training how to use the new suite · ict purchasing dsitia has confirmed new documents can be used...
TRANSCRIPT
Training
How to use the new suite
of tender and contract
documents
December 2014 Procurement Transformation Division
Key drivers for the review and benefits
Introducing the new tender and contract documents
Comparing terms and conditions
ICT purchasing
Working with the new documents
How the documents fit together
Which contract to use
Contract negotiation and execution
Clause bank
Transition period
This session will cover…
1. Basic Purchasing Conditions
2. General Contract Conditions +
Contract Details
3. SOA
4. Invitation to Offer
5. Request for Quote
Key benefits This has always been a ‘customer focus’
initiative. Documents have been designed with
‘problem solving’ in mind.
Key benefits of new documents
• Designed to enable outcomes
• Support Queensland Government Procurement
Strategy
• Make it easier to do business with Government
• Use Simplified language
• Reduce red tape
• Improve flexibility
• Improve capability
• Support value/risk approach
• Encourage innovation
116
Reducing # docs
Old New
45%
reduction
63%
reduction
66%
reduction
• “It takes a little bit of time to get used to the new documents but the effort is worth it. The documents are
excellent - they are flexible and well drafted using very plain English. Samantha Mathers has been very
generous with her time providing excellent support to understand the documents. The new approach is a
credit to the Procurement Transformation Program centre of excellence” (DJAG and Wave 2 Sourcing
Team for Legal Services)
• “We can see real efficiencies achieved through the compilation of information from schedules i.e.
subcontractor, tenderers details, invitation to tender directly into the contract document for the supplier to
complete. This reduces paperwork and effort required for the tenderer and ultimately for the procurement
officer not needing to transpose all of this information from schedules into a separate contract document. The
questions within the documents for suppliers are relevant and direct.” (Ergon)
• “I am 100% behind what your team is trying to achieve as I too believe we have far too much red tape”
(DJAG)
• “Much better structure than the old RFO … many thanks!” (Health team that piloting the new ITO)
• [Re ITO] “…this is an excellent document and definitely heading in the right direction…” (Health)
• “I am working on a service based procurement activity and my client (who also attended the Q and A session)
is very keen to use the new templates and be part of the trial” (DCCDS)
• “The template changes proposed will provide all parties with a contract document to enable clear
identification of the requirements and responsibilities to fulfil performance outcomes. The modular structure
of the documents will allow flexibility to suit the procurement. The simplified terms and conditions should
enable easier understanding by all parties through succinct plain language.” (DETE)
Feedback so far
SOA
(5 docs)
Short
Form
Contract
(3 docs)
Invitation
to Offer
(3 docs)
Conventional
Contract
(2 docs)
SOA
Details
SOA
Conditions
Comprehensive
Contract
Conditions
Contract
Details
General
Contract
Conditions Invitation
to Offer Definitions
Request
for Quote
Basic
Purchasing
Conditions
Simplifying tender and contract documents
From
To
New go-to-market templates
Definitions and Interpretation
Invitation to Offer
• Replaces Invitation to Offer (template)—Sections 1-5
• Replaces Invitation to Offer (template)—Section 6 (Response Forms)
• Replaces Conditions of Offer—version 004—1 July 2012
• Replaces Standing Offer Arrangement—Invitation to offer (template)—Sections 1-5
• Replaces Standing offer arrangement—Conditions of offer—version 004—1 July 2012
Request for Quote
General Contract
Conditions
• Replaces Short-form conditions of contract—version 004—1 July 2012 (for purchase of
non-ICT goods or services)
• Replaces Short-form conditions of contract (referencing the Short form contract
schedule)—version 005—1 July 2012
Contract Details
• Replaces Invitation to Offer (template)—Section 6 (Response forms)
• Replaces Short-form contract schedule—version 005—1 July 2012
New
SOA Details
SOA Conditions
• Replaces Standing Offer Arrangement—Invitation to offer (template)—Section 6
• Replaces Standing Offer Arrangement—Deed of agreement—version 005—1 July 2012
• Replaces Standing offer arrangement conditions—version 004—1 July 2012
Introducing the new documents
Basic
Purchasing Conditions
Basic Purchasing Conditions
Definitions and Interpretation
• A ‘single source of truth’ for definitions and interpretation clauses applicable to
multiple documents. This ensures consistency and reduces duplication.
• This contains details of the procurement, including a section for suppliers to
complete as part of their response to the ITO (Schedule A – Response).
• The terms and conditions that apply to the Invitation to Offer process are at the
back of the document (ITO Conditions).
• New version ITO is simplified, streamlined, easier to read and more flexible.
Invitation to
Offer
• NEW document for routine purchases of low value/low risk goods/services
• Basic Purchasing Conditions reduces red tape, and will make it easier to do
business with Government.
