing schedule or otherwise included in the

price envelope, the proposer shall be requested to remove the tags. Unacceptable tags in

the price envelope cannot be considered and the response is to be rejected if the proposer

refuses to remove them.

4.2.3 Clarification Clarification of a response to establish conformity with the RFP/RFT or for any other reason

can be obtained during response evaluation. Any additional information provided which

attempts to improve the response shall not be included for evaluation purposes.

However, should a response not include information of a minor nature requested in the

RFP/RFT and it is required to complete the evaluation, then the proposer should be advised

and invited to supply it.

Any request for clarification or additional information and the response to it should be in

writing. Such response is to be received by the NZTA within 24 hours of request and may be

provided by email, facsimile, courier, hand delivery or post. Requests should be along the lines

proposer to judge compliance.

Requests for additional information or clarification shall be issued by the Corporate

procurement team and should include clear reference to the RFP/RFT clauses under which

clarity is being sought.

If the evaluators are unable to undertake a meaningful evaluation because a significant

amount of information requested in the RFP/RFT has not been supplied and/or there is a

record of the proposer being continually requested to submit further details by way of

clarification, then the response may be rejected or deemed non-conforming. The supply of an

entire attribute cannot, on any sensible interpretation, be called clarification. The TET must

consider the integrity of the process and the possible prejudice of other proposers in

providing their responses by a deadline.

In the clarification process, no change in the price or substance of the response shall be

sought, offered or permitted.

4.3 Dealing with comments received from proposers

All comments by proposers are to be channelled through the Corporate procurement team to

ensure that no claim may be laid that any proposer received privileged information or was

treated differently.

4.4

Once responses have been submitted, proposer requests for substitution of named key

personnel shall only be considered after award of the contract. Approval of a substitution may




Page 178

be granted if replacement is by a person of equivalent or better skills and qualifications and is

to the satisfaction of the NZTA.

Once the contract is signed the contractor may change key personnel in accordance with the

conditions specified in the contract.

4.5 Subconsultants/Subcontractors and consortia

4.5.1 Subconsultants/

Subcontractors

In particular, when assessing attributes, the attributes of the subconsultants/subcontractors

must be included. The detail expected in the tender should be in proportion to the amount of

work to be carried out. For example, a short statement in a general section could cover a

A proposer who proposes to subcontract any significant portion of the work should still have

an appropriate organisational and management structure.

4.5.2 Consortia This is similar to the subconsultant/subcontracting situation except that the consortium

would jointly sign the tender and therefore have a closer involvement in the management and

organisation of the contract. Although close evaluation is necessary, a group of contractors

may complement each other well and enhance the quality of the overall tender.

4.6 Non-price attribute assessment

4.6.1 Introduction When assessing non-price attributes, deliberations shall relate to the RFP and type of work to

be undertaken.

When allocating the grades for non-price attributes, care must be exercised not to award

higher grades just because proposers capabilities exceed those required for implementation

of the project.

Any factual information available to the TET may be used in determination of non-price

attributes. However, the TET shall not be obliged to look beyond the tender submissions.

Information supplied by the proposer must be in accordance with the RFP.

4.6.2 Non-price

attribute

evaluation

Non-price attributes shall be evaluated as specified in the RFP and in accordance with the

Procurement manual. A non-price evaluation summary sheet is provided at appendix

6, part B of this manual.

-price attributes are evaluated and where a tender attribute grade

of between 0 and 35 is given the tender becomes non-conforming through having graded less

than 35 on an attribute. The evaluation of the tender should be completed and the price

envelope should be retained unopened pending any formal challenge unless requested to be

returned.

Grading of each non-price attribute should be in increments that give the appropriate level of

flexibility considering the value of the contract and the possible SQP generated (i.e.

increments of five points).

On completion of the evaluation of the non-price attributes, the evaluators shall stand back

and undertake an overall review to verify from the information available, that:

for a pass/fail evaluation, the proposer can be expected to complete the project

adequately and safely




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for a price /quality evaluation, the grade awarded is reasonable, particularly in comparison

with grades awarded to other proposers.

Financial resources are not to be included in any weighted attributes. Where there is

doubt that the proposer has sufficient financial resources to complete the contract, the

matter shall be taken up with the Manager Procurement upon completion of the

evaluation and prior to award of contract.




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4.6.3 Use of tender

evaluation forms

for price quality

grading

The evaluation summary forms and guidelines are to be used as appropriate during tender

evaluation. The purpose of using standard forms is to ensure uniformity in evaluation and

contribute to consistent and transparent evaluation.

The following describes the use of these forms:

The project manager/Corporate procurement advisor/specialist selects and briefs the TET

(others may be involved in this briefing as required).

Where not identified in the RFP/RFT, proposers are entitled, at their request, to the names

of the TET members during the tender, or during the evaluation process.

The project manager/Corporate procurement advisor/specialist or person authorised by

the Corporate procurement team to act in this role ensures TET members are provided with

sets of pre-formatted forms corresponding to the number of responses received, copies of

the responses and a copy of the RFP/RFT. Pre-formatted forms will have included, as

appropriate, the contract name and number, attribute weights, and factors to be graded

against on the methodology form.

Note: Attribute, subattribute, personnel and methodology factor weights are determined by

the project manager/ Corporate procurement advisor and indicated in the RFP/RFT.

