2.9.2 What are the specific features

of the procurement of services?

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Service contracts include advertising, property management, cleaning, management consultancy, training, financial and IT related services. There are a number of features specifically related to the procurement of services.

Defining the Outcome - Services tend to be less tangible than supplies and therefore more difficult to define within a specification. Contracting authorities should aim to define outcomes such as:

A tangible end product such as a report. For example the following outputs are relevant when a contracting authority wants to assess local labour skills against the requirement of inward investors. The contracting authority might procure a management consultancy research report that provides them with
A research report including a framework for action
A Presentation of findings to present to the Minister
An Executive Summary suitable for publication/press release
A tangible benefit such as the development of skills and expertise in staff through a training and development programme.

Most service contracts are awarded on the basis of the Most Economically Advantageous Tender and through a series of relevant and appropriate evaluation criteria. It is important with service contracts that part of the selection criteria relates to reliability of the supplier and the expertise and ability of the personnel involved.

Complexity of services - Service delivery normally means the delivery of a service package consisting of several single services. This could include for instance, a main service (e.g. training course contents and its delivery by trainers), supportive services (provision of equipment, textbooks and other materials) and side services (catering for participants). All these aspects need to be considered within the tender specification.

Due to the complexity of some service requirements, contracting authorities may break the contract into separate contracts, for example, a complex IT contract might be broken down into staff training, network maintenance, trouble shooting, and hotline and so on.

In estimating the value of a public contract, the value of material and equipment needed to carry out the services to be supplied by the contracting entity and which are required for the provision of the services shall be taken into account.

In awarding public contracts for insurance services the value of the contract shall be calculated on the basis of the premium payable.  For banking and other financial services, the corresponding calculation shall be made on the basis of the total amount payable in fees, commission, interest and other types of remuneration.   For architects' services and similar services, the calculation shall be made on the basis of fees and commission payable.

Where a contract is one of a series of similar contracts the value of each must be aggregated to determine the estimated value of the overall project. As with supply contracts, if the aggregated estimated value of a contract exceeds the threshold, each contract must be advertised in the OJEU, even if the estimated value of the individual contract is below the EU Thresholds.

Ensuring consistency in quality When appointing service providers contracting authorities should explore opportunities to request relevant European Standards for quality assurance in the specification document.

The delivery of a service is often a unique process and difficult to repeat in another circumstance (for example, the group dynamics in a staff training and development programme). However it is possible to obtain consistency in outputs, for example:

Number of participants completing the programme
Number of participants receiving accreditation for the programme
Level of accreditation of the programme
Length of the programme (i.e. 2 days? 6 months? etc)

 

As the quality of service delivery is usually dictated by the skills and expertise of the personnel involved it is important that contracting authorities set out minimum requirements for the skills and expertise of the personnel in the specification.

The Law excludes a number of services and service contracts from its application. Please refer to Law 12(I)/2006.


© 2007 Republic of Cyprus, Treasury of the Republic, Public Procurement Directorate
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