THE SOUTH WEST WALES HIGHER EDUCATION PROCUREMENT PARTNERSHIP PURCHASING PROCEDURES

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1 THE SOUTH WEST WALES HIGHER EDUCATION PROCUREMENT PARTNERSHIP PURCHASING PROCEDURES 1. INTRODUCTION 1.1. The University operates a Devolved Budgeting System under which the responsibility for day-to-day purchasing decisions is delegated to Heads of School / Department and school / departmental buyers, as they are best placed to make the decisions to meet their school / department s operational needs on a day-to-day basis When making purchasing decisions school / departmental Buyers must comply fully with the University s Financial Regulations and Procedures and ensure they comply with all appropriate current legislation It must be emphasised that Heads of School / Department are accountable to the Vice Chancellor for all expenditure committed by their school / department on behalf of the University irrespective of the source of funds, and for ensuring that all targets are met. 2. Competition 2.1. It is the University s policy to obtain value for money whilst ensuring probity in all its purchasing activity. This policy is normally best achieved through the competitive tendering process under which suitable suppliers are given fair and equal opportunity to compete for University business. 3. Aggregation 3.1. In following this policy it is recognised that the University is one corporate body and that wherever appropriate the total University requirements for goods and/or services of the same or a similar kind should be aggregated together in order to achieve better prices and terms & conditions of contract 4. Collaboration 4.1. The University should wherever appropriate be collaborating in its procurement activity with other appropriate organisations and consortia such as the other members of the South West Wales Higher Education Procurement Partnership (SWWHEPP), the Higher Education Purchasing Consortium for Wales (HEPCW), Value Wales, HE sector wide groups, OGC etc Where the University decides to participate in an agreement let by another organisation a report outlining the reasons why the decision has been reached should be written by the appropriate officer of the University and approved by the Head of Procurement 5. PURCHASING ETHICS 5.1. This relates to the standards of conduct that ensure the University and the individuals that conduct business on behalf of the University are 1

2 respected and trusted by those with whom they deal. It is vital that there is no suspicion of conflict of interest between official duties and private interests, and that actions or decisions by officers of the University do not give the impression that they may have been influenced in any way, or show favour or disfavour to any person or organisation Confidentiality 5.3. Much information received in the course of business is confidential and must be respected as such. Under no circumstances whatsoever should details of any supplier s offers or agreed contract terms be divulged to any third party. Information given in the course of business should be true and fair and not designed to mislead or to provide personal gain Declaration of Interests 5.5. A Register of Declarations of Interest is held (on the intranet) by the Head of Administration. All Members of Council, Academic and Academic Related members of staff are required, annually, to complete a Declaration of Interests form declaring in full, details of all their outside interests and those of close family members. It is the Head of School / Department s responsibility to ensure that all members of staff in his / her school / department update their Declaration of Interests form in August each year Members of Staff 5.7. It is prohibited for the University to place an order with a member of staff in their personal capacity or with a company in which a member of staff has a personal interest Exception Where the University has created a spin out company and a member of staff has a personal interest in that company then it shall be permitted for the University to place orders with the spin out company provided that: The University s Purchasing Procedures have been complied with, The member of staff that has an interest is not involved in any way in the procurement process and the Vice Chancellor s approval has been obtained The member of staff who has an interest in the spin out company is responsible for ensuring that full details of all work undertaken on behalf of the University are recorded in the Register of Declarations of Interest each year. This must include details of all orders received, invoices raised and the total value of the business undertaken Close Family of Members of Staff and Students Under no circumstances whatsoever should any goods (whether new or second hand) or services including food for buffets be purchased on behalf 2

3 of the University from any member of staff, or close relative or student in a personal capacity. Where goods or services are to be purchased from a company in which a student or a close family member of any member of staff has a personal interest then the purchase must be approved by the Head of School / department and the Director of Finance prior to the order being placed. If the student or close family member is related to the head of school / department then the Vice Chancellor s approval must be obtained prior to the order being placed Ex Members of staff Before placing any orders or contracts with an ex member of staff the requirements must be subjected to a formal tender process. The University will not invite former members of staff to tender for business until a minimum period of six months has elapsed after they have left the employment of the University Business Gifts Gifts, other than items of very small intrinsic value such as business diaries, calendars, telephone pads, etc., should not be accepted. Exception Members of staff representing the University on business overseas may accept gifts, if the culture in the country visited dictates. All gifts are accepted on behalf of the University and become the property of the University. Gifts where the value exceeds 100 must be declared in the hospitality register Hospitality Modest hospitality is an accepted courtesy of business relationships. However, the recipient should not allow a position to be reached whereby they might be, or might be deemed by others to have been induced into making a business decision as a consequence of accepting such hospitality. The frequency and scale of hospitality should not be greater than the University would be likely to provide in return Register of Hospitality The Head of Administration holds a Register of Hospitality for events attended by Heads of School / department; each Head of School / department is in turn responsible for maintaining the same register on behalf of their own school / departmental staff. All members of staff attending corporate hospitality events must register full details of the event in the appropriate Register of Hospitality. Examples of Hospitality The following are some examples of hospitality events which fall into the category of events which must be recorded in the Register of Hospitality: Horse Racing Meetings; Opera Tickets; Motor Racing Events; Football 3

