Decision details
The Procurement of a contractor to deliver works at 36/37 Boutport Street
Decision Maker: Chief Executive
Decision status: Recommendations Approved
Is Key decision?: No
Is subject to call in?: No
Decision:
Officer Decision requested by decision maker
regarding the procurement of a contractor to deliver works at 36/37
Boutport Street.
Reasons for the decision:
Decision requested by decision maker:
To enable us to utilise paragraph 15.5 & 24.1 of our internal
Contract Procedure Rules to change our procurement process to that
of awarding a Contract by Negotiation Without Prior Publication of
the FTS notice (shadowing Regulation 32 and 72 of PCR 2015) &
thereby allowing non-substantial changes to be made to the proposed
contract via negotiation.
1. BACKGROUND / REASONS FOR THE DECISION REQUEST
1.1 In order to utilise the first part of this process under
paragraph 15.5a of the CPR, it is necessary to prepare a report for
the Chief executive, who will seek advice from the Monitoring
Officer, to set out that “15.5a – no tenders/suitable
tenders or requests to participate have been received” in
response to the procurement run under the Restricted Procedure. We
stated the budget both in the FTS Notice & in the Tender
documents as £5,000,000 (the Invitation to Tender document
specifically saying at paragraph 3.1 that “Tenderers should
be aware that the Contracting Authority has a Budget, set pursuant
to councillor approval, of £5,000,000 for the Works which
cannot be exceeded and it does not have approval to accept a higher
value Tender”). The Council only received 1 Tender Return -
that Tender Return was received significantly over budget which is
“manifestly incapable of meeting the Contracting
Authority’s requirements”. As such, we need to be able
to change our procurement process to enable negotiation and value
engineer the project.
1.2 It is noted that we have two other options:
• OPTION 1 – Abandon this Tender process, revisit the
drawings & specifications and re-advertise with amended
documents
• OPTION 2 – Accept the Tender submission (subject to
final clarifications) and obtain funding to bridge the gap
It is not considered that Option 1 is appropriate. We used a two
stage tender process and whilst 4 companies past the gateway
criteria only 1 submitted a return – this project is complex
and is an 18 month project – others have been given the
opportunity to tender but have withdrawn from the process. Very
little changes can be made to 36 Boutport Street – it is a
renovation project that works within the existing structure. There
is a little more scope with 37 Boutport Street but the scheme needs
to deliver 9 residential units, commercial space and a link from
the car park to the High Street – these parameters dictate
the bulk of the design. They are required both as outputs of the
FHSF programme and to meet the revenue model. The time and cost in
fees of redesigning ahead of another procurement process would
start to put the FHSF Programme under threat where monies have to
be committed by September 24 and defrayed by March 25 (assuming we
are successful with our extension application). The external design
team and internal officers working on the project consider amending
the procurement process to be the most appropriate way
forward.
1.3 We do not believe finding the funding to bridge the gap is an
appropriate way forward either as described in option 2. We may be
able to find some funding but not that would bridge the gap in its
entirety.
1.4 Allowing officers to negotiate with the tenderer by changing
the procurement process will allow us to value engineer the project
and likely achieve a deliverable solution.
1.5 In order to be legally complaint with procurement legislation
alongside the Council’s own Contract Procedure Rules, the
Council must be able to evidence that there are no suitable tenders
in this instance and that any changes to the contract agreed must
not be a substantial modification from the contract as advertised
in the Council’s FTS notice previously published by the
Council. The Council should consider the substantial modification
tests in PCR 2015, reg 72 as a guide to whether any change may be
substantial. The first point, that no suitable tenders were
received, is met given the clearly specified budget which could not
be exceeded and Council Officers will ensure that the second point
is adhered to whilst undertaking negotiations with the
Contractor.
1.6 We are concerned that waiting until Strategy and Resources on
the 4th December 2023 would lose us valuable time to push this
project forward where timescales are already tight and the single
tenderer could lose interest – the tenderer that we intend to
enter into negotiation with has already put in significant amounts
of work to tender their return diligently.
1.7 The intention would be for the negotiation process to start
with the Contractor prior to Strategy and Resources so that, at
that meeting, members can be given a full update on what
negotiations have taken place and one of the options open to
Members will be to grant a contract on the basis of the negotiated
tender.
1.8 Whilst there is always a potential for the previous bidders
involved in the tender to pursue a legal challenge, ie by stating
that the contract entered into is substantially different to that
offered at tender stage, that they would have taken a bid forward
for that contract and have therefore been disadvantaged by the
action taken by the Council, the Council will have met the criteria
needed in this instance to change the procurement method and could
thereby respond to any such legal challenge robustly.
Alternative options considered:
3. ANY ALTERNATIVE OPTIONS CONSIDERED AND
REJECTED?
3.1. As set out in the body of the report, 2 other options have
been considered and rejected.
Publication date: 16/11/2023
Date of decision: 14/11/2023
Accompanying Documents:
- The Procurement of a contractor to deliver works at 36/37 Boutport Street PDF 393 KB
- The Procurement of a contractor to deliver works at 36/37 Boutport Street