This webinar includes information on the changes to the Local Government (Functions and General) Regulations which came into effect 1 October 2015. The webinar covers the following principle amendments:
- Increase to tender threshold;
- Introduction of ‘Panels of Pre-Qualified Suppliers’;
- Introduction of additional tender exemptions;
- Technical drafting amendments to improve understanding, and
- Increase to abandoned vehicle and disposition of property thresholds.
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Question and Answer Session
The following are a range of questions asked during and after the Changes to Funcations and General Regulations Webinar held by WALGA on 29 September 2015:
Do the regulations deal with when a prequalified supplier decides to leave the panel? And can the LG have provision to extend to another supplier to maintain an x amount of suppliers on the panel until its expiry?
Local Governments will be able to determine how the panel operates – Reg. 24AD(5)(e) – and this can incorporate information about replacing exiting pre-qualified suppliers.
In setting up a prequalified panel, can we enter into contracts with 2 suppliers at one time ie. mirroring the current practice of say establishing a panel of 2 suppliers for turf installation as an example?
Yes. Regulation 24AJ(1) states: “The local government may enter into a contract, or contracts, for the supply of goods and services.....”.
When does WALGA anticipate the Panel Policy Template will be completed?
This is planned to be available by mid-October.
May the LG enter into a contract for more than 12 months if under WALGA panel?
Yes. You are taking advantage of the tender exemption provision under Regulation 11(2)(b) when contracting and purchasing through WALGA’s Preferred Supplier arrangements.
Can a panel exist for more than 12 months? Can we establish a panel for 3 or 5 years or more?
Yes. Regulation 24AD(5)(h) stipulates that a Local Government is to inform the period for which the Panel is established.
In respect to panels and public notice - can the advert reference the information only?
Yes. Regulation 24AD(4) requires that the public notice is to include:
- Brief description of goods and services;
- Contact details of where more detailed information can be obtained;
- Where and how to submit applications, and
- Date and time of close of applications.
As I understand the new Panel provisions we have two separate processes:
- a panel of suppliers; and
- a tender process.
What is the situation for a panel of tenderers? Are the new rules the same?
The Functions and General Regulations provide four separate processes to acquire goods and services:
- By utilising your Purchasing Policy (under $150k).
- By utilising tender exempt opportunities.
- By public tender.
- By establishing a panel of pre-qualified suppliers.
The advent of the new regulations from 1 October 2015 will prevent a Local Government from establishing a panel by the public tender process, bearing in mind Regulation 23 still permits an expressions of interest process to be an acceptable tenderer.
Does WALGA have any advice on the amendments to varying a contract, since in the past the Regs remained silent on post award procurement activity?
The purpose of introducing Regulation 21A is to permit a Local Government to make a variation after a contract has been entered into; previously, Regulation 20 only dealt with variations before entering into contract. The Local Government sector argued that post-contract variations are often entered into, in consultation between the parties and if there is a benefit to the Local Government.
On Regulation 21A, it mentions but does not define ‘scope of the contract’ as one limiting factor in making a variation. This phrase is likely to be interpreted quite differently, therefore WALGA will raise this issue with the Department of Local Government to see if they can provide further guidance.
Do we need a separate panel policy or can this be included in our current procurement policy?
It is recommended the Policies be adopted separately to ensure there is clarity of process and compliance with the different Regulations relating to each Policy.
Without the timeframe does the threshold time rule apply as previously?
The proposal to associate the tender threshold with a timeframe incurred unforeseen, negative consequences and therefore did not progress.
If you contemplate having an ongoing, recurrent relationship with a supplier that will incur expenditure in excess of the tender threshold, then a public tender process (or use of a tender exemption opportunity) should occur. If this is not anticipated, purchasing in accordance with your Purchasing Policy or through an established Panel may be the appropriate course of action.