This is an HTML version of an attachment to the Freedom of Information request 'Request for a copy of Department's responses to FoI DHSSPS 2013/0023'.


 
 
 
 
 
 
 
   
 

Procurement Guidance Note 
 
02/12 
 
  
   
 

PUBLIC PROCUREMENT:  
 
 
A GUIDE FOR SMALL AND 
 
MEDIUM SIZED 
 
 
ENTERPRISES (SMEs) 
 
 
 
 
 
 
 
 
 
 
 
17th February 2012 
 
 
 
 
 

PROCUREMENT GUIDANCE NOTES 
 
 
Northern Ireland Public Procurement Policy was approved by the Executive in 
2002. In approving the policy the Executive took the decision that legislation 
was not necessary to ensure that Departments, their Agencies, non-
Departmental Public Bodies and Public Corporations complied with the policy. 
 Instead it considered that compliance could be achieved by means of 
administrative action.  
 
These Procurement Guidance Notes are the administrative means by which 
the Northern Ireland Public Sector is advised of procurement policy and best 
practice developments.  They are developed by Central Procurement 
Directorate (CPD), in consultation with the Centres of Procurement Expertise 
(CoPEs), and are subject to the approval of the Procurement Board. 
 
Once endorsed by the Procurement Board, they are issued to Departments 
for implementation and copied to CoPEs to develop, if necessary, 
underpinning procedures supporting the implementation of this guidance in 
their particular sector.   
 
CPD is responsible for disseminating advice and guidance to the NI public 
sector on public procurement policies and for monitoring implementation.  
Procurement Guidance Notes are also published on CPD’s website. 
  
The following Procurement Guidance Note was endorsed by the 
Procurement Board and issued with effect from 17 February 2012 for use 
by those bodies covered by Northern Ireland Public Procurement Policy.   
 
  2

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CONTENTS PAGE  
 
 
1. 
PURPOSE ...............................................................................................5 
2. 
BACKGROUND .......................................................................................5 
 
What is a Small and Medium Sized Enterprise?................................5 
3. 
WHAT IS THE PUBLIC SECTOR? ..........................................................6 
 
What does the public sector buy?......................................................6 
4. 
THE LEGISLATIVE AND POLICY FRAMEWORK FOR      
 PROCUREMENT.....................................................................................6 
 
The legislation ...................................................................................7 
 
NI Public Procurement Policy ............................................................7 
5. 
IS PUBLIC SECTOR BUSINESS RIGHT FOR YOUR SME?..................8 
 
Issues of scale and size.....................................................................8 
 
How can SMEs participate in public sector business?.......................9 
 
Sub-contracting opportunities ............................................................9 
 
Consortium bids.................................................................................9 
6. 
A TYPICAL PROCUREMENT PROCESS .............................................10 
7. 
HOW AND WHERE ARE TENDERING OPPORTUNITIES         
 PUBLICISED? .......................................................................................12 
 
Official Journal of the European Union (OJEU) ...............................12 
 
Tendertap -Tender Alert Service - Invest NI ....................................12 
 
eSourcing NI....................................................................................12 
 
Low Value Contracts........................................................................13 
 
Meet the Buyer events.....................................................................13 
 
Investment Strategy Northern Ireland (ISNI) Information Website...13 
 
Reserved contracts for supported factories and businesses ...........14 
8. 
SELECTION ..........................................................................................15 
 
Invitation to tender (ITT), evaluation and award ..............................15 
9. 
UNSUCCESSFUL BIDS ........................................................................15 
10.  CONTRACT TERMS AND CONDITIONS .............................................16 
11.  DELIVERING THE CONTRACT ............................................................16 

 
Getting paid on time – what to expect from CAs..............................17 
12.  COMPLAINT HANDLING ......................................................................17 
13.  CONCLUSION.......................................................................................18 
14.  FURTHER INFORMATION....................................................................18 
 
Annex A TYPES OF PROCUREMENT PROCEDURES ...............................19 
 
The Open Procedure .......................................................................19 
 
The Restricted Procedure................................................................19 
 
The Competitive Dialogue Procedure..............................................19 
 
The Negotiated Procedure...............................................................20 
 
Framework Agreements ..................................................................20 
Annex B USEFUL WEBSITES.......................................................................22 
 
 
 

  3

LIST OF ABBREVIATIONS 
 
CA 

 
Contracting Authority 
CoPE  
Centre of Procurement Expertise 
CPD  
Central 
Procurement 
Directorate 
DDA   
Disability Discrimination Act 
DEL   
Department for Employment and Learning 
DETI   
Department of Enterprise, Trade and Investment 
DFP   
Department of Finance and Personnel 
EU  
European 
Union 
GCCG 
Government Construction Clients Group 
ISNI   
Investment Strategy Northern Ireland 
ITT 
 
Invitation to Tender 
MEAT 
Most Economically Advantageous Tender 
NDPB 
Non Departmental Public Body 
NI  
Northern 
Ireland 
OJEU  
Official Journal of the European Union 
PCL   
Procurement Control Limits 
PQQ   
Pre Qualification Questionnaire 
SEE   
Social Economy Enterprises 
SME   
Small and Medium sized Enterprises 
TED   
Tenders Electronic Direct 
TFEU  
Treaty on the Functioning of the European Union 
UK   
United 
Kingdom 
VfM    
Value for Money 
 
 
 
  4

link to page 5 link to page 5 1. 
PURPOSE 
 
1.1 
This guide aims to help Small and Medium sized Enterprises (SMEs) 
increase their knowledge and understanding of public sector 
procurement (supplying goods, services and works to the public sector) 
and in so doing, help them to develop their capability to compete 
successfully for public sector contracts.  Public sector procurement can 
be daunting and readers will find the additional guidance signposted 
throughout this document to be essential reading.  The overview of 
procurement procedures at Annex A will also be helpful. 
 
