Waverley Borough Council Committee System - Committee Document Meeting of the Council held on 18/02/2003 ANNEXE 3 - ANNEXE REPORT OF EXECUTIVE 4TH FEBRUARY 2003 - CONTRACT PROCEDURE RULES

Summary of main changes from current Standing orders with Respect to Contracts

Subject	Current Requirements	New Requirements
Tendering/quotations financial limits	Quotations up to £35,000; minimum of 3 or more depending on value of contract if above £500 Tenders over £35,000	Alternative quotations above £3,500; less formal and speedier process for obtaining quotations – 2 quotations up to £10,000, 3 up to £50,000. Tenders over £50,000 – 3 up to £100,000, 4 over £100,000. Tenders and quotations can be substituted in individual cases if appropriate.
Form of contract	Under seal over £35,000 Official orders under £35,000	Contract under seal if over £100,000. Not under seal below £100,000 unless Head of Legal Services advises to contrary. Official order under £50,000 unless nature of contract warrants formal or full contract.
Transfer of staff	Not covered	Head of Personnel and Central Services to be involved and Executive to approve award of contract
Disposal of property	Not covered	Land and buildings referred to Asset Management Group, or Director of Housing and then to Executive. Other property to be sold for best price in most appropriate manner with the approval of chief officer and Director of Finance.

Subject	Current Requirements	New Requirements
Assessment of contractors	Not covered	Full assessment of a number of matters including financial status and technical ability in respect of contracts over £50,000 unless nature of a lesser value contract warrants less rigorous assessment.
Method of tendering	Use of ad-hoc list, standing list or open tendering. Subject to EC requirements	Open tendering, selective/restricted tendering or standing lists. Subject to EC requirements
Custody and opening of tenders/quotations	Custody of chief officer, opening by relevant chief officer and Chief Executive if under £35,000 Custody of Chief Executive, opening by relevant chief officer, Chief Executive and a Member if over £35,000	Custody of quotations sought in writing by chief officer if under £50,000; custody of quotations sought in writing if over £50,000 plus all tenders by Chief Executive Opening of quotations up to £50,000 by chief officer’s staff (minimum of 2 persons). Chief officer to ensure record maintained. Opening of quotations sought in writing and all tenders for contracts over £50,000 and up to £100,000 by Chief Executive, chief officer (or representatives); Director of Finance to be invited (or representative). Chief Executive to ensure record is maintained. Opening of quotations sought in writing over £100,000 and all tenders by Chief Executive, Director of Finance and chief officer (or representatives). Chief Executive to ensure record is maintained.
Errors in tenders/quotations	Not covered	New procedure set out

Subject	Current Requirements	New Requirements
Evaluation of tenders/quotations	Presumption towards the cheapest (where payment is made by the Council) or highest (where payment is received by the Council)	Cheapest/highest accepted unless Best Value solution required. Best Value solution to be assessed using predetermined and approved criteria; then cheapest solution once assessment against criteria has reached minimum requirements.
Post tender negotiations	Not covered	Permitted in limited circumstances; procedure set out
Security to be provided by contractor	Bonds required if contract over £35,000	Bond required if contract over £100,000; Director of Finance’s approval to be obtained if bond considered not necessary. Bond to be obtained for lower value contracts if appropriate. Decision requires assessment of risks to be undertaken.
Management of contracts and best practice	Not covered	Suitable arrangements to be put in place; Council’s Procurement Manual to be referred to for guidance
Waivers	Approval of Chief Executive and relevant member required	Approval of Chief Executive; if contract is to be let by Chief Executive, approval of Chairman of Executive to be obtained

comms/council/2002-03/066 33942

Financial Regulations

Summary of main changes from current Financial Regulations

Subject	Current Requirements	New Requirements
Financial Management Standards	No specific reference	New section to highlight responsibilities for high standards of probity in dealing with financial issues
Managing Expenditure	Limited Guidance on procedure for transferring budgets between budget heads ‘virements’ Virement up to £10,000 require approval of Executive Virements over £10,000 require approval of Council	More robust rules around virement procedure and clearer limits for value of virements as shown below: <£100 same service – Budget manager notify Director of Finance (DoF) £100 to £1,000 same service – Chief officer/DoF £1,001 to £5,000 same service – Management Board < £5,000 between services or capital/revenue - Management Board £5,001 to £50,000 – Executive approval £5,001 to £50,000 between services or capital/revenue – Executive approval Over £50,000 – Full Council
Managing Expenditure	Limited Guidance on procedure for carrying forward budget provision between years, no limits specified.	Overspending above £1,000 on individual budget will be first call on that budget in the following year. Planned carry forward amounts require the approval of the Director of Finance if below £5,000 and the Executive if above £5,000.

Subject	Current Requirements	New Requirements
Performance Plans	No specific mention	Highlights the chief officers’ responsibilities in relation to the production and monitoring of performance against plans including PIs.
Budgets and medium-term planning	Sets out requirements of officers in relation to setting the annual budget	New requirements to prepare budget consistent with the Medium-Term Financial Strategy To integrate budget setting into service planning
Capital Programmes	Sets out requirements of officers in relation to setting the capital programme	New requirements to prepare budgets in accordance with Waverley’s Capital Strategy. To ensure compliance with Waverley’s Procurement Strategy and Contract Procedure Rules
Risk Management	Requirement to notify Director of Finance of all new risks	New requirement for officers to take responsibility for managing risks in their service areas
Preventing Fraud and Corruption	No specific mention	Requirement for the Director of Finance to develop and maintain an anti-fraud and corruption policy and report any suspected irregularities to the Executive if appropriate
Treasury Management	Detailed guidance which requires updating	Ensure compliance with Waverley’s Policy Statement
Systems and Procedures	Various references to financial systems	New section setting out requirements on officers to ensure sound systems and procedures are in place including accounting records and the use of IT.
Debtor Write-offs	Up to £2,000 - Director of Finance £2,000 to £5,000 – Director of Finance and Chief Executive Over £5,000 - Executive	Less than £25 – Service manager with Internal Audit £25 to £3,000 – Director of Finance (DoF) Greater than £3,000 up to £5,000 DoF and Chief Executive Over £5,000 – Executive approval

Subject	Current Requirements	New Requirements
Ordering Goods	Detailed guidance which requires updating	New requirement to ensure that spending officers have regard to the Procurement Strategy and Contract Procedure Rules and endeavour to obtain best value in all purchases
Partnerships	No Specific Mention	New requirement on officers to ensure that partnership arrangements support corporate objectives and to assess risk and resource issues
External Funding	No Specific Mention	New requirement to ensure that the requirements of the matched funding and sponsored organisation schemes are considered

comms/council/2002-03/066