CONTRACT STANDINGORDERS GENERAL

Introduction

1. These Standing Orders provide basic guidance to anyone making a contract or entering into an agreement (generally, contracts) for the Council. They apply equally to the supply of works, goods,materials and servicesor other (e.g. utilities). In making such contracts or agreements, the overriding objective is to obtain the best value for the Council in all circumstances.

Compliance

2. Every contractmade by or for the Council must comply with these Standing Orders except in the circumstances where exemptions are obtained in advance.

3. Where tendersor quotes have been invitedon behalf of any consortium, collaboration or agency arrangement of which the Council is a member, the Standing Orders or requirements adopted by the lead agency can be observed if they differ from these Standing Orders.

PREPARING FOR THE CONTRACT

Contract file to be set up from the start

4. Every procurement for whole contract value over £340,000 must be fully documented on a dedicated contract file, with a complete audit trail recording all significant decisions and actions taken.

5. All contractfiles should clearlyrecord the specification of requirements and theidentity of the staff member undertaking the procurement (the Procuring Officer).

Requirement for a nominatedprocurement manager

6. The Procuring Officer is responsible for ensuring and recording on the contract file that the relevant authority (Council, the relevant Strategic Committee, delegated or other as appropriate for the type and / or level of spend) has been obtained and there is sufficient budgetary provision in place for the whole life of the procurement before any steps are undertaken.

7. Where stipulated as required in table1 (Procedural Rules),the Procuring Officerwill seek the support from the Procurement Team.

Contractor Suitability

8. The ProcuringOfficer (with supportfrom the Procurement Team ~~Manager~~ where necessary) is to ensure that the contractor is sufficiently capable and financially sound to undertake the contract by making enquiries, pursuing references and reviewing the quotes, tender proposals/method statements as appropriate, during the procurement process. The Procuring Officeris also requiredto ensure that the contractor has appropriate healthand safety policies and procedures in place (as appropriate).

9. The Procurement Team ~~Manager~~ will advise on the most appropriate procurement route, taking into account relevantfactors such as the legalrequirement to advertise (depending on the value); the works, goods or services required; the prevailing market conditions, etc.

10. The Procurement Team ~~Manager~~ will assist the Procuring Officer in developing compliant tender documents which optimise the achievement of value for money.

Specification and Selection Criteria

11. A specification and selection criteria must be prepared in advance of tenders or quotations being sought. For lower value procurements, the lowest price may be used as the main selection criterion; however, whole life value for money will also need to be taken into consideration. For larger value procurements, and in particular those which are covered, by virtue of their value, by the ~~Public Contracts Regulations 2015 (as amended)~~Procurement Act 2023, an appropriate split of quality and commercial factors must be used as the selection criteria. Both the specification and the selectioncriteria must be recorded on the contractfile and be used to evaluate tenders/quotations received.

12. If a potential contractor requires information not provided in the specification, such additional information must also be provided to all other bidders, to ensure the equal treatment of all potential contractors.

13. In preparing the specification and selection criteria, the Procuring Officer should consider the opportunities to deliver additional Social Value which the procurement may offer. The Procurement Team will advise onthe suitable requirements to be included, relative to the size, type and value of the procurement.

Procurement Board

14. The role of the Procurement Board is to take a strategic approach to the Council’s procurement. All contracts likelyto exceed £340,000 (otherthan urgent contracts) should be notified at the planning stage to the Chief Finance Officer. The Procurement Team ~~Manager~~ will maintain a forward plan of contracts to advise Procurement Board and the appropriate Strategic Committee where required, on relevant procurement matters.

Electronic Procurement

15. All procurement opportunities likely to exceed£340,000 should be advertised through the Council’s electronic procurement system (Elcom~~In-tend~~).

PROCEDURAL STEPS OF THE PROCUREMENT

Estimated Value of Contracts

16. An estimated value must be prepared and documented for every contract immediately before startingthe procurement processto confirm there is adequatebudget provision, and to determine the appropriate procurement process to follow.

17. For contracts which continue over a number of years, the estimated value of the contract shall be taken to be the annual value multiplied by thelife (number of years) of the contract to allow the Procurement Team ~~Manager~~ to assess whether the procurement falls under the Public Contracts Regulations.

18. For concession contracts (contracts for which the Council does not pay the providerfor any works, goods or services but the contractor receives consideration in other ways, e.g. rights, property or land granted by the Council), the contract value will be based upon the anticipated income which the contractor is likely to receive from any source pursuant to such contract.

Division of Contracts

19. Large scale or high value procurements must not be broken down into smallerunits for the purpose of creating lower value contracts unless there are sound operational or management reasons for doing so. Any such action must be authorised by the Chief Finance Officer in writing with the reasons recorded on the contract file. The avoidance of any provision of these Standing Orders is not an acceptable reason for such action.

