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Waverley Borough Council Committee System - Committee Document

Meeting of the Executive held on 04/10/2004
ENVIRONMENTAL SERVICES CONTRACTS – SELECTION OF TENDERERS



Summary & Purpose
The purpose of this report is to consider the applications by contractors for inclusion on the Select List of Tenderers for:-

1. the Waste Management Services Contract; and
2. the Grounds Maintenance Services Contract,

and to select those which will be invited to submit tenders for the forthcoming contracts, which are to commence on 1st November 2005.

Quality of Life Implications
Natural Resource Use
Pollution Prevention and Control
Biodiversity and Nature
Local Environment
Social Inclusion
Safe Communities
Local Economy
Natural
Resource Use
Pollution
Prevention and Control
Biodiversity
and Nature
Local
Environment
Social
Inclusion
Safe, Healthy
and Active
Communities
Local
Economy
Positive
N/A
N/A
Positive
Positive
Positive
Positive


APPENDIX E

WAVERLEY BOROUGH COUNCIL

EXECUTIVE – 4TH OCTOBER 2004
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Title:
ENVIRONMENTAL SERVICES CONTRACTS – SELECTION OF TENDERERS

[Wards Affected: All]
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Note pursuant to Section 100B(5) of the Local Government Act 1972

An annexe to this report contains exempt information by virtue of which the public is likely to be excluded during the item to which the report relates, as specified in Paragraph 9 of Part I of Schedule 12A to the Local Government Act 1972, viz:-

Any terms proposed or to be proposed by or to the authority in the course of negotiations for a contract for the acquisition or disposal of property or the supply of goods or services.
________________________________________________________________________
Summary and Purpose

The purpose of this report is to consider the applications by contractors for inclusion on the Select List of Tenderers for:-

and to select those which will be invited to submit tenders for the forthcoming contracts, which are to commence on 1st November 2005.
________________________________________________________________________
Quality of life implications – social, environmental & economic (sustainable development):

Natural Resource Use
Pollution Prevention and Control
Biodiversity and Nature
Local Environment
Social Inclusion
Safe, Healthy and Active Communities
Local Economy
Positive
N/A
N/A
Positive
Positive
Positive
Positive

The Domestic Waste and Recyclables Collection, Environmental Cleaning and Grounds Maintenance Services are the most visible services provided by the Council and those upon which many Council Tax payers judge the Authority for its environmental and quality of life credentials.

E-Government implications:

There are no direct implications in this report.


Resource and legal implications:

There are no direct resource implications in this Report. Contractor selection must be carried out in accordance with European Procurement Legislation.
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Introduction

1. The Council’s major environmental services contracts; Domestic Waste and Recyclables Collection, Environmental (Street) Cleaning, and Grounds Maintenance are currently operated under three separate contracts, each of which expires on 31st October 2005. The Executive, at its meeting on 9th March 2004, resolved that, for the purposes of re-tendering, the Waste Management Services; Domestic Waste and Recyclables Collection and Environmental Cleaning be integrated into one Waste Management Services Contract and that the grounds maintenance functions be tendered separately under a Grounds Maintenance Services Contract. It further resolved that both contracts be tendered under the European Communities (EC) ‘Restricted’ procedure.

2. The EC Public Procurement Directives and UK Regulations require public sector organisations to let contracts for works, supplies and services that exceed certain financial thresholds, in accordance with prescribed procedures contained in the Regulations. These contracts fall within those requirements. The ‘Restricted’ procedure enables the Council to restrict the number of Tenderers to those whose financial standing, technical capacity and experience are best suited to the nature and scale of the contracts. The Directives also prescribe the manner of advertising of the contracts.

Contract Notices

3. Notice of the Council’s intention to tender the Waste Management Services Contract and Grounds Maintenance Services Contract were posted in the Supplement to Official Journal of the European Communities, in accordance with the Public Procurement Regulations, and in national contract and trade publications and the local press, in accordance with the Council’s Contract Procedure Rules. Suitably qualified contractors were invited to confirm their interest in tendering for the contracts by completing a pre-qualification tendering questionnaire detailing their financial stability, experience, operational performance and proficiency. Contractors were required to provide referees for their performance on similar contracts, preferably in the local authority arena.

