Context

Value for money is the essential test against which any procurement output is to be justified. It is also essential that the assessment of offers is robust, systematic and unbiased to ensure the application of proper processes and the achievement of the procurement objectives.

Key Requirements

1. Value for Money
Achieving user and system requirements, quality standards and service benchmarks is considered more important than obtaining the lowest purchase/tender price. Value for money is the basis for comparing alternatives so that the optimal offer can be selected.

2. Adopting a Systematic Evaluation Regime
All offers must be evaluated in a consistent manner against the evaluation criteria adopted for the tender. The use of a weighted matrix analysis is a recommended method for analysing and comparing tenders in a detailed and consistent manner.

3. Cost Comparison
Total project costs not just tender price should be assessed in a detailed systematic manner. This assessment must be undertaken separately from other evaluation criteria.

4. Due Diligence of the Shortlisted Tenderers
A due diligence investigation must be undertaken of the preferred or shortlisted tenderers for all high value and/or highly complex projects to ensure that the tenderers have the capacity and stability to comply with the requirements of the contract.

Other Requirements

1. Consideration of Alternative Bids
Tenders offering an alternative solution that meet the performance and functional requirements, should be considered on their merits.

Related VGPB Policy and DTF Guidelines

Nil

Related DTF Templates and Forms

Letter to non-shortlisted tenderers Template (36 KB DOC)

Links to relevant Policy websites

Nil

Version Control Information

Version Number	2.2
Release Date	July 2008

* all values are GST inclusive