Walking and talking

Arguably, land is the most important commodity in today’s industry and it is far from abundant. Coupled with decreasing EU funds towards regeneration and a considerable increase in new-build targets, co-operation between the public and private sectors is essential for success.

Since its introduction last year in the Public Contracts Regulations 2006, the competitive dialogue procedure has been readily accepted by the procurement market with more than 500 projects advertised via this route. It brings an end to the stand-off between our government’s insistence that a flexible procedure was needed to deliver complex procurement, and the European Commission’s concerns over the UK’s use of the negotiated procedure.

The real test is to ensure the market adapts to the new procedure, which has its own nuances, rather than trying to shoehorn old ways under the negotiated procedure into competitive dialogue. This is of particular importance given that the government’s aggressive planning policy has put considerable pressure on the industry to “get the job done”.

The process

Competitive dialogue requires contracting authorities to put a lot more effort in at the front end of the procurement. The advert is of particular importance. Careful planning and assimilation of key facts and points that you are willing to dialogue on is essential to enable bidders to decide whether to tender. Those who publish notices first and think about project contents later will not find competitive dialogue an easy process to manage.

Shortlisting can use the usual technical and financial criteria at the pre-qualification questionnaire stage, but there can also be a further slimming down of participants either before the invitation to dialogue is issued or afterwards. Pre-dialogue, the reduction can take place provided at there are objective and non-discriminatory criteria detailed in the contract notice. In addition to this, or instead

of it, once bidders are invited to participate in the dialogue an invitation to submit outline proposals (ISOP) can be used to look at further matters of ability or initial solutions.

There is no magical solution to the drafting of evaluation criteria, but they have to be detailed in the invitation to participate in competitive dialogue (ITPD) and will be used for the dialogue process, any further slim down that takes place through the dialogue and the final tender. As such, they need to be given serious thought early on and should remain unchanged throughout.

Under the regulations, dialogue cannot be closed until you have a solution or solutions capable of meeting your needs. This can cause difficulties where timetables are set far in advance with a close of dialogue date set. It is important to remain flexible and keep lines of communication open with bidders so as not to give rise to incomplete bids, potential challenges for bidders or bidders not participating in the final tender stage.

The final tender should be a topping and tailing exercise at the end The essence of the deal and associated documentation must be resolved in the dialogue.

Making it work

Confidentiality: It is vital to be absolutely clear in the ITPD how you will address issues of confidentiality. It is also important to have an auditable trail in place to defend your position if more than one bidder provides the same or very similar information or solutions.

Unified approach: Competitive dialogue needs to adopt a unified and corporate approach to its dealings with bidders. In local authority-led mixed-use regeneration schemes, for example, the council’s regeneration, planning, highways and housing teams all need to work together to adopt a holistic approach and align their interests at the outset.

Leadership: The person leading the project in the public sector organisation must have the ability to motivate the internal team, ensure deadlines are met and have a key influence and understanding of each of the core areas of dialogue, including planning, commercial and legal terms, design and financial issues. Given the process is still relatively new the private sector is looking to the public sector to direct it through a complex set of procedures

Innovation: From the public sector perspective, the beauty of competitive dialogue is that it is able to seek innovative solutions to the regeneration of pivotal sites.

Legal issues: the complex nature of regeneration schemes means the legal framework requires considerable thought and negotiation. Once selected, the commercial terms cannot be negotiated so there is no opportunity for the parties to revisit issues where this would occur under more traditional routes of procurement/negotiation