 
2. 
BACKGROUND 
 
2.1 
What is a Small and Medium Sized Enterprise? 
2.2 
The European Commission’s definition of what constitutes an SME is 
based on a combination of the following criteria: number of salaried 
 workers, turnover, balance sheet and independence1.  A diverse group 
 of businesses fall into the SME category, ranging from sole traders to 
businesses and social enterprises.   
 
2.3 
In the Northern Ireland (NI) context, the commonly used definition is 
that SMEs have fewer than 250 employees.  The table below shows 
the sub-categories of SMEs ranging from micro to small and medium-
 sized enterprises as defined by Department of Enterprise Trade and 
Investment (DETI).  
 
Enterprise Category 
Number of Employees 
Micro (a sub-set of small) 
< 10 
Small < 
50 
Medium sized 
50 < 250 
Large 250+ 
 
2.4 
Within NI it is estimated2 that there are 67,955 businesses, with 
medium sized businesses (50 - 249 employees) making up 1.5%, small 
businesses (fewer than 50 employees) accounting for 98.2% and large 
businesses (250+ employees) making up the remainder.  Micro 
businesses (with less than 10 employees) accounted for the majority of 
the NI total with a share of 89%.  Almost 48% of all businesses in NI in 
2011 were registered as ‘Sole Proprietors’.  Micro-businesses therefore 
have a particularly prominent place in the local economy. 
 
                                                 
http://ec.europa.eu/enterprise/policies/sme/files/docs/sme_pack_en_2008_full_en.pdf 
2 The Inter Departmental Business Register (IDBR) – Edition 14 (29 December 2011) contains 
information on all businesses in the United Kingdom which are VAT registered and/or operating a PAYE 
scheme. http://www.detini.gov.uk/idbr_publication_december_2011-2.pdf  
  5

link to page 5 3. 
WHAT IS THE PUBLIC SECTOR? 
 
3.1 
The public sector employs approximately 31%3 of the NI workforce and 
includes:  
 
 Central government departments and agencies; 
 The health sector; 
  The education sector; 
 NI Assembly; 
  Public Corporations and Companies eg Northern Ireland Transport 
Holding Company (which includes Translink which buy goods, 
services and works for NI Railways, Citybus and Ulsterbus) and 
Northern Ireland Water; 
  Councils (District, Borough or City); and 
  Cross Border Agencies.  
 
3.2 
The public sector in NI spends approximately £3bn a year on 
procurement.  A spend of this magnitude offers considerable 
opportunities for SMEs to provide goods, services and works.    
 
3.3 
What does the public sector buy? 
 
3.4 
Given the scale of the public sector it is impossible to detail the full 
range of supplies, works and services that public bodies purchase, 
however it includes common areas such as: 
 
 Advertising   
 
●  Plant and Machinery 
 Chemicals/Reagents  
●  Postal & Telecoms Equipment  
  Clothing and Accessories 
●  Printing/Reprographic Services 
 Construction/Maintenance  ●  Publications 
 Consultancy 
Services 
 
●  Public Utilities 
 
 
Energy 
   ●  Recruitment and Personnel  
 Environmental 
Services 
●  Rental, Leasing or Hire Services 
 Facilities 
Management 
 
●  Repair/Maintenance Services 
 Financial 
Services   
●  Research and Development 
 Food 
stuffs   
 
●  Transportation Equipment 
 
Furniture and Fittings   
●  Transport and Travel Services 
 
Office Machines and Supplies 
 
 
4. 
THE LEGISLATIVE AND POLICY FRAMEWORK FOR PROCUREMENT 
 
4.1 
As an SME applying for public sector contracts, it is important to 
understand that there are both legislative and policy requirements 
which apply to NI public sector procurement.  The next section provides 
                                                 
3 The Inter Departmental Business Register (IDBR) – Edition 14 (29 December 2011) contains 
information on all businesses in the United Kingdom which are VAT registered and/or operating a PAYE 
scheme. http://www.detini.gov.uk/idbr_publication_december_2011-2.pdf  
  6

link to page 6 link to page 7 link to page 7 link to page 7 an overview of these areas.  More detailed information on the context 
within which NI Public Procurement Policy operates, the structure and 
operation of procurement in the public sector and the roles and 
responsibilities of key players within the procurement process, can be 
found in the NI Public Procurement Policy Handbook4.   
 
4.2 
The legislation 
 
4.3 
The award of regulated public procurement contracts within the 
European Union (EU) Member States is subject to the EU Procurement 
Directives, the purpose of which are to open up the public procurement 
market and to ensure the free movement of goods, services and works 
within the EU.  The Directives and implementing United Kingdom (UK) 
Regulations5 set down procedures and standards (based on openness, 
non-discrimination and competition) for choosing tenderers and 
awarding contracts with an estimated value above the EU thresholds6. 
 
4.4 
All public sector procurement contracts within the EU, irrespective of 
value, are also covered by the Treaty on the Functioning of the 
European Union (TFEU, previously known as the European Community 
Treaty) principles of non-discrimination, equal treatment and 
transparency.  
 
4.5 
NI Public Procurement Policy 
 
4.6 
The NI Public Procurement Policy7 was agreed by the NI Executive in 
May 2002 and applies to Northern Ireland Departments, their Agencies, 
Non Departmental Public Bodies (NDPBs) and Public Corporations.  A 
full list of the bodies which are subject to NI Public Procurement Policy 
can be found in the annex to the Policy.  
 
4.7 
Responsibility for the development, dissemination and co-ordination of 
Public Procurement Policy in NI rests with the Procurement Board.  
 
