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Construction Industry Development Board development through partnership Implementing the CIDB Standard for Uniformity in Construction Procurement 3a Aligning. - ppt download
Published byDiamond Wingrove
Presentation on theme: "Construction Industry Development Board development through partnership Implementing the CIDB Standard for Uniformity in Construction Procurement 3a Aligning."— Presentation transcript:
Construction Industry Development Board development through partnership Implementing the CIDB Standard for Uniformity in Construction Procurement 3a Aligning SCM processes to facilitate implementation 2
Construction Industry Development Board development through partnership STANDARDIZED CONSTRUCTION PROCUREMENT DOCUMENTS FOR ENGINEERING AND CONSTRUCTION WORKS NB Employers should develop their own standardised procurement document using this generic document as a base. STANDARDIZED PROCUREMENT DOCUMENTS FOR ENGINEERING AND CONSTRUCTION WORKS 3
Construction Industry Development Board development through partnership Principal activities associated with the procurement process 1 Establish what is to be procured 2 Decide on procurement strategies 3 Solicit tender offers 4 Evaluate tender offers 5 Award contract 6 Administer contracts and confirm compliance with requirements A need triggers the procurement process Provision of works, services, supplies concludes the procurement process Components of a procurement system Methods Procedures Policy 4
Construction Industry Development Board development through partnership Outline of procurement process 1. Establish what is to be procured Clarify what is to be procured 2. Decide on procurement strategies Determine how the procurement is to take place 3. Solicit tender offers Solicit tender offers in terms of a set of 5
Construction Industry Development Board development through partnership 4. Evaluate tender offers Evaluate tender offers in terms of undertakings and parameters established in procurement documents. 5. Award contract Enter into contract with the successful tenderer. 6. Administer contract and confirm compliance with requirements Act in terms of the contract and confirm that procurement is in accordance with all requirements. Register award and cancellation, if any on cidb website 6
Construction Industry Development Board development through partnership 2. Advertise using iTender, indicating approximate contractor grading requirements Registers & Procurement Interactions 1. Establish what is to be procured 5. Award contract 2. Determine Procurement strategy 3. Solicit tender offers 3.a Tender Offers by contractors 4. Tender Evaluation & Contractor selection 6. Manage contractor 3. Validate CIDB Registration 4. Validate Contractor Grade Reg Con 5. Register Award Reg Proj 6. Register Completion (optional) 1. Determine approximate contractor grading requirements e.g 5 GB 7
Construction Industry Development Board development through partnership Activity 1: Establish what is to be procured Prepare broad scope of work for procurement Estimate financial value of proposed procurement Control point : Obtain permission to start with the procurement process 8
Construction Industry Development Board development through partnership Activity 2: Decide on procurement strategies Establish applicable preferential procurement policy contract and pricing strategy targeting strategy procurement procedure Control point: obtain approval for procurement strategies that are to be adopted What BEE goals are to be pursued? How are the risks, liabilities and obligations of the parties to be structured? How is the contractor to be paid? What procedure is required to solicit tender offers? What are the preferencing arrangements? 9
Construction Industry Development Board development through partnership Choosing a procurement strategy is similar to developing a business plan In cases where procurement is routine and occurs regularly, standard procedures can be developed and used. NB Procurement documents need to be aligned with chosen procurement strategy 10
Construction Industry Development Board development through partnership Activity 3: Solicit tender offers Prepare procurement documents Invite contractors to submit tender offers (or expressions of interest) advertise on Receive tender offers (or expressions of interest) Evaluate expressions of interests Prepare evaluation report on short listing process Invite tender offers from short list Control points obtain approval for procurement documents confirm that budget in place Control point : confirm short-list Procurement procedure 11
Construction Industry Development Board development through partnership A procurement system may be considered to be transparent if: the terms upon which the procurement process are to be conducted and the criteria upon which any decisions are to be made are properly documented and made widely available; the eventual procurement award decision, and where appropriate, any intermediate decisions, is made publicly available as are the reasons given for these decisions; and it is possible to verify that the documented procedures and criteria were indeed applied. 12
Construction Industry Development Board development through partnership Standardised procurement documents Tendering procedures T1.1 Tender Notice and Invitation to Tender T1.2 Tender Data Returnable documents T2.1 List of Returnable Documents T2.2 Returnable Schedules Part 1: Agreements and contract data C1.1 Offer and Acceptance C1.2 Contract Data Part 2: Pricing data C2.1 Pricing Instructions C2.2 Activity Schedule / Bill of Quantities Part 3: C3 Scope of Work Part 4: C4 Site information Example in CIDB Standard for Uniformity Examples in CIDB Standard of Uniformity CIDB Standard conditions of tender CIDB Standard of Uniformity Standard Industry Form of Contract with contract specific data Project specific SANS (SANS 1921, SANS 2001 and 1914) Project specific (SANS 10403) 13
