August 2013 Issue 85

Giving local firms a leg up on tenders

B2B Editor1 August 2013

Giving local firms a leg up on tenders

To make it easier to do business in the Territory the ACT Government is now giving local firms a leg up when tendering for government contracts.
Last month a new criterion was introduced for the evaluation of all goods and services tenders for ACT Government work, which supports small- and medium-sized enterprises (SMEs) from the capital region.
The criterion puts a positive weighting on whether the tenderer is a local SME and/or their involvement with local businesses.
In short, the weighting will give local SMEs a small but important boost to their chances of winning ACT Government tenders.
More than 25,000 businesses operate in the ACT – and the majority are SMEs. As such, supporting them is vital to the ACT economy.
ACT Government contracts can be a significant source of work for our private sector, but we acknowledge SMEs can find it challenging to tender for and win government business, which is why this change is being introduced.
It will also provide an incentive for suppliers to the ACT Government to engage with regional SMEs.
The criterion has been designed to so that it doesn’t add to the cost of tendering, doesn’t detract from value for money and safety considerations, nor impinges on free trade requirements.
The criterion is just one of the measures contained in the ACT Government’s Business Development Strategy, which is helping the local private sector to diversify, grow and create jobs.
Details of the new criterion are as follows:
Tenders over $200,000
For Request For Tender (RFT) for procurements over $200,000, tenderers will be required to indicate if they are a local SME and, if they are not a local SME, whether they will be subcontracting to a local SME.
Businesses with up to 200 full-time equivalent employees based within the South East Region Organisation of Councils (SEROC) are defined as local.
If the tenderer is an SME a default 5 per cent weighting will be applied. The weighting may be increased to 10 per cent on a case-by-case assessment.
If the tenderer is not an SME but will be subcontracting to a SEROC SME, a weighting from 1 to 5 per cent will be applied based on the proportion of the total value of the contract to be undertaken by the subcontractor.
For example, if 50 per cent of the value of the contract will be undertaken by a SEROC subcontractor a weighting of 2.5 per cent will be applied, or if 80 per cent of the value of the contract will be undertaken by a SEROC subcontractor a weighting of 4 per cent will be applied.
If a head contractor is not an SME but has indicated they will subcontract to a SEROC SME, confirmation of an arrangement with nominated subcontractors will be required as part of the tender, including an indication of the value of the work that will flow to the subcontractor.
Tenders under $200,000
For Requests for Quotation (RFQ) for procurements under $200,000 that will be undertaken directly by ACT Government Directorates, respondents will be evaluated on three standard criteria: capability, capacity and affordability.
Once these criteria have been considered, the respondent’s SME status or SME involvement will be scored based on the same principles as outlined in the RFT process.

Andrew Barr
Chief Minister of the Australian Capital Territory (ACT)

Act Government New