4 Matches; Rugby Matches; Golf Days: Theatre Tickets; Cricket Matches; Wimbledon; Christmas Parties (excluding staff Christmas Parties) Expenses for Attending Hospitality Events Where a member of staff accepts an invitation to attend a corporate hospitality event, the cost of travel to and from that event must be borne by the individual and should not be claimed as expenses from the University or paid for by the supplier of the hospitality. Exception Where a member of staff is representing the University in an official capacity, then the cost of travel should be reclaimed as expenses from the University Personal inducements Personal inducements to members of staff, in any form, from suppliers are forbidden. Any instances of such inducements being offered must be reported to the Head of Administration immediately Separation of Duties In order to protect public funds, procurement and payment systems must guard against fraud and/or suspicion of financial impropriety. There are four main stages in the purchasing process: Approval to incur or commit expenditure; Ordering the goods or services; Certifying the satisfactory receipt of goods or completion of services; Authorising payment Wherever possible, each of these stages in the purchasing cycle should be carried out by a different person. However it is recognised that in some circumstances this may not be possible, where this is the case the person ordering the goods or services must be different from the person certifying receipt of the goods and authorising payment. N.B. The person certifying satisfactory receipt of goods / services should normally be the person who will use or receives those goods / services and will not necessarily be an authorised signatory Company Directors Under no circumstances whatsoever should members of staff, who have a personal or financial interest in, or are directors of any company, be involved in any tender where the company in which they are a director or have an interest is likely to submit an offer to the University. 6. IDENTIFYING THE NEED / REQUIREMENT 6.1. Genuine Need Before any decision to purchase goods or services is taken the Head of School / Department or the school / departmental buyer must be satisfied 4

5 that there is a genuine need for those goods and services, it should be emphasised that the lowest cost solution in the vast majority of cases is not to purchase anything Forward Planning Once the Head of School / Department or the school / departmental buyer is satisfied there is a genuine need to purchase goods and / or services the acquisition process should be planned properly and professionally, allowing sufficient time to draw up the detailed specification, invite and evaluate thoroughly offers to meet the requirement and make informed decisions which give the University best value for money Urgent Requirements A key element of effective purchasing is forward planning, in normal circumstances the school / departmental buyer will have fully defined their need and orders will be placed after a thorough evaluation of all the alternative solutions to meet that need. It is recognised that there will be the occasional emergency but there should be no need for continual fire fighting. 7. IS THERE AN EXISTING APPROVED SUPPLIER, PREFERRED SUPPLIER OR FRAMEWORK AGREEMENT LET BY ANOTHER APPROPRIATE ORGANISATION THAT CAN BE USED? 7.1. Approved Suppliers Approved Suppliers are those nominated as such following a competitive tendering exercise conducted by the University, Higher Education Purchasing Consortium for Wales, Value Wales or another approved organisation. Wherever possible, orders should be placed with approved suppliers. Where an unusually large quantity is required this should be discussed with the Procurement Section before an order is placed Preferred Suppliers Preferred suppliers are companies with whom the University, HEPCW or other approved organisation has negotiated and agreed preferential terms and conditions of contract without the agreement having been subjected to the full competitive tendering process Framework Agreements Framework agreements are agreements which have normally been let following a competitive tendering exercise and will have agreed prices and terms and conditions of contract arranged by the awarding organisation. There are a number of organisations that let framework agreements which can be used by the University; these include HEPCW; Value Wales; National HE working parties; OGC etc. Using an existing framework can be an efficient and effective way of purchasing goods and services which will often provide value for money and can avoid 5