4.8 Councils in Northern Ireland operate under a separate framework of 
accountability which means that compliance with NI Public 
Procurement Policy is on a voluntary basis.  However, they are 
required to comply with the UK Public Procurement Regulations.   
 
4.9 Central 
Procurement 
Directorate’s (CPD’s) responsibilities include the 
development, dissemination and review of procurement policy, and the 
promotion of best practice within the NI Public Sector.  CPD also has 
two Centres of Procurement Expertise (CoPEs); one for the 
                                                 
http://www.dfpni.gov.uk/index/procurement-2/cpd/cpd-policy-and-
legislation/cpd_policy_ni_public_procurement_policy_handbook.htm 

http://www.dfpni.gov.uk/index/procurement-2/index/procurement-2/cpd/cpd-policy-and-legislation.htm 
http://www.ojec.com/Threshholds.aspx  
http://www.dfpni.gov.uk/index/procurement-2/cpd/cpd-policy-and-legislation/cpd-ni-public-procurement-
policy-version-5.htm
  
  7

link to page 7 procurement of supplies and services and one for construction projects,   
who procure on behalf of Departments, their Agencies and NDPBs.   
 
4.10  In addition to CPD there are a number of other CoPEs, each with its 
own unique procurement portfolio.  These are Roads Service, NI 
Water, Translink, Health Estates, Procurement and Logistics Service 
(which procure supplies and services for the Health Sector), the 
Education and Library Boards and the NI Housing Executive.   
 
 
5. 
IS PUBLIC SECTOR BUSINESS RIGHT FOR YOUR SME? 
 
5.1 
Public sector contracts represent a valuable business opportunity for 
many SMEs.  Public sector organisations are good customers.  They 
ensure fairness, honesty, transparency and professionalism in the way 
they choose suppliers.  They are also long-standing, stable customers, 
and have to pay promptly (refer to paragraph 11.7), in line with agreed 
contract terms. 
 
5.2 
A first and fundamental consideration for an SME is to decide if public 
sector business fits the resources and capability of their own business 
and how this links to their objectives.   
 
5.3 
Market research can assist the SME in deciding which, if any, public 
sector business opportunities to pursue.  The services provided by 
Invest NI’s Business Information Centre8 may be of particular use in 
this regard.   
 
5.4 
In addition, the Enterprise Europe Network offers a “one-stop shop” for 
companies seeking to undertake work in Europe.  The network 
provides help on researching markets, identifying new customers, or 
suppliers and resolving European business issues. It also advises on 
sources of tender information, as well as providing tender alert 
services.  Further information on the network is available from 
www.enterpriseeuropeni.com
 
5.5 
Issues of scale and size 
 
5.6 
Public sector procurement is not suitable for all SMEs.  It can be 
challenging to win business in competition with many others trading in 
a similar field.  This is especially the case for small or growing 
businesses, where there are significant risks and challenges. 
 
5.7 
An SME also needs to decide how many bids to make, and in which 
sectors of business, so that it can grow without becoming 
overstretched.  Attending “Meet the Buyer” events can provide an 
insight into public sector procurement processes and provide an 
                                                 
8 http://www.investni.com/index/grow/strategic_development/business_information_services.htm 
  8

link to page 8 link to page 9 opportunity to meet informally with buyers.  These events are mainly 
hosted by industry bodies and supported by the public sector. 
 
5.8 
How can SMEs participate in public sector business?  
 
5.9 
One message is clear from those who have followed this path before: 
the best course of action is to take one careful step into the field.  
SMEs could consider going it alone taking on a modest contract.  
Alternatively, opportunities may be available as a sub-contractor, or as 
a member of a consortium, both of which are addressed further below.   
 
5.10 Sub-contracting 
opportunities 
 
5.11  SMEs wishing to enter the public sector market can benefit from 
participation in public sector contracts as a sub-contractor.  Where 
possible, Contracting Authorities9 (CAs) will encourage main 
contractors to publish opportunities, for sub-contracting within their 
supply chain on the main contractor’s website and/or, where 
appropriate, in the local Press.  Looking for contract notices published 
in the Official Journal of the European Union (OJEU) is another means 
of identifying possible opportunities within the supply chain.  
 
5.12  In support of this, the Government Construction Clients’ Group (GCCG) 
has agreed a number of actions to monitor main contractors’ delivery of 
their commitments10, advertising supply chain opportunities, and 
adhering to the ‘Code of Practice for Government Construction Clients 
and their Supply Chains’ (including the Fair Payment Charter).  
 
5.13  Consortium bids  
 
5.14  Membership of, or forming, a consortium may also provide a suitable 
alternative route for SMEs to bid for public sector contracts.   
 
5.15  A consortium, in public procurement terms, describes a group of 
suppliers who come together to bid for a contract.  While the term is 
often used where formal legal and financial arrangements exist 
between the participants, this is not a necessary condition for the 
consortium to be able to bid for public contracts.  Any informal grouping 
of suppliers can bid as a consortium and the EU Procurement 
Directives provide that a consortium bidding for a public contract can 
be assessed based on the collective capabilities of all of the 
participants in the consortium. 
 
                                                 
9 The definition of Contracting Authorities includes e.g. NI Government Departments and Councils.  A 
full list of Contracting Authorities may be found in Regulation 3 of The Public Contracts Regulations 
2006 (SI 2006 No 5, as amended) 
10 http://www.dfpni.gov.uk/index/procurement-2/cpd/cpd-
suppliers/cpd_construction_industry_forum_task_group_report.htm
  
  9

5.16  The CA however needs to be confident that the consortium members 
can work together in the manner required and this can be tested 
through appropriate questions in the selection process (see Section 8).   
 
5.17  Clear descriptions of the capabilities required in contract 
documentation will help suppliers identify how they can combine their 
skills to best effect.  Where a CA awards a contract to a consortium, it 
may, if it is justified for satisfactory performance of the contract and 
before entering into a contract or as a term of the contract, require the 
consortium to form a legal entity.  
 