TET members independently read and evaluate the tenders then grade the non-price

attributes noting their overall rating for each attribute. Each TET member records their

reasoning behind their attribute grade allocation and the key differentiations.

Note: Sufficient time must be allowed for this step prior to the TET meeting.

The TET grades are recorded on the evaluator summary of all non-price attributes, or other

medium from which copies can be made.

The attributes for each proposer are then agreed by consensus and recorded in the

highlighted box.

A TET member (or Corporate procurement advisor/specialist for activities over $200,000)

should be nominated to be responsible for summarising and recording the essential

reasoning behind the agreed grades of each non-price attribute and for ensuring that all

evaluation forms and comments are correctly filed.

Note: All documentation used during the evaluation process including all marking sheets and

all documents written or received by the TET during the evaluation, should be returned to

Corporate procurement to be retained on the contract file to ensure proposers can properly

receive feedback on their submissions if requested. All such documentation is to be retained

for a period of seven years after completion of evaluation after which it may be destroyed

unless notice of any claim or dispute relating to the TET process has been received.

4.6.4 Proposal

deficiencies

In the event that the Corporate procurement advisor/specialist or person authorised by the

Corporate procurement team to act in this role discovers errors and/or omissions in a

response, they may, in consultation with the TET, without advising the proposer of the errors

and/or omissions, request the proposer confirms the tender without correction. Where such

confirmation is not received the response may be rejected.

All requirements deemed to be mandatory for completion in the RFP/RFT must be properly

addressed to the satisfaction of the Corporate procurement advisor/specialist or person

authorised by the Corporate procurement team to act in this role





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4.7 Presentation of proposals

Consideration is to be given to the desirability of all proposers making presentations

on their responses. If the TET feel that tender presentations may be required this

should be highlighted in the RFP/RFT. The TET will decide if presentations are

required after submissions have closed and this will be notified to proposers in a

notice to respondents.

4.8 Recommendation report

4.8.1 Negotiations Refer to section 5.0.

Negotiations are best conducted prior to making any announcement to respondents.

The recommendation report may outline the intent to negotiate but ask for approval to

award based on an expected outcome of a negotiation.

It is best not to hold debriefs with any respondents until all negotiations have been

completed.

4.8.2 Recommendation

report

The recommendation report to the appropriate delegated authority, shall include comment

on the rational and key points contributing to:

number of responses, including any responses that were anticipated through a closed

competitive process and not received, and late/rejected responses

the non-price attributes grade for each proposer (grades to be included)

why any tender failed any non-price attribute (see 4.8.3 below)

the acceptance or rejection of tags and late tenders

any plans for negotiation and the expected outcome of those negotiations

any recommendation that is to accept a tender that is not the lowest in price,

the benefits, including financial and operational, to the NZTA of the recommendation

risks associated with the award e.g. market reaction, implementation challenges,

interrelated activities and

the recommendation to award (or next stage) and request for approval of the

recommendation.

The report should be sent to the Corporate procurement advisor/specialist for review.

Once finalised, the Corporate procurement advisor/specialist should note the date the

report has been finalised in the register of tenders.

The TET should then issue the recommendation report to the appropriate delegated

authority as detailed in the procurement delegation schedule contained in part B.

The Corporate procurement team will provide a template.

4.8.3 Non-conforming

or rejected

responses

Reasons for disqualification of any response shall be reported and may include a response

that has been failed on any non-price attribute.




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4.8.4 Final evaluation

forms

Recommendation reports, are to be accompanied by the completed report form for the

particular methodology used.

4.9 Post-evaluation administration

4.9.1 Debrief meetings After the RFP/RFT process is complete and the contract is awarded, it is important the

unsuccessful/successful proposers are given the opportunity to discuss their

responses with the Evaluation team. This will benefit all parties to the process and

provide oppor

process.

The Corporate procurement team will provide a template.

4.10 Release of information post-tender

Care should be taken not to disclose any information that is likely to reveal a

, or any other confidential or

commercially sensitive information.

The following information may be released to unsuccessful suppliers:

The rating of their tender or proposal in relation to the others received (e.g. 7th

out of 12].

A summary against each evaluation criteria where the proposal was strong or

deficient (e.g. specification, technical requirement or delivery terms). The purpose

of this is to encourage and assist suppliers in responding for future NZTA

contracts.




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5.0 Award of contract

5.1 Negotiation and development of contract documentation

5.1.1 Purpose of

negotiation

Negotiations are best conducted prior to making any announcement to respondents.

Post-tender negotiations are an effective risk management tool. Their primary objective

should be to:

test the understandings and underlying assumptions that have influenced a proposer in

preparing its costings, and

achieve cost reductions through operational refinements or enhancements.

5.1.2 Process for

conducting

service

delivery

negotiations

Staff involved in negotiations must ensure that:

they are conducted ethically and in good faith

other proposers are not potentially disadvantage by negotiating a contract that is

materially different in scope from what was proposed in the response documents

the negotiated contract is sustainable and does not compromise quality

where possible, you are able to make key decisions at the negotiation

the negotiations do not focus solely on reducing bottom line costs

negotiations are conducted first with the preferred proposer, and

if, in quality-based evaluations, the outcome is unsatisfactory, negotiations may then

be held with the next highest ranked proposer, and so on down the list, until a

satisfactory outcome is achieved.