6 the need to seek alternative quotations which can be a time consuming and costly process. School / departmental Buyers do not need to follow the tendering procedure when placing orders with Approved Suppliers against Framework Agreements as the Purchasing Procedures will have been complied with when awarding these contracts. However, all of the suppliers on the framework agreement should be given the opportunity to quote for each requirement. In cases where a school / department has an unusually large requirement the requirements should be subjected to a separate tender exercise. The Purchasing Team will assist and advise where appropriate. For all other requirements School / Departmental Buyers will need to ensure they comply with the tendering procedures. 8. WHAT IS THE ESTIMATED TOTAL VALUE OF THE REQUIREMENT? 8.1. Contracts / orders valued up to 3,000 No formal tendering process is required for contracts / orders up to this value. However schools / departments should under normal circumstances be purchasing such goods and / or services from Approved or Preferred Suppliers as defined above. Where there is no Approved Supplier, Preferred Supplier or Framework Agreement available then two verbal quotations should be obtained and the order should be processed directly by the school / department. School / departmental Buyers are strongly advised to obtain written a quotation from the successful company thus ensuring that details of the offer accepted are documented in the event that there is a dispute. It is particularly important to obtain written quotations (not estimates) for printed material. School / departments are encouraged to obtain the written quotation(s) using form F-E which is available on the Purchasing Web site for this purpose Contracts / orders above 3,000 but below 25,000 Competition must always be sought whenever possible and practicable. Normally a minimum of three and a maximum of six written quotations should be sought; it is good practice to follow the sealed bid tender process if possible. All suppliers must be treated equally and given the same information in order to submit their quotation. The order should be placed directly with the supplier by the school / department. The original copy of all the quotations received should be retained for a minimum period of three years. Where an order is placed with a company, which is not the lowest offer, or which is contrary to, or which does not comply fully with, the 6

7 provisions of the Financial Regulations the reasons why should be fully documented in writing and approved by the Head of School / Department. The written report signed by the Head of School / Department should be retained on the file along with the original copies of the quotations for a minimum period of three years Contacts above 25,000 but below 144,000 All requirements for the supply of goods and services valued in excess of 25,000 are subject to the full tender process. All such tenders must be undertaken in consultation with the Procurement Section. Normally a minimum of four and a maximum of six companies will be invited to tender. Tenders should be invited formally using the sealed bid tender process. The tender procedures are defined below For all contracts / orders placed where the total contract value exceeds 25,000, the approval of the Head of Procurement or the Director of Finance, must in all cases, be obtained prior to the order being placed or the contract awarded. The Head of Procurement in conjunction with the Director of Finance will decide whether or not the matter should be referred to the Finance Committee. The form F-E must be completed by the school / departmental buyer, signed by the Head of School / Department and sent to the Procurement Office for approval Contracts for Works above 144,000 but below 3.61m For all contracts for works above 144,000 but below 3.61m competition must be sought following the sealed tender process as detailed above. Normally a minimum of four and a maximum of six companies will be invited to tender wherever possible, unless the contract is placed with an Approved Supplier against a framework agreement where all Approved Suppliers must be given opportunity to tender Contracts for goods / services above 144,000 and contracts for works above 3.61m Contracts for goods / services above 144,000 or for works above 3.61m must be advertised in the EU Journal unless it is for goods / services defined as exempt. 9. TENDERING FOR CONTRACTS EXCEEDING 25k 9.1. The tender process will normally be applicable for all requirements where the total contract value exceeds 25,000. The Procurement Section must be consulted about all contracts above this threshold immediately the need is identified For research equipment the person requesting the tender must, before the tender process is commenced, provide a statement from the Research and Innovation Office confirming: 7

8 How much funding is available; When it is available; When it has to be spent by Identifying the Project Manager and the Project Team Project Manager All projects / tenders must have a nominated Project Manager who will normally be the most senior technical expert. The Project Manager is the person responsible for drafting the specification and ensuring that this is agreed with all appropriate people including all members of the project team. Project Team The project team will include the Project Manager, a member of staff from the procurement team and any other appropriate members of staff. All tenders let by the Estates Department or other non academic department where the total contract value exceeds the 144k must be evaluated by a team which includes at least one appropriate senior member of staff who is not a member of the school / department responsible for that contract Defining the requirement and award criteria The invitation to tender should define fully the goods or services required and the selection / award criteria 9.5. Seeking tenders A Tender Opening Record, form F-E.6.6.3a and a Contract Checklist, form F-E b must be completed. (These are available on the Purchasing Web pages, from the Procurement Section and The Estates Department). The sealed bid tender process should be followed at all times where appropriate. Normally A minimum of four and a maximum of 6 tenders should be sought. The appropriate University Terms and Conditions of Contract must be included with the invitation to tender. A pre addressed envelope or label for the return of the tender should be enclosed, clearly stating the tender reference, the closing date and time. Completed tenders are to be returned to the Administrative Secretary. The Administrative Secretary will keep a register of the receipt of all tenders. Tenders shall be kept secure until the time and date specified for their opening. Tenders should be opened at the earliest practicable time after the time and date for the return of tenders has passed. 8