 
6. 
A TYPICAL PROCUREMENT PROCESS 
 
6.1 
The following diagram (Figure 1) shows a typical procurement process 
within the public sector and is discussed in further detail in the pages 
that follow.  Low-value specific purchases will follow a simplified 
version to that described below (see paras 7.12 – 7.14).   
 
6.2 
The tendering process used should be proportionate to the size, risk 
and complexity of the procurement in question.  This approach will help 
to reduce barriers to all potential suppliers, including SMEs.  It must be 
remembered however that the procurement process is a competition, 
with the majority of contracts being awarded on the basis of the Most 
Economically Advantageous Tender (MEAT).   
 
6.3 
MEAT is the combination of quality and price.  The Public Procurement 
Regulations 2006 set out the criteria which a CA may use to determine 
that an offer is the most economically advantageous.  The criteria may 
include quality, price, technical merit, aesthetic and functional 
characteristics, environmental characteristics, running costs, cost- 
effectiveness, after sales service, delivery date and delivery period or 
period of completion. 
 
6.4 
As an alternative to MEAT, contracts may be awarded subject to Head 
of CoPE approval on the basis of lowest price, where quality 
requirements have been assured through contract specification(s) or 
other appropriate mechanism(s) 
 10

Figure 1. A typical procurement process within the public sector 
 
 
 
Strategic development and identifying need 
 The CA decides what is needed and, if appropriate, dependant on the value 
 of the contract, prepares the business case.  In most cases, it will liaise with 
 CPD, or a CoPE to decide how the procurement process will be conducted, 
 taking account of legislation, NI Public Procurement Policy and market 
 conditions.  The types of procurement procedures which may be used, e.g. 
 open, restricted etc, are given in Annex A.  
  
 
 
 
Specification, inviting tenders and selection 
 A specification is drawn up and the CA invites suppliers to put in an offer, or 
 tender.  Tender opportunities (above £30k) will be advertised on eSourcing 
 NI and depending on value, also in the Official Journal of the European 
 Union (OJEU), (see section 7.3 below). 
   
 Following receipt of tenders/offers, an initial selection process will take 
 place to identify those suppliers who meet the minimum standards of 
 capability and capacity to deliver the particular contract.  
  
 In some cases, such as a Restricted Procedure, suppliers may have to pre-
 qualify before being formally asked to submit a tender.  This will require the 
 completion of a Pre-Qualification Questionnaire (PQQ), which incorporates 
 information requirements about financial status and previous experience 
 etc.  Suppliers who have successfully pre-qualified are then invited to 
 tender (Invitation to Tender, ITT). (See Annex A for details of types of 
 procurement processes).   
 
 
 
Tender evaluation 
 Submitted tenders are evaluated against the published award criteria e.g. 
 price, methodology, time of delivery. 
 
 
 
 
 
Awarding the contract 
 The CA awards the contract on the basis of MEAT.  Suppliers will be 
 notified of the outcome and will be provided with a written debrief to assist 
 them in improving their approach for future competitions.   
 
 
 
 
Contract management 
 Depending on the nature of the contract, the public body, or the CA, will 
 work in partnership with the successful supplier to manage the 
 performance of the contract. 
 
 11

link to page 9 link to page 12 link to page 12 link to page 12 7. 
HOW AND WHERE ARE TENDERING OPPORTUNITIES PUBLICISED? 
 
7.1 
Subject to the CA’s legal obligations, the form of procurement 
competition (see Annex A) should be proportionate to the value, nature 
and complexity of the supplies, works or services required.  
 
7.2 
NI Departments, their Agencies, NDPBs and Public Corporations, 
which are subject to NI Public Procurement Policy, have in place 
Procurement Control Limits (PCLs) for the procurement of supplies, 
works and services.  The PCLs recommend the optimum level of 
tenders/quotes that should be sought to ensure that the cost of the 
procurement is efficient whilst still achieving value for money (VfM) 
through competition.  Detailed information on PCLs is available in 
Procurement Guidance Note (PGN) 03/1011.  
 
7.3 
Official Journal of the European Union (OJEU) 
 
7.4 
Almost all public procurement contracts for business worth more than 
the EU threshold12 must be published in the supplement of the OJEU.  
The threshold changes every two years and varies according to the 
type of contract (supplies, works or services) and the public sector 
entity (Central Government, another public authority, or Utility).  The 
OJEU can be accessed via Tenders Electronic Daily (TED), free of 
charge, from: http://ted.europa.eu/TED/main/HomePage.do 
 
7.5 
Copies of the OJEU (available in CD-ROM format) can also be 
obtained from The Stationery Office Ltd at www.tso.co.uk    
 
7.6 
Tendertap -Tender Alert Service - Invest NI 
 
7.7 Tendertap13 is the new Tender Alert Service provided by Invest NI 
which sends companies’ daily alerts for relevant tender opportunities 
published in TED, as well as some smaller value UK and local 
opportunities.  The service currently costs £100 plus VAT annually.  
Under the previous tender alert service, which was free of charge in 
2010, some 58 companies won 114 contracts potentially worth £239 
 million.   
 
7.8 
eSourcing NI 
 
7.9 eSourcing 
NI14 is a web based portal which provides access to Central 
Government procurement opportunities.  This increases accessibility 
for SMEs, Social Economy Enterprises (SEEs) and other potential 
suppliers who wish to do business with the public sector.  The portal 
                                                 
11 http://www.dfpni.gov.uk/index/procurement-2/cpd/cpd-policy-and-legislation/content_-_cpd_-_policy_-
_procurement_guidance_notes.htm 

12 Current thresholds can be found at http://www.ojec.com/Threshholds.aspx 
13 http://www.enterpriseeuropeni.com/inx/services/tender_information.asp  
14 https://e-sourcingni.bravosolution.co.uk/web/login.shtml 
 12

provides secure, web-based tools for buyers and suppliers to conduct 
the tendering process online.  Using eSourcing NI helps to reduce the 
time and cost of tendering, and simplifies and standardises the 
tendering process. 
 