The skills and expertise of the negotiation team should be commensurate to the value, risk

and complexity of the procurement. The composition of the negotiation team is

determined by the project manager in consultation with the Corporate procurement team.

A negotiation planner is available on request from the Corporate procurement team.

5.1.3 When to

undertake due

diligence

Due diligence provides both the NZTA and a proposer with the opportunity to test their

expectations and understanding of the procurement.

Formal due diligence is usually unnecessary for simple, routine procurements.

An alternative to due diligence, if the cost of the procedure will be high, must require the

successful proposer to provide a performance bond.

Special care must be taken to avoid inadvertently creating a contractual obligation during

the due diligence process. If in doubt, contact the Corporate procurement team.

5.1.4 Due diligence

process

The RFP/RFT documents must:

state whether due diligence may be undertaken, and

set out the anticipated timing of the process and the contact details of the person

responsible for managing it.

The NZTA needs to establish formal procedures to ensure:

relevant material is collected, collated and indexed for inspection by proposer

the relevant employees are available for questioning by proposer, and




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requests for information by proposers are responded to.

Due diligence process

continued

A due diligence process should include an address:

the proposers ability to deliver the goods or services for the price submitted

the reasonableness of any price renegotiation clause

the terms and conditions of any proposed financing structures, including the

certainty of funding and the proposers ability to service the debt, and the financial

viability of the proposer

the experience of either the proposer or any proposed subcontractor in providing

similar goods or services

credit and/or reputation checks to establish (inter alia) the qualifications or

credentials of key personnel, for example by obtaining curricula vitae and meeting

with individuals to discuss their relevant experience, and understanding of the

requirement

the adequacy of the proposers approach to the procurement, and whether it is

likely to meet key objectives

site visits to check the adequacy and condition of infrastructure, equipment and

resources that will be used in meeting the requirement

examination of work or product samples.

The TET must keep a record of the due diligence enquiries undertaken, forwarding the

results and ensure these are forwarded to the Corporate procurement

advisor/specialist.

5.2 Development of formal contracts

5.2.1 Formal

contracts

A formal contract is one that has been agreed to, and signed, by both the appropriate

NZTA purchasing delegation holder and the cont

Formal contracts ensure that all terms agreed through the negotiation process can be

referred to and enforced.

Where it is impossible, from a practical point of view, for the negotiated contract to be

signed by both parties prior to the commencement of supply or work, a formal letter of

intent may be used to allow work or supply to commence. You must consult the

Corporate procurement team before sending a letter of intent to ensure the

commitments you are making within the letter are appropriate, and the letter is clear as

to what is intended to be legally binding and what is not. This letter of intent should

refer to all the relevant contract documents subsequent to its issue. The formal contract

document must be signed by both parties as soon as possible, as the letter is simply a

starting point. .The award of the contract by fax, email or letter is a binding contract. An

award is to be used when it is not possible to present the contract document for signing

prior to the contractor staring to deliver the supply or service. This form of initiating a

contract may be used when time is of the essence but should not be may be used as a

surrogate for a completed formal contract.

The Corporate procurement team will provide template contracts for sponsors/ project

managers.

5.2.2 Deeds A deed is normally headed Deed and is a formal legal document required when a

specific legal right is created. They include every transaction relating to land (including




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leases but not licences), guarantees, power of attorney, and acknowledgement of debt

and gifts.

5.2.3 Process for

preparing

contracts

Contract templates are held by the Corporate procurement team. Employees must

ensure that the appropriate procurement process has been followed before requesting a

contract template.

Employees must complete the schedule of services and forward to the Corporate

procurement team for review prior to release to the contractor.

Any changes to the standard NZTA terms and conditions must be reviewed by the

NZTA legal team.

Contracts must be signed by the relevant delegated authority.

Two signed originals of contracts are required for signature. One signed original must be

provided to the contractor while the other must be returned to the Corporate

procurement team, for central filing in a fireproof safe.

5.2.4 Right of

Renewal

Relationships need to be considered on the expiry of each contract, so the business

relationship can be commercially and competitively tested.

If a contract has a right of renewal period written into it, you only need to go to the

market at the right of renewal point, if the NZTA or the contractor wishes to exercise

the option not to renew. However, the NZTA may use the right of renewal point as an

opportunity to harmonise the service or goods provision with other contracts.

5.2.5 Contract

format and

content

The proposed contract format is to be detailed in the RFP/RFT document.

The user requirement specification, quality assurance plan, and relevant

correspondence should be contained in the schedules to the contract.

Material that adds nothing to the actual contract should not be bound into the contract.

Remove all unnecessary information such as curricula vitae, personal profiles and

promotional material.

5.2.6 Transition plan A transition plan must be prepared if the

delivery. Transition expectations may be relevant to document in a high risk transition

contract.

A transitioning plan will be most likely required where the NZTA has supplier providing

complex or high-value services (e.g. advertising, printing and design services, and bulk

mail-outs), or high-volume, core business goods (e.g. licence plates, drivers licences or

publications).

5.2.7 Preparing a

transition plan

Employees responsible for a contract should ensure that a transition plan is in place or is

required in a response to RFP/RFT.

