Appointment of a service provider to assist with the development of Analytics Capability for PAYE and VAT. RFP No.: RFP 28/2014

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1 Appointment of a service provider to assist with the development of Analytics Capability for PAYE and VAT. Briefing Session: 18 February 2015 at 14h00 RFP No.: RFP 28/2014 Closing Date: 10 March 2015, 11h00

2 Table of Content 1. Welcome and Introduction 2. Background 3. Scope of Work 4. RFP Timelines 5. Bid Evaluation Process 6. Pricing Schedule and B-BBEE 7. Draft Service Level Agreement 8. RFP submission and contact details 9. Q&A 2

3 Welcome and Introduction: Bid Evaluation Committee Senior Manager: Professional Services Procurement Commodity Leader: Professional Services Finance Evaluator: Value Delivery Plan BBBEE Specialist: Support Services Operations Specialist: Governance, Compliance & Risk Contract Specialist: Professional Services SARS Technical Team Executive: Research Executive: Revenue Forecasting and Economic Modelling Senior Specialist: Data Analytics Specialist: Data Analytics Specialist: Econometrics, Forecasting and Modelling Legal Specialist Corporate Legal Services 3

4 Table of Content 1. Welcome and Introduction 2. Background 3. Scope of Work 4. RFP Timelines 5. Bid Evaluation Process 6. Pricing Schedule and B-BBEE 7. Draft Service Level Agreement 8. RFP submission and contact details 9. Q&A 4

5 Background In April 2013, Revenue Planning, Analysis, Reporting and Research (RPARR) took an initiative to establish and develop Data Analytics capability amongst staff to assist with the real-time mining and analysis of data using the data analytics techniques that have been adopted by tax authorities around the world, namely, United States of America, Canada, Australia, Ireland, etc. SARS wishes to develop capabilities along the lines of other tax administrations that are investing in advanced data analytics to improve efficiency and effectiveness of revenue collection. The Key characteristics of these analytical capabilities are: o The analysis of an integrated set of data sources to provide a richer picture of taxpayers; o The analysis of taxpayer information at micro-level; and o The application of data mining techniques enabling the identification of patterns in the data to be incorporated into the development of models supporting decision-making. In the current financial year under the aegis of the project proposed, RPARR aims to build and develop analytical capabilities, through application to Pay-As-You-Earn (PAYE) data and Value-Added tax (VAT) data. 5

6 Background Cont. PAYE Analytics Capability This phase involves the creation, development and piloting of Pay-As-You-Earn (PAYE) Analytics Capability. The project therefore involves exploration of large data sets through the use of advanced analytics techniques typically applied to large data sets of micro data to improve modelling and forecasting, and will be undertaken using SAS tools. VAT Analytics Capability This phase involves the creation and development of Value-Added-Tax (VAT) Analytics Capability. The development of VAT Analytics Capability will follow a similar approach to the PAYE Analytics Capability and incorporates use of the knowledge and skills gained from the PAYE Analytics Capability phase. 6

7 Table of Content 1. Welcome and Introduction 2. Background 3. Scope of Work 4. RFP Timelines 5. Bid Evaluation Process 6. Pricing Schedule and B-BBEE 7. Draft Service Level Agreement 8. RFP submission and contact details 9. Q&A 7

8 Scope of Work The primary objectives of this project are: To create and establish a fully functional PAYE and VAT Analytics Capability. Establish, perform and support micro level analysis of PAYE and VAT data across time. Use the exploratory analysis to understand the tools and skills/techniques that can be used to perform the micro level analysis. Provide an opportunity to work alongside analytics expert, as well as provide a support system to the SARS team throughout the project, in order to maximise knowledge and skills transfer. Provide an understanding of non-compliance vulnerabilities around PAYE and VAT data, as well as how those vulnerabilities impact revenue collection and forecasting. 8

9 Scope of Work Refer to section 8.3 of RFP doc The successful Bidder will be expected to: Provide a full time equivalent advanced analytics team (refer to 8.4 below) which will be based at SARS in Pretoria in order to work with the SARS project team. Establish, perform and support micro level analysis of PAYE and VAT data across time. Provide a support system to the SARS team throughout the project, in order to maximise knowledge and skills transfer. Research and provide strategic advice on emerging technologies and methodologies that will facilitate data mining, analysis, research and reporting. To follow a phased approach as follows: o Phase 1 Create, develop and pilot the Pay-As-You-Earn (PAYE) Analytics Capability o Phase 2 Create and develop the Value-Added Tax (VAT) Analytics Capability. 9