Construction Industry Development Board development through partnership T1.1 Tender Notice and Invitation to Tender (sample) Tenders are invited for the provision of The Employer is ………….. The physical address for collection of tender documents is: …………... Documents may be collected during working hours after 09:00 on ….. A non-refundable tender deposit of R……payable by cheque made out in favour of the Employer is required on collection of the tender documents. Queries relating to the issues of these documents may be addressed to Mr/Ms....., Tel No , Fax No e mail A compulsory pre tender meeting with representatives of the Employer will take place at on starting at.... hrs. The closing time for receipt of tenders is hrs on Requirements for sealing, addressing, delivery, opening and assessment of tenders are stated in the Tender generates this notice 14
Construction Industry Development Board development through partnership T1.2 Tender Data The conditions of tender are the Standard Conditions of Tender as contained in Annex F of the CIDB Standard for Uniformity in Construction Procurement. The standard conditions of tender for procurements make several references to the tender data for details that apply specifically to this tender. The tender data shall have precedence in the interpretation of any ambiguity or inconsistency between it and the standard conditions of tender. Each item of data given below is cross-referenced to the clause in the standard conditions of tender to which it mainly applies. Clause number F.1.1The employer is ……… 15
Construction Industry Development Board development through partnership Annex F Standard conditions of tender CIDB Standard for Uniformity in Construction Procurement 1General Tender Documents Interpretation Communication and employers agent The employers right to accept or reject any tender offer 2Tenderers obligations 3Employers undertakings NB Conditions facilitate compliance with several requirements of MFMA - SCM Regulations Impacts on SCM processes 16
Construction Industry Development Board development through partnership Tenderers obligations EligibilityCost of tendering Check documentsConfidentiality and copyright of documents Reference documentsAcknowledge addenda Site visit and clarification meetingSeek clarification InsurancePricing the tender offer Alterations to documentsAlternative tenders Information and data to Submitting a tender offerbe completed in all respects Closing timeTender offer validity Clarification of tender offer after Provide other material submissionSubmit securities, Inspections, tests and analysisbonds, policies, etc. Check final draftReturn of other tender documentsCertificates 17
Construction Industry Development Board development through partnership The Employers undertakings Respond to clarificationIssue Addenda Return late tender offersOpening of tender submissions Two-envelope systemNon-disclosure Grounds for rejection and DisqualificationTest for responsiveness Arithmetical errorsClarification of a tender offer Evaluation of tender offersInsurance provided by the employer Acceptance of tender offerNotice to unsuccessful tenderers Prepare contract documentsIssue final contract Complete adjudicator's Provide copies of the contract contracts 18
Construction Industry Development Board development through partnership List of returnable documents Returnable Schedules required for tender evaluation purposes Other documents required for tender evaluation purposes Tax Clearance Certificate / Application for a Tax Clearance Certificate Returnable Schedules that will be incorporated into the contract Preference schedules Other schedules and affidavits that will be incorporated into the contract 19
Construction Industry Development Board development through partnership CIDB Standard for Uniformity in Construction Procurement Preferencing schedules Annex D: Direct Preferencing Annex E: Participation Goals BEE 20
Construction Industry Development Board development through partnership Standard returnable documents -Compulsory Enterprise Questionnaire Requires tenderers to: Provide name, VAT, Tax, Company and CIDB registration numbers Record involvement of principals in the service of the state (current and within the last 12 months) Record of spouses, children and parents in the service of the state NB Facilitates compliance with SCM Regulation 21 c) re the compelling of tenderers to declare any conflict of interest and provide certain particulars 21
Construction Industry Development Board development through partnership CIDB Standard for Uniformity in Construction Procurement C1.1 Form of offer and acceptance 1Offer 2Acceptance Schedule of deviations Note: Tenderer signs offer and employer signs acceptance to form the contract. The schedule of deviations records the items that have changed between offer and acceptance Impacts on SCM processes 22
Construction Industry Development Board development through partnership 1.The agreement comes into effect on the date when the tenderer receives the signed agreement (offer and acceptance), complete with schedule of deviations. 2.The tenderer (now contractor) has a specified number of working days from the date of receipt of signed agreement to advise the employer why he cannot accept the contents of this agreement (eg schedule of deviations does not reflect what was agreed), failing which agreement constitutes a binding contract between the parties. Principles 23