• Can be incorporated by reference in an order (e.g. purchase order)
New
• RFQ is a ‘Lite’ procurement process which is simple, streamlined and designed
to be a shorter process than ITO. New format will reduce red tape, be more
efficient and will make it ‘easier to do business’ (reduces tendering costs).
• The RFQ template can be used for low risk procurement. The terms and
conditions that apply to the RFQ process are at the back of the document (RFQ
Conditions).
• Based on DTMR ‘RFQ’ template that has proved successful for low risk
procurement.
Request for
Quote
New
New
Contract Details
• Contains all of the key information that forms the contract with the supplier (in
combination with the General Contract Conditions).
• Clear as to what documents form the contract (which will assist contract
managers). Info captured has been simplified significantly. Easier to use.
• Provides enough flexibility for Agencies to include any special terms and
conditions specific to the Agency or the goods/services purchased.
• These replace the ‘Short Form’ contract conditions for goods and services.
• Agreed special conditions/amendments can be incorporated by identifying the
new clauses/amendments (in the Contract Details).
• Contract has been simplified significantly to create efficiencies for Government
and suppliers, reducing the cost of doing business with Government.
General Contract
Conditions
• Contain information specific to the SOA with the supplier.
• Identify the contract terms that apply when customers buy from the supplier.
• Terms agreed in the SOA Details ‘flow through’ to customer contracts (e.g.
pricing, liability caps). Customers can focus on placing orders.
SOA Details
• These are the ‘mechanics’ of how the SOA works (between Principal/Supplier).
• Significantly simplified compared to current SOA Conditions.
SOA Conditions
• Guidance notes developed for many of the documents to assist users (ITO,
RFQ, Contract Details, SOA Details) and will be continuously improved. ICT
specific guidance will also be incorporated.
Guidance Notes
New
Comparing terms and conditions
• Formation
• Security
• Risk and title
• GST
• Price review
New General Contract Conditions (compared to Short Form):
New SOA Conditions (compared to previous SOA Conditions)
• Termination and
suspension
• Commissions, incentives
and collusion
• Criminal organisations
• Dispute resolution
• Liability
• Information
• Intellectual Property
• Confidentiality
• Privacy
• Insurance
Key features of Basic Purchasing Conditions
• Formation
• Risk and title
• GST
• Liability
• Intellectual Property
• Customer Data
• Confidentiality
• Privacy
• Insurance
• Termination
• Conflict of interest
• Criminal organisations
• Supplier
• Basic Order
• Contract
• Details
Key features of definitions and interpretation
Key take-aways
The magic is in the Contract Details and SOA Details
• SOA
• SOA Order
• No definition of eligible Customer
(see SOA Conditions)
Definitions and Interpretation
• A ‘single source of truth’ for definitions and interpretation clauses applicable to
multiple documents. This ensures consistency and reduces duplication. It’s a
living document – new definitions will be added over time.
New
• Consequential loss
• Cap on liability
• Confidentiality
• GST
• Insurance
• IP default
ICT purchasing DSITIA has confirmed new documents can be used for ICT
purchasing
• Invitation to Offer and Request for Quote templates can be used for ICT purchasing
• New General Contract Conditions (and Contract Details) can be used as an alternative to the
GITC framework to purchase low risk ICT products and services under $1 million.
• Risk to be assessed using value risk matrix.
• Suppliers do not need to be GITC accredited if the General Contract Conditions are used.
• You may need to add some special conditions to deal with any ICT specific issues.
This will make it easier for customers and suppliers to do business for the
purchase of low risk ICT products and services <$1 million
• New SOA documents cannot be used to establish an SOA for ICT products/services yet:
The current ICT Standing Offer Arrangement documentation that utilises GITC must continue to
be used, until it is reviewed (work in progress, to be completed by the end of 2014)
• Guidance Notes will be updated to include guidance for when the ITO, RFQ or General Contract
Conditions / Contract Details are being used for ICT purchasing
• For more information contact ICT Strategic Sourcing on (07) 3719 7695 or email
Basic Purchasing Conditions
Basic purchasing conditions
• Purpose and when to use them
• How to incorporate basic purchasing
conditions
• Key features and terms
• Changes are not recommended
(unless they are minor)
• NEW document for routine purchases of low value/low risk
goods/services
• Basic Purchasing Conditions reduces red tape, and will
make it easier to do business with Government.
• Can be incorporated by reference in an order (e.g. P.O.)
New
General contract conditions plus
contract details
• They replace the ‘Short Form Conditions of Contract’
• When to use / not to use (see guidance material)
• Key features / terms (material changes from old –v- new)
• How to use the Contract Details:
• Contains specific information about the contract being established
• Flexibility to amend standard terms and conditions in customer
details
• Contract manager’s dream!
• Guidance notes
How to use the General
Contract Conditions
General Contract
Conditions
Contract Details
Definitions and
Interpretation
Standing Offer Arrangements Conditions and details
• Guidance notes
• Making changes
• SOA for ICT products/services
How to
create a SOA
Contract (between Customer
and Supplier)
SOA Conditions
Definitions and
Interpretation
SOA Details
SOA Details SOA Conditions Customer Contract
• Contains specific information
about a SOA
• Flexibility built in – can amend
the SOA Conditions or the terms
of Customer contracts.
