Cheapest Not Always The Best Nz News On Tendering


in General

GD Star Rating
GD Star Rating

Concern about the integrity of council in their tendering process was due to be aired at today’s council meeting.

Councillor Steve Gibson wrote in a letter to the editor of the Feilding Herald that he thinks Chris Gommans Contracting are not being treated fairly in the tendering process for roading contracts.

Cr Gibson was aware that in the agenda for today’s meeting was a recommendation to the council that Chris Gommans Contracting tender be accepted for a Himatangi Beach Rd contract. Gommans’ tender was the lowest priced of five tenders for the work.

Cr Gibson’s concern has arisen as Gommans was not invited to tender for the contract work on Denbigh St. At today’s meeting Downer EDI Works was to be recommended as the contractor for that work.

Assets group manager for Manawatu District Council, Richard Kirby, said in his report that a departure was made from the public procurement process due to the council’s desire to engage with contractors who have proven experience and capability to complete the work.

“In the Denbigh Street contract, we required a contractor who has the resources, technical and management skills to carry out water, sewerage, roading, kerbing and pavement work. It is a very complex job. We identified six contracting companies we believed had the capability to carry out the work. Four of those companies submitted tenders.”

Last year, similar questions were raised by Cr Gibson at a council meeting regarding work on Halcombe Hill.

Mr Kirby said: “We are obliged to carry out a process in accordance with the New Zealand Transport Agency (NZTA). In that case we required traffic control as the road has a traffic count of 3000 vehicles per day. It is as busy as a state highway. We required our contractors to have their `ticket’ – a traffic control certificate from NZTA. The risk to us of not having good traffic control and safety for the road users is paramount to us. We don’t always focus on the cheapest option.

“Part of the process of considering a tender is given to a company’s track record, technical skills, methodology and management and expert resources,” said Mr Kirby.

“Council has specific criteria in its procurement processes that ensure the most appropriate contractors are engaged to deliver council’s projects. Although price is a significant component of the evaluation process, council needs to ensure it obtains value for money. The lowest price may not necessarily give you value for money. Council receives a 52 per cent subsidy from the New Zealand Transport Agency and council must follow approved procurement processes to ensure that subsidy is not compromised.

“When contracts are being carried out, we employ independent engineering consultants to inspect work to make sure it is being carried out to our requirements.

“Our records show some companies require a lot more supervision than others as they don’t have the management skills. This has to be taken into account as this is an additional expense above the tender.

“It is public money and we have to ensure we have value for money.”

Other aspects taken into account when assessing contractors are reports from the community, landowners and the supervising engineers.

“We have to take into account how the public are treated, especially when the work is affecting them directly.”

Councillor John Gregory said: “I believe the process to be fair.”

By Sandra Crosbie, Feilding Herald

Reported from:

Leave a Comment