The amount of detail needed in the plan will depend on what is being supplied. For

example a relatively minor, routine contract may require only a statement outlining the

adequacy of existing procurement procedures, while an outsourcing contract may

require a detailed transition plan that identifies the schedule of tasks or activities that

the parties will perform during the transition period, and sets out the responsibilities,

resources, policies and procedures necessary to enable effective management of the

transition.




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Preparing a transition

plan continued

Depending on the complexity of the transition and the services being provided, the plan

may also need to address:

the capacity of the Corporate procurement team to cope with any increase in

workload

any organisational restructuring resulting from the contract

any new training requirements

, e.g. the impact of the contract on

land, facilities, equipment or machinery, and intellectual property

identifying and assigning responsibilities such as ownership, insurance, access, usage,

transfer, and liabilities of a financial, legal, safety, or environmental nature

any effect on customers, including

the need for a customer communication strategy

consultation to identify any customer needs during the transition period

the need to notify any interim arrangements, or changes to staff and service

delivery schedules.

5.2.8 Key

performance

indicators

Each contract must have a set of clear deliverables and measures for establishing

whether or not the supplier is providing the service or goods to the standard specified

within the contract.

The Corporate procurement advisor/specialist will guide the project manager through the

development of the key performance indicators (KPIs) which are to be used by the

project manager to establish whether or not the NZTA is receiving the goods/services

contracted. These KPIs form part of the contract and where the contract is re-tendered at

the end of the current term, those KPIs will normally form part of the tender specification

released in those subsequent tenders.

5.3 Liability and insurance for consultant contracts

5.3.1 Liability and

insurances

The NZTA requires that all contractors and consultants carry adequate insurance coverage

(particularly professional indemnity and/or public liability) to protect the interests of the

NZTA against any claim arising from the provision of services.

5.3.2 Changed

insurance

requirements

after award

If for any reason the Corporate procurement advisor/specialist /project manager believes

that insurance requirements should be amended during the currency of any contract (e.g. if

the value of the contract increases significantly) then such proposed amendments must be

reviewed by the sponsor.

5.3.3 Uninsured

consultants

engaged in

minor contracts

Refer to Insurance and risk management manual (SM013) for uninsured

consultants engaged in minor contracts (up to $100,000) who require insurance, or where

a reduction or waiver for professional indemnity, or public liability insurance is applicable.




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5.4 Insurance, bonds and retention for office accommodation works (Works)

5.4.1 Introduction Insurance of the contract works and a contractor s bond may be required for a Works

contract.

5.4.2 Insurance The provisions for insurance of works carried out under a Works contract are set out in

New Zealand Standard 3910:2003 Conditions of contract for building and civil engineering

construction (NZS 3910:2003) section 8.

5.4.3 Insurance

certificate

approval/

Generic works

insurance

certificates

approval

The NZTA requires the insurance company providing the cover to sign the insurance

certificate.

Alternatively, subject to satisfying the NZTA that it has appropriate insurance policies in

place that meet the ay

provide a generic underwriter certificate together with a project specific insurance broker-

signed certificate.

For further information on the

email [email protected] .

5.4.4 Changed

insurance

requirements

after award of

contract

If for any reason the project manager believes that insurance requirements should be

amended during the currency of any contract (e.g. if the value of the contract increases

significantly) then such proposed amendments must be first approved by the sponsor.

5.4.5 Bonds A contractor's performance bond may be required under NZS 3910:2003 section 3.1. This

provides the NZTA security to ensure performance of the contractor's obligations under

the contract agreement. This may include completing the work to the specified standard

and breach of contract, e.g. through wrongful termination. The bond is usually released

within five days of practical completion.

The contractor in addition may offer a bond in lieu of retentions as under NZS 3910:2003

clause 12.3.3.

5.4.6 Amendments to

standard works

bond forms

The NZTA Works contracts may use performance bonds and bond in lieu of retention

forms as provided in NZS 3910. Some bond providers require amendments to the NZS

3910:2003 bond forms making them on demand and enabling multiple draw downs.

The following amendments to the NZS 3910:2003 standard bond forms are acceptable to

the NZTA:

o the principal in the

sum of NZ$XXXXX and bind themselves, their successors and assigns jointly and severally

for the payment of that sum and the sureties undertake that they will pay to the principal

any amount demanded by the principal provided the demand by the principal is in writing,

NZ$XXXXX in the aggregate.

Notwithstanding any other provision of this bond, the sureties may pay to the principal an

amount equal to its maximum liability under this bond less any moneys previously paid, or





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5.4.7 Bond in lieu of

retentions

retention

amounts

For all contracts the bond value shall be the applicable contract retentions set out below plus

a further 10 percent of that figure.

For construction contracts the maximum amount of retention is $200,000. The amount to be

retained from monies owing to the contractor is:

10 percent for the first $200,000

5 percent for the next $800,000, and

1.75 percent of the amount in excess of $1 million.

5.5 Contract file

5.5.1 Introduction A contract file must be maintained electronically for each contract awarded. This topic

discusses the contents of the contract file.

5.5.2 Contract

procedure

In maintenance of the contract file, the file number must correspond with a sequential

number in the register of tenders. This contract file must contain all relevant information

relating to the administering of that contract in addition to that stated below.