9 The time and date for the return of tenders can be extended for a period up to eight working hours at the discretion of the Administrative Secretary and / or the Head of Procurement. Offers received after the tenders have been opened can only be considered provided it can be proved that the tender was dispatched to the University by the tenderer, in sufficient time to reach the University before the closing date and time. All other tenders received by the University after the tenders have been opened must be returned to the supplier unopened if possible by the Administrative Secretary. Tender documents are to be opened in the presence of at least two persons, the Administrative Secretary or his/her appointed deputy and another member of staff from the University s Administration. The persons opening the tenders must be independent of the tender process. The Administrative Secretary shall maintain a register of all tenders which will include a record of all persons present at the opening of tender documents. The original copy of all tender documents (except tenders conducted by the Estates department) must be returned to the Procurement Section. Copies of tender documents, where appropriate, will be passed to relevant school / departments for evaluation. A report, summarising details of the offers received, should be prepared by the officer(s) evaluating the tenders recommending acceptance of the selected supplier(s) giving the reasons for that recommendation. The approval of the Head of Procurement should be obtained before a contract is awarded and an order placed. Where appropriate the unsuccessful tenderers will be notified in writing by the Procurement Section that they have been unsuccessful Exception In a small number of instances the University s normal tendering procedures cannot be complied for orders exceeding 25k. Where a school / department wishes to process an order in excess of 25,000 without following the tender process the order must be authorised by the Head of Procurement, School / departmental buyers must complete the Request for Purchase Order Approval, form F-E or submit a detailed report explaining why the sealed tender process hasn t been complied which must be signed by the Head of School / Department or his/her nominated deputy. This should be forwarded to the Head of Procurement along with the original copies of all quotations received for the order to be approved and referral to Finance Committee where appropriate. 10. TENDERING FOR GOODS OR SERVICES WHERE THE TOTAL CONTRACT VALUE EXCEEDS 144,000 OR WORKS WHERE THE TOTAL CONTRACT VALUE EXCEEDS 3.61M In addition to the procedures defined above for contracts exceeding 25k the Procurement Section must be consulted about all 9

10 tenders above this value as the EU Procurement Regulations apply unless the requirement is exempt under these regulations All tenders for goods or services where the total contract value is above 144k must undertake the Value Wales Sustainability Risk Assessment. All works contracts above 3.61m must undertake the Value Wales Sustainable Risk assessment In order to comply with the EU Procurement RegulationsAll contracts for the supply of goods or services to a value greater than 200,000 SDR s (approximately 144,000) must, under EU Directives 93/36/EEC and 92/30/EEC as enacted by Statutory Instruments SI 1995/201 and SI 1993/3228, be advertised in the Official Journal of the EU All contracts for building works valued in excess of 5,000,000 SDR s (approximately 3.61m) must, under EU Directive 93/37/EEC as enacted by Statutory Instrument SI 1991/2680 be advertised in the Official Journal of the EU. (SDR s are Special Drawing Rights which is the accounting method of the World Trade Organisation) It should be noted that the above limits are revised every two years and, accordingly, the advice of the Procurement Section must always be sought. There are three procurement routes available under the EU Procurement Regulations: Open Procedure This procedure will normally be used for specialised equipment where there are very few potential suppliers, all companies that apply for the tender documents must receive them and given the opportunity to submit an offer Restricted Procedure This is the most commonly used procedure by the University whereby all companies requesting tender documents are provided with a pre qualification questionnaire (PQQ). Following the receipt of the PQQ all companies capability to service the contract are assessed only those companies that meet the defined criteria at this stage are invited to tender Competitive Dialogue This is the least commonly used procedure and is only used for extremely complex procurements such as PFI / PPP projects. 11. EVALUATING TENDERS All tenders where the total contract value exceeds 144,000 must include a member of the Purchasing team in the evaluation panel. In addition appropriate senior members of staff from key 10

11 customer school / departments must also be invited to participate in this process When evaluating tenders, officers are charged with ensuring that the University obtains value for money. In order to demonstrate this it is essential that decisions are taken objectively and that they can be fully justified in the event of any audit inspection In order to achieve this when taking into account subjective matters it will be appropriate to devise a scoring matrix in which all the relevant factors can be allocated scores and weightings according to their degree of importance. Typically all selection criteria will be given a weighting between 1 and 3 according the degree of importance and scores will be given between 0 and A detailed report and recommendation covering the whole procurement process should be written and signed off by all appropriate officers which must include as a minimum the Project Manager, Head of School / Department, the Purchasing Officer and the Head of Procurement. A copy of the recommended report template is attached at F.E Value for Money It is the University s policy to ensure that it obtains value for money in all its procurement activity whilst ensuring probity taking into account the whole life running costs including the cost of disposal. When making the purchasing decision Value for money is defined as purchasing goods and or services of the most appropriate quality standard to meet the needs of the University taking into account the whole life running costs including the cost of disposal, in appropriate circumstances this will include environmental, sustainability and social issues. In order to ensure that value for money is obtained all Buyers must ensure that competition is sought and stimulated in accordance with the University s Financial Regulations and Procedures, UK Law and European Union Rules. In some circumstances value for money will be obtained by accepting the lowest priced solution to meet the need, however it is recognised that in many cases this will not be the case. Where applicable, the following and any other relevant factors should be considered when calculating the whole life costs : The initial purchase price; Servicing costs over the whole life expectancy; Other running costs including but not limited to, consumables, spare parts, electricity, gas, water and The cost of disposal (if applicable). 11