7.10  Suppliers can view current opportunities on the portal and then, if 
interested, register to respond to a particular tender.  Registration is 
free and is only required once.  As part of the registration process, 
SMEs should also specify the categories of procurement against which 
they might be interested in providing supplies, services and, where 
appropriate, works.  Buyers can then search the system to help identify 
potential suppliers for specific categories of procurement. 
 
7.11  Advertisements in newspapers, under “What’s New”, can also be used 
to highlight new tender opportunities and direct potential suppliers to 
 the eSourcing NI site. 
 
7.12  Low Value Contracts 
 
7.13  Where a contract does not require advertising, i.e. below £30k (as per 
the PCL guidance, paragraph 7.2); buyers can make use of the 
categorisation on e-Sourcing NI to help them identify potential 
suppliers.  
 
7.14 e-quotes is an electronic service which allows accepted suppliers to bid 
for printing work which has been requested by CPD clients i.e, 
Departments and Agencies.  Potential suppliers can obtain an e-quotes 
pack by e-mailing 
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx.xxx@xxxxx.xxx.xx.  Potential 
suppliers should then return the requested documentation and samples 
to the Communication and Advertising Sector Team in CPD.  After 
assessment and if accepted, suppliers will be notified of this 
acceptance and will be forwarded a user name and password to 
access e-quotes. 
 
7.15  Meet the Buyer events 
 
7.16  Representatives from CPD and the CoPEs support “Meet the Buyer” 
events across NI hosted by a range of organisations including Invest 
NI, InterTrade Ireland and Councils etc, covering the supplies, services 
and construction works sectors.  These well attended events provide 
opportunities for suppliers to gain information on future tendering 
competitions, how to access opportunities on eSourcing NI and may 
offer one to one interviews. 
 
7.17  Investment Strategy Northern Ireland (ISNI) Information Website 
 
7.18  The ISNI Information Website, launched in June 2009, also provides 
public access to information on infrastructure investment programmes, 
projects and procurements, including key milestone dates.  The 
website can be accessed at www.isni.gov.uk  
 13

link to page 12 link to page 14 link to page 14  
7.19  Reserved contracts for supported factories and businesses  
 
7.20  Provision exists within the UK Procurement Regulations15 to enable 
CAs to reserve the right to participate in public contract award 
procedures to supported factories and businesses, or to economic 
operators, which operate supported employment programmes.  These 
terms are defined in the Regulations as follows: 
 
  A supported business is: ‘A service where more than 50% of the 
workers are disabled persons who by reason of the nature or 
severity of their disability are unable to take up work in the open 
labour market.’ 
 
  A supported employment programme is: ‘A scheme under which 
work is provided for disabled persons and where more than 50% of 
the workers so supported are disabled persons who by reason of 
the nature or severity of their disability are unable to take up work 
in the open labour market.’ Under the EU Directive, these are 
known as sheltered employment programmes. 
 
  A supported factory is: “An establishment where more than 50% of 
the workers are disabled persons who by reason of the nature or 
severity of their disability are unable to take up work in the open 
labour market.”  
 
7.21  The Disability Discrimination Act 1995 (DDA) defines16 a disabled 
person as someone with “a physical or mental impairment which has a 
substantial and long-term adverse effect on his/her ability to carry out 
normal day-today activities.”  Further advice can be sought from the 
Department of Employment and Learning (DEL)17 on whether or not 
your organisation can be classified as a supported factory or business.  
 
7.22  ‘Reserving’ a contract means that only supported factories and 
businesses or economic operators operating supported employment 
programmes can bid for that particular contract.  These organisations 
can be from anywhere in the EU, but where a contract has been 
reserved under this provision, the process must allow for fair and open 
competition amongst the suppliers that bid for such contracts. 
Contracts cannot therefore be reserved for a specific organisation and 
all bids from supported factories and businesses submitted under the 
reserved contracts arrangements are still assessed on a VfM basis, 
with award to the bid offering MEAT. 
 
                                                 
15 Regulation 7 of The Public Contracts Regulations 2006 (as amended) and Regulation 10 of The 
Utilities Contracts Regulations 2006 (as amended), available at:  
http://www.dfpni.gov.uk/index/procurement-2/cpd/cpd-policy-and-legislation.htm 
16 Changes to coverage of the definition of disability were made to the DDA by the Disability 
Discrimination (Northern Ireland) Order 2006.  This came into effect on 31 October 2007.  
http://www.ofmdfmni.gov.uk/index/equality/disability/new-disability-discrimination-order.htm 
17 Disablement Advisory Service http://www.delni.gov.uk/index/finding-employment-finding-staff/fe-fs-
help-to-find-employment/das/nddp-contact-details.htm 

 14

link to page 14 link to page 15 7.23  Where a contract is reserved, the CA should indicate in the OJEU 
notice that the contract is “reserved for sheltered workshops under 
Article 19 of the Directive”. 
 
 
8. 
SELECTION 
8.1 
The selection stage is a precursor to the evaluation of tenders.  Some 
selection processes also require the completion of a Pre-Qualification 
Questionnaire (PQQ) which can help to make the selection process 
more manageable, transparent and efficient for all parties.  The number 
of questions on the PQQ will be proportionate to the scale and 
complexity of the project.    
 