10 Scope of Work - PAYE Refer to section 8.3 of RFP doc Work activity Deliverable Phase One 1. Business understanding, data understanding and data Bidders to present the findings to the SARS project preparation. team for approval. 2. Modelling Bidder to present a report to the SARS project team for approval. 3. Evaluation and Deployment. Bidder to present a report to the SARS project team for approval. 4. Piloting of the results. Bidder to present the approach, execution and expected results followed by a PAYE pilot report. RFP Document 10

11 Scope of Work - VAT Refer to section 8.3 of RFP doc Work activity Deliverable Phase Two 1. Business understanding, data understanding and data Bidders to present the findings to the SARS project preparation. team for approval. 2. Modelling Bidder to present a report to the SARS project team for approval. 3. Evaluation and Deployment Bidder to present a report to the SARS project team for approval. 11

12 Table of Content 1. Welcome and Introduction 2. Background 3. Scope of Work 4. RFP Timelines 5. Bid Evaluation Process 6. Pricing Schedule and B-BBEE 7. Draft Service Level Agreement 8. RFP submission and contact details 9. Q&A 12

13 RFP Timelines ACTIVITY DUE DATE RFP Advertisement in Sunday Times 08 February 2015 Tender documents on SARS website 09 February 2015 RFP Advertisement in Government Bulletin 13 February 2015 Non compulsory briefing session 18 February 2015, 14H00 Questions relating to RFP 23 February 2015 RFP Closing Date Notice to Bidders 10 March 2015, 11h00 SARS will endeavour to inform Bidders of the progress until conclusion of the tender. 13

14 Table of Content 1. Welcome and Introduction 2. Background 3. Scope of Work 4. RFP Timelines 5. Bid Evaluation Process 6. Pricing Schedule and B-BBEE 7. Draft Service Level Agreement 8. RFP submission and contact details 9. Q&A 14

15 Bid Evaluation Process Gate 0: Pre-Qualification Criteria Gate 0 Pre-Qualification Name of Document that must be submitted Response to bid letters Invitation to Bid SBD 1 Tax Clearance Certificate SBD 2 Declaration of Interest SBD 4 Preference Point Claim Form - SBD 6.1 Declaration of Bidder s Past Supply Chain Management Practices SBD 8 Certificate of Independent Bid Determination SBD 9 SARS s Oath of Secrecy Non-submission may result in disqualification? YES YES YES YES NO YES YES YES 15

16 Bid Evaluation Process Gate 1 Gate 1 Experience of the Consulting company Desktop Technical Evaluation 70 points Experience to deliver on the scope Capability Annexure A Technical Scorecard Presentation 30 points Knowledge and skills transfer Only Bidder(s) that have met the Pre-Qualification Criteria in (Gate 0) will be evaluated in Gate 1 for functionality. Functionality will be evaluated as follows: Desktop Technical Evaluation Bidders will be evaluated out of 70 points. Bidders who have met the minimum threshold of 49 out of 70 will be shortlisted and invited for a presentation. Presentation Evaluation criteria for the presentation will only be send to the shortlisted Bidders. 16

17 Bid Evaluation Process Gate 1 Cont Functionality Maximum Points Achievable The Bidder(s) information will be scored according to the following points system: Minimum Threshold Desktop Technical Evaluation Criteria: Generic Company experience Capability of the Consultant (Knowledge and skills transfer to SARS personnel) Client references Presentation 30 N/A Overall combined score Only Bidders that have obtained a combined score (Desktop Technical Evaluation and Presentation) of 70 out of 100 points will proceed to Price and BBBEE evaluations. 17

18 Table of Content 1. Welcome and Introduction 2. Background 3. Scope of Work 4. RFP Timelines 5. Bid Evaluation Process 6. Pricing Schedule and B-BBEE 7. Draft Service Level Agreement 8. RFP submission and contact details 9. Q&A 18