12 Deducted from these costs should be the resale value, if any, of the product at the end of its useful working life. Other factors which should also be considered include, but are not limited to, the financial status of the company and references from other appropriate organisations. In addition the University has adopted an Environmental Policy, in order to comply with this policy, in certain circumstances it may be appropriate to consider, environmental, sustainability and social factors. Examples of such factors which might be appropriate for consideration are as follows: Environmental and Sustainability Factors Products should adhere to sustainable design criteria and be: made from renewable sources; produced with the minimum adverse environmental impact; reusable, recyclable, durable and upgradeable. Production processes should not harm the workers or the local environment and should avoid, wherever practicable, the use of man-made chemicals, pesticides and other non-renewable and/or toxic materials. Products should be sourced locally where appropriate in order to reduce transport miles (the distance that the product has had to travel); consideration should be given to the overall impact of a product (including resource use in production, implications of its use for long-term work practices and disposal). Where relevant evidence of a corporate Code of Conduct, sustainability policy or adherence to widely recognised certification standards e.g. SA8000, Fairtrade Mark, Rug Mark, Soil Association, may be considered Social factors Products should have been produced in accordance with local and international laws, e.g. the Universal Declaration of Human Rights, International Labour Organisation core labour standards Other considerations Consideration should also be given to hiring, leasing, and other suitable means of acquisition where appropriate. This may include, but is not limited to, outsourcing, contracting out and the use of private sector funds through the Private Finance Initiative and the Public Private Partnership. Where the PFI / PPP route is followed the principles set out in the Funding Council s Good Practice Guide must be followed Sole Tenders Where only one offer is received in response to a tender that offer should be given full consideration and if it meets the technical specification and is within budget the offer should be accepted. If the sole tender does not meet the technical specification or is rejected because it exceeds the budget then the following course of action should be followed: Sole Tenders rejected because they do not meet the technical specification 12

13 If the sole offer received does not meet the technical specification it should be rejected and the University should: Either recommence the tender process inviting tenders from other potential suppliers or commence negotiations with other potential suppliers in accordance with the procedures defined below Sole tenders rejected because they exceed the budget In circumstances where sole tenders are rejected because they exceed the budget available the University should either recommence the tender process inviting tenders from other potential suppliers or commence negotiations with other potential suppliers in accordance with the procedures defined below. Where a sole tender is rejected because it exceeds the budget under no circumstance whatsoever should, a contract be awarded to / or an order placed, with another company for those goods and / or services at a higher price These procedures should also be adopted in cases where more than one tender is received but none of them meet the technical specification or none of them are within the budget available Where there is only one potential supplier school / department buyers are require to draft a report using the form F E explaining why there is no alternative supplier that is able to meet the requirement 12. NEGOTIATION, BID CLARIFICATION & POST TENDER NEGOTIATION Negotiation It is the University s stated policy to achieve value for money whilst ensuring probity in all its purchasing activity. In normal circumstances this will be achieved through the tendering procedure detailed above. However, it is recognised that in some circumstances the tender procedure cannot be complied with, in these circumstances negotiation may be an alternative method of ensuring that the University obtains best value for money. In all circumstances where negotiation takes place it must be undertaken in a fair and ethical manner with all appropriate, potential suppliers given equal opportunity. In all circumstances, the relevant buyer must confirm details of the points discussed and agreed, in writing with a copy held on the appropriate file. A member of staff from the Procurement Section should always be a member of the negotiation team in negotiations for contracts/orders above 144,000 excluding VAT in value Bid Clarification 13

