Context

Procurement valued in excess of $150,000* is subject to an approach to the open market through a public tender. In approaching the open market, departments are responsible for conducting a process that is fair and equitable to facilitate opportunities for businesses in contracting with Government.

The conduct of a tender is an integral element in the application of strategic sourcing principles that underpin the achievement of value for money outcomes and continuous improvement built on an interactive relationship with suppliers.

The term open tendering refers to a one stage process which involves the release of a Request for Tender (RFT) to the open market whereas selective tendering concerns a two stage approach to the open market involving first an Expression of Interest (EOI) or Request for Information (RFI) followed by a request for tender to a selected number of suppliers who have satisfied an assessment of their capability and capacity.

An exemption from open or selective tendering must satisfy the requirements and processes noted in VGPB policy titled: Exemption from Seeking Multiple Quotes, Open or Selective Tendering (Limited Tendering) and ICT IP Default Position Policy

Key Requirements

1. Open and Selective Tendering
Open and selective tendering is the preferred method of approaching the open market for the supply of goods and services.

2. Advertising Tenders
Tenders must be published in the composite Government tender advertisement that appears in the Herald Sun (Wednesday edition).
Tenders must also be published on the Victorian Government Tenders website - http://www.tenders.vic.gov.au along with the ability to download relevant tender documents and the name of a person(s) responsible for the management of the tender or tender enquiries.

Other Requirements

1. The Unacceptability of Splitting Identical Need
It is unacceptable to divide a particular procurement or procurement phase into separate parts or use a particular method for calculating estimated total value for the purpose of circumventing an approach to the open market.

2. Conduct of a Selective Tender
When conducting a selective tendering process the following procedures apply:
(a) Tenders are to be invited from a list of:

1. suppliers who have responded to a notice inviting application to participate in a procurement
2. suppliers responding to an EOI or an RFI
3. suppliers that have been granted a licence or the entity has determined compliance with specific legal requirements that exist independent of the procurement process

(b) Provided the relevant requirements and criteria have been specified beforehand, the entity may limit the suppliers invited to tender having regard to:

1. the extent to which the supplier’s proposals or responses meet the technical and performance specifications, and shortlisting criteria
2. the rating of a supplier’s proposals or responses having regard to the supplier’s capability and capacity to supply

3. Proceeding with Supplementary Advertising
In addition to the mandatory advertising requirement noted previously, consideration could be given to placing a supplementary display advertisement where it is considered that the potential market:

1. has limited internet access
2. the procurement has particular relevance to regional suppliers
3. the procurement is of a highly specialised or technical nature

Any display advertising should be placed in the relevant feature section offered by most national and regional newspapers. Consideration could also be given to advertising in a relevant trade magazine but the extent of circulation and regularity of publication may limit the effectiveness of utilising this medium. It is essential that the display advertisement precedes the notification of the public tender on the Victorian Government Tenders website and the composite advertisement in the Herald-Sun newspaper. The display advertisement must note that the tender documents are available from the Victorian Government Tenders website.

Entities are also directed to use the "Advance Tenders" feature of the Victorian Government Tenders website to alert prospective suppliers of forthcoming supply opportunities. The lead time prior to the release of the tender documents can be used by suppliers to conduct initial research or form relationships with other suppliers to address the indicated scope of requirements.

4. Tender Opening Period

• The tender period for both open and selective tendering is to provide sufficient time for suppliers to prepare a tender submission having regard to the value and complexity of the procurement.
• The tender period should take into account the time required to transmit and submit documentation where the supplier market lacks the ability to access/deliver documents electronically.
• Minimum suggested tender periods in working days excluding public holidays:

Note:

• The recommended tender period includes the first and last tender opening day even if this is not a full working day.
• The minimum tender period is 19 working days for the purchase of goods and services valued in excess of A$679,000 (the level at which the AUSFTA applies) although a minimum of 8 working days is permissible in the following situations:
  1. the entity has published a notice of a planned procurement on the "Advance Tenders" feature of the Victorian Government Tenders website stating the subject matter and date of tender publication that must be more than 19 working days prior to the tender advertisement
  2. the tender relates to procurement of a recurring nature
  3. a state of urgency exists
  4. a certificate of exemption has been granted by the Accountable Officer (or delegate) to proceed with Limited Tendering
• Wherever possible, a tender period should open on the weekday that coincides with the composite tender advertisement in the Herald Sun newspaper and activation of the tenders website.
• A supplementary display advertisement in another publication must conform to the tender period and other requirements noted in the composite tender advertisement and the Victorian Government Tenders website.

5. Purchase from a Standing Offer Agreement (State Purchase Contracts, Open State Purchase Contracts or Department Standing Offer Agreement)
The rules of use apply when purchasing from a Standing Offer Agreement. There is no requirement to conduct a tender as the open market was approached in the establishment of the standing offer agreement. An exemption granted from using a standing offer agreement is to apply relevant procurement policy concerning the conduct of open or selective tendering or obtaining quotes for values less than the public tender threshold.

Related VGPB Policy and DTF Guidelines

Australia - United States Free Trade Agreement (AUSFTA)
Strategic Procurement - General Guidelines (905 KB DOC)
VGPB Conduct of Commercial Engagements Policy
Exemption from Seeking Multiple Quotes and from Open or Selective Tendering (Limited Tendering) Policy

Related DTF Templates and Forms

Nil

Links to relevant Policy websites

Victorian Government Tenders website

Version Control Information

Version Number	2.3
Release Date	July 2008
Further Information	Strategy and Policy, Government Services Division, Department of Treasury and Finance
Phone	(+613) 868 32944
Email	vgpb@dtf.vic.gov.au

* all values are GST inclusive