19 Bid Evaluation Process Gate 2: Price & BBBEE Evaluation Gate 2 Price Evaluation 90 points Annexure B Pricing Schedule BBBEE Evaluation 10 points Price Evaluation (90 points) Adjudication Criteria Price Evaluation Points 90 Where: Ps = Points scored for price of Bid under consideration Pt = Rand value of Bid under consideration Pmin = Rand value of lowest acceptable Bid BBBEE Evaluation (10 Points) Adjudication Criteria BBBEE Evaluation (BBBEE Certificate and/or submission of SBD 6.1) Points 10 19

20 Bid Evaluation Process Gate 2: Pricing Schedule - Annexure B RFP PRICING SCHEDULE 20

21 Table of Content 1. Welcome and Introduction 2. Background 3. Scope of Work 4. RFP Timelines 5. Bid Evaluation Process 6. Pricing Schedule and B-BBEE 7. Draft Service Level Agreement 8. RFP submission and contact details 9. Q&A 21

22 B-BEE = 10 Points B-BBEE points may be allocated to Bidders on submission of documentation or evidence as follows: ADJUDICATION CRITERIA A duly completed Preference Point Claim Form: SBD 6.1 and a B-BBEE Certificate. POINTS 10 Bidders MUST complete and sign the SBD 6.1 form to claim the Bidder s B-BBEE preference points, failing which, the Bidder will be scored zero.

23 B-BBEE The table below indicates the specific B-BBEE certification documents that must be submitted for this tender. Failure to submit the required certification documents will also result in Bidders scoring zero for B-BBEE. Classification Turnover Submission Requirement Exempted Micro Enterprise ( EME) Below R5 million p.a. Certified copy of B-BBEE Rating Certificate from a SANAS Accredited rating agency or a Registered Auditor approved by IRBA or a letter from an Accounting Officer as contemplated in the CCA. Qualifying Small Enterprise (QSE) Between R5 million and R35 million p.a. Certified copy of B-BBEE Rating Certificate from a SANAS Accredited rating agency or a Registered Auditor approved by IRBA. Large Enterprise (LE) Above R35 million p.a. Certified copy of B-BBEE Rating Certificate from a SANAS Accredited rating agency or a Registered Auditor approved by IRBA.

24 24 B-BBEE Key Sections to complete in SBD BID DECLARATION 6.1 Bidders who claim points in respect of B-BBEE Status Level of Contribution must complete the following: 7. B-BBEE STATUS LEVEL OF CONTRIBUTION CLAIMED IN TERMS OF PARAGRAPHS AND B-BBEE Status Level of Contribution:. = (maximum of 10 or 20 points) (Points claimed in respect of paragraph 7.1 must be in accordance with the table reflected in paragraph 5.1 and must be substantiated by means of a B-BBEE certificate issued by a Verification Agency accredited by SANAS or a Registered Auditor approved by IRBA or an Accounting Officer as contemplated in the CCA). 8 SUB-CONTRACTING 8.1 Will any portion of the contract be sub-contracted? YES / NO (delete which is not applicable) If yes, indicate: (i) what percentage of the contract will be subcontracted?.... % (ii) the name of the sub-contractor?.. (iii) the B-BBEE status level of the sub-contractor?.. (iv) whether the sub-contractor is an EME? YES / NO (delete which is not applicable)

25 BEE Joint Ventures and Consortiums Incorporated JVs must submit the B-BBEE status of the entity. Unincorporated JVs must submit a consolidated B-BBEE certificate as if they were a group structure for every separate Bid. Sub-contracting Bidders who want to claim preference points will have to comply fully with regulations 11(8) and 11(9) of the Preferential Procurement Regulations, 2011 with regard to sub contracting: Regulation 11(8) A person must not be awarded points for B-BBEE status level if it is indicated in the tender documents that such a tenderer intends sub-contracting more than 25% of the value of the contract to any other enterprise that does not qualify for at least the points that such a tenderer qualifies for, unless the intended sub-contractor is an Exempted Micro Enterprise that has the capability and ability to execute the subcontract.