14 Bid Clarification must be distinguished from Post Tender Negotiation It is frequently the case that aspects of tenders are unclear or contain obvious errors. In all such circumstances the buyer should clarify those ambiguities and arrange for the correction of obvious errors. Written confirmation of the clarification and / or corrections must always be obtained and filed with the original tender Post Tender Negotiation Is negotiation with potential suppliers after the receipt of formal tenders/quotations in an attempt to change the offer received in some way. In no circumstances should Post Tender Negotiations be conducted in a way, which puts any tenderer at a disadvantage, distorts competition, or adversely affects trust in the competitive tendering process. Whenever Post Tender Negotiation is entered into all tenderers must be treated equally fairly and ethically. In order to achieve this all suppliers who are able to meet the specification must be given the same opportunity to engage in Post Tender Negotiation. Under no circumstances whatsoever must post tender negotiation become any form of Dutch Auction with one supplier played off against another or given information, which could be construed in any way as showing favour. 13. SELECTING THE SUCCESSFUL SUPPLIER The main objective is to obtain value for money; this does not necessarily mean accepting the lowest offer received In all circumstances a proper tender evaluation must be conducted and the appropriate authorisation and approval within the University must be obtained. When evaluating a tender where subjective issues are of relevance the officers responsible for the decision must be able to demonstrate that the University will obtain value for money, in following the course of action taken. The tender evaluation should take into account all appropriate factors which should be allocated scores based on their relevant importance In normal circumstances the company allocated the highest score will be awarded the contract. If a company other than the one allocated the highest marks is to be awarded a contract this must be approved by the Head of Procurement or the Director of Finance and Finance Committee must be advised of the decision. 14. PLACING AN ORDER This is the most important stage in the purchasing / procurement process as it is the order that commits the University to expenditure. All commitments must be signed or approved by the appropriate authorised signatory before they are given to any supplier The University has two methods of purchasing goods / services either via a purchasing card or by raising a purchase order. Orders for all goods and services required by the University must be processed 14

15 using one of these methods. Members of staff should not purchase goods and services on behalf of the University and reclaim the expenditure through the expenses system Purchasing Cards Purchasing cards are available for departments to use for the purchase of: Low value transactions defined as transactions below 2,000, Foreign transactions, Booking conferences, One off requirements, Travel and accommodation Student functions / hospitality up to the maximum defined in section E of the Financial Regulations Other appropriate requirements approved by the Head of Procurement or the Director of Finance As a consequence the use of personal credit cards to purchase goods and services on behalf of the University shall be prohibited with the exception of purchases related to travel and subsistence which can still be purchased by individual members of staff and reclaimed through the expenses system. Under no circumstances will the University reimburse staff for goods purchased duty free at airports or goods purchased overseas and brought back to the UK as under Customs and Excise regulations the University is not permitted to benefit from the purchase of such goods In addition The Director of Finance will nominate appropriate members of staff in the Finance Department to have purchasing cards with a transaction limit of up to 5,000 which can be used to process transactions above 2,000 on behalf of schools / departments. This will normally only be used for one off transactions where the supplier will not accept a purchase order e.g. for purchases over the internet, payment of conference fees, foreign purchases. The Finance Department will not normally process transactions on behalf of school / departments for transactions below 2,000. A form F.E Purchasing Card Transaction Request duly approved by an appropriate authorised signatory delegated power by the Head of school / department must be received by the person processing the transaction in the Finance Department before the transaction will be processed. Transactions above 5,000 in value can only be processed if approved by the Head of Procurement or the Director of Finance. There are additional procedures laid down in the Purchasing Card User Manual for the use of purchasing cards which must be adhered to by members of staff using purchasing cards to make purchases on behalf of the University. 15

16 In order to apply for a purchasing card, members of staff must complete the University s Purchasing Card User Application Form which must be signed by the Head of School / department as appropriate and the Nat West One Card Cardholder application form. Both must be returned to the Procurement Section in the Finance Department which will process the applications once approved by the appropriate person in the Finance Department. Transaction limits All Purchasing Card users will be allocated a maximum individual transaction limit by their Head of School / Department which will normally be either 1,000 or 2,000 and a maximum monthly transaction limit of either 10,000 or 25,000. These limits can be increased where there is a specific need subject to approval by the Head of Procurement or the Director of Finance. Restrictions on use All purchasing cards will have a restriction which prohibits their use to draw cash, individual cards may in addition have appropriate merchant categories blocked from use Purchase Orders (placed with UK based organisation s) Purchase orders must be raised for all goods / services and equipment to be supplied by companies based in the UK where the value is in excess of 2,000 unless the Head of Procurement or Director of Finance has given approval for the transaction to be processed via a purchasing card. Approval for purchases above 2,000 to be processed through the purchasing card will normally only be given for: Genuine one off requirements; Foreign transactions; Booking conferences: Booking Travel and Accommodation for field trips Purchase Orders must include as a minimum, full details of the specification and price, the full delivery address and the full name and address of the supplier. Where appropriate the following details should also be included on the order: the agreed delivery date; the delivery charges (if any); the special terms and conditions agreed with the supplier and any other relevant information. It is the Head of School / Department s responsibility to ensure that all the necessary authorisations have been received and that there are sufficient funds available to meet the cost Orders processed via POP should be printed at school / departmental level. The original copy of each order should be forwarded by the school / department to the supplier. All such orders must be authorised by an appropriate authorised signatory before they are processed. Orders processed via POP need not be signed by an authorised signatory. School 16