Selective Tendering

4. The objective of selective tendering is to ensure that tenders are received only from those contractors who have demonstrated an appropriate level of financial stability and technical competence, and to limit their number to a manageable level. Contractors are reluctant to expend the considerable resources needed to construct competitive tender bids if the number of Tenderers results in a disproportionately small chance of their success. There is also a practicable limit to the number of tenders of this size and complexity which can be effectively evaluated within a reasonable timescale.


5. The Procurement Regulations require that the “envisaged number of suppliers which will be invited to tender” be specified in the Contract Notice either by a fixed number or range. The procedure specifies that the numbers must be at least five and not more that 20. The Waverley Contract Notices specified a minimum of five and a maximum of 8 Tenderers. This also exceeds the minimum number required under the Council’s Contract Procedure Rules. It is therefore proposed to seek to select a maximum of eight contractors for each contract.

Expressions of Interest

6. Waste Management Services Contract

Expressions of Interest were confirmed by thirteen contractors, by their return of the completed pre-qualification tendering questionnaire, by the prescribed date. Most of the leading UK waste management operators and some with more limited experience, were represented. Financial and operational performance references were sought on each of the applicants.

7. Grounds Maintenance Service Contract

Expressions of Interest were confirmed by twenty-four contractors, by their return of the completed pre-qualification tendering questionnaire, by the prescribed date. Most of the UK’s leading grounds maintenance operators and many of more limited experience were represented. Financial and operational performance referees were sought on each of the applicants.

Evaluation of Prospective Tenderers

8. The Regulations require that the suitability of Tenderers can only be verified by considering their legal, financial and technical capability. The matters that may be considered when assessing technical capacity are shown at Annexe 1. The risks associated with competitive tendering can best be managed by selecting Tenderers who are the most financially stable and have a proven record of successfully undertaking contracts of the size and content of Waverley’s over a comparable geographic area. The evaluation therefore examined each contractor’s performance in this context.

9. The current aggregate annual value of the waste management services is approximately 3.8 million. The current annual value of the grounds maintenance contract is approximately 800,000. The financial appraisal of contractors was carried out in the knowledge of these values and in consideration of the Council’s requirements in this respect which include that.

Turnover/sales is, in general, stable and sufficient.
Profits are being generated.
Liquidity is satisfactory.
The company’s gearing is satisfactory/not a cause for concern.
The company’s auditors have not qualified the accounts.
Waverley’s credit consultant has raised no matters of major concern.
The company has a positive Net Worth.


Advice to Unsuccessful Applicants

10. Unsuccessful applicants for inclusion on the select lists will be advised that the high levels of interest from all of the leading contractors, and others, in the waste management and grounds maintenance industries, has resulted in a difficult selection process, but that, having considered carefully the details provided, both financial and technical, and having taken up references on every contractor, the Council has selected those which are judged to provide the best level of confidence in their ability to provide the ‘best value’ quality service and continuous improvements which the Council seeks.

Conclusion

11. The information provided by prospective Tenderers and their referees, and information from credit reference agencies and other available data has been carefully evaluated. The contractors recommended for inclusion on the select lists are judged to be of such proficiency, technically, operationally and financially, to offer confidence in their ability to provide the required quality of service and continuous ‘best value’ improvements, which the Council seeks.

Recommendation

It is recommended that:-

1. the contractors named in paragraph 4 of (Exempt) Annexe 1 be selected to tender for the Waste Management Services Contract which commences on 1st November 2005; and

2. the contractors named in paragraph 7 of (Exempt) Annexe 1 be selected to tender for the Grounds Maintenances Services Contract which commences on 1st November 2005.

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Background Papers (DoE)

There are no background papers (as defined by Section 100D(5) of the Local Government Act 1972) relating to this report.
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CONTACT OFFICER:

Name: R Ellks Telephone: 01483 523411
E-mail: rellks@waverley.gov.uk

Name: Peter Maudsley Telephone: 01483 523398
E-mail: pmaudsley@waverley.gov.uk



Comms/Executive/2004-05/196
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