Public procurement policy

Board of management

The Association’s Board of Management is responsible for ensuring that:

• the Association’s procurement policies include the delivery of best value for money
• the organisation, management and methods of procurement used by the Association have been authorised by the Board
• Associations’ overall procurement processes and the appropriateness and use of any delegated functions are monitored and reviewed
• the relative merits of alternative methods of procurement in terms of value and risk are regularly reviewed by the Association

Public procurement policy and procurement guidance notes

At its meeting on16th May 2002, the Northern Ireland Executive agreed to a revised Public Procurement Policy for Northern Ireland Departments, their Agencies, non-Departmental Public Bodies (NDPBs) and Public Corporations. A copy of the NI Public Procurement Policy, Version 11 August 2014 may be accessed at NI Public Procurement Policy – Central Procurement Directorate (CPD)

As a condition of receiving Housing Association Grant housing associations are required to comply with NI Public Procurement Policy.

The Executive agreed that the Policy should be guided by a clear definition of “public procurement” and adopted the following definition: “Public procurement is the process of the acquisition, usually by means of a contractual arrangement after public competition, of goods. services and works and other supplies by the public service”

At that time the former Executive also agreed the concept of “Best Value for Money”. This definition was revised and endorsed by the Executive in March 2011. It is now defined as: “the most advantageous combination of cost, quality and sustainability to meet customer requirements”

In this context, cost means consideration of the whole life cost; quality means meeting a specification which is fit for purpose and sufficient to meet the customer’s requirements; and sustainability means economic, social and environmental benefits, considered in the business case, in support of the Programme for Government.

12 Principles of Public Procurement

The achievement of Best Value for Money is governed by adherence to the 12 Principles of Public Procurement, which are as follows:

• Accountability
• Competitive Supply
• Consistency
• Effectiveness
• Efficiency
• Fair-dealing
• Integration
• Integrity
• Informed decision-making
• Legality
• Responsiveness
• Transparency

Further guidance in relation to evidencing Best Value for Money and satisfying the 12 principles may be found in Northern Ireland Public Procurement Policy document (Version 11, issued August 2014).

Bid-rigging and anti-collusion

Bid-rigging

‘Bid-Rigging’ is an illegal anti-competitive business practice where rival businesses discuss bids and collude on contract tenders. The Competition and Markets Authority (CMA) is the principal competition regulator in the United Kingdom. It is a non-ministerial government department responsible for promoting competitive markets and tackling unfair behaviour. 

 CMA suggest that Bid-Rigging can involve businesses:  

• agreeing with their competitors how much they’ll bid for a contract or sharing information about their bid;
• taking turns to win contracts;
• asking other businesses to submit inflated bids when they do not want the contract (called ‘cover bids’);
• paying other businesses not to bid or when you win a tender; and/or
• agreeing with other businesses not to bid, or to withdraw their bid.

CMA have advised Government Departments to be alert to the signs of bid-rigging. Housing Associations also need to be vigilant of this risk and take measures to reduce its occurrence where possible. Therefore, Associations should require Economic Operators/Tenderers/Developers to confirm that their arrangements are not anti-competitive, and they should also reserve the right to require any Economic Operators/Tenderers/Developers to comply with any reasonable requests for evidence that may be needed to verify and certify that no anti-competitive arrangements are in place. Any evidence of Bid-Rigging may result in the Association notifying the Economic Operator/Tenderer/Developer of disqualification from the procurement process.

Associations’ tender documents shall include a requirement for tenderers to self-declare and certify that their tender has been prepared without the knowledge of any collusion with competitors i.e. there is no knowledge of bid-rigging. Associations should prepare standardised contractual clauses and certificates for inclusion in their ‘Tender Documents’ to ensure the risk of Bid-rigging is mitigated and recorded as part of the associated tender competition. The essence of a public procurement process is that the Contracting Authority shall receive bona fide competitive Tenders from all Tenderers, ensuring a fair and competitive bidding process.