17 / departments are not required to keep a hard copy of any orders processed via POP Purchases from organis ations not based in the UK Goods & Services up to 2,000 in value The University s purchasing cards should wherever possible be used to process all orders for goods and services ordered from non UK organisations up to the value of 2,000. Where the supplier will not accept the University s purchasing card a purchase order should be raised for the purchase of goods / equipment. Goods and Services between 2,000 and 5,000 These should be processed through a purchasing card administered by the Finance department. The school / department initiating the request should complete the form F-E which must be authorised by an appropriate authorised signatory and received in the Finance Department before the transaction can be processed. Equipment and Goods above 5,000 in Value A purchase order should be raised for all equipment and Goods above 5,000 in value, the invoice related to the payment for these orders should however be processed with a DP1 attached, duly signed by two authorised signatories in the department Other Services including the payment of Overseas Student Recruitment agencies No purchase orders should be raised for these but invoices should be processed using the DP1 signed off by two different authorised signatories Exceptions to Using the Purchasing Card or Raising a Purchase Order All exception to using the official order form must be approved by the Head of Procurement with individual transactions processed using the DP1 certified by an authorised signatory. Examples are food ordered by the Catering Department; library books and periodicals ordered by the Library and Information Services Department; utilities, recruitment advertising ordered by Personnel Department, corporate stationery and photocopiers. All such exceptions should be processed using the DP1, form F-E Verbal / Confirmation Orders Verbal and confirmation orders should generally be avoided, however where a genuine urgent requirement exists then a verbal or confirmation order may be given, provided the appropriate school / departmental authorisation has been obtained. However, the use of fax instead of verbal orders should be encouraged wherever practicable. Written confirmation of verbal orders must be sent to the supplier within twenty four hours. 17

18 Exception Where a verbal order has been placed with a supplier and that supplier expressly requests that the order should not be confirmed in writing then the confirmation order should not be processed. This exception will normally only apply for low value orders for consumable items where the total order value is below 200. The use of the purchasing card is encouraged for such purchases Authorised Signatories All Authorised Signatories will become users of QL and be allocated user names and granted permissions within QL. In addition each school / department shall normally be allowed a maximum of six additional QL users who will be given power to input orders but who will be unable to authorise the purchase order. All QL users will be given their own unique password, which must not be divulged to any other person. Under no circumstances whatsoever should any person allow another person access to QL Financials with their password. New or replacement authorised signatories must be approved of School / Department. by the Head New or replacement in putters will need to be nominated by the school / departmental administrator or finance officer who must be an authorised signatory New Suppliers Before placing an order with a new supplier school / departmental buyers should satisfy themselves of the credit worthiness of any supplier. The purchasing team will assist school / departmental buyers in this, by obtaining information from the University s nominated Financial Information Services adviser. 15. MANAGING THE CONTRACT Contract management is the process which ensures that both parties to a contract fully meet their respective obligations as efficiently and effectively as possible, in order to deliver the business and operational objectives required from the contract and in particular to provide value for money Having organised effective contract arrangements, all benefits that could be attained by the contracting organisation could be lost if the contract is not effectively managed - it is important not to 'let and forget' Managing the contract effectively will involve regular review meetings with suppliers. 16. ADDITIONAL PROCEDURES FOR SPECIFIC REQUIREMENTS Building and Construction Works & Services 18

19 All orders for building and or construction works must be placed or approved by the Director of Estates or approved nominee. In order to facilitate this process school / departments must use the University s Works Order to process such transactions. Wherever appropriate, orders for building and construction works & services should be placed with one of the University s Approved Suppliers. For the purposes of the Financial Regulations Building and Construction Works & Services can be sub divided into three categories; Measured Term (Partnered Contracts) Measured Term (Partnered Contracts) will be awarded following the University s normal Purchasing Procedures as defined in these Financial Regulations. Minor Works (Partnered Contracts) These are defined as contracts for minor projects & repairs to the University s buildings or the fabric of the building valued up to 500k. All such contracts valued up to 100k shall be approved by the Director of Estates, projects valued above 100k must be approved by the Management Board. For projects valued above 100k the Estates Department Project Officer must undertake a customer satisfaction survey approximately one year after the project has been completed The following categories of work are defined as minor works : General Building Work Refurbishment New Build Fabric maintenance Roofing Lift Replacement & Refurbishment Data & Telecoms Repairs & Installations Electrical Works Mechanical Works Civil Engineering / Ground Works Major Works ( Partnered Contracts) These are contracts for building Works & Services where the total contract value exceeds 500k all such projects must be approved by the Management Board Appointment of Consultants General Principles Wherever practicable the University should appoint consultants following a competitive tendering exercise conducted in 19