Construction Industry Development Board development through partnership Option 1- tenderer comes in and collects signed contract Option 2- employer submits documentation to a courier-to- counter delivery / counter-to- counter delivery / door-to-counter delivery /door-to-door delivery /courier service On what date does the contract come into effect? When tenderer receives the signed agreement 2 working days after the employer submits the signed agreement to the service provider, provided that the employer notifies the tenderer of the tracking number within 24 hours of such submission 24
Construction Industry Development Board development through partnership C1.2 Contract Data Example The General Conditions of Contract for Construction Works (2004) published by the South African Institution of Civil Engineering, is applicable to this contract. Copies of these conditions of contract may be obtained from the South African Institution of Civil Engineering (tel ) Part 1: Contract Data completed by the Employer (see guidance on essential data and optional data provided in GCC 2004) Part 2: Contract Data completed by the Contractor (see guidance on essential data and optional data provided in GCC 2004) 25
Construction Industry Development Board development through partnership Part 2 :Pricing Data Formulate around the pricing strategy that is adopted, typically Bill of Quantities. Other strategies include: Activity schedules Cost reimbursableTarget cost Time-based contractRetainer and / or contingency contract Percentage contractIndefinite Delivery Contract Note: The terms of payment and the provisions for price adjustment for inflation, if applicable, are established in the contract data. 26
Construction Industry Development Board development through partnership C2.1 Pricing Instructions The method of measurement published by the South African Bureau of Standards in clause 8 of the Standardised Specifications for Civil Engineering Construction is applicable, subject to the variations and amendments contained in the section Applicable SABS 1200 standardised specifications. Descriptions in the Schedule of Quantities are abbreviated and comply generally with those in the Standardised Specifications. Clause 8 of each Standardised Specification, read together with the relevant clauses of the Scope of Work, set out what ancillary or associated activities are included in the rates for the operations specified. Should any requirements of the measurement and payment clause of the applicable Standardised Specification, or the Scope of Work, conflict with the terms of the Schedule, the requirements of the Standardised Specification or Scope of Work, as applicable, shall prevail. 27
Construction Industry Development Board development through partnership Bill of quantities Item.RefDescriptionUnitQuantityRatePrice Total for section carried forward to the summary of Bill 28
Construction Industry Development Board development through partnership The Scope of Work specifies and describes the engineering and construction works which are to be provided and any other requirements and constraints relating to the manner in which the contract work is to be performed e.g. 1. building will be occupied during upgrading 2. Other contractors will be on site simultaneously 29
Construction Industry Development Board development through partnership The Standard for Uniformity in Construction Procurement (see clause 4.4.7) requires that the scope of work shall, wherever possible be: a)described in terms of performance rather than the design or descriptive characteristics, and b)based on national or international standards, where such exist. e.g. the building shall maintain an ambient day time temperature of 20 to 24 degrees 30
Construction Industry Development Board development through partnership SANS 1921 family of standards for Construction and Management Requirements Construction Works specifications Plant and materials Construction Equipment Existing services Site establishment Site usage Permits and way leaves Alterations, additions, extensions and modifications to existing works Inspection of adjoining properties Water for construction purposes Survey control and setting out of the works Management Management of the works Health and safety Each part of SANS 1921 standardizes an aspect of requirements separation of management from construction 31
Construction Industry Development Board development through partnership SANS 1921 family of standards for Construction and Management requirements for Works Contracts Part 1 General engineering and construction works Part 2 Accommodation of traffic on public roads Part 3 Structural steelwork Part 4 Third-party management support in works contracts Part 5 Earthworks activities which are to be performed by hand Part 6 HIV/AIDS Awareness EPWP requirement 32
Construction Industry Development Board development through partnership Under development SANS 2001 family of Construction Works Standards Site clearanceEarthworks Earthworks (small Earthworks (pipe trenches) Earthworks (small dams) works) Gabions and pitchingEarthworks (roads, Earthworks (railway Structural aluminum worksubgrade) sidings) PilingConcrete (small works)) Concrete (structural) Precast concrete (structural)Prestressed concrete Installation of Masonry walling Foundations for masonry glazing in window Cladding and sheeting walls and door frames Fixing of roofs tiles and Structural steel work Structural steelwork Sheeting Corrosion protection of (sundry items) Structural timberwork structural steelwork Timber flooring Medium pressure pipelines Bedding (pipes) Cable ducts Sewers Stormwater drainage Erf connections Pipe jacking Cement –mortar lining (water) Roads (general) of pipes and pipelines Subbase Base Bituminous surface Asphalt base and Segmented paving treatment surfacing Kerbing and channeling Ancillary roadworks Base-heavy Base (light pavement structure) Supply of crushed stone base pavement Railway sidings (trackwork) Cement plaster structures 33
