Getting the best from the local government contract procurement process - A contractor's view

In a world experiencing increasing financial pressures, including the global economic climate and the costs of long-term infrastructure development and maintenance, asset owners – including local authorities - are continually looking for ways to reduce operational costs. Under legislation, local authorities are also required to prove best value and face challenges in demonstrating this in a way other than purely by price.

These pressures have resulted in outsourcing the delivery of contract activities and turning to different methods of contract procurement, often with varying degrees of success.

The procurement decision process can be fraught with challenges in terms of how the contract service delivery is procured. This process can significantly influence and drive contractor behaviour, not only in the way tender prices are developed but also in the development and management of systems that will be put in place for the life of the contract.

Other critical decisions such as the form of contract, e.g. lump sum, schedule of rates or measure and value, can also significantly impact on the risk profile associated with the development of tender prices and service delivery behaviours.

This paper outlines a contractor’s view on the entire contract procurement process. It aims to provide an insight to asset owners on the processes and systems that contractors believe will deliver them the best outcome for their service delivery needs. It also aims to ensure the right behaviours are put in place from day one of the contract procurement process to improve the success and efficiency contract model.