20 accordance with the University s Purchasing Policy and Procedures and use bona fide firms of consultants to undertake consultancy work on its behalf. In all cases details of the specification and / or the outputs required must be agreed in writing between the parties and duly signed off by both parties. Payments due to consultants will be defined in each contract and must only be made on completion of the work specified, or on achieving agreed milestones to the satisfaction of the University. The reimbursement of expenses paid to consultants will be in accordance with the University s scheme of expenses as defined in its Financial Policies and Procedures as amended from time to time. Exceptions may be considered in cases where a Consultancy firm has its own defined expenses scheme. Consultancy Firms In the vast majority of cases, consultants will be bona fide, registered companies offering consultancy services to business at large who are able to submit proposal to meet the requirements detailed in the University s specification. Individuals Members of staff acting as consultants Under no circumstances whatsoever should members of staff be engaged to act as consultants to the University. Close family of members of staff Close family of members of staff shall not be prohibited from acting as consultants to the University; however, the member of staff at the University is not permitted to be involved in any decision to appoint a close family member as a consultant to the University. In situations where a member of staff has a potential conflict of interest because of a personal, familial, financial or other relationship with a prospective consultant, this matter must be approved, before the consultant is instructed to undertake work, by the Head of School and the Director of Finance or, if it is the Head of School who has the relationship, by the appropriate Pro-Vice Chancellor. Other Consultants / Technical Experts Individuals employed by other universities It shall be the responsibility of the consultant to ensure that he / she has the necessary approval from his / her employer to carry out the work. Payments made to the individuals by the University will be paid directly to the individual and will be subject to deduction of tax and national insurance. Individuals employed by other organisations 20

21 The University does not (normally) appoint individuals employed by other organisations to act as consultants in a personal capacity. Individuals who are self employed Individuals who are self employed must agree to accept the University s terms & conditions of contract for the appointment of consultants and sign the Appointment of Consultants Form. Please note that in some cases such persons must be regarded as employees of the university and will be subject to deductions of tax and national insurance. (See appendix) Other Individuals It shall not be permitted to appoint individuals to act as consultants to the University unless they have self employed status and certify as such be signing University s Appointment of Consultants Form and accept the University s terms and conditions of contract for the appointment of consultants. (See appendix) Students Under no circumstance whatsoever shall it be permitted to appoint students to act as consultants to the University. Terms & Conditions Of Contract For Consultants The University s Terms and conditions of contract for the appointment of consultants must when appropriate always be used in agreements with consultants. If the University s terms & conditions of contract are not being used then the approval of the Head of Procurement or the Director of Finance must be obtained before the contract is awarded All consultants mus t comply the following: with all relevant University policies including Equal Opportunities Code of Practice Race Equality Policy Statement Dignity at Work Policy Sexual Orientation Policy Computing Regulations Section E.9.8 of the Financial Regulations provides guidance to assist staff decide whether a person is a Consultant or Employee Information or Communications Technology & Other Major Projects (IT) Information or Communications Technology Any purchase of Information or Communications Technology that is either: 21

22 large in its scale (e.g. intended to handle a major or critical area of operations), or of substantial complexity (e.g. multi-modular), or intended to interact with other critical University systems, or likely to cost over 250,000 (in total over the whole life expectancy). (A system is defined as an integrated series of programs or modules intended to perform a complex set of related operations). IT and other major projects must comply with the following procedures. Where the proposal to acquire a new system arises outside Library & Information Services (LIS) or the Administrative Computing Unit (ACU), the School / department concerned must consult with the Director of Library & Information Services (in the case of academic school / departments) or the Director of ACU (in all other cases), to ensure that the proposed purchase is consistent with the University s ICT strategies. The School / department should conduct an initial feasibility study and establish the likely costs and source(s) of funding. As part of the feasibility study a formal risk assessment/benefit analysis should be undertaken. The study must be signed off by the Head of School / department and either the Director of Information Services or the Director of the Administrative Computing Unit. The feasibility study and estimates should be approved by the Library & Information Services Committee and referred to the Senior Management Team. The Committee which regulates the School / department concerned (the Library & Information Services Committee in the case of LIS and ACU) should formally establish a Project Steering Group (PSG). The PSG should be chaired by a Pro-Vice-Chancellor or a senior member of another school / department. Other members of the PSG should include representatives of other school / departments who may be affected by the introduction of the system, the Finance Office, the Procurement Section and of end-users in the case of publicly available systems. There should not normally be more than six members on the PSG in addition to the Chair. The Committee should agree for the PSG: formal terms of reference, proposed members, chair, frequency of meetings and reporting lines and appoint a Project Manager who should be given overall responsibility for running the project and who will be accountable for the delivery of the project. A separate Project Evaluation and Implementation Group (PEIG) should be established, charged with the task of detailed planning and implementation of the new system. The PEIG should be made up mainly 22