Special Requirements

20. All contracts must comply with the ~~Public Contract Regulations~~Procurement Act 2023, the Procurement Regulations 2024 and any subsequent legislation. Where there is a conflict between these StandingOrders and any statutory provision, the law must prevail. Advice on the tender process and form of contract should be taken from the Procurement Team and Legal Services at the start of any procurement project.

21. The procedures outlined below by contract value are the minimum. It is important to remember that we are trying to get the best value for the residents of Spelthorne. Consequently, where better value for the Council might be achievedby seeking more tenders or quotations this should be done. ~~The figures outlined in this document are exclusive of VAT.~~

Contract Standing Orders Procedural Rules

22. The Procuring Officer and / or Procurement Team ~~Manager~~ as appropriate must ensure that the procurement procedurally complies with Table 1 below.

Framework Agreements

1. ~~Procuring Officerswishing to let a FrameworkAgreement must consultwith the Procurement Manager for support in doing so.~~

1. ~~Where the Council has set up Framework Agreements for a particular service, the use of these should be maximised, and in accordance with the stated call-off arrangements.~~

1. Procurement Managers may purchase works, goods or services from an appropriate external Framework Agreements subject to (i) the agreement of the Chief Finance Officer that the call-off represents good value for moneyand (ii) the agreement of the Procurement Manager that the proposed Framework Agreement has been procured appropriately, and by following the procedure stated in the Procedural Rules.

~~PROCUREMENT ACT 23 -~~ CONTRACT STANDING ORDERS PROCEDURAL RULES

Whole Life	Level of	Support	Advertising	Approach to	Testing	Evaluation	Approval to	Contract
Contract Value	Authority to	required from	the	Market	Market	by	Award	Required?
	Proceed	Procurement	Opportunity		Capability		Contract
	required	Team
Under £5,000	Budget	No	Opportunity	Local1 suppliers	Selected	Budget	No further	No.
(including VAT)	Holder		does not need	must be sought.	suppliers	Holder	approval	Invoices and
			to be	If no local	confirm prices		required	quotes to be
			advertised	suppliers can be	in writing			retained in
				found, then a	/email in			accordance
				regional	advance			with the
				suppliers should				retention
				be sought. If				policy.
				the selected
				supplier is not
				Local or
				Regional2 then
				approval to
				proceed must be
				sought from
				Group Heade
				and the variation
				must be added to
				the Exemption
				Report

1 Local is definedas within the Borough of Spelthorne

2 Regionalis defined as in the wider Countyof Surrey.

~~PROCUREMENT ACT 23 -~~ CONTRACT STANDING ORDERS PROCEDURAL RULES

Whole Life Contract Value	Level of Authority to Proceed required	Support required from Procurement Team	Advertising the Opportunity	Approach to Market	Testing Market Capability	Evaluation by	Approval to Award Contract	Contract Required?
£5,000 - £30,000 (Including VAT)	Procurement Business Case is approved by Group Head	No, except where the opportunity is to be advertised on Contracts Finder	Not required but if the value of contract is over £30,000 and is advertised, it must be advertised in Contracts Finder (Govt transparency requirements)	Requirement communicated to suppliers and confirmed in writing.	A minimum of 3 written quotes to be obtained and retained on file.	Budget Holder	Group Head	Yes. Support from Legal Services is required.
£30,000 (Including VAT) – Procurement Act 2023 Threshold ~~(BELOW³ THRESHOLD TENDER)~~	Procurement Business Case and Procurement process must be approved by Group Head and MaT	Yes, Project needs to be discussed at the Procurement Board and put on the Procurement Project Plan	Opportunity advertised on Elcom portal and on Contracts Finder (if over £30K)	Detailed Specification with required outcomes, outputs and KPIs. (Invitation to Tender, Request for Quotation or suitable Framework)	A minimum of 3 suppliers to be invited to tender. (Select 1 “Local” supplier)	Project Lead with Procurement	Deputy Chief Exec or Service Committee (if the requirement is strategic/critical)	Yes, support from Legal Services is required unless a framework is used. Contract made under seal if over £100,000.00

3 Suppliesand Services Threshold - £214,904, Works Threshold - £5,372,609.00 (inc VAT) as from 1st Jan 2024. These figures are revised every two years.