5.5.3 Information in

contract file

Contract files must include the following information.

All documents with signatures must be scanned to retain an electronic copy. If the original is electronic, retaining in electronic is fine (and not printing a hardcopy duplicate is fine).

practice to retain the hardcopy original.

Supporting procurement plan.

Estimate.

Copies of all notices to proposer.

The Schedule of tenders received and evaluation report.

Summary of unsuccessful proposers.

Copy of the successful tender and supporting papers.

Copy of the tender acceptance and decline notices.

Correspondence on the contract generated the project manager and any other party.

The signed contract document. A hard copy original must also be retained.

Two original copies of the contract are to be signed. Each party to the contract is to retain a

copy of the contract with one signed original to be provided to the Corporate procurement

team for central filing in a fire proof safe.




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6.0 Signing of contract

6.1 Introduction

This section discusses the procedure for signing the contract documents.

6.2 Signing the contract

The delegation to enter into contracts is detailed in the procurement delegations

schedule of this part.

If the contract is not a deed, the c a person who is

authorised to enter into contract by the expressed or implied authority of the

contract.

Two original copies of the contract are to be signed. Each party to the contract is to

retain a copy of the contract with one signed original to be provided to the Corporate

procurement team for central filing in a fire proof safe.

If the contract is a deed, the following personnel from the supplier must sign the

contract for it to be legal:

two directors (where there are two or more directors of the company), no witness

is required

if there is only one director, signed by that director whose signature must be

witnessed

the person authorised by the company constitution (evidence of authorisation

must be provided), or

an attorney appointed by the company (certificate of non-revocation of the

appointment of the attorney must be provided).

The witness as well as the signatory must also state his/her address, profession or

title.




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7.0 Contract management

7.1 Contract confidentiality

The NZTA representative responsible for managing a contract, often the project

manager, or recipient of the deliverables (Contract managers) should retain a copy of

the contract that they are administering or managing. A copy can be requested from

the Corporate Procurement team. These employees are reminded that it is their duty

to keep the detail contained within that contract confidential.

7.2 Assessing the performance of the supplier

Contract managers must regularly assess the performance of a selected supplier

against established criteria.

Contract managers must take steps from time to time to ensure that the selective

supply is still justified. This might include advertising to seek expressions of interest

from other potential suppliers for the goods or services. Contact the Corporate

Procurement team for advice.

7.3 Process for managing contracts

Contract managers should ensure that they:

are able to identify performance issues and any problems with the conduct of the

contract, which may result in appropriate remedial action and negotiated

solutions

have regular reporting on the performance of the contract, and

implement a contingency plan, to address continuity of service/supply in the

event of contract failure.

A contingency plan should be prepared before the contract takes effect.

For low-value or low-risk services, the plan may simply recognise that some delay

could occur in restoring services, or dealing with problems, should the contract fail.

Contract managers must monitor the cont (monthly for

high value or high risk or core goods/services; quarterly for medium value or medium

risk or key goods/services; bi-annually or annually for other goods/services), to

ensure that standards set out in the contract are met, particularly that:

the contracted service is delivered

the associated risks are managed, and

effective communication is maintained between all parties.

Contract managers

that are

included in the contract. .




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The monitoring procedures should enable the Contract Manager to:

make the contractor aware of problems as they occur (if necessary, in writing)

clearly identify issues to be addressed by all parties, providing an opportunity for

the contractor to improve performance during the period of the contract, and

collect information to inform any subsequent extension or renewal of the contract.

Meetings to review contract performance will vary in scope and frequency. The types

of meeting may include the following:

Regular progress meetings involve the contractor, the contract management

team, other key staff from the NZTA, and end users. The purpose of these

meetings is to discuss performance, contract events or milestones, changes to

user demands, and proposed actions or responses to current or potential

problems.

Technical meetings as required, involve specialist technical representatives of

the Contract Management team and the contractor. The purpose of these

meetings is to review technical reports and performance data, and discuss

technical issues.

Longer-term reviews and audits the purpose of these is to consider

the achievement of objectives,

out-turn versus budget,

user satisfaction,

future opportunities and process improvement,

the extent to which value for money is being achieved and requirements met,

and

how to address any emerging need for changes.

Contract Managers must ensure that a reporting system, such as KPIs and

scorecards, is in place to allow enough relevant, succinct and timely information to:

manage the project, and

monitor performance and risk.

Relevant information may relate to:

the cost of the project

technical aspects, including standards of reliability, safety, availability of

equipment, and other performance criteria

performance against specifications, allocation of resources, costs of work

performance, and other contractor evaluation reports.

7.4 Contract variations

Because a contract is a binding commitment between the parties, there may be legal

and cost considerations in formalising any changes.

Where changes become necessary during the period of the contract a formal

variation must be put in place.

Advice from the Corporate Procurement team must be sought when planning:




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negotiation of renewals, extensions

cancellations of existing contracts

where the impact of any extension, renewal, or cancellation is unclear or the

costs are greater than originally intended.

7.5 Process for contract variations

The NZTA must manage any proposed variation to a contract in accordance with a

formal change procedure. This may include:

keeping a record of any potential need for change

considering the full implications of change before making any amendments to the

contract or price

giving those involved the authority and the requisite knowledge to negotiate

variations

recording each action taken

incorporating the changes into the contract by formal variation

involving end users in the change process as necessary, and subsequently

informing them of changes that have been made.

