The European Union recently introduced some of the most significant changes to the procurement process in the last 10 years, including competitive dialogue. Rob Hann, explains how to get to grips with competitive dialogue. Competitive dialogue is designed to promote and encourage transparent and fair competition between contractors. The process also gives bidders the opportunity to be creative and innovative when working up solutions to meet the needs of the contracting authority. It provides flexibility for authorities to discuss solutions with bidders when the procurement is still at a competitive stage. This should encourage bidders to develop more value-for-money solutions, and allow authorities to promote innovative thinking. Once the dialogue phase is closed, however, the scope for changes is greatly restricted. The winning bidder can be asked to confirm commitments, but any changes must not modify the final tender, distort competition or cause discrimination. It is important for authorities to understand and adhere to the new rules as the Freedom of Information Act, and the Alcatel ‘stand-still’ provisions, increase the risk of scrutiny and possible legal challenge at the end of the process. Competitive dialogue drives the need for contracting authorities to do much more work at the start of the procurement, either prior to going to the market or, at the latest during the dialogue process. Authorities need to: l plan the whole procurement process at the outset and avoid rushing to market too quickly l define clearly the scope of the project and keep any variables to a minimum. Authorities must be clear about ‘what’ the bidders are being invited to provide and ‘how’ the service should be delivered l provide bidders with information on issues which may affect price early on, eg, titles to land or buildings, ground contamination, design and planning, and employee and workforce issues l give careful consideration to the potential for increased costs associated with better service levels and robust performance-monitoring regimes l appoint external legal, financial and technical specialists to help develop draft outline specifications, payment mechanisms, contracts and performance indicators, well before the project reaches the market l use standard sector contracts unless there are compelling reasons not to. 4ps has developed sector-specific PFI-compliant contracts in most authority service sectors. Some practitioners have expressed concerns that competitive dialogue will lead to increased costs and substantial delays in the procurement of complex schemes. However, while dialogue may extend the competitive phase, it should also shorten closure with the overall effect being a shorter procurement timetable. Authorities can also use competitive dialogue to extract innovative ideas from bidders, feeding them back in revised bidding documents for the next round. Bidders’ intellectual property rights should be respected but they should also be encouraged to share innovation. This can be achieved by: l awarding additional evaluation marks to bidders who initiate innovative ideas l ensuring the dialogue process includes special meetings with each bidder on alternative value-for-money solutions l approaching the dialogue process with an open mind and being flexible enough to accept that the service-delivery outputs could be achieved by alternative inputs. Only variant solutions discussed and agreed at the dialogue stage will be considered acceptable for inclusion in a formal offer. To help authorities, bidders and funders understand the new procurement processes, and get to grips with what competitive dialogue means in practice, 4ps has established a bespoke skills training programme. Log on to www.4ps.gov.uk for more details. w Rob Hann is legal services director for 4ps