~~PROCUREMENT ACT 23 -~~ CONTRACT STANDING ORDERS PROCEDURAL RULES

Whole Life Contract Value	Level of Authority to Proceed required	Support required from Procurement Team	Advertising the Opportunity	Approach to Market	Testing Market Capability	Evaluation by	Approval to Award Contract	Contract Required?
Over Procurement Act 2023 Threshold	Procurement Business Case and Procurement process must be approved by Group Head and MaT and appropriate Service Committee . The project must be on the Council’s Forward Plan	Yes, Project needs to be discussed at the Procurement Board and put on the Procurement Project Plan	Opportunity must (unless a suitable Framework is sought) be advertised on Find A Tender (FTS) via the Elcom portal and on Contracts Finder	Detailed Specification with required outcomes, outputs and KPIs. (Invitation to Tender or suitable Framework)	ITT (inclusive of Suitability Assessment Questionnaire) in accordance with the Procurement Act 2023	Project Lead and /or subject matter experts and Procurement	Service Committee	Yes, support from Legal Services is required. Contract will be made under seal.

~~CONTRACT~~ ~~STANDING ORDERS PROCEDURAL~~

~~RULES~~Whole Life Contract Value

Level of Authority to Proceed required

Support required from Procurement Team

Advertising the Opportunity

Approach to Market

Testing Market Capability

Evaluation by

Approval to Award Contract

Contract Required?

~~Procurements~~

~~from an internal Spelthorne Framework Agreement (in accordance with the contract values above)~~

~~Procurement~~

~~Business~~ ~~Case and Procurement process must be approved by Group Head and MaT~~

~~Yes,~~ ~~where~~ ~~the~~

~~contract value exceeds~~

~~£30,000.00.~~

~~The project needs to be discussed at the Procurement Board and put on the Procurement~~

~~Project Plan~~

~~Detailed~~

~~Specification~~ ~~with required outcomes, outputs and KPIs.~~

~~In accordance with the specific Framework, ie, Mini Comp or Direct~~

~~Award~~

~~In accordance~~

~~with the framework conditions.~~

~~Project Lead~~

~~and~~ ~~Procurement~~

~~In accordance~~

~~with the expect contract value as above.~~

~~No. Use the~~

~~Framework~~ ~~Terms and Conditions~~~~. Contract~~ ~~made under seal if above~~

~~£100,000.00~~

Procurements from an external Framework Agreement (in accordance with the contract values above)

Procurement Business Case and Procurement process must be approved by Group Head and MaT

Yes, where the contract value exceeds

£30,000.00.

The project needs to be discussed at the Procurement Board and put on the

Procurement Project Plan

Detailed Specification with required outcomes, outputs and KPIs.

In accordance with the specific Framework, i.e., Mini Comp

or Direct Award

In accordance with the Fframework conditions.

Project Lead and Procurement

In accordance with the expect contract value as above.

No. Use the Framework Terms and Conditions. Contract made under seal if above

£100,000.00

~~CONTRACT~~ ~~STANDING ORDERS PROCEDURAL~~

~~RULES~~Whole Life Contract Value

Level of Authority to Proceed required

Support required from Procurement Team

Advertising the Opportunity

Approach to Market

Testing Market Capability

Evaluation by

Approval to Award Contract

Contract Required?

Variations to a

Contract Over

£100,000.00 (including VAT)

NOTE:

Not to exceed 50% of the original Contract value

Service

Committee

Yes

No, but needs

to be put on the internal Contract Database

Existing

Supplier only

N/A

Project Lead

Service

Committee

Variation to be

included in the existing Contract – support

from Legal Services is required.~~Legal~~

Extending a contract’s duration

Service Committee

Yes – only if the existing contract has extension periods.

No, but needs to be put on the internal Contract Database

Existing Supplier only

N/A

Project Lead

Service Committee

Extension to contract to be included in the existing Contract –support

from Legal Services is required

~~Legal~~

CONTENT OF CONTRACTS

Form of Contracts

27. Every contract over £20,000 must be in writing, in a form approved by the Group Head of Corporate Governance. All contracts of £340,000 and over in value (other than for vehicle purchase) must be in writing and over £100,000 must be under seal.32

28. For contractsover £20,000 where the Councilmay be obliged to contracton the standard terms and conditions of another organisation, the following minimum requirements must be adhered to:

(a) a specification of services required should be produced and sent to the contractor. This is requiredin all cases where the Council procuresgoods and services together. It is not required where the Council only procures goods.

(b) a copy of the applicable standardterms and conditions shouldbe retained on the contract file.

(c) an appropriate letter or otherdocument should be agreed with the contractor which refers to the Council’s specification of services required and confirms the terms and conditions on which the supply is to made.

Public liability insuranceand professional indemnity insurance

29. The Procuring Officer must considerthe Council’s need for appropriate indemnities backed by insurance. In the case of a contract for works or services, the contract must require the contractor to carry public liability insurance to a minimum of

£5,000,000, unlessotherwise agreed by the Chief Finance Officer.