8.2 
A detailed PGN 04/10 on the Selection and Pre-Qualification of 
Contractors is available from CPD’s website18.    
 
8.3 
Suppliers will be notified of the outcome of the selection stage, and 
unsuccessful candidates provided with written debrief information..  
Further advice on information disclosure throughout the procurement 
process is available in PGN 01/1018.  
 
8.4 
Invitation to tender (ITT), evaluation and award 
 
8.5 
Shortlisted suppliers will be provided with ITT documents, with clear 
instructions on how they should submit their tenders, and the deadlines 
for receipt.  The ITT will include detailed requirements, instructions to 
tenderers, contractual terms and conditions, any associated pricing and 
technical schedules, and award criteria and weightings. 
 
8.6 
The CA will award the contract to the tenderer who provides the MEAT.  
Further information on Procedures and Principles for the Evaluation of 
Tenders is available in PGN 02/0918. 
 
 
9. 
UNSUCCESSFUL BIDS 
9.1 
It is a requirement under the UK Procurement Regulations to provide 
feedback even when not sought by a supplier.  For those contracts 
below the EU thresholds, CoPEs should be able to provide general 
advice and feedback on the tendering process on request.   
 
9.2 
 If unsuccessful, the SME can use the information provided by the CA to 
see how it can improve its approach to future competitions.  The 
information disclosed by the CA has been significantly impacted by the 
Remedies Directive (2007/66/EC).  This was transposed into UK law 
via the Public Contracts (Amendment) Regulations 2009 and Utilities 
Contracts (Amendment) Regulations 200919.  These took effect from 20 
                                                 
18 http://www.dfpni.gov.uk/index/procurement-2/cpd/cpd-policy-and-legislation/content_-_cpd_-_policy_-
_procurement_guidance_notes.htm 

19 http://www.dfpni.gov.uk/index/procurement-2/cpd/cpd-policy-and-legislation.htm 
 15

link to page 15 December 2009 and set out the information to be given to unsuccessful 
tenderers and the rules concerning the minimum mandatory standstill 
period (sometimes referred to as the Alcatel period) in relation to 
contracts over the EU Thresholds.   
 
9.3 
The standstill period refers to the time between a buyer notifying 
 tenderers of the decision to award a contract and contract signature.  
This is to allow tenderers time to review the award decision and 
provides an opportunity for unsuccessful suppliers, to decide whether 
to seek further information concerning the award decision, prior to 
contract award.  SMEs should refer to PGN 01/10, entitled ‘Information 
Disclosure throughout the Procurement Process and Application of the 
Rules on the Standstill Period’, for further details. 
 
 
10. 
CONTRACT TERMS AND CONDITIONS 
 
10.1  Most government contracts are based on standard contract documents 
appropriate to the supplies, works and services being purchased.  For 
routine tenders, the tenderer will receive a copy of the tender 
documentation which includes the terms and conditions of contract.  
When submitting their tender, the tenderer will be legally bound by the 
terms and conditions set out in the tender documentation, if awarded a 
contract.  
 
10.2  More complex contracts, such as IT systems will not be concluded until 
the winning tenderer and the CA have agreed the terms and conditions.  
It is therefore important for all parties to fully understand their 
responsibilities under the contract.  If in doubt, legal advice should be 
sought. 
 
 
11. 
DELIVERING THE CONTRACT 
 
11.1  Contract management is the phase of the procurement cycle in which 
the successful tenderer delivers the required supplies, works and 
services in accordance with the CA’s specification.  The CA’s20 and 
supplier's approach to managing their relationship is critically important 
to ensuring successful contract delivery and VfM.  When things go 
wrong, the failure can be expensive in human, financial and 
reputational terms. 
 
11.2  Good management of this operational phase of the procurement is 
therefore critical.  It ensures that both parties fully meet their respective 
obligations as efficiently and effectively as possible, in order to meet 
the business and operational objectives required from the contract. 
 
                                                 
20 In some cases, the relationship may be between the successful tenderer and the client itself. 
 16

link to page 16 link to page 17 link to page 17 11.3  The SME therefore needs to be in a position to deliver the contracted 
requirement in full and to the agreed performance standards to ensure 
and enable an effective commercial relationship.  
 
11.4  PGN 01/12 on Contract Management - Procedures and Principles 
provides more information and is available from the CPD website21
 
11.5  Getting paid on time – what to expect from CAs 
 
11.6  Having won the tender, the successful SME should expect that CAs will 
have clearly defined the payment terms within the contract.  
 
11.7 Public 
Sector 
organisations will: 
  pay invoices in accordance with agreed terms, or as required by law;  
  tell suppliers without delay when an invoice is contested; and  
  settle as quickly as possible when a contested invoice gets a 
satisfactory resolution. 
 
11.8  In November 2008, the Minister for Finance and Personnel made a 
commitment to speed up the payment process on presentation of a 
valid invoice.  NI Departments will therefore aim to pay suppliers, 
wherever possible, within 10 working days.  Where the main contractor 
benefits from earlier payment, and on presentation of a valid invoice, 
this should be passed on to the sub-contractor. 
 
11.9  Public sector organisations are also bound by The Late Payment of 
Commercial Debts (Interest) Act 199822.  This provides a statutory right 
for suppliers to claim interest on late payments of commercial debt.  
Payment is regarded as late if made outside the agreed terms, or 30 
days after receipt of a valid invoice, where no terms are agreed. 
 
11.10  Government Construction Clients also agreed to expand the ‘Code of 
Practice for Government Construction Clients and their Supply Chains’ 
to include a ‘Fair Payment Charter’23 and to require main contractors to 
report payment progress to sub-contractors at project meetings.   
 