Before agreeing to a variation, the Contract Manager must confirm that the variation:

will not significantly alter the original scope of the contract

complies with the .

If a proposed change will significantly alter the scope of the contract, advice must be

sought from the Corporate procurement team, regarding the need to consider re-

tendering. Negotiation of variations to contracts is the responsibility of the Corporate

procurement team, assisted by the Contract Manager.

Care must be taken to ensure the sponsor and/or budget holder is kept informed of

any contract variations or amendments that could substantially change any aspect of

7.6 Assignment or novation

The NZTA will only consent to assignment or novation if the process set out below is

followed, and it is satisfied that its interests, the integrity of any procurement process

will not be compromised, and that any existing bonds and insurances are confirmed

or appropriate substitutions made.

In an assignment the original supplier should ordinarily remain responsible for

performance under the contract unless that is clearly inappropriate (e.g. the incoming

party is stronger and willing to take on liability for past events) and that continued

liability must be documented.

It is important that the assignment or novation is specifically addressed so that if

there are difficulties later, there is not a dispute about whether it is the original party

or the assignee that is liable. Specifically if the original party is excused, the new party

must be expressly stated to be liable for past events. At this point, the assignment is




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materially the same as a novation.

In a novation the original supplier ceases to have any ongoing involvement. Issues as

to the time when a liability arises can therefore be material. Generally, novations

should not be accepted unless there is substitution of a clearly stronger party and

there is no risk to the integrity of the procurement process. The incoming (or

novated) party must acknowledge responsibility for everything done or not done by

the original party.

7.7 Changes after contract awarded

Where the Corporate procurement advisor/specialist Contract Manager becomes

aware of a material change to, or change in, the control of an existing supplier, or

receives a request for the NZTA to consent to assignment or novation of an existing

contract the Corporate procurement advisor/specialist Contract Manager shall do

the following:

1. Request details of the (proposed) change in control from the consultant and

details of the proposed new key personnel.

2. Assess whether the new party is at least as able to perform the contract.

3. If so, the procurement specialist/project manager shall obtain the consent of

the project sponsor to request from the supplier a deed of assignment or

novation of the contract for approval by the NZTA (such approval to be

given by the project sponsor). This deed must clearly transfer all the rights

and obligations of the contract to the new party, and state that from the date

of the deed, the NZTA is entitled to deal only with the new party in relation

to all matters. The new party must be clearly bound in respect of past acts or

omissions of the original party and liable for them and any rectification

required as it was the original party.

4. If it is assessed that the new party is as not able to perform the contract, the

procurement specialist/project manager shall refer the matter to the project

sponsor. The project sponsor may determine that it is appropriate, to require

the consultant/ contractor to provide a deed of assignment or novation. In

this case, the original party would not be fully released.

5. Check whether the new party unsuccessfully tendered for the contract. If so,

seek advice from the Corporate procurement team.

6. Check that replacement bonds (if any) and insurances are in place, or that

the relevant deed assignment includes the assignment or novation (as

appropriate) of existing bonds and insurances

It is very important to respond to notice, even informal, of any events that might

inferred from conduct or acquiescence, and in those cases its position might not be

adequately protected.

Where approval of assignment or novation is not recommended legal advice should

be sought regarding termination of the contract.




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7.8 Where a change in control involves an assignment or novation or subcontracting

NZTA's consent to this should always expressly prohibit the

subconsultant/subcontractor assigning or novating its rights and obligations in

relation to the particular tender, require notice of changes of control and include a

provision that the NZTA may amend or withdraw its consent if those types of

arrangements occur.

7.9 Ending a contract

The unsuccessful incumbent being terminated must be advised in a timely manner of

the transition arrangements. These should include (but not be limited to):

end of contract reviews if different from routine contract management reviews

referred to

long-term record retention,

intellectual property requirements, and

final payments.

Where a service is being re-tendered and the incumbent supplier is unsuccessful or a

contract is to be terminated early, a transition plan must be developed to ensure that

there is a seamless transition from one supplier to the next.

7.10 Contract evaluation reviews

Monitoring the performance of the Corporate procurement team, the Contract

Manager, NZTA end users and the supplier are important aspects in improving the

way we operate.

Performance reviews should be conducted at any time if there is an identified

problem or at pre-determined periods during a project.

Where the term is greater than one year, annual reviews are to be conducted on the

effectiveness of the contract. These reviews are to canvass the NZTA end users and

supplier.

For one off project contracts, On the completion of the project, a wrap up evaluation

should to be conducted to determine the overall effectiveness of the project.

Standard format evaluations for annual reviews and wrap up evaluations should be

completed.

7.11 Record keeping

Personnel involved in a procurement process must ensure that all documentation

relating to a procurement process is kept on file either electronically or hard copy for




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a minimum period of seven years. The Corporate procurement team will advise on

the documentation that needs to be retained.