30. In the case of a contract for professional services, the contract must require the contractor to carry professional indemnity insurance to a minimumof £5,000,000, unless otherwise agreed by the Chief Finance Officer.

Assignment of Contracts

31. Assignment or under letting of contracts is not to be permitted except with the prior consent of the Chief Finance Officer, and then only where the Chief Finance Officer is satisfied that an effective vetting procedure of assignees or subcontractors has been implemented.

Liquidated Damages

32. The Procuring Officer, with support from the Procurement Team, must consider whether the contractshould provide for the contractor to pay liquidated damages on failure to complete the contract by the specified completion date. Where considered appropriate by the Group Head of Corporate Governance, the contract must require the contractor to pay damages for any breach of the terms of the contract. Advice on liquidated damages should be taken from Legal Services at an early stage in the procurement project.

Corruption, Bankruptcy &Cancellation

33. Every contract must state that the Council may cancel the contract and recover any resulting losses if the contractor, their employees or anyone acting on their behalf, with or without their knowledge, does anything improper to influence the Council or commits an offence under Bribery Act 2010.

34. Every contract must state that if the Contractor enters into liquidation or administration, the Council is entitled to cancel the contract and recover any resulting losses.

Performance Bonds

35. Where a contract is estimated to be £100,001 or over, the Chief Finance Officer must consider before the procurement whether the Council should require security for its performance. It must be certified on the contract file that no such security is considered necessary or specify in the conditions of tender the nature and amount of security to be given.In the latter event the Chief Finance Officer must ensure the required bond or other security for the due performance of the contract is given at the time the contract is let.

Nominating Subcontractors and Suppliers

36. Where it is decided to be in the Council's interest, that a sub contractor or supplier should be nominated to a main contractor, at least three tenders for the nomination must be invited in accordance with one of the methods described in Table 1 above.

37. The invitation to tender as sub contractors or suppliers must require an undertaking from any tenderer to enter into a contract with the main contractor, including an obligation to indemnify the main contractor in respect of matters included in the sub contract.

Consultants

38. Any consultant employed by the Council to let or manage contracts must comply with these Standing Orders. The contract with any consultant must provide that all records maintained by the consultant in relation to a contract must be made available to the Council on request and handed over to the Council on completion of the procurement.

MANAGING THE CONTRACT

Contract Management

39. Unless prior written approvalis given by the Chief Finance Officer to the Procuring Officer and recorded on the contract file, all contracts in excess of £340,000 should nominate a Contract Manager (and include provision for those details to be updated). Where reasonably practicable, the Contract Manager should be ~~part of the procurement project team, and~~ a member of Spelthorne Borough Council staff.

The Procuring Officer must notifythe name of the ContractManager to the contractor prior to letting of the contract.

40. The role of the Contract Manager will be to manage the contract throughout its duration, as well as enforce duties owed to the Council under contract and to be responsible on behalf of the Council for those duties owed to the contractor.

41. The responsibilities of the ContractManager will include:

(a) monitoring the performance of the contractor against the agreed level of service;

(b) monitoring the continuing levelof operational and financial risk to whichthe Council is exposed and to institute controls as appropriate;

(d) facilitating the resolution of issues betweenthe contractor and users of the service;

(e) ensuring prompt payment of invoices and compliance with all financial regulations and Contract StandingOrders during the lifetime of the contract;

(f) providing assurance that the contractor has a long-term, sustainable supply chain, and that there is no evidence of modern slavery;

(g) ensuring that appropriate arrangements are made for the termination or re- letting of the contract at the appropriate time.

Variations

42. Where the Contract Manager considers, and the relevant Deputy Chief Executive agrees, that an existing contract needs to be varied (i.e. practical changes are required which do not alter the essential nature of the original contract, as opposed to additional works or suppliesnot originally envisaged) tThe DeputyChief Executive may approve these subject to the proposed variation being contained within the total budget approved for the contract. The reasons for and details of any such variation must be recorded on the contract file. On contracts over £100,000 in value, where the approved budget would be exceeded because of the variation, approval must be obtained from the appropriate Strategic Committee or Council (according to financial regulations) for any such variation.

Registration of Contracts

43. The Chief Finance Officerwill ensure that a registerof all contracts of £5,000and over, placed by the Council is kept. The register must state the name of the

contractor, ~~the name of the Council’s ContractManager,~~ the scope of the work to be done or goods to be supplied, the duration and value of the contract. Any Procuring Officer letting a contract must ensure details are supplied ~~to the Chief Finance Officer~~ for entry in the register.

44. The ChiefFinance Officer will also ensurethat a register of all contracts for building, construction or engineering work and associated Consultants which provide for payment by instalments is kept. This register must show the state of account of each contract between the Council and contractor, together with any other payments and related professional fees. The Procuring Officer letting such a