12. 
COMPLAINT HANDLING 
 
12.1  CPD and the CoPEs aim to provide a high quality, efficient and 
professional service, but occasionally things can go wrong and there 
are formal complaints procedures in place to resolve such matters if 
they arise.  
                                                 
21 http://www.dfpni.gov.uk/index/procurement-2/cpd/cpd_publications/content_-_cpd_-_policy_-
_procurement_guidance_notes.htm 
22 (as amended by the Late Payment of Commercial Debt Regulations 2002 (SI 1674) 
23 http://www.dfpni.gov.uk/index/procurement-2/cpd/cpd-
suppliers/cpd_code_of_practice_for_government_construction_clients_and_their_supply/code_of_practi
ce.pdf 

 17

 
12.2  NI Public Procurement Policy requires each CoPE to have a formal 
complaints procedure through which complaints can be formally 
investigated.  Details of these procedures can be found on the relevant 
CoPE websites.  
 
12.3  It is important to note that the complaints procedure is not an appeal 
mechanism for tenderers who are dissatisfied with the outcome of a 
procurement competition. The relevant procedures for challenging an 
award decision are set out in The Public Contracts Regulation 2006 (SI 
2006 No 5) as amended and The Utilities Contract Regulations 2006 
(SI 2006 No 6) as amended.  Such a challenge will be a matter for the 
High Court to decide. 
 
 
13. 
CONCLUSION 
 
13.1  There are considerable opportunities for SMEs in bidding for public 
sector procurement contracts.  However, like all business opportunities, 
the risks have to be assessed and weighed against the potential 
benefits.  Organisations can also avail of networking opportunities or 
“Meet the Buyer” events to improve their ability to tender for public 
sector contracts. 
 
14. 
FURTHER INFORMATION 
 
14.1  Additional useful websites and sources of information are listed at 
Annex B.  Any queries on this PGN should be addressed to: 
 
Central Procurement Directorate 
Procurement Policy Branch 
2nd Floor East 
Clare House 
303 Airport Road West 
BELFAST 
BT3 9ED 
 
Phone: 028 9081 6518 
 
e-mail: xxxxxxx.xxxxxx@xxxxx.xxx.xx 
All PGNs can be found at http://www.dfpni.gov.uk/cpd
 18

Annex A 
 
TYPES OF PROCUREMENT PROCEDURES 
 
The EU Procurement Directives provide for four main procurement 
procedures to be used by CAs. 
 
For straightforward procurements, for example of commodity supplies and 
services, the open, or restricted procedures are used.  For complex 
procurements, CAs normally use the Competitive Dialogue procedure.  This 
can be used where a CA wishes to award a particularly complex contract and 
considers that the open or restricted procedure will not allow the award of that 
contract.  In exceptional circumstances or where other procedures fail to 
produce a contract, CAs may use the Negotiated Procedure. 
 
The Open Procedure 
 
Under the Open Procedure, all interested suppliers who respond to an OJEU 
advertisement must be invited to tender.  This procedure does not allow any 
form of pre-qualification.  If the supplier meets the selection criteria, the CA 
must consider and evaluate the submitted tender. 
 
The Restricted Procedure 
 
Under the Restricted Procedure, interested suppliers are invited to respond to 
an OJEU advertisement by submitting an “Expression of Interest” (a 
completed PQQ) in which they reply against defined selection criteria such as 
technical capability, financial standing, or experience of supplying similar 
projects.  A shortlist of suppliers is then drawn up and invited to submit 
tenders (an ITT). 
 
The submitted tenders are then evaluated against the award criteria, e.g. 
price, quality and time of delivery.  The CA will then award the contract to the 
tenderer that best satisfies all the criteria. 
 
The Competitive Dialogue Procedure 
 
For complex procurements, the restricted procedure is usually too inflexible as 
it allows only limited discussion and dialogue with suppliers.  CAs will 
therefore normally follow the Competitive Dialogue Procedure, unless there 
are exceptional circumstances that would justify the use of the Negotiated 
Procedure. 
 
Competitive Dialogue is a flexible procedure, suitable where there is a need 
for CAs to discuss aspects of the proposed contract with suppliers.  For 
 19

 
example, the procedure would be used where CAs cannot define clearly in 
advance the technical means capable of satisfying their needs or objectives, 
or where there is a range of options for the legal and/or financial structure of a 
project. 
 
Under Competitive Dialogue, a similar pre-selection procedure is undertaken 
to that used for the restricted procedure.  Shortlisted suppliers are then invited 
to participate in dialogue, which may have several stages.  This helps to refine 
the requirement through supplier input and gives the opportunity for 
meaningful dialogue.  Once this stage is concluded, suppliers are invited to 
submit a final tender. 
 
The Negotiated Procedure  
 
The Negotiated Procedure is a procedure leading to the award of a contract 
whereby the CA negotiates the terms of the contract with one or more 
economic operators selected by it.  It is limited to specified circumstances for 
each type of contract and is intended for use when other procedures will not 
work.  It may be valid when: competition is not viable, or appropriate; other 
procedures have not produced an acceptable tender; work is needed for 
research and development purposes; or where prior overall pricing is not 
possible.  There are also circumstances where this procedure can be used 
without a call for competition for example, where it is strictly necessary for the 
completion of a project and the services cannot be provided separately 
without major inconvenience to the CA or where the services are a repetition 
of the services already provided and the notice advertising the original 
contract provided for such a repetition.   
 
Use of the Negotiated Procedure has been reduced since the introduction of 
the Competitive Dialogue procedure and the direction from both the EU and 
the Cabinet Office is that the Negotiated Procedure should only be used in 
exceptional circumstances and any use will be scrutinised by the EU.   
 
Framework Agreements  
 
Framework Agreements are put in place with one, or more (usually several), 
suppliers of the same product or service.  The Framework Agreement sets out 
the general terms and conditions under which specific purchases can be 
made as and when they are required.  They are mainly used when the 
quantity of supplies, works or services is undetermined.   
 