7.12 Health and safety requirements of contractors

The NZTA has an active health and safety policy that requires all contractors to

comply with the provisions of the Health and Safety in Employment Act 1992, and

regulations pertaining to that Act.

required to sign a document confirming they agree with, and will comply with the




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8.0 Alternative procurement options

8.1 Emergency procurement

8.1.1 Introduction Emergency procurement of goods or services may be authorised provided:

life, property or equipment are immediately at risk, or

standards of public health, welfare or safety needing to be established without delay,

such as in the case of disaster relief.

8.1.2 Arranging

emergency

procurement

Emergency procurement allows all normal procurement rules to be set aside to meet an

emergency. The prime element that constitutes an emergency procurement is that

unforeseen circumstances have risen that require urgent attention by NZTA.

When the goods or services that are needed to cope with an emergency cannot be

obtained within the required time by normal procurement procedures, they may be

purchased from the most convenient suitable supplier, provided that:

the purchase is limited to the meeting the requirement needed to cope with the

particular emergency, and

the price quoted is a fair market price at the time and place where the purchase is

made.

Any NZTA employee may exercise emergency procurement provisions to meet a genuine

emergency situation, provided that the person can later justify their actions. Where the

NZTA employee concerned does not have a formal purchasing delegation, the value of

the purchase is limited to that of a cost centre manager. All others may make emergency

procurement up to their purchasing delegation level.

Responsibility for determining that the circumstances warrant an emergency purchase

rests with the NZTA employee l placing the emergency request. An individual may be

liable for any expenditure or loss resulting from misuse of the emergency purchase

procedure.

8.1.3 Post the

emergency

procurement

All documentation relating to the must be retained.

As soon as practical after the emergency procurement has taken place notification of the

emergency procurement must be sent to the Corporate procurement team and the tier

three manager responsible for the expenditure outlining:

The reason for the emergency procurement

The value and term of the emergency procurement

The supplier appointed, the form of contract used, and why

Any other relevant information to support the emergency procurement

8.2 Master Agreements

The Corporate procurement team hold information on Master Agreements able to be

accessed by the NZTA.




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8.3 Syndicated procurement

There are two types of syndicated procurement contracts. Syndicated procurement

contracts come into effect where a group of government departments/agencies

collaborate to select a preferred vendor for goods or services under a syndicated

procurement arrangement.

A Common Use Provision (CUP) contract involves, the notification of the intention to

procure the goods or services by a lead department on behalf any departments and

agencies who may wish to participate in a collaborative agreement, some many be

named at the time of engaging suppliers.

CUP contracts contain the option to join a previously established syndicated contract

utilising the provisions of that contract for the balance of the term. A CUP contract

requires MBIE sign off before creation,

The Cluster contract involves the intention to procure goods or services be made by a

lead department on behalf of the group with specifically identified participating

departments and agencies. A Cluster contract cannot be accessed by other

departments once it is in place.

.

The Corporate procurement team holds a list of syndicated contracts and must be

involved in accessing, or creating, any syndicated procurement contracts.

8.4 All-of-government contracts

All-of-government contracts (AoG) contracts are binding on all core agencies and

those agencies where the CE has opted in (NZTA has opted in on most AoG

contracts). These contracts are being developed and established as opportunities are

identified by MBIE.

The Corporate procurement team can advise which goods and services are covered

by an AoG contract.

Project management manual SM021



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9.0 Appendices Part B



Page 199

Procurement plan Direct appointment

Background

Brief description of goods or services that are required

Provide a statement that describes the value for money in making

this purchase

Project manager details

Name

Business group

Budget

Is the expenditure budgeted?

What is the budget?

For tracking purposes what will any payments be coded to, i.e.

cost centre/general ledger/output/project code?

Approvals

Who has approved this expenditure?

Who will sign the contract?

Signing delegations are as follows:

tier 3 managers up to $250,000

tier 2 managers up to $1 million

Chief Executive up to $2 million

over $2 million requires the NZTA Board approval and delegation to the Chief Executive.

Users

Name the key user groups within the NZTA of this

product/service that will be impacted

Have these groups been consulted?

Is there an information services opponent to this project? Have

they been consulted?

Contract term

When must this contract commence?

When must this contract finish?

Any other key dates?

Why this time frame?



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The market

Is there a current supplier to the NZTA that can provide these

services?

What is the justification for not using this supplier?

Is there a pool of suppliers in New Zealand that can provide these

services?

If suppliers are available, provide the reasoning why you are not

placing these services out to the market?

Are you aware of any market trends affecting these Suppliers? If

so, what?

External factors

What stakeholders are interested in this purchase, e.g. industry,

public, media, competitor suppliers?

Risk

Any risks or other factors to consider?

List health and safety considerations, e.g. hazard identification (if

applicable)

Contract performance

Against what criteria will you measure successful delivery of this

contract, i.e. what are the key outcomes of this contract that the

contractor will need to perform and how will these be measure?

Approval by Cost Centre Manager or delegated authority (if over $100,000)

Name

Date

Signed

Endorsement of budget availability by Management Accountant

Name

Date

Signed



Page 201

Procurement plan Competitive process

Background

Project Name

Brief description of goods or services that are required

Provide a value for money statement

Project manager details

Name

Business group

Budget

Is the expenditure budgeted?

What is the budget?

For tracking purposes what will any payments be coded to, i.e.

CC/general ledger/output/project code?

Approvals

Who has approved this expenditure?

Who will sign the contract?