Tenderers should confirm that they are alert to the signs of bid-rigging and should state that they have not: 

1. entered into any agreement with any other person with the aim of preventing Tenders being made or as to the fixing or adjusting of the amount of any Tenders or the conditions on which any Tenders are made; or
2. informed any other person, other than the person calling for these Tenders, of the amount or the approximate amount of the Tender, except where the disclosure, in confidence, of the amount of the Tender was necessary to obtain quotations necessary for the preparation of the Tender for insurance, for contract guarantee bonds or for professional advice required for the preparation of the Tender; or
3. caused or induced any person to enter into such an agreement as is mentioned in paragraphs 1 and 2 above or to inform us of the amount or the approximate amount of any rival Tenders for the Contract; or
4. committed any offence under the Bribery Act 2010 or
5. offered or agreed to pay or give any sum of money, inducement or valuable consideration directly or indirectly to any person for doing or having done or causing or having caused to be done in relation to any other Tenders or proposed Tenders for the Contract any act or omission; or
6. canvassed any other persons referred to in paragraph 1 above in connection with the Contract; or
7. contacted any officer, member, consultant or adviser of the Association about any aspect of the Contract including (but without limitation) for the purposes of soliciting information in connection with the Contract.

Tenderers must undertake that they shall not procure the doing of any of the acts mentioned in paragraphs 1 to 7 above before the hour and date specified for the return of Tenders nor (in the event of their Tender being accepted) shall they do so while any resulting Contract continues in force between them (or their successors in title) and the Association.

The word "person" includes any person, body or association, corporate or incorporate and "agreement" includes any arrangement whether formal or informal and whether legally binding or not. 

Associations are responsible for the drafting of the clauses and certificates to be included in their tender documentation to combat anti-competitive arrangements, bid rigging and collusion. Associations should gain assurance from their legal consultants on the appropriateness of contractual clauses and certificates.

Procurement Act 2023 (PA 23) Debarment and exclusion

Part of PA23 sets out rules on exclusion and debarment on competition grounds, meaning that suppliers who take part in illegal cartel activity such as bid-rigging, price fixing or market sharing, risk being excluded from public procurement work for up to 5 years unless they can demonstrate that they have ‘self-cleaned’, so that the wrongdoing that led to the exclusion won’t happen again. For more information refer to New Procurement Act: exclusion and debarment on competition grounds – what suppliers and contractors need to know – Competition and Markets Authority

Economic Operators/Tenderers/Developers should be required to confirm that they are not excluded from public procurement work as set out in PA 23.  Where appropriate, Economic Operators/Tenderers/Developers who have been excluded from public procurement work but have undertaken a ‘self-cleaned’ cleaning process should declare this in their returns for Association consideration.

Procurement guidance notes

Central Procurement Directorate (CPD) is responsible for disseminating advice and guidance to the NI public sector on public procurement policies, determined by the Procurement Board, and monitoring their implementation. This it does through the production of Procurement Guidance Notes (PGNs).

PGNs are the administrative means by which the NI Public Sector is advised of procurement policy and best practice developments. They are developed by CPD, in consultation with CoPEs, including NIHE as CoPE for social housing, and are subject to the approval of the Procurement Board. Once endorsed by the Procurement Board, CPD issues PGNs to Departments for implementation, copies PGNs to CoPEs and lists them on the CPD website. At this stage the Department will advise PGs / Associations of their publication and expects PGs / Associations, without undue delay, to comply with the new guidance.

There may however be occasions when a new PGN may not be completely workable by PGs / Associations. In this event, the Department, in conjunction with the CoPE, will consider representations from PGs / Associations in relation to substantive points raised. Following discussion the Department, in conjunction with the CoPE, will decide on the most appropriate course of action. In addition, any approved deviation from the new PGN must be approved by an Association’s Accounting Officer.

To ensure full compliance, PGs should regularly consult the CoPE on the detailed implementation of PGNs.

The PGN’s are updated regularly by CPD and PGs/ Associations should always refer to the CPD website for the latest versions. The full suite of Procurement Guidance Notes, as developed by CPD, may be accessed at:

• Procurement Guidance Notes - Central Procurement Directorate (CPD)