Construction Industry Development Board development through partnership Part 4 : Site Information Describe the site and access to the site as at the time of tender to enable the tenderer to price his tender offer and to decide upon his method of working and programming. examples 1. report on founding conditions 2. Building will be occupied during upgrading contract NB Forms basis of claims if situation is different from what is described. 34
Construction Industry Development Board development through partnership Activity 4: Evaluate tender offers Open and record tender offers received Determine whether or not tenders offers are complete Determine whether or not tender offers are responsive Evaluate tender submissions Perform a risk analysis on preferred tenderer. Prepare a tender evaluation report Control point: Confirm recommendations contained in the tender evaluation report. 35
Construction Industry Development Board development through partnership Standard Conditions of Tender: employers undertakings Opening of tenders Record particulars -name of tenderer -the total of prices -preferences claimed Make information available to interested parties F Register contract award cidb website 36
Construction Industry Development Board development through partnership Standard Conditions of Tender: employers undertakings Disqualify tenderer if corrupt or fraudulent practices are detected F.3.7 Links to Code of Conduct 37
Construction Industry Development Board development through partnership Standard Conditions of Tender: employers undertakings Test for responsiveness A responsive tender submission is one which a)satisfies the requirement of the tender data; b)has been properly and fully completed and signed; and c)conforms to all the terms, conditions, and specifications of the procurement documents without material deviation or qualification which, in the organizations opinion, would -detrimentally affect the scope, quality, or performance of the works, services or supply identified in the scope of work, -change the employer's or the tenderer's risks and responsibilities under the contract, or -affect the competitive position of other tenderers presenting responsive tenders, if it were to be rectified. F.3.8 SCM processes 38
Construction Industry Development Board development through partnership Standard Conditions of Tender: employers undertakings Arithmetical errors Check responsive tender offers for arithmetical errors, correcting them in the following manner: Amount in words govern. In a bill of quantities (or schedule of quantities or schedule of rates) the line total applies and the rate shall be corrected. Where there is an obviously gross misplacement of the decimal point in the unit rate, the unit rate will be corrected. The total of the prices applies and the tenderer will be asked to revise selected item prices (and their rates if a bill of quantities applies) to achieve the tendered total of the prices. F.3.9 SCM processes 39
Construction Industry Development Board development through partnership Ranking and scoring of responsive tenderers Do so in terms of method nominated in Tender Data F.3.11 SCM processes 40
Construction Industry Development Board development through partnership Method 1: Financial offer e.g. emergency 1)Rank tender offers from the most favourable to the least favourable comparative offer. 2)Recommend highest ranked tenderer for the award of the contract, unless there are compelling and justifiable reasons not to do so. 41
Construction Industry Development Board development through partnership Method 2: Financial offer and preferences 1)Score tender evaluation points for financial offer. 2)Confirm that tenderers are eligible for the preferences claimed and if so, score tender evaluation points for preferencing 3)Calculate total tender evaluation points. 4)Rank tender offers from the highest number of tender evaluation points to the lowest. 5)Recommend tenderer with the highest number of tender evaluation points for the award of the contract, unless there are compelling and justifiable reasons not to do so. 42
Construction Industry Development Board development through partnership Method 3: Financial offer and quality (when appropriate) 1)Score quality, reject all tender offers that fail to score the minimum number of points for quality stated in the Tender data, if any. 2)Score tender evaluation points for financial offer. 3)Calculate total tender evaluation points. 4)Rank tender offers from the highest number of tender evaluation points to the lowest. 5)Recommend tenderer with the highest number of tender evaluation points for the award of the contract,, unless there are compelling and justifiable reasons not to do so. 43
Construction Industry Development Board development through partnership Method 4: Financial offer, quality and preferences 1)Score quality, reject all tender offers that fail to score the minimum number of points for quality stated in the Tender data, if any. 2)Score tender evaluation points for financial offer. 3)Confirm that tenderers are eligible for the preferences claimed, and if so, score tender evaluation points for preferencing. 4)Calculate total tender evaluation points. 5)Rank tender offers from the highest number of tender evaluation points to the lowest. 6)Recommend tenderer with the highest number of tender evaluation points for the award of the contract. 44