The competition for awarding a place on a Framework is usually very similar 
to that for winning an ordinary contract.  There may well be a formal pre-
qualification process, and/or a tendering stage which suppliers must complete 
successfully before they can be party to the agreement.  Framework 
Agreements normally last a maximum of four years. 
 
 20

 
A supplier who has succeeded in being awarded a place on a Framework 
Agreement, can receive a call-off order directly, or (since a Framework 
Agreement does not mean an automatic agreement to purchase) may be 
asked to take part in a mini-competition with other suppliers on the 
Framework.  The formal contract is formed when the customer places a ‘call-
off’ order against the Framework requesting specific delivery of supplies or 
services. 
 21

Annex B 
USEFUL WEBSITES 
(This is not an exhaustive list) 
 
NORTHERN IRELAND 
 
Central Procurement Directorate (CPD)
 
http://www.dfpni.gov.uk/index/procurement-2/cpd.htm 
CPD provides a professional procurement service to the NI Government 
Departments, their Agencies and other public sector bodies in respect of a 
wide range of supplies, service and construction works.  This ensures best 
value for money, legal compliance and competitiveness.  Current tender 
opportunities are advertised on the CPD website. 
 
eSourcing NI https://e-sourcingni.bravosolution.co.uk/web/login.shtml 
This is an electronic tendering portal which provides increased accessibility for 
SMEs, SEEs and other potential suppliers who wish to do business with the 
NI public sector.   
 
Department for Employment and Learning 
http://www.delni.gov.uk/index/finding-employment-finding-staff/fe-fs-
help-to-find-employment/das/nddp-contact-details.htm 
The Disablement Advisory Service can be contacted via the link above. 
 
NI Business Info 
http://www.nibusinessinfo.co.uk/bdotg/action/home?site=191 
Northern Ireland’s online business advice service. 
 
NI Departments  
http://www.northernireland.gov.uk/gov.htm
 
Website providing links to all of the NI Departments. 
 
NI Public Procurement Policy 
http://www.dfpni.gov.uk/index/procurement-2/cpd/cpd-policy-and-
legislation/cpd-ni-public-procurement-policy-version-5.htm 
Includes the 12 guiding principles which govern the administration of public 
procurement and the procurement structures within NI such as the 
Procurement Board and the CoPEs. 
 
NI Public Procurement Policy Handbook 
http://www.dfpni.gov.uk/index/procurement-2/cpd/cpd-policy-and-
legislation/cpd_policy_ni_public_procurement_policy_handbook.htm 
The handbook provides details on the context within which NI Public 
Procurement Policy operates, the structure and operation of procurement in 
the NI public sector and the roles and responsibilities of key players within the 
procurement process. 
 
Trade Social www.tradesocial.net 
Trade Social aims to promote opportunities for social economy enterprises to 
do more business – by selling to each other, selling to the public and private 
sectors and selling to the general public.  Entries in the Directory are free to 
social economy enterprises set up and trading in Northern Ireland. 
22 
 

 
 
UK WIDE 
 
UK Treasury
 www.hm-treasury.gov.uk 
 
Winning the Contract 
http://www1.learndirect-business.com/business-courses/winning-the-
contract/
 
This is a free online course is designed to address the small business 
knowledge gap on public procurement.  Although focused on Great Britain, 
SMEs will find useful background information and strategies to enable them to 
compete for public sector contracts.  
 
Government Procurement Service (Buying Solutions) 
www.buyingsolutions.gov.uk/ 
The supplier zone of this website provides valuable information, advice and 
guidance to existing and potential Buying Solutions suppliers.   
 
Business Link 
http://www.businesslink.gov.uk/bdotg/action/layer?lang=en&topicId=107
4033478
 
This provides businesses of all sizes with access to guidance and support to 
meet their business needs and carry out transactions with government online, 
thus helping to save time and money. 
 
Efficiency and Reform Group within the Cabinet Office 
http://www.cabinetoffice.gov.uk/government-efficiency 
This site provides information on supplying to the UK government, 
publications and other programmes and initiatives for public procurement.   
 
The Scottish Executive Procurement & Commercial Services Division is 
responsible for ensuring that public funds are utilised to achieve value for 
money for the taxpayer. www.scotland.gov.uk/procurement/ 
 
Sell2Wales is an initiative from the Welsh Assembly Government helping 
SMEs work successfully with public sector clients. www.sell2wales.co.uk/ 
 
IRELAND 
 
InterTrade Ireland http://www.intertradeireland.com/  
This organisation provides business development initiatives offering 
companies practical advice and support in targeting new cross-border 
business opportunities, developing new products and processes and 
attracting equity investment. 
 
Public Sector Opportunities in the Republic of Ireland  
www.e-tenders.gov.ie 
This site is designed as a central facility for all public sector Contracting 
Authorities to advertise procurement opportunities which currently exist in the 
Irish Public Sector.  
EUROPE 
 

 23

 
Gateway to the European Union 
http://europa.eu/policies-activities/tenders-contracts/index_en.htm
  
A website which gives an overview of the Public Procurement market in 
Europe, provides information on various issues such as legislation, tenders 
and signposts useful links for both buyers and suppliers (includes links to 
SIMAP and Tenders Electronic Daily). 
 
Enterprise Europe Network www.investni.com 
The Enterprise Europe Network offers a “one-stop shop” for companies 
seeking to undertake work in Europe.   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 24

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

Central Procurement Directorate 
                                                                  Clare House 
       
303 
Airport 
Road 
West 
 
 
 
 
 
 
 Belfast BT3 3ED 
 
       
Telephone: 
 
028 
9081 
6518 
 
 
 
 
 
 
 Email: xxxxxxx.xxxxxx@xxxxx.xxx.xx 
 
 25

Document Outline