Signing delegations are as follows:

Cost centre manager up to $80,000

National Manager Corporate Support, regional directors, transport registry centre manager up to $250,000

group managers up to $1 million

Chief Executive up to $2 million

over $2 million requires the NZTA Board approval and delegation to the Chief Executive.

Users

Name the key user groups within the NZTA of this

product/service that will be impacted

Have these groups been consulted?

Is there an information services component to this project? Have

they been consulted?



Page 202

The market

Is there a current supplier and have there been any discussions

with the supplier prior to this process?

Please include why you would or would not like them to be

awarded the contract

Who are the prospective suppliers?

Are you aware of any market trends affecting these suppliers? If

so, what?

External factors

What stakeholders are interested in this purchase, e.g. industry,

public, media, competitor suppliers?

Risk

Any risks or other factors to consider?

List health and safety considerations, e.g. hazard identification.

Tender process term

When must this process commence?

When must this process finish?


Contract term

When must this contract commence?

When must this contract finish?

Any other key dates?


Procurement method

What procurement method will you use or are you planning to

use? For example, open tender released through GETS or selective

tender.

The standard requirement is that all procurement over $100,000

is placed on GETS as an open tender unless otherwise approved. If

using a selective tender method justification must be provided.

Supplier selection models

What supplier selection method will you use:

lowest price conforming

purchaser nominated price

price quality

quality based?

Please contact the contracts team for assistance if required

The Procurement manual has more detailed information on each method (see appendix C).

http://www.nzta.govt.nz/resources/procurement-manual/docs/appendix-c-supplier.pdf



Page 203

Contract performance

Against what criteria will you measure successful delivery of this

contract, i.e. what are the key outcomes of this contract that the

contractor will need to perform and how will these be measured?

Evaluation panel

Provide the nominated evaluation panel. This should be a

minimum of three people and may include external

representation.

Is there a representative from any affected groups within the

NZTA?

A member of the contracts team must sit on all panels where the contract value is over $200,000.

Endorsement of budget availability by Management Accountant

Name

Date

Signed

Approval by budget holder or project sponsor

Name

Date

Signed

Project management manual SM021



Page 204

Closed tender register

Contract: Closing at: On:


Proposer name Email address Contact name Issued Returned

Notice to tenderers

1 2 3 4



Page 205

Received tender register



Serial Item Supplied Comment

yes no n/a

1 Conflict of interest/Confidentiality declaration form received by

evaluation panel members

2 Acknowledgement of acceptance of rules

3 Submissions correctly packaged and received on time

4 Acknowledgement or submission of terms and conditions

5 All non-price attributes/mandatory response sections completed

6 Subcontractor/Subconsultant details provided

7 Obvious tags that are clearly identified



Page 206

Proposal close off checklist



Proposer name Email address Contact name Issued Returned

Notice to tenderers

1 2 3 4



Page 207

Evaluation summary

Contract name: Closing at: On:

File number: Evaluator name:

Participant 1 Participant 2 Participant 3 Participant 4 Participant 5

Criteria P/F GRADE P/F GRADE P/F GRADE P/F GRADE P/F GRADE

1 Methodology

2 Resources

4 Relevant skills

6 Track record 0 0 0 0 0

Total RAW score

A scale of 0 to 100 is used when grading non-price attributes. To help achieve consistency of practice, the NZTA recommends that grades be awarded in steps of five and that the following grading scale be

used.

90, 95 or 100 Demonstrates exceptional compliance or ability to convey exceptional provision of the requirement

75, 80 or 85 Requirements are fully covered in all material aspects

60, 65 or 70 Requirements are adequately covered

50 or 55 Adequate, with some deficiencies that are not likely to have any adverse effect

40 or 45 Barely adequate and would need considerable improvement in this attribute, if selected

35 or less Total non-compliance or inability to convey provision of the requirement

Contract procedures manual SM021 Appendix 7



Page 208

Conflict of interest/

Confidentiality declaration

RFP Number/Name of RFP

Conflict of interest declaration

I declare that to the best of my knowledge, I do not have:

any financial interest in the supply of goods, and or services for this project

any relatives or friends with a financial interest in the supply of goods and/or services for the project, and

any personal bias, inclination, personal obligations, allegiance or loyalty which would in any way affect my decisions in relation to the

evaluation of the tenders/proposals.

Except as set out below:

I undertake to make a further declaration detailing any conflict, potential conflict or apparent conflict which may arise during the

duration of my involvement with this project. I agree to abstain from any discussion and decision or to take appropriate steps to

manage a conflict where such conflict arises, should I be required to.

Confidentiality declaration

During the period that the request for proposal process is open and during subsequent evaluation (up until formal announcement of the

successful supplier(s)), I will not:

pass any information to

make any comments to, and

meet with:

Any potential suppliers of goods and services for the project, excluding those that have an existing relationship with the NZTA that requires operational management (and then only for purposes related to the management of that existing relationship).

I will pass any requests for information, meetings and other correspondence that I receive from potential suppliers to the contracts

team for handling via formal channels.

TET member Sponsor acknowledgment

Signature Signature

Name Name

Title Title

Date Date

Documents

Contract procedures manual · Contract procedures manual SM021 Second edition, Amendment 1 Effective from June 2013 Page i Document management plan 1) Purpose This management plan