Construction Industry Development Board development through partnership Highest price (or discount) Lowest price (or percentage commission/fee) Pm = comparative offer of the most favourable P = comparative offer of the offer being scored F 45
Construction Industry Development Board development through partnership Scoring price and preference Ps=80 (1- (Pt – Pmin)) Pmin Where Ps = Points scored for financial offer of tender under consideration Pt = Rand value of financial offer under consideration Pmin = Rand value of lowest acceptable financial offer Total points = Points for financial offer + points for preference or 90 depending upon the value 46
Construction Industry Development Board development through partnership Scoring financial offer, quality and preference Quality score score for quality (Sq) using the following formula: Sq = W2 x So/Ms where W2 is the percentage score given to quality (remainder allocated to financial offer eg 60% quality and 40% to financial offer) So is the score for quality allocated to the submission under consideration Ms is the maximum possible score for quality in respect of a submission 47
Construction Industry Development Board development through partnership Financial offer Score financial offer using the following formula: Ss = Pmin X W3 or (1- (Pt – Pmin)) X W3 Pt Pmin Where Ss= the percentage scored for price of the tender submission under consideration; Pmin=the lowest acceptable tender submission Pt=the price of the tender submission under consideration W3=percentage allocated for price Note: negative numbers result if Pt > 2 x P min 48
Construction Industry Development Board development through partnership Preferential Procurement Policy Framework Act Act does not make reference to functionality. The regulations, however, do. The Act only provides for tender price + preference. Total points not equal to price + quality + preference Total points equals tender price (combination of points for quality and financial offer) + preference 49
Construction Industry Development Board development through partnership Combine quality and financial offer The score for quality and financial offer is to be combined, before the addition of the score for preference, as follows: WC = W3 x (1+(S-Sm)) Sm Where W3 is the number of tender evaluation points for quality and financial offer and equals 80 / 90 S is the sum of score for quality and financial offer of the submission under consideration Sm is sum of the score for quality and financial offer of the submission scoring the highest number of points Standard method 50
Construction Industry Development Board development through partnership Risk analysis Does any of the following present an unacceptable commercial risk?: a)unduly high or unduly low tendered rates or amounts in the tender offer; b)contract data provided by the tenderer; or c)the content of tender returnables which are to be included in the contract. If so overlook tenderer (justifiable reason) 51
Construction Industry Development Board development through partnership Tenderers (reasons for not awarding): may not be subject to restrictions eg listed on Register of Tender Defaulters must have the capability and capacity to perform the contract. must have legal capacity to enter into the contract. must be solvent must satisfy all legal requirements, eg no tax clearance. may be disqualified due to conflicts of interest. 52
Construction Industry Development Board development through partnership Tender evaluation report Prepare report as per employers requirements Remember that written reasons must be given for decisions taken. State reasons for rejecting a tender so that tender evaluation committee can confirm / overturn decisions. 53
Construction Industry Development Board development through partnership Activity 5: Award contract Notify successful tenderer and unsuccessful tenderers of outcome Compile contract document Capture contract award data Control point: formally accept tender offer Contract concluded Suitable point for capturing of data pertaining to the procurement 54
Construction Industry Development Board development through partnership CIDB Standard for Uniformity in Construction Procurement Form of offer and acceptance 1Offer 2Acceptance Schedule of deviations Note: Tenderer signs offer and employer signs acceptance to form the contract. The schedule of deviations records the items that have changed between offer and acceptance Employer signs acceptance portion 55
Construction Industry Development Board development through partnership Register contract Award cidb website Register of projects (deemed to satisfy provisions) 56
Construction Industry Development Board development through partnership Activity 6: Administer contracts and confirm compliance with requirements Administer contract in accordance with the terms and provisions of the contract Ensure compliance with requirements Control point: capture contract completion / termination data Register cancellation of contract cidb website 57
Construction Industry Development Board development through partnership Contact persons Please contact the following people at the CIDB for: Procurement related issues Nomaphoso Mkhonza Lerato Molefe Contractor Registration issues: Wisane Maluleke Busang Tjale Tel: 58
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