26 BEE Regulation 11(9) A person awarded a contract may not sub-contract more than 25% of the value of the contract to any other enterprise that does not have an equal or higher B-BBEE status level than the person concerned, unless the contract is sub-contracted to an Exempted Micro Enterprise that has the capability and ability to execute the subcontract. Joint Ventures and/or Sub-Contracting Bidders must submit concrete proof of the existence of joint ventures and/or subcontracting arrangements. SARS will accept signed agreements as acceptable proof of the existence of a joint venture and/or sub-contracting arrangement. The joint venture and/or sub-contracting agreements must clearly set out the roles and responsibilities of the primary Bidder and the joint venture and/or subcontracting party. The agreement must also clearly identify the primary Bidder, who shall be given the power of attorney to bind the other party/parties in respect of matters pertaining to the joint venture and/or sub-contracting arrangement.

27 27 Services Agreement Bidders are requested to: Comment on the terms and conditions set out in the Services Agreement and where necessary, make proposals to the terms and conditions; Each comment and/or amendment must be explained; and SARS reserves the right to accept or reject any or all amendments or additions proposed by a successful Bidder if such amendments or additions are unacceptable to SARS or pose a risk to the organisation.

28 Table of Content 1. Welcome and Introduction 2. Background 3. Scope of Work 4. RFP Timelines 5. Bid Evaluation Process 6. Pricing Schedule and B-BBEE 7. Draft Service Level Agreement 8. RFP submission and contact details 9. Q&A 28

29 Bid Submission Bidders must submit copies of each file (Original and Duplicate) and a CD-ROM with content of each file by the 10 March 2015 at 11: Original + Duplicate + Content of File 1 and 2 TENDER BOX SARS, Linton House, Brooklyn Bridge, 570 Fehrsen Street, Brooklyn, PRETORIA Any enquiries must be referred, in writing via to: or 29

30 Technical Compliance Checklist ANNEXURE A2: BIDDER TECHNICAL COMPLIANCE CHECKLIST The form must be submitted in File 1 (Technical file), Exhibit 2 Example of how to complete the compliance checklist: Section No. Technical Criteria 1 Experience of the Consulting Company Compliant Partially Compliant Non- Compliant Reference page in Bidder s Proposal Yes Page 9 to 12 - exhibit 2 Comments 2 Capacity to deliver Yes Page 13 to 15 - exhibit 4 Bidder to state reason for partial compliance 3. Client References Yes Page 17 to 20 - Bidder to state reason exhibit 5 for non-compliance 30

31 File 1: Original / Duplicate Exhibit 1 Pre-qualification documents (SBD documents) Exhibit 2 Bidder Compliance Checklist for Technical evaluation Annexure A2 Technical Responses - Annexure A1 Supporting documents for technical responses. References/testimonials Exhibit 3 Company profile Supplementary information (if any) Exhibit 4 General Conditions of contract Draft Service Agreement Annexure C1 31

32 File 2 :Original / Duplicate Exhibit 1 B-BBEE Certificate Exhibit 2 Pricing Schedule Annexure B NB Each file and CD-ROM must be marked correctly and sealed separately for easy reference during the evaluation process. 32

33 33

34 34 Questions and Answers The following questions were raised during the briefing session: Question 1. Will software and hardware be supplied by SARS? 2. In regard to the pricing schedule, should each resource per section be included in the Project Resources column? Response The successful Bidder will be requested to provide their own laptops but access to systems and SAS software will be provided. The Bidder should indicate the title of the resources for each stage. There may be a skills overlap among the resources i.e. the same person could have more than one expertise, however SARS will not accept only one resource being allocated to the project. SARS requests that experienced resources are proposed to work on the project. SARS requests that the pricing schedule be submitted in Excel format. A signed PDF document can also be submitted.

35 35 Questions and Answers (cont) Question Response 3. In regard to the SARS Oath of Secrecy, who should sign the Oath of Secrecy? 4. Does SARS have specific deadline for the project phases? 5. How big is the PAYE data set SARS plans to use? The Oath of Secrecy should be signed by the authorised person, who acts on behalf of the company for the purposes of submitting the tender. The allocated resources of the successful Bidder will also be requested to sign the Oath of Secrecy and the Non-Disclosure Agreement, prior to commencing the services. The Bidder should propose the period for each phase. The 12 months indicated in the RFP document includes both phases. Both the PAYE and VAT project will be carried out using full population data and not samples. Bidders are advised to visit the SARS website (link below) to get an indication of the size of data sets used by SARS.

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