• Changes to ts and cs ‘flow
through’ to customer contracts
(only need to negotiate them
once, at SOA level).
• ‘SOA Orders’ – flexibility in how
you define / describe this.
• The mechanics of how
the SOA works
• ‘Eligible customers’ that
can purchase under the
SOA
• Unusual for SOA
Conditions to need
modification
• In SOA Details identify the
contract that applies
between the supplier and
customers when they place
orders under the SOA.
• Select the contract of ‘best
fit’ based on value and risk
• Make it easy for customers
to place orders.
Invitation to offer
• Structure: Response Schedules –v- Contract Details
• Key features and ‘tips’
• Contract selection – maximum flexibility.
• Preparing Response Schedule A
• Schedule B – Innovation and alternative offers
• Guidance notes
• This contains details of the procurement, including a section
for suppliers to complete as part of their response to the ITO.
• New version ITO is simplified, streamlined, easier to read and
more flexible.
Invitation to
Offer
Request for quote
• RFQ is a ‘Lite’ procurement process which is simple,
streamlined and designed to be a shorter process than ITO.
New format will reduce red tape, be more efficient and will
make it ‘easier to do business’ (reduces tendering costs).
Request for
Quote
New
• When to use the RFQ template
• Structure
• Contract selection – maximum flexibility
• Key features and ‘tips’
• Guidance notes
How the documents fit together Basic
Purchasing Conditions
Definitions and
Interpretation
To buy goods/services using
Basic Purchasing Conditions
To buy goods or services
(using new General Contract
Conditions - no tender process)
General Contract
Conditions
Contract Details
Definitions and
Interpretation
Tender process (ITO or RFQ) using new General Contract Conditions
ITO for a Standing Offer Arrangement
Contract* (between Customer
and Supplier)
SOA Conditions
Definitions and
Interpretation
SOA Details
Invitation to Offer +
General Contract
Conditions*
Contract Details
Definitions and
Interpretation + Invitation to Offer or RFQ
* See note below re flexibility in contract selection
* Customer selects which contract to use – these docs can be replaced with alternative contract e.g. General Contract
Conditions, Basic Purchasing Conditions, Comprehensive Contract Conditions (coming soon), Social Services Contract, GITC etc.
Place order +
Our new suite of documents gives you flexibility to choose the contract that is the
‘best fit’ for what you are buying. How do you know which contract is the right one?
• Judgment call based on an assessment of value / risk
• Value /risk matrix will provide some guidance but won’t give you the answer
• Consult with experienced procurement advisors or legal if unsure
Tools to help you:
Guidance note Decision tree
Which contract should I use?
Basic
Purchasing
Conditions
General
Contract
Conditions
Comprehensive
Contract
Conditions
Bespoke
Contract
RISK Lowest Highest
Agencies now have flexibility in how they formalise contracts
For general and comprehensive contract conditions and SOAs:
• Supplier and customer both sign the Contract Details OR
• Supplier signs the contract and customer confirms in writing that the supplier’s offer
has been accepted.
Steps to take if there is negotiation with the supplier about what is in the
contract details:
• Step 1: update the contract details to reflect what has been agreed
• Step 2: send the updated version to the supplier to sign again
• Step 3: customer/principal accepts the updated contract details
For basic purchasing conditions:
• Customer places an order referring to the basic purchasing conditions
• Contract is formed when the Supplier accepts a Basic Order, or provides the
goods/services
set out in a Basic Order
Contract negotiation and execution
Clause bank is under review. Possible
clauses could include:
• excluding consequential loss
• alternative clauses for capping liability
• alternative clauses re ownership of
intellectual property rights
• financial security clause
• performance guarantee clause
• price review clauses (e.g. using CPI)
• business continuity clause
• ICT specific clauses
• transition out services
• contractor clauses
Additional Provisions will be reviewed for
other ideas
Clause bank
Other possible precedents:
• Deed of novation
• Deed of variation
• Confidentiality deed
Clause bank provides a list of clauses that
could be used in contracts which have
been approved by legal services. This
would help relieve pressure on legal teams
by allowing users to incorporate these pre-
approved clauses.
Agencies have time to transition to the new documents
• Three to six months for Agencies to transition to new documents
• Older versions will remain on HPW website during transition period
• Once transition period ends, old documents will be moved to archived documents
Recommendations to agencies
• Use the new documents for new procurement activities where possible
• For contract renewals, consider moving suppliers across to the new contract documents
• Identify people within your Agency that can be the first point of contact for others
• Deliver training to your broader teams in how to use the new documents.
Next steps
• Keep us informed of your progress
• Provide feedback
• Join ProQr on QG Yammer
Questions?
Transition period