Local Government Procurement

Procurement Practitioners on the Canberra Stage

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Procurement Practitioners on the Canberra Stage

In mid-September, the 5th annual Future of Gov Procurement summit was held in Canberra. Local Government speakers included Marea Getsios, Manager of Procurement and Fleet, at City of Canada Bay, Anubhav Madan, Head of Contract Compliance and Optimisation, LGP and myself. Cathy Dizon, Strategic Procurement & Contracts Manager, SSROC, supported from the audience.

Marea presented on the topic Strategies to Reduce the Supplier Lead Time and participated in a panel session on Tackling the Skills Shortage for Qualified Professional. Anubhav presented details of process improvement and reducing red tape at LGP, while I presented details of the white paper recently written by some of local government’s procurement leaders (Challenges of Innovative Projects and/or Preferential Treatment Under the Tendering Process in NSW Local Government). (To download the white paper please click here.) All our presentations were well received and led to questions and later discussions. I’d like to thank Marea and Anubhav for standing up and demonstrating some of the excellent work that is going on in the local government community. I would encourage others who might feel ready to present to chat with us for ideas and support.

Two items in the white paper generated audience interest and feedback. These related the West Australian Government’s (WA) Market-led Proposals Policy. WA Government can use a ‘Swiss Challenge’ approach or alternatively a ‘Bid Premium.’ It works like this:

An unsolicited proposal is received by government from a proponent. An initial concept evaluation involving on-line self-assessment and a compulsory pre-submission meeting takes place. If the proposal passes, then stage 2 involves a business case submission.

If the proponent does not meet the justification for exclusive negotiation characteristics in stage 1 then ‘A First Mover Advantage’ process (‘Swiss Challenge/Bid Premium’) may be required.

Stage 1: Swiss Challenge
Here the Government undertakes a competitive tender process. If the proponent is initially unsuccessful in submitting the most attractive bid, it has the option to match the winning bid and implement its proposal, provided it be successfully negotiated in a later Stage 3 step.

The government recognises bidders other than the proponent are only likely to participate in a Swiss Challenge if they believe that they have a significant, differentiating advantage over the Proponent.

Stage 2: Bid Premium
Here the government will undertake an otherwise competitive tender process, but the proponent will receive a bonus bid evaluation. Typically, the bonus is the addition of a premium to the technical offer. The premium will be set between 10 & 20 percentage points. The premium reflects the ‘first mover’ advantage of the proponent.

On hearing this, some in the audience had perplexed expressions on their faces. A couple could be seen shaking their heads over this approach. It is innovative, but what do you think? Use the LGP Forum for your feedback.

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